Regency Centers (REG) Q2 FFO Misses Estimates, NOI Slips
Regency Centers Corporation’s REG second-quarter 2020 NAREIT funds from operations (FFO) per share of 61 cents missed the Zacks Consensus Estimate of 78 cents. The reported figure was also 35.8% lower than the prior-year quarter’s 95 cents.
Evidently, results reflect a decline in same property net operating income (NOI) because of a higher rate of uncollectible lease income in relation to the coronavirus pandemic.
Further, total revenues of $231.1 million lagged the Zacks Consensus Estimate of $249.3 million. Further, the top line fell 16.2% year on year.
Notably, 415 properties of the company remained open and operational during the entire pandemic. Roughly 95% of Regency’s tenants were open, based on pro-rata Annual Base Rent (ABR) as of July-end.
Through Jul 31, 2020, the company collected 72% of second-quarter pro-rata base rent (77% when including executed rent deferral agreements) and 75% of July pro-rata base rent (79% when including executed rent deferral agreements).
Inside the Headlines
During the reported quarter, Regency Centers executed 1.3 million square feet of comparable new and renewal leases with blended rent spreads for the June quarter of 4.0%.
As of Jun 30, 2020, the company’s wholly-owned portfolio along with its pro-rata shares of co-investment partnerships was 93.9% leased. Its same-property portfolio was 94.5% leased. In its same property portfolio, anchor percent leased (includes spaces greater than or equal to 10,000 square feet) was 96.9%, denoting a slip of 20 basis points (bps) sequentially while same property shop percent leased (includes spaces less than 10,000 square feet) was 90.3%, marking a contraction of 110 bps.
Same-property NOI excluding termination fees plunged 20.1% on a year-over-year basis. Results reflect a higher rate of uncollectible lease income pertaining to the coronavirus pandemic.
Portfolio Activity
During the reported quarter, the company completed the sale of its joint venture interest in Kent Place in Denver, CO for $9.8 million.
As of Jun 30, 2020, the company had $192.3 million of in-process developments and redevelopments with roughly $70 million of remaining costs to complete.
Liquidity Update
As of Jun 30, 2020, Regency had a cash balance of nearly $590 million and no outstanding balance under its $1.25-billion revolving credit facility. Further, the company had a debt-to-EBITDAre ratio of 5.6X as of Jun 30, 2020. It has no unsecured maturities until 2022. During the quarter, the company closed a public offering of $600 million 3.70% unsecured notes due 2030.
Dividend Update
On Jul 29, 2020, Regency Centers’ board of directors announced a quarterly cash dividend of 59.5 cents per share on its common stock. The dividend will be paid out on Aug 24 to its shareholders of record as of Aug 14, 2020.
Regency Centers currently carries a Zacks Rank #4 (Sell).
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
We now look forward to the earnings releases of other retail REITs like Federal Realty Investment Trust FRT and Kimco Realty Corporation KIM, which are scheduled to release their earnings this week while The Macerich Company MAC will report its quarterly numbers next week.
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.
Biggest Tech Breakthrough in a Generation
Be among the early investors in the new type of device that experts say could impact society as much as the discovery of electricity. Current technology will soon be outdated and replaced by these new devices. In the process, it’s expected to create 22 million jobs and generate $12.3 trillion in activity.
A select few stocks could skyrocket the most as rollout accelerates for this new tech. Early investors could see gains similar to buying Microsoft in the 1990s. Zacks’ just-released special report reveals 8 stocks to watch. The report is only available for a limited time.
See 8 breakthrough stocks now>>
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
Kimco Realty Corporation (KIM) : Free Stock Analysis Report
Federal Realty Investment Trust (FRT) : Free Stock Analysis Report
Macerich Company The (MAC) : Free Stock Analysis Report
Regency Centers Corporation (REG) : Free Stock Analysis Report
To read this article on Zacks.com click here.
Zacks Investment Research
