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Regency Centers Corporation’s (REG - Free Report) third-quarter 2021 NAREIT funds from operations (FFO) per share was $1.12. However, adjusted FFO per share came in at 96 cents which missed the Zacks Consensus Estimate of 98 cents.
However, on a year over year basis, NAREIT (FFO) per share compared favorably with the prior-year period’s 60 cents.
The quarterly results reflect higher-than-anticipated revenue numbers. Healthy rent collection and leasing activity display improvements in tenants and retail landscape. The retail REIT has also issued an improved outlook. Total revenues of $307.4 million exceeded the Zacks Consensus Estimate of $279.1.4 million. Moreover, revenues jumped 26.5% from the year-earlier quarter.
Lisa Palmer, president and chief executive officer noted, “We are very pleased with another quarter of solid results and continued improvement in operating trends, further accelerating our path to recovery. The dividend increase reflects our confidence in the recovery of NOI and balance sheet strength to pre-pandemic levels, as well as a return to sustained growth over the long term.
As of Nov 1, the company collected 98% of the third-quarter pro-rata base rent.
Inside the Headlines
During the third quarter, Regency Centers executed 2 million square feet of comparable new and renewal leases with blended rent spreads of 5.1%.
As of Sep 30, 2021, the company’s wholly-owned portfolio, along with its pro-rata shares of co-investment partnerships, was 93.5% leased. Its same-property portfolio was 93.8% leased, reflecting an expansion of 90 basis points (bps), sequentially.
In the same-property portfolio, anchor percent leased (includes spaces greater than or equal to 10,000 square feet) was 96.5%, highlighting an expansion of 110 bps sequentially, while the same property shop percent leased (includes spaces less than 10,000 square feet) was 89.3%, marking an expansion of 60 bps, quarter on quarter.
The same-property NOI, excluding termination fees, climbed 24.4% on a year-over-year basis.
Portfolio Activity
During the July-September period, the company completed the redevelopment project at Bloomingdale Square with total pro-rata costs of $21.3 million.
As of Sep 30, 2021, Regency’s in-process development and redevelopment projects had estimated net project costs of $327 million and an estimated $144 million of remaining costs to complete these projects, each at the company’s share.
Liquidity Update
As of Sep 30, 2021, Regency Centers had cash, cash equivalents, and restricted cash of $362.7 million, down from $378.5 million at year-end 2020. The retail REIT had full capacity under its $1.2-billion revolving credit facility. As of that date, its pro-rata net debt-to-operating EBITDAre ratio was 5.0x compared with 6.0x as of Dec 31, 2020.
Outlook
Regency has revised the 2021 guidance and now projects the current-year NAREIT FFO per share in the range of $3.93-$3.97 compared with the prior guidance $3.74-$3.82. The range is ahead of the Zacks Consensus Estimate, which is currently pegged at $3.79.
Management also pulled up the same-property NOI (excluding termination fees) guided range to 15.5-16.5% from the 13.5-15.5% previously estimated.
Dividend Update
On Nov 2, Regency Centers’ board of directors announced a quarterly cash dividend of 62.5 cents per share on its common stock, indicating a 5% increase. The dividend will be paid out on Jan 5, to its shareholders of record as of Dec 16, 2021.
Prologis, Inc. (PLD - Free Report) came up with third-quarter core FFO per share of $1.04, surpassing the Zacks Consensus Estimate of $1.03. Results reflected solid increases in market rents and valuations amid unprecedented low vacancies in its markets.
Boston Properties Inc.’s (BXP - Free Report) third-quarter 2021 FFO per share of $1.73 beat the Zacks Consensus Estimate of $1.70. The quarterly figure also exceeded the mid-point of the company’s third-quarter guidance by 4 cents, highlighting the better-than-projected results from the in-service portfolio and improved parking revenues.
Highwoods Properties, Inc.’s (HIW - Free Report) FFO per share of 96 cents topped the Zacks Consensus Estimate of 93 cents for the September-end quarter. Rental and other revenues of $195.5 million outpaced the consensus mark of $192.2 million.
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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Regency Centers (REG) Misses Q3 FFO Estimates, Raises '21 View
Regency Centers Corporation’s (REG - Free Report) third-quarter 2021 NAREIT funds from operations (FFO) per share was $1.12. However, adjusted FFO per share came in at 96 cents which missed the Zacks Consensus Estimate of 98 cents.
However, on a year over year basis, NAREIT (FFO) per share compared favorably with the prior-year period’s 60 cents.
The quarterly results reflect higher-than-anticipated revenue numbers. Healthy rent collection and leasing activity display improvements in tenants and retail landscape. The retail REIT has also issued an improved outlook.
Total revenues of $307.4 million exceeded the Zacks Consensus Estimate of $279.1.4 million. Moreover, revenues jumped 26.5% from the year-earlier quarter.
Lisa Palmer, president and chief executive officer noted, “We are very pleased with another quarter of solid results and continued improvement in operating trends, further accelerating our path to recovery. The dividend increase reflects our confidence in the recovery of NOI and balance sheet strength to pre-pandemic levels, as well as a return to sustained growth over the long term.
As of Nov 1, the company collected 98% of the third-quarter pro-rata base rent.
Inside the Headlines
During the third quarter, Regency Centers executed 2 million square feet of comparable new and renewal leases with blended rent spreads of 5.1%.
As of Sep 30, 2021, the company’s wholly-owned portfolio, along with its pro-rata shares of co-investment partnerships, was 93.5% leased. Its same-property portfolio was 93.8% leased, reflecting an expansion of 90 basis points (bps), sequentially.
In the same-property portfolio, anchor percent leased (includes spaces greater than or equal to 10,000 square feet) was 96.5%, highlighting an expansion of 110 bps sequentially, while the same property shop percent leased (includes spaces less than 10,000 square feet) was 89.3%, marking an expansion of 60 bps, quarter on quarter.
The same-property NOI, excluding termination fees, climbed 24.4% on a year-over-year basis.
Portfolio Activity
During the July-September period, the company completed the redevelopment project at Bloomingdale Square with total pro-rata costs of $21.3 million.
As of Sep 30, 2021, Regency’s in-process development and redevelopment projects had estimated net project costs of $327 million and an estimated $144 million of remaining costs to complete these projects, each at the company’s share.
Liquidity Update
As of Sep 30, 2021, Regency Centers had cash, cash equivalents, and restricted cash of $362.7 million, down from $378.5 million at year-end 2020. The retail REIT had full capacity under its $1.2-billion revolving credit facility. As of that date, its pro-rata net debt-to-operating EBITDAre ratio was 5.0x compared with 6.0x as of Dec 31, 2020.
Outlook
Regency has revised the 2021 guidance and now projects the current-year NAREIT FFO per share in the range of $3.93-$3.97 compared with the prior guidance $3.74-$3.82. The range is ahead of the Zacks Consensus Estimate, which is currently pegged at $3.79.
Management also pulled up the same-property NOI (excluding termination fees) guided range to 15.5-16.5% from the 13.5-15.5% previously estimated.
Dividend Update
On Nov 2, Regency Centers’ board of directors announced a quarterly cash dividend of 62.5 cents per share on its common stock, indicating a 5% increase. The dividend will be paid out on Jan 5, to its shareholders of record as of Dec 16, 2021.
Regency Centers currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Regency Centers Corporation Price, Consensus and EPS Surprise
Regency Centers Corporation price-consensus-eps-surprise-chart | Regency Centers Corporation Quote
Performance of Other REITs
Prologis, Inc. (PLD - Free Report) came up with third-quarter core FFO per share of $1.04, surpassing the Zacks Consensus Estimate of $1.03. Results reflected solid increases in market rents and valuations amid unprecedented low vacancies in its markets.
Boston Properties Inc.’s (BXP - Free Report) third-quarter 2021 FFO per share of $1.73 beat the Zacks Consensus Estimate of $1.70. The quarterly figure also exceeded the mid-point of the company’s third-quarter guidance by 4 cents, highlighting the better-than-projected results from the in-service portfolio and improved parking revenues.
Highwoods Properties, Inc.’s (HIW - Free Report) FFO per share of 96 cents topped the Zacks Consensus Estimate of 93 cents for the September-end quarter. Rental and other revenues of $195.5 million outpaced the consensus mark of $192.2 million.
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.