East Properties(EGP) - 2024 Q4 - Annual Report

Financial Performance - EastGroup's rental income for 2024 was $638,035,000, an increase from$ 566,179,000 in 2023, reflecting a growth in income from real estate operations [139]. - Net Income Attributable to EastGroup Properties, Inc. Common Stockholders was $4.66 per share for 2024, a 5.4% increase from$ 4.42 in 2023 [119]. - Net Income Attributable to EastGroup Properties, Inc. Common Stockholders for 2024 was $227,751,000, an increase of 13.6% from$ 200,491,000 in 2023 [167]. - FFO per diluted share for 2024 was $8.35, representing a 7.2% increase from$ 7.79 in 2023; FFO excluding gains on involuntary conversion was $8.31, up 7.9% from$ 7.70 [142]. - PNOI for the year ended December 31, 2024, was $464,995,000 ($ 9.51 per diluted share), an increase from $413,321,000 ($ 9.12 per diluted share) in 2023, reflecting a growth of approximately 12.5% [169]. Leasing and Occupancy - Average rental rates for new and renewal leases signed in 2024 increased by 53.0% compared to previous leases on the same spaces [118]. - The occupancy rate for EastGroup's operating portfolio was 96.1% at the end of 2024, down from 98.2% at the end of 2023 [122]. - EastGroup executed leases on 9,384,000 square feet of operating properties in 2024, representing 15.9% of its total square footage [118]. - The percentage of leased square footage for the operating portfolio was 97.1% at December 31, 2024, down from 98.7% at December 31, 2023 [168]. - Average rental rate for same properties was $8.22 per square foot in 2024, up from$ 7.76 in 2023, reflecting a rental rate increase of 53.0% on new and renewal leases [146]. Property Acquisitions and Sales - EastGroup acquired 2,474,000 square feet of operating properties for $390,011,000 during 2024 [125]. - The company sold properties generating gross sales proceeds of$ 18,311,000 in 2024, recognizing a gain of $8,751,000 on real estate investments [126]. - The Company recognized$ 8,751,000 in gains on sales of real estate investments during 2024, with gross sales proceeds from sold properties totaling $14,050,000 [150]. - Investment in Development and value-add properties increased to$ 674,472,000, with total capital invested during 2024 amounting to $245,033,000 [151]. Financial Position and Capital Structure - Total Assets increased by$ 558,263,000 to $5,077,476,000, while Total Liabilities decreased by$ 125,647,000 to $1,784,932,000, resulting in Total Equity increasing by$ 683,910,000 to $3,292,544,000 [145]. - Distributions in excess of earnings increased by$ 36,699,000 due to dividends on common stock of $264,450,000 exceeding net income [164]. - As of December 31, 2024, total immediate liquidity was approximately$ 757,320,000, including $17,529,000 in cash and cash equivalents [183]. - As of December 31, 2024, the total unsecured debt amounts to$ 1,510,000,000 with a weighted average interest rate of 3.34% [187]. - The company has a $625,000,000 unsecured bank credit facility with a maturity date of July 31, 2028, with an interest rate of 5.222% as of December 31, 2024 [191]. Interest and Financing - Interest expense decreased to$ 38,956,000 ( $0.80 per diluted share) in 2024 from$ 47,996,000 ( $1.06 per diluted share) in 2023, a reduction of approximately 18.5% [170]. - Capitalized interest increased by$ 3,588,000 for 2024 compared to 2023, attributed to changes in development activity and spending [176]. - The company refinanced a $100,000,000 senior unsecured term loan, reducing the credit spread by 30 basis points to an effectively fixed interest rate of 4.97% [189]. - The Company has an unsecured bank credit facility balance of$ 100,000,000, with a potential interest expense fluctuation of approximately $528,000 annually if interest rates change by 10% [217]. Economic and Market Conditions - Economic conditions significantly impact the Company's financial results, with potential uncollectible rent affecting income from real estate operations [219]. - An economic downturn could lead to increased vacancy rates and reduced rental income upon lease expirations, adversely affecting cash flows [220]. - Most leases include scheduled rent increases and require tenants to pay a pro rata share of operating expenses, mitigating exposure to inflation-related cost increases [218]. Development and Capital Improvements - As of December 31, 2024, EastGroup's development and value-add program consisted of 21 projects totaling 4,143,000 square feet, with a projected total cost of$ 608,700,000 [124]. - Capital improvements on existing and acquired properties amounted to $58,128,000 during 2024 [149]. - Total real estate improvements amounted to$ 58,128,000 in 2024, up from $53,550,000 in 2023, representing an increase of about 8.8% [177]. - Total capitalized leasing costs were$ 34,913,000 in 2024, compared to $31,672,000 in 2023, reflecting an increase of approximately 10.3% [178]. Shareholder Activities - During the year ended December 31, 2024, the company sold 1,373,459 shares of common stock under its ATM programs at a weighted average price of$ 174.30 per share, generating net proceeds of $236,996,000 [199]. - The company has approximately$ 719,665,000 of common stock available to be sold under the Current ATM Program as of February 12, 2025 [202]. - The company distributed $252,794,000 in common stock dividends during 2024 [184].