W.P. Carey Inc (WPC, Financial), a net lease real estate investment trust, reported its financial results for the third quarter ended September 30, 2023, on November 3, 2023. The company's net income attributable to W.P. Carey Inc (WPC) for Q3 2023 was $125.0 million, marking a 19.2% increase from $104.9 million for Q3 2022. However, the company's Adjusted Funds from Operations (AFFO) for Q3 2023 was $1.32 per diluted share, down 2.9% from $1.36 per diluted share for Q3 2022.
Financial Performance
W.P. Carey Inc (WPC, Financial)'s total revenues for Q3 2023 amounted to $448.6 million, up 16.9% from $383.6 million for Q3 2022. The increase in revenues was primarily due to net investment activity, rent escalations, and net lease properties acquired in the CPA:18 Merger. The company's net income from Real Estate attributable to W.P. Carey was $124.2 million, which increased due primarily to the impact of net investment activity and rent escalations, partly offset by higher interest expense and impairment charges recognized during the current year period.
Strategic Plan to Exit Office
W.P. Carey Inc (WPC, Financial) announced a strategic plan to exit the office sector, which includes spinning-off NLOP and implementing an on-balance sheet Office Sale Program. The NLOP spin-off was completed on November 1, 2023. Four properties have been sold to date under the program for gross proceeds of $142.5 million, including one disposition for $87.9 million during Q3 2023. The company targets to complete all sales under the program in early 2024.
Investment and Disposition
The company completed investments totaling $978.4 million during the nine months ended September 30, 2023, including $39.9 million during Q3 2023. Gross disposition proceeds of $196.3 million were recorded for the nine months ended September 30, 2023, including $148.1 million during Q3 2023.
Balance Sheet and Capitalization
After the end of the quarter, the company settled all outstanding forward sale agreements, issuing approximately 4.7 million shares of common stock for net proceeds of $384 million. The company also received approximately $350 million, net of transaction expenses, from NLOP in connection with the Spin-Off.
Outlook
For the full year 2023, the company has lowered and narrowed its guidance range for total AFFO to between $5.17 and $5.23 per diluted share. The company also announced a preliminary 2024 AFFO guidance of between $4.60 and $4.80 per diluted share.
Explore the complete 8-K earnings release (here) from W.P. Carey Inc for further details.
