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Jun 30, 2020
First Industrial Q2 2020 Earnings Report
Reported strong results driven by high occupancy and cash collections amidst COVID-19 challenges.
Key Takeaways
First Industrial Realty Trust reported second quarter results with a diluted net income of $0.28 per share and FFO of $0.46 per share/unit. The company achieved a high occupancy rate of 97.7% and strong cash collections of monthly rental billings, demonstrating resilience in a challenging operating environment.
Occupancy increased to 97.7% at quarter-end.
Collected 98% of second quarter monthly rental billings and 97% of July billings to-date.
Increased 2020 FFO guidance by $0.02 at midpoint to $1.80 per share/unit, primarily reflecting portfolio performance.
Increased midpoint of cash same store NOI guidance range 25 basis points to 3.75%.
First Industrial
First Industrial
Forward Guidance
The company increased the midpoint of its FFO per share guidance by $0.02 from prior guidance, driven primarily by the early lease up of a recently acquired development in Baltimore and additional leasing revenue. Tenant activity has been ramping up along with improved economic activity.
Positive Outlook
- Early lease up of recently acquired development in Baltimore.
- Additional leasing revenue from a vacating tenant.
- Tenant activity in the sector has been ramping up.
- Improved economic activity compared to March and April.
- Accelerated e-commerce adoption is a positive demand driver for the sector long term.
Challenges Ahead
- COVID-19 continues to impact many businesses in the near term.
- Average quarter-end in service occupancy of 96.0% to 97.0%. This assumes Pier 1 Imports vacates September 1st.
- Full year 2020 bad debt expense of $2.6 million, which includes approximately $0.8 million realized in the first half of 2020.
- Guidance does not include the impact of any future debt repurchases prior to maturity or future debt issuances.
- Guidance does not include the impact of any future investments or property sales.