Alexandria Q4 2023 Earnings Report
Key Takeaways
Alexandria Real Estate Equities, Inc. announced financial results for the fourth quarter and year ended December 31, 2023, featuring a net loss per share of $0.54 and FFO per share, as adjusted, of $2.28 for the quarter. The company celebrated its 30th anniversary and highlighted operational excellence, a strong balance sheet, and a value-creation pipeline.
Total revenues reached $757.2 million, a 13.0% increase year-over-year.
Operating margin was 71% and adjusted EBITDA margin was 69%.
Leasing volume aggregated 889,737 RSF during 4Q23.
Incremental annual net operating income of $145 million was delivered from development and redevelopment projects placed into service.
Alexandria
Alexandria
Alexandria Revenue by Segment
Forward Guidance
Alexandria provided guidance for 2024, including earnings per share of $3.49 to $3.69 and FFO per share of $9.37 to $9.57, with key assumptions for occupancy, rental rate increases, and same property performance.
Positive Outlook
- Occupancy percentage in North America as of December 31, 2024 is expected to be between 94.6% and 95.6%.
- Rental rate increases for lease renewals and re-leasing of space are projected to be between 11.0% and 19.0%.
- Net operating income increases for same properties are anticipated to be between 0.5% and 2.5%.
- The company expects to issue new unsecured senior notes payable in 2025 to fund the repayment of its $600 million unsecured senior notes payable due on April 30, 2025.
- Fixed-charge coverage ratio – 4Q24 annualized is expected to be greater than or equal to 4.5x.
Challenges Ahead
- The guidance excludes unrealized gains or losses on non-real estate investments after December 31, 2023.
- It is subject to market conditions, which may affect the ability to refinance debt maturities.
- The company's ATM program became inactive in January 2024 upon expiration of the associated shelf registration.
- Realized gains on non-real estate investments are projected to be between $95 million and $125 million, excluding significant impairments realized on non-real estate investments.
- Fixed-charge coverage ratio – 4Q24 annualized is expected to be less than or equal to 5.1x.