The following is a summary of the City Office REIT, Inc. (CIO) Q1 2024 Earnings Call Transcript:
Financial Performance:
City Office REIT reported a Q1 net operating income of $26.7 million, a slight decrease due to reduced occupancy levels.
Core FFO was recorded at $13.5 million or $0.33 per share, consistent with the previous quarter.
AFFO stood at $9.1 million or $0.22 per share, covering the dividend for the quarter.
Total debt was reported at $668 million as of end-Q1, with a Net Debt to EBITDA ratio of 6.6x.
The company is modifying its guidance to account for WeWork's downsizing, impacting the core FFO by $0.04 per share.
Business Progress:
City Office REIT leased out 191,000 sq.ft. of new and renewal spaces during the quarter. This included signing two key leases in Raleigh and Orlando.
The company maintains a robust leasing pipeline, with potential tenants across their portfolio.
An investment of approximately $9 million has been planned for the renovation of four projects by year-end, aimed at increasing net operating income.
The company envisions enhanced leasing execution over the coming years, laying a solid foundation for performance in 2025 and beyond.
City Office REIT is in negotiations to lease the WeWork space at Block 23 to another coworking tenant potentially by early 2025.
Plans are being considered to break up the building into smaller suites in response to market trends.
The company is on caution regarding the AmberGlen property in Portland due to market challenges, with its next debt maturity due in 2027.
More details: City Office REIT IR
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