[FORWARD-LOOKING STATEMENTS](index=3&type=section&id=FORWARD-LOOKING%20STATEMENTS) This section outlines inherent uncertainties and risks associated with forward-looking statements, covering business strategy and financial performance - Forward-looking statements are subject to uncertainties and risks, including guidance, business strategy, future financings, acquisitions/dispositions, development opportunities, stock issuances, distributions, capital expenditures, market trends, interest rates, and operating performance[10](index=10&type=chunk)[12](index=12&type=chunk) - Actual results may vary due to factors such as capital availability and terms, ability to refinance debt, failure of contracts to close, inability to achieve anticipated benefits from transactions, potential dilutive effects of stock issuances, and changes in economic and real estate market conditions, particularly in key Sun Belt markets[12](index=12&type=chunk) - Other risks include public health crises, sociopolitical unrest, impairment charges, leasing risks (new tenants, renewals, declining rates), changes in tenant needs (co-working, less space per employee, remote work), tenant financial condition, volatility in interest/insurance rates, inflation, competition, development risks, cybersecurity breaches, changes in management, uninsured losses, regulatory non-compliance, joint venture disputes, debt covenant failures, REIT qualification changes, tax law changes, and other SEC-reported risks[12](index=12&type=chunk)[14](index=14&type=chunk) [PART I — FINANCIAL INFORMATION](index=5&type=section&id=PART%20I%E2%80%94FINANCIAL%20INFORMATION) This part presents the company's unaudited condensed consolidated financial statements and management's discussion of financial results [Item 1. Condensed Consolidated Financial Statements (Unaudited)](index=5&type=section&id=Item%201.%20Condensed%20Consolidated%20Financial%20Statements%20(Unaudited)) This section presents the company's unaudited condensed consolidated financial statements, including balance sheets, income, equity, and cash flow data [CONSOLIDATED BALANCE SHEETS](index=5&type=section&id=CONSOLIDATED%20BALANCE%20SHEETS) Consolidated Balance Sheet Highlights (June 30, 2023 vs. December 31, 2022, in thousands) | Metric | June 30, 2023 | December 31, 2022 | Change ($) | Change (%) | | :-------------------- | :------------ | :---------------- | :--------- | :--------- | | **Assets:** | | | | | | Total assets | $7,595,785 | $7,537,016 | $58,769 | 0.78% | | Operating properties, net | $6,740,557 | $6,738,354 | $2,203 | 0.03% | | Projects under development | $124,105 | $111,400 | $12,705 | 11.40% | | Cash and cash equivalents | $8,031 | $5,145 | $2,886 | 56.09% | | Investment in unconsolidated joint ventures | $138,992 | $112,839 | $26,153 | 23.18% | | **Liabilities:** | | | | | | Total liabilities | $2,991,487 | $2,890,067 | $101,420 | 3.51% | | Notes payable | $2,423,761 | $2,334,606 | $89,155 | 3.82% | | Deferred income | $172,552 | $128,636 | $43,916 | 34.14% | | **Equity:** | | | | | | Total equity | $4,604,298 | $4,646,949 | $(42,651) | -0.92% | [CONSOLIDATED STATEMENTS OF OPERATIONS](index=6&type=section&id=CONSOLIDATED%20STATEMENTS%20OF%20OPERATIONS) Consolidated Statements of Operations Highlights (Three Months Ended June 30, in thousands) | Metric | Q2 2023 | Q2 2022 | Change ($) | Change (%) | | :-------------------- | :----------- | :----------- | :--------- | :--------- | | Revenues: | | | | | | Rental property revenues | $203,954 | $183,174 | $20,780 | 11.35% | | Total revenues | $204,320 | $185,680 | $18,640 | 10.04% | | Expenses: | | | | | | Rental property operating expenses | $67,099 | $62,216 | $4,883 | 7.85% | | Interest expense | $25,972 | $16,549 | $9,423 | 56.94% | | Depreciation and amortization | $80,269 | $69,861 | $10,408 | 14.89% | | Total expenses | $181,996 | $156,724 | $25,272 | 16.12% | | Net income | $23,077 | $34,164 | $(11,087) | -32.46% | | Net income available to common stockholders | $22,621 | $34,052 | $(11,431) | -33.57% | | Net income per common share — basic | $0.15 | $0.23 | $(0.08) | -34.78% | | Net income per common share — diluted | $0.15 | $0.23 | $(0.08) | -34.78% | Consolidated Statements of Operations Highlights (Six Months Ended June 30, in thousands) | Metric | H1 2023 | H1 2022 | Change ($) | Change (%) | | :-------------------- | :----------- | :----------- | :--------- | :--------- | | Revenues: | | | | | | Rental property revenues | $404,030 | $366,401 | $37,629 | 10.27% | | Total revenues | $407,048 | $372,578 | $34,470 | 9.25% | | Expenses: | | | | | | Rental property operating expenses | $138,312 | $127,093 | $11,219 | 8.83% | | Interest expense | $51,002 | $32,074 | $18,928 | 59.01% | | Depreciation and amortization | $156,039 | $140,605 | $15,434 | 10.98% | | Total expenses | $363,039 | $316,514 | $46,525 | 14.70% | | Net income | $45,433 | $62,327 | $(16,894) | -27.11% | | Net income available to common stockholders | $44,817 | $62,036 | $(17,219) | -27.76% | | Net income per common share — basic | $0.30 | $0.42 | $(0.12) | -28.57% | | Net income per common share — diluted | $0.29 | $0.42 | $(0.13) | -30.95% | [CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME](index=7&type=section&id=CONSOLIDATED%20STATEMENTS%20OF%20COMPREHENSIVE%20INCOME) Consolidated Statements of Comprehensive Income Highlights (Three Months Ended June 30, in thousands) | Metric | Q2 2023 | Q2 2022 | Change ($) | | :------------------------------------ | :----------- | :----------- | :--------- | | Net income available to common stockholders | $22,621 | $34,052 | $(11,431) | | Other comprehensive income: | | | | | Unrealized gain on cash flow hedges | $5,936 | $— | $5,936 | | Amortization of cash flow hedges | $(908) | $— | $(908) | | Total other comprehensive income | $5,028 | $— | $5,028 | | Total comprehensive income | $27,649 | $34,052 | $(6,403) | Consolidated Statements of Comprehensive Income Highlights (Six Months Ended June 30, in thousands) | Metric | H1 2023 | H1 2022 | Change ($) | | :------------------------------------ | :----------- | :----------- | :--------- | | Net income available to common stockholders | $44,817 | $62,036 | $(17,219) | | Other comprehensive income: | | | | | Unrealized gain on cash flow hedges | $4,894 | $— | $4,894 | | Amortization of cash flow hedges | $(1,096) | $— | $(1,096) | | Total other comprehensive income | $3,798 | $— | $3,798 | | Total comprehensive income | $48,615 | $62,036 | $(13,421) | [CONSOLIDATED STATEMENTS OF EQUITY](index=8&type=section&id=CONSOLIDATED%20STATEMENTS%20OF%20EQUITY) Consolidated Statements of Equity Highlights (Three Months Ended June 30, 2023, in thousands) | Metric | Balance March 31, 2023 | Net Income | Other Comprehensive Income | Common Dividends | Balance June 30, 2023 | | :---------------------------- | :--------------------- | :--------- | :------------------------- | :--------------- | :-------------------- | | Common Stock | $154,256 | — | — | — | $154,336 | | Additional Paid-In Capital | $5,631,076 | — | — | — | $5,634,996 | | Treasury Stock | $(147,157) | — | — | — | $(147,157) | | Distributions in Excess of Net Income | $(1,039,694) | $22,621 | — | $(49,296) | $(1,066,369) | | Accumulated Other Comprehensive Income | $537 | — | $5,028 | — | $5,565 | | Total Stockholders' Investment | $4,599,018 | $22,621 | $5,028 | $(49,296) | $4,581,371 | | Total Equity | $4,621,036 | $23,077 | $5,028 | $(49,296) | $4,604,298 | Consolidated Statements of Equity Highlights (Six Months Ended June 30, 2023, in thousands) | Metric | Balance Dec 31, 2022 | Net Income | Other Comprehensive Income | Common Dividends | Balance June 30, 2023 | | :---------------------------- | :------------------- | :--------- | :------------------------- | :--------------- | :-------------------- | | Common Stock | $154,019 | — | — | — | $154,336 | | Additional Paid-In Capital | $5,630,327 | — | — | — | $5,634,996 | | Treasury Stock | $(147,157) | — | — | — | $(147,157) | | Distributions in Excess of Net Income | $(1,013,292) | $44,817 | — | $(97,894) | $(1,066,369) | | Accumulated Other Comprehensive Income | $1,767 | — | $3,798 | — | $5,565 | | Total Stockholders' Investment | $4,625,664 | $44,817 | $3,798 | $(97,894) | $4,581,371 | | Total Equity | $4,646,949 | $45,433 | $3,798 | $(97,894) | $4,604,298 | [CONSOLIDATED STATEMENTS OF CASH FLOWS](index=10&type=section&id=CONSOLIDATED%20STATEMENTS%20OF%20CASH%20FLOWS) Consolidated Statements of Cash Flows Highlights (Six Months Ended June 30, in thousands) | Metric | H1 2023 | H1 2022 | Change ($) | Change (%) | | :------------------------------------ | :----------- | :----------- | :--------- | :--------- | | Net cash provided by operating activities | $161,071 | $157,689 | $3,382 | 2.15% | | Net cash used in investing activities | $(149,671) | $(193,346) | $43,675 | -22.59% | | Net cash provided by (used in) financing activities | $(8,514) | $30,777 | $(39,291) | -127.69% | | NET INCREASE (DECREASE) IN CASH, CASH EQUIVALENTS, AND RESTRICTED CASH | $2,886 | $(4,880) | $7,766 | -159.14% | | CASH, CASH EQUIVALENTS, AND RESTRICTED CASH AT END OF PERIOD | $8,031 | $5,288 | $2,743 | 51.87% | [NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS](index=11&type=section&id=NOTES%20TO%20CONDENSED%20CONSOLIDATED%20FINANCIAL%20STATEMENTS) This section provides detailed disclosures and explanations for the condensed consolidated financial statements, covering business, real estate, debt, equity, and segment information [Note 1. DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION](index=11&type=section&id=Note%201.%20DESCRIPTION%20OF%20BUSINESS%20AND%20BASIS%20OF%20PRESENTATION) This note describes the company's business as a fully integrated REIT focused on Class A office properties and mixed-use developments - Cousins Properties Incorporated operates as a fully integrated, self-administered, and self-managed REIT, conducting business primarily through Cousins Properties LP (CPLP), which it consolidates[36](index=36&type=chunk) - The Company develops, acquires, leases, manages, and owns primarily Class A office properties and opportunistic mixed-use developments in Sun Belt markets, including Atlanta, Austin, Tampa, Charlotte, Phoenix, Dallas, and Nashville[37](index=37&type=chunk) - As of June 30, 2023, the Company's real estate portfolio included **18.8 million square feet** of office space and **310,000 square feet** of multi-family space[37](index=37&type=chunk) [Note 2. REAL ESTATE](index=11&type=section&id=Note%202.%20REAL%20ESTATE) This note details the company's real estate transactions, impairment charges, and future impairment risks - The Company had no real estate transactions for the three and six months ended June 30, 2023[40](index=40&type=chunk) - No impairment charges were recorded for held-for-investment buildings, held-for-sale buildings, land, or projects under development during any periods presented[41](index=41&type=chunk)[42](index=42&type=chunk)[43](index=43&type=chunk) - Future impairment charges could be recorded if the economy or office industry weakens, operating results differ materially from forecasts, or the contemplated hold period for operating buildings shortens[44](index=44&type=chunk) [Note 3. INVESTMENT IN UNCONSOLIDATED JOINT VENTURES](index=12&type=section&id=Note%203.%20INVESTMENT%20IN%20UNCONSOLIDATED%20JOINT%20VENTURES) This note provides financial summaries and operational details for unconsolidated joint ventures, including debt refinancing and asset sales Summary of Financial Position for Unconsolidated Joint Ventures (in thousands) | Metric | June 30, 2023 | December 31, 2022 | | :-------------------- | :------------ | :---------------- | | Total Assets | $537,604 | $433,822 | | Total Debt | $248,624 | $178,796 | | Total Equity (Deficit)| $249,372 | $232,702 | | Company's Investment | $108,447 | $93,666 | Summary of Operations for Unconsolidated Joint Ventures (Six Months Ended June 30, in thousands) | Metric | H1 2023 | H1 2022 | | :-------------------- | :----------- | :----------- | | Total Revenues | $12,022 | $19,807 | | Net Income (Loss) | $3,968 | $11,441 | | Company's Income from Investment | $1,426 | $6,404 | - In May 2023, Crawford Long - CPI, LLC refinanced its mortgage loan for the Medical Offices at Emory Hospital property, securing a new **$83.0 million** interest-only mortgage at a fixed rate of **4.80%** maturing in June 2032, repaying the previous **$62.4 million** loan[46](index=46&type=chunk)[51](index=51&type=chunk) - Neuhoff Holdings LLC has a construction loan with a borrowing capacity up to **$312.7 million**, maturing September 2025, with an interest rate based on SOFR plus **3.45%** (minimum **3.60%**), replacing LIBOR-based rates prior to April 2023[47](index=47&type=chunk) - On June 30, 2022, HICO Victory Center LP sold a **3.0-acre** land parcel in Uptown Dallas for **$23.1 million**, with the Company's share of the gain being **$4.5 million**[52](index=52&type=chunk) [Note 4. INTANGIBLE ASSETS AND LIABILITIES](index=14&type=section&id=Note%204.%20INTANGIBLE%20ASSETS%20AND%20LIABILITIES) This note details the company's intangible assets and liabilities, including leases and goodwill, along with their amortization Intangible Assets (in thousands) | Intangible Asset | June 30, 2023 | December 31, 2022 | | :--------------- | :------------ | :---------------- | | In-place leases, net | $89,611 | $102,080 | | Below-market ground leases, net | $17,193 | $17,393 | | Above-market leases, net | $13,409 | $15,093 | | Goodwill | $1,674 | $1,674 | | Total | $121,887 | $136,240 | Intangible Liabilities (in thousands) | Intangible Liability | June 30, 2023 | December 31, 2022 | | :------------------- | :------------ | :---------------- | | Below-market leases, net | $46,511 | $52,280 | Amortization of Intangible Assets and Liabilities (Six Months Ended June 30, in thousands) | Amortization Type | H1 2023 | H1 2022 | | :---------------- | :----------- | :----------- | | Rental property revenues, net (Below-market and Above-market leases) | $4,084 | $3,464 | | Depreciation and amortization (In-place leases) | $12,470 | $14,390 | | Rental property operating and other expenses (Below-market ground leases) | $200 | $174 | [Note 5. OTHER ASSETS](index=15&type=section&id=Note%205.%20OTHER%20ASSETS) This note outlines other assets such as predevelopment costs, prepaid expenses, and lease inducements, detailing their nature Other Assets (in thousands) | Other Asset | June 30, 2023 | December 31, 2022 | | :---------- | :------------ | :---------------- | | Predevelopment costs | $54,501 | $50,009 | | Prepaid expenses and other assets | $16,633 | $6,438 | | Furniture, fixtures and equipment and other deferred costs, net | $10,997 | $11,824 | | Lease inducements, net | $7,922 | $8,091 | | Credit Facility deferred financing costs, net | $4,916 | $5,550 | | Total | $94,969 | $81,912 | - Predevelopment costs represent capitalized amounts for projects deemed probable of future development[56](index=56&type=chunk) - Lease inducements, such as moving costs and sublease arrangements, are amortized into rental revenues over the individual lease terms[57](index=57&type=chunk) [Note 6. NOTES PAYABLE](index=16&type=section&id=Note%206.%20NOTES%20PAYABLE) This note details the company's notes payable, including unsecured and secured debt, credit facility terms, and covenant compliance Notes Payable Outstanding (June 30, 2023 vs. December 31, 2022, in thousands) | Description | June 30, 2023 | December 31, 2022 | | :-------------------- | :------------ | :---------------- | | Unsecured Notes | $1,898,500 | $1,806,600 | | Secured Mortgage Notes| $531,141 | $535,241 | | Total Notes Payable | $2,423,761 | $2,334,606 | - The weighted average maturity of notes payable outstanding at June 30, 2023, was **3.5 years**[62](index=62&type=chunk) - The Company's Credit Facility allows borrowing up to **$1 billion**, with **$851.5 million** available capacity at June 30, 2023, with interest rates based on Adjusted SOFR plus a spread, and includes financial covenants[60](index=60&type=chunk)[61](index=61&type=chunk)[62](index=62&type=chunk) - The Company entered into floating-to-fixed interest rate swaps for **$200 million** of the 2022 Term Loan (fixed at **5.45%** as of June 30, 2023) and the **$350 million** 2021 Term Loan (fixed at **4.234%** SOFR)[62](index=62&type=chunk)[64](index=64&type=chunk)[65](index=65&type=chunk) - Unsecured senior notes total **$1.0 billion** across five tranches with fixed annual interest rates ranging from **3.78%** to **4.09%** and maturities between 2025 and 2029[67](index=67&type=chunk) - Secured mortgage notes total **$531.1 million**, with fixed interest rates, including a December 2022 refinancing of two Terminus properties to **$221.0 million** at **6.34%** interest, maturing January 2031[69](index=69&type=chunk)[70](index=70&type=chunk) - The Company is in compliance with all covenants related to its unsecured and secured debt, with the estimated fair value of notes payable being **$2.3 billion** at June 30, 2023[71](index=71&type=chunk)[72](index=72&type=chunk) Interest Expense (in thousands) | Metric | Q2 2023 | Q2 2022 | H1 2023 | H1 2022 | | :------------------ | :----------- | :----------- | :----------- | :----------- | | Total interest incurred | $30,977 | $20,140 | $61,098 | $39,116 | | Interest capitalized| $(5,005) | $(3,591) | $(10,096) | $(7,042) | | Total interest expense | $25,972 | $16,549 | $51,002 | $32,074 | [Note 7. DERIVATIVE FINANCIAL INSTRUMENTS](index=18&type=section&id=Note%207.%20DERIVATIVE%20FINANCIAL%20INSTRUMENTS) This note describes the company's use of interest rate swaps as cash flow hedges to manage interest rate exposure for its term loans - The Company uses interest rate swaps as cash flow hedges to stabilize interest expense and manage exposure to interest rate movements, specifically for the 2021 and 2022 Term Loans[76](index=76&type=chunk) - In April 2023, a floating-to-fixed interest rate swap was entered for **$200 million** of the 2022 Term Loan, fixing the underlying SOFR rate at **4.298%** through March 2025[74](index=74&type=chunk) - In September 2022, a floating-to-fixed interest rate swap was entered for the **$350 million** 2021 Term Loan, fixing the underlying SOFR rate at **4.234%** through August 2024[75](index=75&type=chunk) Effect of Derivative Financial Instruments on Consolidated Statements of Operations (in thousands) | Metric | Q2 2023 | Q2 2022 | H1 2023 | H1 2022 | | :------------------------------------------ | :----------- | :------ | :----------- | :------ | | Income recognized in AOCI on interest rate derivatives | $5,936 | $— | $4,894 | $— | | Income reclassified from AOCI into interest expense | $(908) | $— | $(1,096) | $— | [Note 8. OTHER LIABILITIES](index=19&type=section&id=Note%208.%20OTHER%20LIABILITIES) This note details other liabilities, including ground lease liabilities, prepaid rent, and security deposits Other Liabilities (in thousands) | Other Liability | June 30, 2023 | December 31, 2022 | | :-------------------- | :------------ | :---------------- | | Ground lease liability | $53,322 | $53,129 | | Prepaid rent | $37,660 | $33,165 | | Security deposits | $14,398 | $14,635 | | Restricted stock unit liability | $— | $1,048 | | Other liabilities | $1,720 | $1,465 | | Total | $107,100 | $103,442 | [Note 9. COMMITMENTS AND CONTINGENCIES](index=19&type=section&id=Note%209.%20COMMITMENTS%20AND%20CONTINGENCIES) This note outlines the company's outstanding performance bonds, future lease obligations, and legal proceedings - As of June 30, 2023, the Company had outstanding performance bonds totaling **$0.7 million** and future obligations under leases to fund tenant improvements and other construction totaling **$153.1 million**[82](index=82&type=chunk) - The Company is subject to various legal proceedings but does not expect them to have a material adverse effect on its liquidity, results of operations, business, or financial condition[83](index=83&type=chunk) [Note 10. STOCKHOLDERS' EQUITY](index=19&type=section&id=Note%2010.%20STOCKHOLDERS%27%20EQUITY) This note details the company's stockholders' equity, including its at-the-market stock offering program and common share issuances - The Company has an at-the-market stock offering program (ATM Program) allowing the sale of up to **$500 million** in common stock, including through forward equity sale agreements to align funding with capital needs[84](index=84&type=chunk) - In April 2022, the Company purchased its partner's **10%** joint venture interest in HICO Avalon, LLC and HICO Avalon II, LLC for **$43.4 million**, which included a promote related to fair value increases[85](index=85&type=chunk) - In June 2022, the Company issued **2.6 million** common shares under Forward Sales contracts for gross proceeds of **$105.1 million**, with no shares issued under the ATM Program during the six months ended June 30, 2023, and no Forward Sales contracts outstanding[86](index=86&type=chunk) [Note 11. REVENUE RECOGNITION](index=20&type=section&id=Note%2011.%20REVENUE%20RECOGNITION) This note explains the company's revenue recognition policies for rental property and fee income, including the impact of lease rejections Rental Property Revenues (in thousands) | Metric | Q2 2023 | Q2 2022 | H1 2023 | H1 2022 | | :-------------------- | :----------- | :----------- | :----------- | :----------- | | Total rental property revenues | $204,000 | $183,200 | $404,000 | $366,400 | | Variable rental revenue | $62,200 | $50,200 | $121,400 | $103,000 | Fee and Other Revenue (in thousands) | Metric | Q2 2023 | Q2 2022 | H1 2023 | H1 2022 | | :-------------------- | :----------- | :----------- | :----------- | :----------- | | Fee and other revenue | $366 | $2,500 | $3,000 | $6,200 | - Due to SVB Financial Group's bankruptcy and lease rejection, the Company recognized a **$1.6 million** reduction of revenue related to the write-down of net assets associated with the lease at Hayden Ferry property for the three and six months ended June 30, 2023[89](index=89&type=chunk) - Rental property revenues are recognized on a straight-line basis for contractual revenues, once specified sales targets are achieved for percentage rents, and include parking revenues, termination fees, and tenant reimbursements for operating expenses[90](index=90&type=chunk) [Note 12. STOCK-BASED COMPENSATION](index=21&type=section&id=Note%2012.%20STOCK-BASED%20COMPENSATION) This note describes the company's stock-based compensation plans, including restricted stock, RSUs, and the Employee Stock Purchase Plan - The Company offers stock-based compensation through restricted stock, restricted stock units (RSUs), and an Employee Stock Purchase Plan (ESPP), with a portion also provided to independent directors[91](index=91&type=chunk) Stock-Based Compensation Expense, Net of Forfeitures (in thousands) | Metric | Q2 2023 | Q2 2022 | H1 2023 | H1 2022 | | :------------------------------------ | :----------- | :----------- | :----------- | :----------- | | Total equity-classified award expense | $2,771 | $2,448 | $6,282 | $5,196 | | Total liability-classified award expense | $— | $(148) | $61 | $(1) | | Total stock-based compensation expense | $2,771 | $2,300 | $6,343 | $5,195 | - In June 2023, the Company granted **81,909 shares** of stock with a grant date value of **$1.6 million** to independent directors, which vested on the issuance date[93](index=93&type=chunk) [Note 13. EARNINGS PER SHARE](index=22&type=section&id=Note%2013.%20EARNINGS%20PER%20SHARE) This note provides detailed calculations for the company's basic and diluted earnings per common share Earnings Per Common Share (Three Months Ended June 30) | Metric | Q2 2023 | Q2 2022 | | :------------------------------------ | :----------- | :----------- | | Net income available to common stockholders | $22,621 | $34,052 | | Weighted average common shares - basic | 151,721 | 148,837 | | Net income per common share - basic | $0.15 | $0.23 | | Weighted average common shares - diluted | 152,126 | 149,142 | | Net income per common share - diluted | $0.15 | $0.23 | Earnings Per Common Share (Six Months Ended June 30) | Metric | H1 2023 | H1 2022 | | :------------------------------------ | :----------- | :----------- | | Net income available to common stockholders | $44,817 | $62,036 | | Weighted average common shares - basic | 151,650 | 148,788 | | Net income per common share - basic | $0.30 | $0.42 | | Weighted average common shares - diluted | 152,003 | 149,090 | | Net income per common share - diluted | $0.29 | $0.42 | [Note 14. CONSOLIDATED STATEMENTS OF CASH FLOWS - SUPPLEMENTAL INFORMATION](index=23&type=section&id=Note%2014.%20CONSOLIDATED%20STATEMENTS%20OF%20CASH%20FLOWS%20-%20SUPPLEMENTAL%20INFORMATION) This note provides supplemental cash flow information, including interest, taxes, dividends, and cash reconciliation Supplemental Cash Flow Information (Six Months Ended June 30, in thousands) | Metric | H1 2023 | H1 2022 | | :------------------------------------ | :----------- | :----------- | | Interest paid, net of amounts capitalized | $48,502 | $29,456 | | Income taxes paid | $— | $— | | Common stock dividends declared and accrued | $49,296 | $48,522 | | Tenant improvements funded by tenants | $41,240 | $4,360 | Reconciliation of Cash and Cash Equivalents (in thousands) | Metric | June 30, 2023 | December 31, 2022 | | :------------------------------------ | :------------ | :---------------- | | Cash and cash equivalents | $8,031 | $5,145 | [Note 15. REPORTABLE SEGMENTS](index=23&type=section&id=Note%2015.%20REPORTABLE%20SEGMENTS) This note details the company's reportable segments by property type and region, using Net Operating Income (NOI) for performance evaluation - The Company's reportable segments are classified by property type (Office and Non-Office) and geographical region (Atlanta, Austin, Charlotte, Dallas, Phoenix, Tampa, and other markets)[97](index=97&type=chunk) - Net Operating Income (NOI) is used to evaluate segment performance, representing rental property revenues (excluding termination fees) less rental property operating expenses, and excludes corporate G&A, interest, depreciation, and other non-operating items[98](index=98&type=chunk) Total Segment Revenues (Three Months Ended June 30, in thousands) | Segment | Q2 2023 | Q2 2022 | Change ($) | Change (%) | | :------------ | :----------- | :----------- | :--------- | :--------- | | Office | $203,917 | $184,346 | $19,571 | 10.62% | | Non-Office | $2,250 | $2,920 | $(670) | -22.95% | | Total segment revenues | $206,167 | $187,266 | $18,901 | 10.10% | Total Segment Net Operating Income (Three Months Ended June 30, in thousands) | Segment | Q2 2023 | Q2 2022 | Change ($) | Change (%) | | :------------ | :----------- | :----------- | :--------- | :--------- | | Office | $130,397 | $121,164 | $9,233 | 7.62% | | Non-Office | $1,447 | $1,887 | $(440) | -23.32% | | Total Net Operating Income | $131,844 | $123,051 | $8,793 | 7.15% | Total Segment Net Operating Income (Six Months Ended June 30, in thousands) | Segment | H1 2023 | H1 2022 | Change ($) | Change (%) | | :------------ | :----------- | :----------- | :--------- | :--------- | | Office | $259,101 | $238,984 | $20,117 | 8.42% | | Non-Office | $2,879 | $3,674 | $(795) | -21.64% | | Total Net Operating Income | $261,980 | $242,658 | $19,322 | 7.96% | [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=29&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) This section provides management's perspective on the company's financial performance, liquidity, and capital resources, discussing key trends and results [Overview of 2023 Performance and Company and Industry Trends](index=29&type=section&id=Overview%20of%202023%20Performance%20and%20Company%20and%20Industry%20Trends) This section outlines the company's strategic focus on premier urban office portfolios, highlighting leasing activity, NOI growth, and occupancy trends - The Company's strategy focuses on owning premier urban office portfolios in Sun Belt markets, employing disciplined capital allocation, opportunistic acquisitions, selective developments, and timely dispositions of non-core assets[106](index=106&type=chunk) - During Q2 2023, the Company leased or renewed **435,000 square feet** of office space, with straight-line basis net rent per square foot increasing by **19.6%** for recently leased office spaces[107](index=107&type=chunk) - Same property net operating income (NOI) for consolidated and unconsolidated properties increased by **6.3%** for the three months ended June 30, 2023, compared to the prior year[107](index=107&type=chunk) - The Company observes an increase in physical occupancy in H1 2023, driving higher parking revenue and operating expenses, and expects this gradual increase to continue, as customers prioritize collaboration and in-person work in high-quality, amenitized properties[108](index=108&type=chunk) [Results of Operations For The Three and Six Months Ended June 30, 2023](index=29&type=section&id=Results%20of%20Operations%20For%20The%20Three%20and%20Six%20Months%20Ended%20June%2030%2C%202023) This sub-section details changes in key financial metrics, including net income, revenues, expenses, and FFO for the three and six months ended June 30, 2023 [General](index=29&type=section&id=General) Net Income Available to Common Stockholders (in millions) | Period | 2023 | 2022 | Change ($) | Change (%) | | :-------------------- | :---------- | :---------- | :--------- | :--------- | | Three months ended June 30 | $22.6 | $34.1 | $(11.5) | -33.7% | | Six months ended June 30 | $44.8 | $62.0 | $(17.2) | -27.7% | [Rental Property Revenue, Rental Property Operating Expenses, and Net Operating Income](index=29&type=section&id=Rental%20Property%20Revenue%2C%20Rental%20Property%20Operating%20Expenses%2C%20and%20Net%20Operating%20Income) This section analyzes changes in rental property revenues, operating expenses, and Net Operating Income (NOI) for same-property and non-same-property portfolios - The "Same Property" portfolio includes stabilized office properties owned for the entirety of comparable reporting periods, with stabilization defined as **90%** economic occupancy or one year from major construction cessation[110](index=110&type=chunk) - Net Operating Income (NOI), a non-GAAP measure, is used to assess property operating performance by excluding non-property-level items like interest expense, depreciation, and gains/losses on sales[111](index=111&type=chunk) Consolidated Rental Property Performance (Three Months Ended June 30, in thousands) | Metric | Q2 2023 | Q2 2022 | Change ($) | Change (%) | | :---------------------------- | :----------- | :----------- | :--------- | :--------- | | Same Property Rental Property Revenues | $186,316 | $175,329 | $10,987 | 6.3% | | Non-Same Property Rental Property Revenues | $11,068 | $7,396 | $3,672 | 49.6% | | Termination Fee Income | $6,570 | $449 | $6,121 | 1363.2% | | Total Rental Property Revenues | $203,954 | $183,174 | $20,780 | 11.3% | | Same Property Operating Expenses | $63,794 | $60,089 | $3,705 | 6.2% | | Non-Same Property Operating Expenses | $3,305 | $2,127 | $1,178 | 55.4% | | Total Rental Property Operating Expenses | $67,099 | $62,216 | $4,883 | 7.8% | | Same Property NOI | $122,522 | $115,240 | $7,282 | 6.3% | | Non-Same Property NOI | $7,763 | $5,269 | $2,494 | 47.3% | | Total NOI | $130,285 | $120,509 | $9,776 | 8.1% | - Same Property Rental Property Revenues increased due to higher economic occupancy at Domain and Buckhead Plaza and increased tenant-funded improvements, while Same Property Operating Expenses rose due to higher real estate taxes and inflation-driven operating costs[112](index=112&type=chunk)[113](index=113&type=chunk) - Non-Same Property revenues, expenses, and NOI increased primarily from the stabilization of 100 Mill and Heights Union in 2022 and operations at Promenade Central after redevelopment, partially offset by a revenue write-down due to SVB Financial's bankruptcy and lease rejection[114](index=114&type=chunk) - Termination Fee income significantly increased due to negotiated early terminations, often contemporaneous with new leases for the same space[115](index=115&type=chunk) [Fee Income](index=31&type=section&id=Fee%20Income) Fee Income (in millions) | Period | 2023 | 2022 | Change ($) | Change (%) | | :-------------------- | :---------- | :---------- | :--------- | :--------- | | Three months ended June 30 | $0.35 | $2.31 | $(1.96) | -84.8% | | Six months ended June 30 | $0.73 | $3.69 | $(2.96) | -80.2% | - The decrease in fee income is primarily attributed to the completion of the Norfolk Southern transactions during the third quarter of 2022[19](index=19&type=chunk)[116](index=116&type=chunk) [Interest Expense](index=31&type=section&id=Interest%20Expense) Interest Expense, Net of Capitalized Amounts (in millions) | Period | 2023 | 2022 | Change ($) | Change (%) | | :-------------------- | :---------- | :---------- | :--------- | :--------- | | Three months ended June 30 | $26.0 | $16.5 | $9.5 | 57.6% | | Six months ended June 30 | $51.0 | $32.1 | $18.9 | 58.9% | - The increase in interest expense is primarily due to the issuance of the 2022 Term Loan in October 2022, refinancing of Terminus operating properties' mortgage loans in December 2022, higher interest rates on variable rate debt, and an increased average outstanding balance on the credit facility[19](index=19&type=chunk)[117](index=117&type=chunk) [Depreciation and Amortization](index=32&type=section&id=Depreciation%20and%20Amortization) Depreciation and Amortization (Three Months Ended June 30, in thousands) | Metric | Q2 2023 | Q2 2022 | Change ($) | Change (%) | | :-------------------- | :----------- | :----------- | :--------- | :--------- | | Same Property | $72,431 | $66,826 | $5,605 | 8.4% | | Non-Same Property | $7,727 | $2,877 | $4,850 | 168.6% | | Non-Real Estate Assets | $111 | $158 | $(47) | -29.7% | | Total | $80,269 | $69,861 | $10,408 | 14.9% | - Same Property depreciation and amortization increased due to more tenant improvements being placed into service[118](index=118&type=chunk)[119](index=119&type=chunk) - Non-Same Property depreciation and amortization increased primarily due to the stabilization of 100 Mill and Heights Union in 2022 and the completion of the Promenade Central redevelopment in November 2022[120](index=120&type=chunk) [Income and Net Operating Income from Unconsolidated Joint Ventures](index=32&type=section&id=Income%20and%20Net%20Operating%20Income%20from%20Unconsolidated%20Joint%20Ventures) Income from Unconsolidated Joint Ventures (Three Months Ended June 30, in thousands) | Metric | Q2 2023 | Q2 2022 | Change ($) | Change (%) | | :------------------------------------ | :----------- | :----------- | :--------- | :--------- | | Income from unconsolidated joint ventures | $753 | $5,280 | $(4,527) | -85.7% | | Net operating income from unconsolidated joint ventures | $1,559 | $2,542 | $(983) | -38.7% | - Income from unconsolidated joint ventures decreased primarily due to the gain on sale of a land parcel by a joint venture in the prior year and a decrease in income and depreciation/amortization resulting from the sale of the Carolina Square joint venture interest in September 2022[121](index=121&type=chunk)[122](index=122&type=chunk) [Funds From Operations (FFO)](index=32&type=section&id=Funds%20From%20Operations%20(FFO)) - Funds From Operations (FFO) is a non-GAAP measure, calculated according to Nareit definition, used by industry analysts and investors as a supplemental measure of a REIT's operating performance, excluding historical cost depreciation and other items from GAAP net income[123](index=123&type=chunk)[124](index=124&type=chunk) Funds From Operations (Three Months Ended June 30, in thousands, except per share) | Metric | Q2 2023 | Q2 2022 | Change ($) | Change (%) | | :------------------------------------ | :----------- | :----------- | :--------- | :--------- | | Net Income Available to Common Stockholders | $22,621 | $34,052 | $(11,431) | -33.6% | | Depreciation and amortization of real estate assets | $80,634 | $70,661 | $9,973 | 14.1% | | Funds From Operations | $102,951 | $104,731 | $(1,780) | -1.7% | | FFO per share | $0.68 | $0.70 | $(0.02) | -2.9% | Funds From Operations (Six Months Ended June 30, in thousands, except per share) | Metric | H1 2023 | H1 2022 | Change ($) | Change (%) | | :------------------------------------ | :----------- | :----------- | :--------- | :--------- | | Net Income Available to Common Stockholders | $44,817 | $62,036 | $(17,219) | -27.8% | | Depreciation and amortization of real estate assets | $156,219 | $142,151 | $14,068 | 9.9% | | Funds From Operations | $201,045 | $204,156 | $(3,111) | -1.5% | | FFO per share | $1.32 | $1.37 | $(0.05) | -3.6% | [Net Operating Income (Reconciliation)](index=34&type=section&id=Net%20Operating%20Income%20(Reconciliation)) - Net Operating Income (NOI) for consolidated properties is reconciled from net income by adding back fee income, termination fee income, other income, general and administrative expenses, interest expense, depreciation and amortization, reimbursed expenses, other expenses, income from unconsolidated joint ventures, and adjusting for investment property transactions and debt extinguishment[126](index=126&type=chunk)[127](index=127&type=chunk) Reconciliation of Consolidated Net Operating Income from Net Income (in thousands) | Metric | Q2 2023 | Q2 2022 | H1 2023 | H1 2022 | | :------------------------------------ | :----------- | :----------- | :----------- | :----------- | | Net Income | $23,077 | $34,164 | $45,433 | $62,327 | | Adjustments (net) | $107,208 | $86,345 | $213,579 | $175,070 | | Net Operating Income | $130,285 | $120,509 | $259,012 | $237,397 | [Liquidity and Capital Resources](index=34&type=section&id=Liquidity%20and%20Capital%20Resources) This sub-section discusses the company's ability to meet financial obligations and fund future growth, detailing liquidity, capital sources, and debt structure [General Liquidity Needs and Sources](index=34&type=section&id=General%20Liquidity%20Needs%20and%20Sources) This section outlines the company's short-term and long-term liquidity needs and the various sources available to meet them - Primary short-term and long-term liquidity needs include property operating expenses, acquisitions, development/redevelopment, tenant improvements, debt payments, G&A costs, and dividends[128](index=128&type=chunk) - Liquidity needs may be met through cash on hand, net cash from operations, asset sales, credit facility borrowings, mortgage/unsecured loans, construction loans, equity offerings, and joint venture formations[128](index=128&type=chunk) - As of June 30, 2023, the Company had **$153.1 million** in unfunded tenant improvements and construction costs, **$148.5 million** drawn on its credit facility (with **$851.5 million** remaining capacity), and **$8.0 million** in cash and cash equivalents, expecting sufficient liquidity[128](index=128&type=chunk) [Other Debt Information](index=35&type=section&id=Other%20Debt%20Information) This section details the company's debt structure, including unsecured and secured debt, and compliance with covenants - The Company's debt structure includes a **$1 billion** unsecured Credit Facility (**$148.5 million** outstanding), **$750 million** in unsecured term loans, and **$1 billion** in unsecured senior notes[129](index=129&type=chunk) - Existing mortgage debt consists of non-recourse, fixed-rate mortgage notes secured by real estate assets, which the Company expects to refinance or repay at maturity using various capital resources[129](index=129&type=chunk) - **86%** of the Company's consolidated debt bears interest at a fixed rate, while the remaining **14%** bears interest at a floating rate based on SOFR, and the Company is in compliance with all debt covenants[129](index=129&type=chunk)[130](index=130&type=chunk) [Future Capital Requirements](index=35&type=section&id=Future%20Capital%20Requirements) This section outlines the company's plans to meet future investment capital requirements through portfolio management, asset sales, and funding sources - To meet future investment capital requirements, the Company plans to actively manage its property portfolio, strategically sell non-core assets, and reposition income-producing assets[131](index=131&type=chunk) - Capital will be generated from cash retained from operations, third-party sources (indebtedness, construction facilities), and the issuance of securities (common/preferred stock, warrants, debt, CPLP units)[131](index=131&type=chunk)[132](index=132&type=chunk) - If capital sources are unavailable, the Company may reduce project acquisitions/developments or raise capital on unfavorable terms, potentially impacting financial position and results[133](index=133&type=chunk) [Cash Flows](index=35&type=section&id=Cash%20Flows) Changes in Cash Flows (Six Months Ended June 30, in thousands) | Cash Flow Activity | H1 2023 | H1 2022 | Change ($) | | :---------------------------------- | :----------- | :----------- | :--------- | | Net cash provided by operating activities | $161,071 | $157,689 | $3,382 | | Net cash used in investing activities | $(149,671) | $(193,346) | $43,675 | | Net cash provided by (used in) financing activities | $(8,514) | $30,777 | $(39,291) | - Operating cash flows increased due to timing of prepaid rent receipts, higher physical occupancy at Domain and Buckhead Plaza, and stabilization of 100 Mill and Heights Union[134](index=134&type=chunk) - Investing cash flows decreased (less cash used) due to reduced capital expenditures from 2022 redevelopment activities (e.g., Promenade Central) and lower contributions to the Neuhoff Holdings LLC joint venture[135](index=135&type=chunk) - Financing cash flows decreased (more cash used) primarily due to cash provided by ATM Program forward contract settlements in June 2022, partially offset by cash used for a joint venture interest purchase in April 2022 and increased net borrowings on the credit facility[136](index=136&type=chunk) - Non-cash activities included a significant increase in tenant-funded capital improvements, recorded as assets and deferred income, as tenants invest in highly amenitized office spaces[137](index=137&type=chunk) [Capital Expenditures](index=36&type=section&id=Capital%20Expenditures) Components of Property Acquisition, Development, and Tenant Asset Expenditures (Six Months Ended June 30, in thousands) | Component | H1 2023 | H1 2022 | Change ($) | Change (%) | | :---------------------------- | :----------- | :----------- | :--------- | :--------- | | Operating — leasing costs | $63,120 | $23,722 | $39,398 | 166.1% | | Operating — building improvements | $37,365 | $76,207 | $(38,842) | -50.9% | | Capitalized interest | $10,096 | $7,041 | $3,055 | 43.4% | | Development | $7,622 | $57,815 | $(50,193) | -86.8% | | Capitalized personnel costs | $3,720 | $4,249 | $(529) | -12.5% | | Change in accrued capital expenditures | $12,356 | $3,172 | $9,184 | 289.5% | | Total property acquisition, development, and tenant asset expenditures | $134,279 | $172,206 | $(37,927) | -22.0% | - Total capital expenditures decreased by **$37.9 million**, primarily due to reduced spending on building improvements (e.g., 3350 Peachtree, Promenade Tower renovations) and the nearing completion of development activities at Domain 9 and 100 Mill[139](index=139&type=chunk) - This decrease was partially offset by an increase in leasing costs for commissions and tenant improvements[139](index=139&type=chunk) Tenant Improvement and Leasing Costs Per Square Foot for Office Portfolio (Three Months Ended June 30) | Lease Type | Q2 2023 | Q2 2022 | | :---------------- | :----------- | :----------- | | New leases | $13.83 | $11.86 | | Renewal leases | $11.91 | $7.17 | | Expansion leases | $2.24 | $9.17 | [Dividends](index=36&type=section&id=Dividends) Common Dividends Paid (in millions) | Period | 2023 | 2022 | Change ($) | Change (%) | | :-------------------- | :---------- | :---------- | :--------- | :--------- | | Six months ended June 30 | $97.3 | $93.7 | $3.6 | 3.8% | - Future quarterly common dividends are expected to be funded by operating cash flows, proceeds from investment property sales, joint venture distributions, indebtedness, and equity offerings, while adhering to REIT status requirements and credit agreement covenants[142](index=142&type=chunk)[143](index=143&type=chunk) [Off Balance Sheet Arrangements](index=36&type=section&id=Off%20Balance%20Sheet%20Arrangements) This section describes the company's off-balance sheet joint ventures and their financing arrangements, including non-recourse carve-out guarantees - The Company has off-balance sheet joint ventures involved in real estate ownership, acquisition, and development, which fund capital and operational needs through cash from operations or financing proceeds[144](index=144&type=chunk) - As of June 30, 2023, unconsolidated joint ventures had **$248.6 million** in aggregate outstanding third-party indebtedness, primarily non-recourse mortgage or construction loans, for which the Company may provide "non-recourse carve-out guarantees"[145](index=145&type=chunk)[146](index=146&type=chunk) [Critical Accounting Policies](index=37&type=section&id=Critical%20Accounting%20Policies) This section confirms no material changes to the company's critical accounting policies since the last annual report - There have been no material changes in the Company's critical accounting policies from those disclosed in its Annual Report on Form 10-K for the year ended December 31, 2022[147](index=147&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=37&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) This section states no material changes in the company's market risk profile related to notes payable since its last annual report - No material changes in market risk associated with notes payable at June 30, 2023, compared to the disclosures in the Annual Report on Form 10-K for the year ended December 31, 2022[148](index=148&type=chunk) [Item 4. Controls and Procedures](index=37&type=section&id=Item%204.%20Controls%20and%20Procedures) This section confirms the effectiveness of disclosure controls and procedures and reports no material changes in internal control over financial reporting - Management, including the CEO and CFO, concluded that the Company's disclosure controls and procedures were effective as of June 30, 2023[150](index=150&type=chunk) - No changes in internal control over financial reporting occurred during the most recent fiscal quarter that have materially affected, or are reasonably likely to materially affect, internal controls[150](index=150&type=chunk) [PART II. OTHER INFORMATION](index=37&type=section&id=PART%20II.%20OTHER%20INFORMATION) This part contains other information not included in the financial statements, such as legal proceedings, risk factors, and exhibits [Item 1. Legal Proceedings](index=37&type=section&id=Item%201.%20Legal%20Proceedings) This section refers to Note 9 of the condensed consolidated financial statements for details on legal proceedings - Information regarding legal proceedings is described under the subheading "Litigation" in Note 9 of the notes to condensed consolidated financial statements[151](index=151&type=chunk) [Item 1A. Risk Factors](index=37&type=section&id=Item%201A.%20Risk%20Factors) This section states no material changes to the company's risk factors since its last annual report and advises investors to consider disclosed risks - There have been no material changes in the Company's risk factors from those previously disclosed in its Annual Report on Form 10-K for the year ended December 31, 2022[152](index=152&type=chunk) - Investors should carefully consider the risks described in the Annual Report, as additional unknown or immaterial risks could also adversely affect the business[152](index=152&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=37&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) This section refers to Note 12 for equity compensation plans and confirms no unregistered sales or common share purchases in Q2 2023 - For information on equity compensation plans, refer to Note 15 of the notes to consolidated financial statements in the Annual Report on Form 10-K for the year ended December 31, 2022, and Note 12 of the notes to condensed consolidated financial statements[153](index=153&type=chunk) - The Company did not make any sales of unregistered securities or purchase any common shares during the second quarter of 2023[153](index=153&type=chunk) [Item 6. Exhibits](index=38&type=section&id=Item%206.%20Exhibits) This section lists all exhibits filed as part of the quarterly report, including corporate governance documents, certifications, and financial data - The report includes a list of exhibits, such as the Agreement and Plan of Merger, Restated and Amended Articles of Incorporation, Bylaws, certifications from the CEO and CFO, and financial information in inline XBRL format[155](index=155&type=chunk) [SIGNATURES](index=39&type=section&id=SIGNATURES) This section confirms the report's signing by the Executive Vice President and Chief Financial Officer on July 27, 2023 - The report was signed on July 27, 2023, by Gregg D. Adzema, Executive Vice President and Chief Financial Officer, as the duly authorized officer and principal financial officer[157](index=157&type=chunk)

BALANCE SHEET PRIMED FOR OPPORTUNITIES Leverage Below Peers with Substantial Liquidity NET DEBT/EBITDA1 14.0x $831MM 12.0x Liquidity² 10.0x 8.0x Avg = 7.3x 6.0x 5.1x 4.0x 2.0x 0.0x HPP PGRE BXP BDN ESRT OFC HIW KRC SLG VNO OPI DEA FSP CIO ARE cuz PDM Cousins 18 | --- | --- | --- | --- | --- | --- | --- | --- | |---------|-------|------------------------------|---------------------------------------------------------------------------|----------------------------------------------|-------------|-------|----- ...

Cousins Properties Incorporated (NYSE:CUZ) Q1 2023 Results Conference Call April 28, 2023 11:00 AM ET Company Participants Pamela Roper - General Counsel Colin Connolly - President and Chief Executive Officer Richard Hickson - Executive Vice President of Operations Gregg Adzema - Chief Financial Officer Conference Call Participants Blaine Heck - Wells Fargo Anthony Powell - Barclays John Kim - BMO Capital Dylan Burzynski - Green Street Camille Bonnel - Bank of America Operator Good day, and welcome to the C ...

Credit Facility Secured Mortgage Notes The table below presents the effect of the Company's derivative financial instruments on the consolidated statements of operations for the three months ended March 31, 2023 and 2022 ($ in thousands): For the three months ended March 31, 2023, the Company recognized fee and other revenue of $2.7 million. For the three months ended March 31, 2022, the Company recognized fee and other revenue of $3.7 million. The $3.7 million fee and other revenue includes $814,000 of inc ...

Financial Data and Key Metrics Changes - The company reported a fourth-quarter FFO of $0.66 per share, with same property net operating income (NOI) increasing by 2.5% on a cash basis [25][40] - The cash rent roll-up for the fourth quarter was 7.3%, while the full-year cash rent roll-up was 9.5% [11][25] - The net debt-to-EBITDA ratio closed the year at 4.9 times, significantly lower than the Green Street sector average of 8.2 times [30][42] Business Line Data and Key Metrics Changes - The company executed 632,000 square feet of leases in the fourth quarter, marking the highest quarterly volume of 2022 [33] - Excluding Houston, second-generation net rents increased by 27.7% on a cash basis in the fourth quarter [12] - Parking revenues during the fourth quarter were the highest since Q1 2020, with a 10% year-over-year increase for all of 2022 [17] Market Data and Key Metrics Changes - The physical office occupancy averaged over 50% during the last week of January, with Austin leading at 68% [4] - In Austin, the company signed 153,000 square feet of leases in the last quarter, rolling up cash net rents over 40% on average [37] - The Atlanta Metro recorded 485,000 square feet of net absorption last quarter, with Class A rents up 5% year-over-year [57] Company Strategy and Development Direction - The company aims to build a preeminent Sun Belt REIT, focusing on high-quality, amenitized office spaces [28] - The development pipeline is currently valued at $428 million, with 63% pre-leased [7] - The company is positioned to benefit from improving supply and demand fundamentals in the office market [5][8] Management's Comments on Operating Environment and Future Outlook - Management anticipates that market conditions will become more challenging in 2023 but believes the company is well-positioned to thrive [6][8] - There is optimism that premier workplaces will become a distinct asset class with improved sentiment over the long term [8] - The company expects to maintain occupancy and potentially grow it towards the end of 2023, despite modest lease expirations [14][29] Other Important Information - The company has no significant near-term loan maturities and approximately $950 million available on its $1 billion revolving credit facility [30] - The company anticipates full-year 2023 FFO between $2.52 and $2.64 per share, with no property acquisitions or dispositions included in this guidance [19] Q&A Session Summary Question: How are leasing conversations going at Neuhoff in Nashville? - Management expressed excitement about the Neuhoff project and noted increased activity as the project nears completion, with hopes to sign leases this year [64] Question: What are the current market dynamics affecting leasing spreads? - Management indicated that leasing spreads were significantly higher excluding Houston, with Austin being a key driver [75] Question: What is the company's strategy regarding floating rate debt? - The company plans to maintain floating rate debt at around 20% of total debt, consistent with industry peers [97] Question: How does the company view the transaction environment in the current market? - Management noted a potential increase in off-market discussions as owners with weak capital structures begin to reach out [66] Question: What is the expected impact of lease expirations on occupancy? - Management clarified that they expect to maintain occupancy levels despite low lease expirations, with a focus on renewals [68][70]

INVESTMENT ACTIVITY Completed Operating Property Dispositions | --- | --- | --- | --- | --- | --- | --- | --- | --- | |--------------------------|--------|-------------|-------------------------------|--------|-------------|-------|------------------------------------|-------| | Property | Type | Market | Company's Ownership Interest | Timing | Square Feet | | Gross Sales Price ($ in thousands) | | | 2022 | | | | | | | | | | Carolina Square | Mixed | Charlotte | 50% | | | | 3Q 468,000 $ 105,000 (1) | | | 20 ...

Our executive offices are located at 3344 Peachtree Road NE, Suite 1800, Atlanta, Georgia 30326-4802, and we maintain regional offices in each of our additional key operating markets of Austin, Charlotte, Phoenix, Tampa, and Dallas. We recognize that our achievements and progress on our corporate strategy are made possible by the attraction, development, and retention of our dedicated employees. We regularly evaluate, modify, and enhance our internal processes and technologies to increase employee engagemen ...

INVESTOR PRESENTATION November 2022 WHY COUSINS? • 100% Sun Belt / 100% Class A / 2004 average year built1 • 34% of portfolio less than 5 years old or recently redeveloped1,2 • CUZ asking rents 10% higher than pre-pandemic levels and 24% higher than Class A avg3,4 PREMIER SUN BELT PORTFOLIO BENEFITING FROM POWERFUL OFFICE TRENDS • Migration to the Sun Belt leading to outsized population and job growth • Flight to quality driving demand for newer, highly-amenitized assets • Modest lease expirations well belo ...

Cousins Properties Incorporated (NYSE:CUZ) Q3 2022 Earnings Conference Call October 28, 2022 11:00 AM ET Company Participants Pamela Roper - General Counsel Michael Connolly - President and CEO Richard Hickson - EVP, Operations Gregg Adzema - CFO Conference Call Participants Blaine Heck - Wells Fargo Dave Rodgers - Baird Brian Spahn - Evercore ISI Camille Bonnel - Bank of America Vikram Malhotra - Mizuho Anthony Powell - Barclays Daniel Ismail - Green Street Operator Good morning, and welcome to the Cousins ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-Q ☑ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended September 30, 2022 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission file number: 001-11312 (404) 407-1000 (Registrant's telephone number, including area code) Securities registered pursuant to Section 12(b) of the Act: ...