- Federal Realty Investment Trust’s Q1 2024 funds from operations (FFO) per share of $1.64 narrowly missed the Zacks Consensus Estimate, but showed a 3.1% increase from the previous year.
- Despite lower occupancy levels, the company’s revenues and robust leasing activity rose, with quarterly revenues of $291.3 million surpassing the consensus mark of $287.1 million and improving 6.7% from the same quarter last year.
- CEO Donald C. Wood highlighted the company’s record first-quarter leasing volume and successful execution of leases for approximately 190,000 square feet of office space at its premier mixed-use destinations.
Federal Realty Investment Trust’s Q1 2024 results show a strong start to the year, with record leasing volumes and increased revenues despite lower occupancy levels.
Leasing and Operational Details
During the reported quarter, Federal Realty signed 111 leases for 587,329 square feet of retail space. On a comparable space basis, the company signed 104 leases for 566,865 square feet of space at an average rent of $36.39 per square foot. This denotes cash-basis rollover growth of 9% and 20% on a straight-line basis. However, occupancy rates in the portfolio decreased 60 basis points (bps) year over year to 92% as of Mar 31, 2024. The portfolio was 94.3% leased as of the same date. Federal Realty’s residential properties were 96.3% leased as of the same date.
Financial Position and Dividend Announcement
Federal Realty ended the first quarter of 2024 with cash and cash equivalents of $95.9 million, down from $250.8 million recorded at the end of 2023. Alongside the first-quarter earnings release, the company announced a regular quarterly cash dividend of $1.09 per share, indicating an annual rate of $4.36 per share. The dividend will be paid out on Jul 15 to shareholders of record as of Jun 21, 2024.
2024 Guidance and Stock Performance
For 2024, FRT revised its guidance for FFO per share in the range of $6.67-$6.87 from the $6.65-$6.87 range guided earlier. The Zacks Consensus Estimate of $6.80 also stands within this range. Federal Realty currently carries a Zacks Rank #3 (Hold).
Performance of Other Retail REITs
The Macerich Company reported an FFO per share, excluding financing expense in relation to Chandler Freehold, of 31 cents, which missed the Zacks Consensus Estimate of 39 cents. Moreover, the figure declined 22.5% from the year-ago quarter’s 40 cents. Kimco Realty Corp. reported first-quarter 2024 FFO per share of 39 cents, which beat the Zacks Consensus Estimate of 38 cents. The figure was in line with the year-ago quarter’s tally.
Conclusion
Federal Realty Investment Trust’s Q1 2024 results show a promising start to the year despite some challenges. The company’s record leasing volumes and increased revenues, coupled with a robust dividend announcement, suggest a positive outlook for investors. However, the decrease in occupancy levels and cash equivalents will be areas to monitor in the coming quarters.
