First Industrial Realty Trust Inc (FR, Financial) released its 8-K filing on July 17, 2024, reporting its second-quarter earnings for 2024. The company, a real estate investment trust specializing in industrial properties, demonstrated robust performance with significant leasing activity and increased guidance for funds from operations (FFO).
Company Overview
First Industrial Realty Trust Inc is a real estate investment trust that owns, manages, acquires, sells, develops, and redevelops industrial real estate. The company's portfolio includes light industrial properties and bulk warehouse properties, primarily located in business parks near transportation hubs. The majority of its revenue is derived from rental income tied to medium-term leases, serving customers in manufacturing, retail, wholesale trade, distribution, and professional services sectors.
Q2 2024 Financial Performance
First Industrial Realty Trust Inc reported diluted net income available to common stockholders per share (EPS) of $0.39 for the second quarter, compared to $0.41 a year ago. The company's funds from operations (FFO) were $0.66 per share/unit on a diluted basis, up from $0.61 per share/unit a year ago. This performance exceeded the analyst estimates of $0.35 EPS and $0.64 FFO per share/unit.
Leasing and Development Highlights
The company signed 1.1 million square feet of new leases for speculative developments in the second quarter and third quarter to date. Additionally, it signed a 212,000 square-foot partial build-to-suit lease and started two developments in South Florida and Houston, totaling 683,000 square feet with an estimated investment of $109 million. The company also renewed its largest 2025 lease rollover of 1.3 million square feet and one of the two largest remaining 2024 expirations in Southern California for 221,000 square feet.
Financial Achievements
First Industrial Realty Trust Inc achieved a 45% cash rental rate increase on leases signed to date commencing in 2024. The company sold eight buildings for $90 million in the second quarter and third quarter to date. The 2024 NAREIT FFO guidance was increased by $0.03 at the midpoint to a range of $2.57 to $2.65 per share/unit.
Income Statement and Balance Sheet Highlights
| Metric | Q2 2024 | Q2 2023 |
|---|---|---|
| Total Revenues | $164,136 | $152,223 |
| Net Income | $52,876 | $56,234 |
| FFO (NAREIT) | $89,827 | $83,358 |
First Industrial Realty Trust Inc reported total revenues of $164.1 million for Q2 2024, up from $152.2 million in Q2 2023. Net income was $52.9 million, compared to $56.2 million a year ago. The company's FFO (NAREIT) was $89.8 million, up from $83.4 million in the same period last year.
Portfolio Performance
In-service occupancy was 95.3% at the end of Q2 2024, compared to 95.5% at the end of Q1 2024 and 97.7% at the end of Q2 2023. Cash rental rates on new and renewal leasing increased by 43.4% and 59.4% on a straight-line basis. The company achieved a cash rental rate increase of approximately 45% on leases signed to date commencing in 2024, reflecting 88% of 2024 expirations by rental income.
Commentary and Outlook
"Congratulations to our team for delivering several significant leasing wins within our development and core portfolios across multiple markets since our last earnings release," said Peter E. Baccile, president and chief executive officer of First Industrial. "We are focused on building upon these successes with further lease-up of our development projects to realize these embedded cash flow opportunities."
With the benefit of the progress made in leasing developments, First Industrial Realty Trust Inc raised its FFO per share guidance by $0.03 at the midpoint. The company forecasts an incremental 1.2 million square feet of development leasing, contributing to cash flow growth in 2025 and beyond.
For more detailed financial information and analysis, visit the full 8-K filing.
Explore the complete 8-K earnings release (here) from First Industrial Realty Trust Inc for further details.
