RALEIGH – Highwoods Properties (HIW) on Tuesday reported a key measure of profitability in its second quarter. The results exceeded Wall Street expectations.
The real estate investment trust said it had funds from operations of $108.1 million, or $1 per share, in the period. The average estimate of five analysts surveyed by Zacks Investment Research was for funds from operations of 98 cents per share.
Funds from operations is a closely watched measure in the REIT industry. It takes net income and adds back items such as depreciation and amortization.
Ted Klinck, Highwoods’ CEO, praised what he called “another productive and active quarter.”
“We delivered solid FFO [funds from operations] of $1.00 per share, 7.5% higher year-over year, as leasing momentum, particularly for new deals, remained strong and is continuing thus far in the third quarter,” he said in a statement.
“In addition to strong financial and operational results, we announced several investments that will enhance our long-term growth rate and further strengthen our cash flows. We expanded our presence in Charlotte with the agreement to acquire 650 South Tryon at Legacy Union in Uptown and the acquisition of a mixed-use development site located in the heart of Charlotte’s South End. Subsequent to quarter-end, we entered the Dallas market through the formation of 50/50 joint ventures with Granite Properties to develop Granite Park Six in the Frisco/Plano BBD and 23Springs in the core of the Uptown BBD.”
The company said it had net income of $50.5 million, or 47 cents per share.
The real estate investment trust posted revenue of $203.8 million in the period, which met Street forecasts.
Highwoods Properties expects full-year funds from operations to be $3.92 to $4 per share.
