PHILADELPHIA, PA — Brandywine Realty Trust (NYSE: BDN) has announced its financial and operational performance for the third quarter of 2024, highlighting achievements and adjustments in its business strategy. The company reported a net loss of $165.5 million for the quarter, equating to $0.96 per share. This figure includes significant non-cash impairment charges amounting to $161.4 million.
Gerard H. Sweeney, President and CEO of Brandywine Realty Trust, emphasized the company’s progress, noting improvements in leasing activities and adjustments to speculative revenue targets. “During the third quarter, we made strong progress on our 2024 business plan, highlighted by exceeding many of our targets,” Sweeney stated. The company raised its speculative revenue target to $26.3 million, marking a 7% increase from the original plan, and managed to achieve a 3% increase in tenant retention rate.
The quarter saw the company completing the sale of five Class-B office properties in Plymouth Meeting, Pennsylvania, for $65.5 million. The asset sales target for 2024 has been increased from $90 million to $150 million. However, the company decided to exclude land sales from its financial projections, initially expected to generate $5 million in earnings.
Leasing activity remained robust with 298,000 square feet of new and renewal leases signed, contributing to an overall core portfolio occupancy of 87.2%. The rental rate for renewals and new leases marked an increase of 14.9% and 8.9%, respectively, on an accrual basis. Despite a tenant retention ratio of 42%, Brandywine’s portfolio was 88.7% leased, including upcoming lease commencements.
In terms of financing, Brandywine reported a $40 million outstanding balance on its $600 million unsecured revolving credit facility, with $36.5 million in cash and cash equivalents available as of the end of September.
The company has adjusted its 2024 earnings guidance, now projecting a loss per share of between $1.01 and $0.98. The Funds from Operations (FFO) guidance has been revised to a range of $0.89 to $0.92 per diluted share. These adjustments reflect current market conditions and strategic shifts, including removed land sale projections and increased asset sales expectations.
Brandywine Realty Trust’s strategic moves and financial adjustments position it to navigate the evolving real estate market, with a focus on maintaining high occupancy rates and leveraging asset sales for growth.
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