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Sep 30, 2020
Alexandria Q3 2020 Earnings Report
Alexandria reported solid financial and operating results, driven by strong leasing activity, rental rate growth, and strategic transactions.
Key Takeaways
Alexandria Real Estate Equities, Inc. announced strong financial and operating results for the third quarter ended September 30, 2020, with a net income per share of $0.63 and FFO per share, as adjusted, of $1.83. The company's operational excellence and strong, flexible balance sheet with significant liquidity contributed to the positive results.
Total revenues increased by 39.6% compared to 3Q19.
Net income attributable to Alexandria's common stockholders was $79.3 million, or $0.63 per share.
Funds from operations (FFO) attributable to Alexandria's common stockholders, as adjusted, was $230.7 million, or $1.83 per share.
The company had $3.9 billion of liquidity as of September 30, 2020, proforma for the unsecured senior line of credit amended in October 2020.
Alexandria
Alexandria
Forward Guidance
Alexandria updated its 2020 earnings per share guidance to $3.09 to $3.11 and FFO per share, as adjusted, to $7.29 to $7.31.
Positive Outlook
- Occupancy percentage in North America as of December 31, 2020, is expected to be between 94.8% and 95.4%.
- Rental rate increases for lease renewals and re-leasing of space are projected to be between 30.5% and 33.5%.
- Rental rate increases (cash basis) for lease renewals and re-leasing of space are expected to range from 16.0% to 19.0%.
- Net operating income increase is projected to be between 1.0% and 3.0%.
- Net operating income increase (cash basis) is expected to be between 4.5% and 6.5%.
Challenges Ahead
- Straight-line rent revenue is projected to be between $98 million and $108 million.
- General and administrative expenses are expected to be between $126 million and $131 million.
- Capitalization of interest is projected to be between $117 million and $127 million.
- Interest expense is expected to be between $170 million and $180 million.
- Net debt and preferred stock to Adjusted EBITDA – 4Q20 annualized Less than or equal to 5.3x