Core Insights - The article discusses the mispricing in REITs related to dividend cut announcements, highlighting that not all cuts indicate fundamental issues, creating investment opportunities [1][5]. Group 1: Dividend Cuts Analysis - Dividend cuts typically lead to significant sell-offs in REITs, regardless of the underlying reasons [1][9]. - There is a distinction between forced dividend cuts, which are associated with fundamental turmoil, and responsible cuts, which may simply reflect a change in payout ratios without fundamental damage [2][3]. - Responsible cuts can be identified when the company maintains strong fundamentals, such as occupancy rates and rental income, despite reducing dividends [4][5]. Group 2: Market Reactions and Opportunities - The market often punishes stocks with responsible dividend cuts, leading to price drops that create buying opportunities for investors who recognize the underlying strength of the company [11][18]. - Historical examples, such as W. P. Carey (WPC) and Brixmor (BRX), illustrate that stocks can recover significantly after initial punishment following a responsible cut [9][18]. - The article suggests that buying during the period of price punishment can yield substantial returns, as seen in past instances [27][33]. Group 3: Current Investment Opportunities - Current examples of companies experiencing responsible cuts include Armada Hoffler (AHH) and Easterly Government Properties (DEA), both of which are believed to be undervalued due to market overreactions [45][54]. - AHH recently cut its dividend from $0.2050 to $0.14 quarterly, yet its fundamentals remain strong, indicating a potential buying opportunity [45][50]. - DEA is also highlighted as a company with a responsible cut that presents a favorable entry point for investors [54].

Group 1 - The conventional wisdom suggests avoiding stocks that cut dividends, as it often indicates poor capital allocation by management and potential over-leveraging of balance sheets [1] - AT&T is cited as an example of a company that has cut its dividend, which aligns with the concerns regarding management's capital allocation decisions [1] Group 2 - The company invests significant resources, over $100,000 annually, into researching profitable investment opportunities to provide high-yield strategies [2] - The approach has garnered over 180 five-star reviews from members who are experiencing positive returns [2]

Financial Performance - Net loss attributable to common stockholders and OP Unitholders was $7.2 million, or $0.07 per diluted share, compared to a net income of $14.8 million, or $0.17 per diluted share, for the same period in 2024[164] - Funds from operations (FFO) were $17.2 million, or $0.17 per diluted share, down from $35.0 million, or $0.40 per diluted share, in the prior year[164] - Normalized funds from operations (Normalized FFO) were $25.6 million, or $0.25 per diluted share, compared to $29.4 million, or $0.33 per diluted share, for the same period in 2024[164] - Total revenues for the three months ended March 31, 2025, were $114.6 million, a decrease of $78.8 million or 68.1% compared to $193.5 million in the same period of 2024[1] - Rental revenues increased by $1.9 million or 3.1% to $63.8 million for the three months ended March 31, 2025, compared to $61.9 million in 2024[1] - Total expenses decreased by $72.7 million or 42.7% to $97.5 million for the three months ended March 31, 2025, compared to $170.1 million in 2024[1] - The diluted net loss per share for Q1 2025 was $(0.07), while the diluted net income per share for Q1 2024 was $0.17[253] - The diluted FFO per share for Q1 2025 was $0.17, down from $0.40 in Q1 2024, indicating a decrease of 57.5%[253] - The diluted Normalized FFO per share for Q1 2025 was $0.25, compared to $0.33 in Q1 2024, a decrease of approximately 24.2%[253] Operational Metrics - As of March 31, 2025, weighted average stabilized portfolio occupancy was 95.7%, with retail occupancy at 94.5%, office occupancy at 97.5%, and multifamily occupancy at 95.0%[164] - Positive spreads on lease renewals included 11.0% (GAAP) and 7.4% (Cash) for retail, 23.3% (GAAP) and 3.7% (Cash) for office, and 2.6% (GAAP and Cash) for multifamily[164] - Executed 31 commercial lease renewals and 11 new commercial leases totaling 313,002 net rentable square feet during the first quarter[164] - Office Same Store Net Operating Income (NOI) increased by 9.2% on a GAAP basis compared to the same quarter in 2024[164] - Retail same store rental revenues for the three months ended March 31, 2025 increased by $626,000 or 2.7% to $24.183 million compared to the same period in 2024[170] - Office same store NOI for the three months ended March 31, 2025 increased by $1.3 million or 9.2% to $15.153 million, reflecting strong tenant additions[172] - Multifamily same store NOI for the three months ended March 31, 2025 decreased by $284,000 or 3.2% to $8.689 million, primarily due to increased utility expenses[174] Segment Performance - Retail segment NOI for the three months ended March 31, 2025 decreased by $1.0 million or 5.5% to $17.982 million compared to the same period in 2024, primarily due to property dispositions[167] - Office segment NOI for the three months ended March 31, 2025 increased by $1.7 million or 12.5% to $15.238 million, driven by the addition of new tenants[171] - Multifamily segment NOI for the three months ended March 31, 2025 was $9.020 million, showing a slight increase compared to the same period in 2024[173] - General contracting and real estate services segment revenues for the three months ended March 31, 2025 decreased by $80.361 million to $46.614 million, with a gross profit decline of $2.713 million[175] - Real estate financing segment gross profit for the three months ended March 31, 2025 decreased by $646,000 or 24.2% to $2.022 million, primarily due to decreased interest rates[179] Cash Flow and Investments - Net cash provided by operating activities decreased by $46,379,000 to $107,000 compared to the same period in 2024, primarily due to timing of payments for construction projects[245] - Net cash used in investing activities decreased by $19,458,000 to $(21,488,000) compared to the same period in 2024, attributed to reduced investment in development[246] - Total cash, cash equivalents, and restricted cash at the end of the period was $48,567,000, down from $72,223,000 at the beginning of the period[245] Debt and Financing - As of March 31, 2025, total consolidated indebtedness amounted to $1,321,436,000, with secured debt at $575,436,000 and unsecured debt at $746,000,000[231] - Scheduled principal payments for 2025 are $134,825,000, representing 10% of total indebtedness, while 2026 payments are $360,513,000, accounting for 27%[233] - The company maintains a total leverage ratio of not more than 60%, with a maximum of 65% allowed for specific acquisitions[217][230] - The company has a tangible net worth requirement of at least $825.2 million plus 75% of net equity proceeds received after June 30, 2022[217][230] - The company must maintain a minimum occupancy rate of 80% for all unencumbered properties[217][230] - The company is currently in compliance with all covenants under the Credit Agreement, M&T term loan agreement, and TD term loan agreement[229] Interest Rate Management - The company entered into an interest rate swap agreement with a notional amount of $150.0 million at a SOFR rate of 2.50%[169] - The company held interest rate swap agreements with a total notional amount of $1,335,778,000 as of March 31, 2025, aimed at reducing interest rate exposure[236] Other Financial Information - The company has a $50.0 million share repurchase program, with $37.4 million remaining available for repurchases as of March 31, 2025[10] - The revolving credit facility capacity increased by $105.0 million to $355.0 million, with total credit facility capacity reaching $655.0 million[208] - The M&T term loan facility commitment increased to $350.0 million as of June 14, 2024, due to an existing lender's increased commitment[208] - The TD term loan facility commitment increased to $95.0 million on June 29, 2023, due to the addition of a second lender[225] - The company recorded a $0.4 million credit loss reserve in conjunction with the total unfunded commitments, indicating a remote probability of contingency funding[244] - The company reported a provision for unrealized credit losses of $22,000 in Q1 2025, down from $83,000 in Q1 2024[253] - The company has not reported any material changes to its market risk since December 31, 2024[257]

Financial Data and Key Metrics Changes - The company reported normalized FFO of $0.25 per diluted share for Q1 2025, slightly above expectations [25] - Net operating income for Q1 was $42.2 million, representing a 2% year-over-year increase [25] - FFO attributable to common shareholders was $17.2 million or $0.17 per diluted share [25] - AFFO totaled $20.4 million or $0.20 per diluted share, with cash dividend fully supported by operating property cash flow [25][11] - The company maintained a net debt to total adjusted EBITDA ratio of 7.1 times at quarter end [28] Business Line Data and Key Metrics Changes - Office segment same-store NOI increased by 9.2% on a GAAP basis and 6.3% on a cash basis, with occupancy at 97.5% [26] - Multifamily leasing reported a blended growth rate of 2.6% for the quarter, with renewal spreads at 5.4% [27] - Retail performance remained steady, with grocery-anchored centers maintaining high occupancy levels above 95% [28] Market Data and Key Metrics Changes - The company noted strong demand for well-located retail space, despite broader retail headwinds [13] - Multifamily fundamentals remained solid, with occupancy at 95% and signs of supply absorption in key Sunbelt markets [12] - The retail portfolio showed resilience amid tenant closures, with over 85% of the affected space already under lease or LOI to higher credit quality tenants at 25% higher rents [13] Company Strategy and Development Direction - The company is shifting its strategy away from reliance on fee income towards driving higher quality property-level earnings [9] - A focus on operational excellence and cost management is emphasized to navigate external economic uncertainties [10] - The company aims to reduce complexity in its business model while improving the balance sheet [11] - Redevelopment opportunities within the existing portfolio are being closely evaluated to unlock incremental value [20] Management's Comments on Operating Environment and Future Outlook - Management acknowledged external factors like tariffs and macroeconomic uncertainty but emphasized control over internal operations [9] - The company reaffirmed its full-year 2025 normalized FFO guidance of $1 to $1.1 per diluted share [32] - Management expressed confidence in the company's ability to sustain dividends and maintain liquidity amid economic challenges [29] Other Important Information - The quarterly dividend was reset to $0.14 per share to align with projected property cash levels [11] - The company is actively engaging with shareholders and investment partners to reinforce its long-term strategy [10] Q&A Session Summary Question: Impact of macroeconomic factors on leasing - Management indicated that macroeconomic uncertainties have not significantly affected leasing activity, with strong execution on new and renewal leases [37] Question: Future portfolio composition and investment strategy - Management expressed a cautious approach to acquisitions and dispositions in the short term, focusing on mixed-use communities for long-term growth [41] Question: Tenant watch list and potential risks - Management identified a few tenants of concern but noted that 85% of affected spaces are already under lease or LOI [53] Question: Multifamily segment impact from local financing cuts - Management has not observed significant impacts from local financing cuts, with occupancy holding steady and demand expected to increase [56] Question: Upcoming lease expirations and renewal risks - Management highlighted Office Depot as a key rollover concern but has backfill options identified [64]

Financial Data and Key Metrics Changes - Armada Hoffler reported normalized FFO of $0.25 per diluted share for Q1 2025, slightly above expectations [23] - Net operating income for Q1 was $42.2 million, representing a 2% year-over-year increase [23] - FFO attributable to common shareholders was $17.2 million or $0.17 per diluted share [23] - AFFO totaled $20.4 million or $0.20 per diluted share [24] - The company maintained a net debt to total adjusted EBITDA ratio of 7.1 times at quarter end [26] Business Line Data and Key Metrics Changes - Office segment same-store NOI increased by 9.2% on a GAAP basis and 6.3% on a cash basis, with occupancy at 97.5% [24] - Multifamily leasing reported a blended growth rate of 2.6% for the quarter, with renewal spreads at 5.4% [25] - Retail performance remained steady, with grocery-anchored centers achieving high occupancy levels above 95% [26] Market Data and Key Metrics Changes - The company noted strong demand for well-located retail space, particularly in mixed-use environments [26] - Multifamily fundamentals remained solid, with occupancy rates above 95% across all segments [11] - The company observed signs of supply absorption in key Sunbelt markets like Atlanta and Charlotte [11] Company Strategy and Development Direction - The company is shifting its strategy away from reliance on fee income, focusing on driving higher quality property-level earnings [8] - A strategic decision was made to reset the quarterly dividend to $0.14 per share to align with operating property cash flow [10] - The company is evaluating redevelopment opportunities within its existing portfolio to unlock incremental value [18] Management's Comments on Operating Environment and Future Outlook - Management acknowledged external factors like tariffs and macroeconomic uncertainty but emphasized a disciplined approach to managing costs [8] - The company reaffirmed its full-year 2025 normalized FFO guidance of $1 to $1.1 per diluted share despite headwinds in the construction segment [31] - Management expressed confidence in the company's ability to deliver value through a proactive posture and strategic decision-making [9] Other Important Information - The company is focused on maintaining liquidity and has completed a hedging transaction to mitigate interest rate exposure [26] - General and administrative expenses are projected to decrease by 13% year-over-year [29] - The recent addition of Jennifer Boykin to the board of directors is expected to bring valuable insights and leadership experience [20] Q&A Session Summary Question: Impact of macroeconomic uncertainty on leasing - Management indicated that macroeconomic factors have not significantly affected leasing activity, with strong execution of new and renewal leases [35] Question: Future portfolio composition and mixed-use communities - Management expressed a preference for mixed-use communities and indicated that while acquisition and disposition may be challenging in the short term, they remain open to opportunities [39] Question: Tenant watch list and potential risks - Management identified a few tenants of concern but noted that 85% of the affected spaces are already under lease or LOI with higher rents [51] Question: Multifamily segment impact from local financing cuts - Management has not seen a significant impact from local financing cuts and believes demand remains strong due to increased traffic from local employers [55] Question: Upcoming lease expirations and renewals - Management highlighted the Office Depot lease as a potential concern but noted they have backfill options identified [62]

Core Viewpoint - Armada Hoffler Properties reported quarterly funds from operations (FFO) of $0.25 per share, missing the Zacks Consensus Estimate of $0.26 per share, and down from $0.33 per share a year ago, indicating a -3.85% surprise [1] Financial Performance - The company posted revenues of $63.8 million for the quarter ended March 2025, surpassing the Zacks Consensus Estimate by 0.74%, compared to $61.88 million in the same quarter last year [2] - Over the last four quarters, Armada Hoffler Properties has exceeded consensus FFO estimates two times and topped consensus revenue estimates three times [2] Stock Performance - Armada Hoffler Properties shares have declined approximately 32.3% since the beginning of the year, while the S&P 500 has decreased by -4.7% [3] - The current consensus FFO estimate for the upcoming quarter is $0.27 on revenues of $63.74 million, and for the current fiscal year, it is $1.06 on revenues of $255.97 million [7] Industry Outlook - The REIT and Equity Trust - Residential industry, to which Armada Hoffler Properties belongs, is currently ranked in the bottom 39% of over 250 Zacks industries, suggesting potential challenges ahead [8]

Financial Highlights - First Quarter Funds From Operations (FFO) was $0.17 per diluted share[5] - First Quarter Normalized FFO was $0.25 per diluted share[5] - Weighted Average Portfolio Occupancy as of March 31, 2025, was 95.7%[5] - Average Base Rent (ABR) in Mixed-Use Communities was 58.0%[5] - Multifamily Occupancy was 95.0%[5] - First Quarter Retail Lease Renewal Spread Increase, GAAP, was 11.0%[5] - First Quarter Office Lease Renewal Spread Increase, GAAP, was 23.3%[5] - Net Operating Income (NOI) to be Added by the End of 2025 By Delivery of Development Pipeline is approximately $4.5 million[5] 2025 Outlook - Property Portfolio NOI is projected to be between $172.2 million and $175.8 million[7] - Construction Segment Profit is expected to range from $4.8 million to $6.8 million[7] - Normalized FFO per Diluted Share is guided to be between $1.00 and $1.10[7] Debt and Leverage - As of March 31, 2025, Fixed-Rate Debt accounted for 100.0% of the total debt portfolio, with a weighted average interest rate of 4.2% and a maturity of 3.0 years[27] - Stabilized Portfolio Debt / Stabilized Portfolio Adjusted EBITDAre was 5.4x[26] - Net Debt/Total Adjusted EBITDAre was 7.1x[26]

Exhibit 99.1 PRESS RELEASE ARMADA HOFFLER REPORTS FIRST QUARTER 2025 RESULTS GAAP Net Loss of $(0.07) Per Diluted Share for the First Quarter Normalized FFO of $0.25 Per Diluted Share for the First Quarter Office Same Store NOI Growth of 9.2% (GAAP) Positive Office Releasing Spreads of 23.3% (GAAP) and 3.7% (Cash) Positive Retail Renewal Spreads of 11.0% (GAAP) and 7.4% (Cash) Approximately 313K Net Rentable Square Feet of New and Renewed Commercial Lease Space Maintained 2025 Full-Year Normalized FFO Guida ...

Core Insights - Armada Hoffler Properties, Inc. reported a GAAP net loss of $7.2 million, or $0.07 per diluted share, for the first quarter of 2025, a decline from a net income of $14.8 million, or $0.17 per diluted share, in the same period of 2024 [3][5][29] - The company maintained its full-year 2025 Normalized FFO guidance range of $1.00 to $1.10 per diluted share [1][9] Financial Performance - Normalized FFO for the first quarter was $25.6 million, or $0.25 per diluted share, down from $29.4 million, or $0.33 per diluted share, in the first quarter of 2024 [6][29] - Total revenues for the first quarter were $114.6 million, compared to $193.5 million in the same quarter of 2024 [27] - The decrease in FFO and revenues was primarily attributed to a decline in general contracting and real estate services gross profit and unrealized losses on interest rate derivatives [6][27] Operating Metrics - The weighted average stabilized portfolio occupancy was 95.7%, with retail occupancy at 94.5%, office occupancy at 97.5%, and multifamily occupancy at 95.0% [3][7] - Office Same Store NOI increased by 9.2% on a GAAP basis compared to the same quarter in 2024 [3][6] - The company executed 31 commercial lease renewals and 11 new commercial leases, totaling approximately 313,000 net rentable square feet [3][6] Construction and Backlog - The third-party construction backlog as of March 31, 2025, was $80.4 million, with general contracting and real estate services gross profit for the first quarter reported at $1.4 million [3][7] Balance Sheet - As of March 31, 2025, total debt outstanding was $1.3 billion, with $166 million under the revolving credit facility [8] - The company's debt was 100% fixed or economically hedged after considering interest rate swaps [8] Outlook - The company provided guidance for full-year 2025, projecting portfolio NOI between $172.2 million and $175.8 million, with construction segment gross profit expected between $4.8 million and $6.8 million [10][9]

Core Viewpoint - Armada Hoffler has reached an agreement to acquire full ownership of Allied | Harbor Point, a 312-unit multifamily asset in Baltimore, aligning with its strategy to simplify operations and enhance long-term value [1][2][3] Acquisition Details - The agreement involves Armada Hoffler acquiring the minority interest from its joint venture partner, Beatty Development Group, transitioning to sole ownership [2] - The acquisition is expected to close in June, pending customary closing conditions [2] Strategic Intent - The CEO of Armada Hoffler emphasized the commitment to streamline operations and focus on wholly owned assets in prime mixed-use environments [3] - Full ownership of the Allied | Harbor Point asset is expected to enhance portfolio quality and provide 100% control and flexibility for future operations [3] Property Highlights - Allied | Harbor Point has shown strong demand since its opening in early 2025, featuring a landscaped rooftop terrace and waterfront views, making it a valuable addition to Armada Hoffler's portfolio [3] Company Overview - Armada Hoffler is a self-managed real estate investment trust (REIT) with over 40 years of experience in developing, acquiring, and managing high-quality properties primarily in the Mid-Atlantic and Southeastern United States [4] - The company also provides development and general contracting services to third-party clients, having been founded in 1979 [4]