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Jun 30, 2021
Alexandria Q2 2021 Earnings Report
Alexandria reported strong Q2 2021 results, driven by high demand for its office/laboratory space and strategic acquisitions and dispositions.
Key Takeaways
Alexandria Real Estate Equities reported a solid second quarter, marked by record leasing activity and rental rate growth. The company continues to execute its strategy of providing high-quality office/laboratory space to the life science industry, with strong tenant collections and a robust balance sheet.
Historic leasing activity of 1.9 million RSF, the highest in a single quarter.
Rental rate increases of 42.4% over expiring rates on renewed and re-leased space.
North America occupancy of operating properties was 94.3% (98.1% excluding recent acquisitions).
Liquidity of $4.5 billion as of June 30, 2021.
Alexandria
Alexandria
Forward Guidance
Alexandria provided its 2021 guidance, with EPS expected to be between $3.46 and $3.54 and FFO per share, as adjusted, expected to be between $7.71 and $7.79.
Positive Outlook
- Occupancy percentage in North America as of December 31, 2021, is expected to be between 94.3% and 94.9%.
- Lease renewals and re-leasing of space: Rental rate increases are projected to be between 31.0% and 34.0%.
- Lease renewals and re-leasing of space: Rental rate increases (cash basis) are projected to be between 18.0% and 21.0%.
- Same property net operating income increase is expected to be between 2.0% and 4.0%.
- Same property net operating income increase (cash basis) is expected to be between 4.7% and 6.7%.
Challenges Ahead
- Unrealized (gains) losses on non-real estate investments are projected to be $(1.39).
- Realized gains on non-real estate investments are projected to be $(0.41).
- General and administrative expenses are projected to be between $146 million and $151 million.
- Capitalization of interest is projected to be between $172 million and $182 million.
- Interest expense is projected to be between $128 million and $138 million.