Strong Leasing Volume and Occupancy Outlook
Highwoods signed over 1 million square feet of second-gen volume, including 326,000 square feet of new leases. Leasing volumes have been strong for 8 consecutive quarters, driving the leased rate 340 basis points higher than the occupancy rate at quarter end.
Net Effective Rent Growth
Net effective rents hit a high watermark, with an 18% increase over the trailing 4 quarters compared to the 2019 average.
Development Pipeline Progress
122,000 square feet of leases were signed across the development pipeline, driving the lease percentage to 72%, up from 64% last quarter.
Financial Performance and Outlook
FFO delivered at $0.86 per share. The midpoint of the FFO outlook was raised, marking the third consecutive quarter increase, now $0.08 higher than the initial outlook.
Asset Recycling and Acquisitions
Acquired Legacy Union parking garage for $111.5 million and sold a noncore property for $16 million. Highlighted potential for $500 million of both acquisitions and dispositions over the next few quarters.
Balance Sheet and Debt Management
Extended the only consolidated debt maturity prior to 2027, leaving $625 million of available liquidity. Debt-to-EBITDAre stands at 6.4x, with expectations to reduce it by 0.5x with future occupancy gains.