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Cousins Properties Incorporated’s (CUZ - Free Report) first-quarter 2022 funds from operations (FFO) per share of 67 cents came in line with the Zacks Consensus Estimate.
Total revenues aggregated $186.9 million, exceeding the Zacks Consensus Estimate of $184.7 million.
On a year-over-year basis, FFO per share and total revenues declined 2.9% and 1.4%, respectively.
According to Colin Connolly, president and CEO of Cousins Properties, “We have been proactively assembling a Sun Belt trophy office portfolio for over a decade. The heavy lift of upgrading asset quality is largely behind us. We have firmly established a unique and compelling position in the office sector. Looking forward, we have never been more excited about the power of our platform to drive earnings and increase shareholder value."
Quarter in Detail
Cousins Properties executed leases for 324,000 square feet of office space in the March quarter, including 224,000 square feet of new and expansion leases. This marked 69% of total leasing activity.
The same-property rental property revenues, on a cash basis, marginally grew year over year to $156.3 million. The same-property rental property operating expenses on cash basis increased 2% year over year to $58.9 million in first-quarter 2022. The same-property NOI, on a cash basis, marginally increased to $97.5 million.
CUZ’s weighted average occupancy of the same-property portfolio was 87%, down from 91.2% as of Mar 31, 2021.
As of Mar 31, 2022, 90% of its same-property portfolio was leased, down from 92.5% at the end of the year-ago period.
The second-generation net rent per square foot (cash basis) climbed 15.4%.
Portfolio Activity
Subsequent to the first-quarter results, Cousins Properties acquired 10% interest in Avalon, a consolidated joint venture between CUZ and Hines, for a gross price of $43.4 million.
Balance Sheet
CUZ exited first-quarter 2022 with cash and cash equivalents of $7 million, down from $8.9 million as of Dec 31, 2021.
The company’s net debt to annualized EBITDAre was 5.28 times compared with 4.87 times in the year-ago quarter.
Dividend Update
CUZ’s management announced a hike of 3.2% in the quarterly common stock cash dividend the first-quarter 2022. Dividend of 32 cents per share was paid out on Apr 14, 2022 to shareholders recorded as of Apr 5.
2022 Outlook
Cousins Properties maintained its earlier 2022 guidance. It expects 2022 FFO per share to lie in the range of $2.70 to $2.78. The Zacks Consensus Estimate for the same is pegged at $2.73.
Equity Residential’s (EQR - Free Report) reported first-quarter 2022 normalized FFO per share of 77 cents, missing the Zacks Consensus Estimate of 80 cents.
Rental income came in at $653.3 million, lagging the consensus mark of $658.07 million. Nonetheless, on a year-over-year basis, normalized FFO per share improved 13.2%, while rental income climbed 9.3%.
EQR’s normalized FFO grew based on strong lease demand, while same-store revenue witnessed growth driven by strong physical occupancy and improvement in pricing power.
Mid-America Apartment Communities, Inc. (MAA - Free Report) , reported first-quarter 2022 core FFO per share of $1.97, surpassing the Zacks Consensus Estimate of $1.92. The reported number increased 20.1% year over year.
The rental and other property revenues came in at $476.1 million, outpacing the Zacks Consensus Estimate of $474.20 million. The reported figure was 12% higher than the previous-year quarter’s $425 million.
MAA’s quarterly results were driven by an increase in the average effective rent per unit for the same-store portfolio.
Alexandria Real Estate Equities, Inc. (ARE - Free Report) reported first-quarter 2022 adjusted FFO per share of $2.05, surpassing the Zacks Consensus Estimate of $2.00. The reported FFO per share also compared favorably with the year-ago quarter’s $1.91.
Rental revenues in the quarter were $615.1 million. Also, rental revenues climbed 28.2% from the prior-year quarter’s $479.8 million. ARE witnessed continued healthy leasing activity and rental rate growth during the quarter.
Note: Anything related to earnings presented in this write-up represent funds from operations (FFO) — a widely used metric to gauge the performance of REITs.
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Cousins Properties (CUZ) Q1 FFO Meets Estimates, Revenues Beat
Cousins Properties Incorporated’s (CUZ - Free Report) first-quarter 2022 funds from operations (FFO) per share of 67 cents came in line with the Zacks Consensus Estimate.
Total revenues aggregated $186.9 million, exceeding the Zacks Consensus Estimate of $184.7 million.
On a year-over-year basis, FFO per share and total revenues declined 2.9% and 1.4%, respectively.
According to Colin Connolly, president and CEO of Cousins Properties, “We have been proactively assembling a Sun Belt trophy office portfolio for over a decade. The heavy lift of upgrading asset quality is largely behind us. We have firmly established a unique and compelling position in the office sector. Looking forward, we have never been more excited about the power of our platform to drive earnings and increase shareholder value."
Quarter in Detail
Cousins Properties executed leases for 324,000 square feet of office space in the March quarter, including 224,000 square feet of new and expansion leases. This marked 69% of total leasing activity.
The same-property rental property revenues, on a cash basis, marginally grew year over year to $156.3 million. The same-property rental property operating expenses on cash basis increased 2% year over year to $58.9 million in first-quarter 2022. The same-property NOI, on a cash basis, marginally increased to $97.5 million.
CUZ’s weighted average occupancy of the same-property portfolio was 87%, down from 91.2% as of Mar 31, 2021.
As of Mar 31, 2022, 90% of its same-property portfolio was leased, down from 92.5% at the end of the year-ago period.
The second-generation net rent per square foot (cash basis) climbed 15.4%.
Portfolio Activity
Subsequent to the first-quarter results, Cousins Properties acquired 10% interest in Avalon, a consolidated joint venture between CUZ and Hines, for a gross price of $43.4 million.
Balance Sheet
CUZ exited first-quarter 2022 with cash and cash equivalents of $7 million, down from $8.9 million as of Dec 31, 2021.
The company’s net debt to annualized EBITDAre was 5.28 times compared with 4.87 times in the year-ago quarter.
Dividend Update
CUZ’s management announced a hike of 3.2% in the quarterly common stock cash dividend the first-quarter 2022. Dividend of 32 cents per share was paid out on Apr 14, 2022 to shareholders recorded as of Apr 5.
2022 Outlook
Cousins Properties maintained its earlier 2022 guidance. It expects 2022 FFO per share to lie in the range of $2.70 to $2.78. The Zacks Consensus Estimate for the same is pegged at $2.73.
CUZ currently carries a Zacks Rank #3 (Hold).You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Cousins Properties Incorporated Price, Consensus and EPS Surprise
Cousins Properties Incorporated price-consensus-eps-surprise-chart | Cousins Properties Incorporated Quote
Performance of Notable REITs
Equity Residential’s (EQR - Free Report) reported first-quarter 2022 normalized FFO per share of 77 cents, missing the Zacks Consensus Estimate of 80 cents.
Rental income came in at $653.3 million, lagging the consensus mark of $658.07 million. Nonetheless, on a year-over-year basis, normalized FFO per share improved 13.2%, while rental income climbed 9.3%.
EQR’s normalized FFO grew based on strong lease demand, while same-store revenue witnessed growth driven by strong physical occupancy and improvement in pricing power.
Mid-America Apartment Communities, Inc. (MAA - Free Report) , reported first-quarter 2022 core FFO per share of $1.97, surpassing the Zacks Consensus Estimate of $1.92. The reported number increased 20.1% year over year.
The rental and other property revenues came in at $476.1 million, outpacing the Zacks Consensus Estimate of $474.20 million. The reported figure was 12% higher than the previous-year quarter’s $425 million.
MAA’s quarterly results were driven by an increase in the average effective rent per unit for the same-store portfolio.
Alexandria Real Estate Equities, Inc. (ARE - Free Report) reported first-quarter 2022 adjusted FFO per share of $2.05, surpassing the Zacks Consensus Estimate of $2.00. The reported FFO per share also compared favorably with the year-ago quarter’s $1.91.
Rental revenues in the quarter were $615.1 million. Also, rental revenues climbed 28.2% from the prior-year quarter’s $479.8 million.
ARE witnessed continued healthy leasing activity and rental rate growth during the quarter.
Note: Anything related to earnings presented in this write-up represent funds from operations (FFO) — a widely used metric to gauge the performance of REITs.