Group 1 - The analyst has over 10 years of experience researching more than 1000 companies across various sectors including commodities and technology [1] - The focus has shifted from writing a blog to creating a value investing-focused YouTube channel, where hundreds of companies have been researched [1] - The analyst expresses a particular interest in metals and mining stocks, while also being comfortable with other industries such as consumer discretionary, REITs, and utilities [1]

Core Insights - Easterly Government Properties (NYSE: DEA) has been under observation for its execution and performance in the REIT sector, particularly due to its focus on government-related properties [1] Group 1 - The company is associated with a former U.S. Navy employee, indicating a potential alignment with government contracts and properties [1] - The investment strategy emphasizes dividend investing in quality blue-chip stocks, Business Development Companies (BDCs), and REITs, suggesting a focus on stable income generation [1] - The company aims to assist lower and middle-class workers in building investment portfolios that consist of high-quality, dividend-paying companies, reflecting a commitment to financial empowerment [1]

Core Insights - Red Light Holland Corp. has received initial testing results confirming the psilocybin quantity and process compatibility for potential medical grade manufacturing applications from its partner Irvine Labs Inc. [1][2] - The successful delivery of psilocybin from Red Light Holland's Netherlands facility to Irvine Labs in California marks a significant milestone in their collaboration [2][4] - Irvine Labs is advancing proprietary dehydration and packaging processes to extend shelf life while maintaining product integrity [3][4] Company Overview - Red Light Holland is engaged in the production, growth, and sale of functional mushrooms and mushroom home grow kits in North America and Europe, as well as psilocybin truffles in the Netherlands [1][6] - Irvine Labs, established in 1997, focuses on natural medicines and is licensed for drug manufacturing by the California Department of Public Health [5] Research and Development - The initial testing results validate the compatibility of Red Light Holland's psilocybin products with Irvine Labs' manufacturing processes [4][8] - Both companies are focused on creating a commercialized and standardized psilocybin product for emerging therapeutic markets and government-funded pilot programs [4][8]

Company Overview - Easterly Government Properties (DEA) is a Real Estate Investment Trust (REIT) that specializes in acquiring, developing, and managing Class A commercial properties leased to U.S. government agencies [1] Investment Strategy - The company focuses on properties that are essential for government operations, which may provide stability and reliability in income generation [1] Market Position - The investment approach emphasizes identifying REITs that are temporarily out-of-favor, suggesting a contrarian strategy aimed at long-term value [1]

Core Insights - Easterly Government Properties reported strong financial results for Q2 2025, with Core Funds From Operations (Core FFO) per share of $0.74, significantly exceeding analyst expectations of $0.115 by 543.5% [1][2] - GAAP revenue increased to $84.2 million, surpassing the consensus estimate of $80.6 million, reflecting a year-over-year growth of 10.5% from $76.2 million in Q2 2024 [1][2] - The company maintains a focus on government-leased properties, with over 90% of its income derived from U.S. government agencies, ensuring stability and long-term cash flow visibility [3][4] Financial Performance - GAAP EPS for Q2 2025 was reported at $0.09, down 18.2% from $0.11 in Q2 2024 [2] - Core FFO per share rose slightly by 2.8% year-over-year from $0.72 in Q2 2024 [2][5] - EBITDA (Non-GAAP) increased by 18.3% to $54.3 million compared to $45.9 million in Q2 2024 [2] Business Strategy - The company focuses on maintaining high occupancy rates and long lease terms with secure government tenants, alongside targeted acquisitions and developments [4] - Recent acquisitions include a 290,000-square-foot property in Washington, DC, and a 74,549-square-foot facility leased to the Department of Homeland Security [6] - Development projects include a federal courthouse in Medford, Oregon, and a forensic laboratory in Florida, both backed by long-term leases [7] Leasing and Tenant Retention - The portfolio consists of 102 properties with a weighted average lease term of 9.6 years, indicating strong cash flow visibility [8] - Government and government-adjacent leases account for over 90% of rental income, supporting stability [8] Cost Management - Property operating costs rose to $19.2 million from $18.1 million in Q2 2024, influenced by increased depreciation, interest expense, and property taxes [9] - Interest expense increased to $18.96 million due to a heavier debt load and rising rates [9] Environmental and Sustainability Focus - Over 45% of the portfolio meets sustainability benchmarks, aligning with tenant and government energy policies [10] Future Guidance - Management reiterated full-year 2025 guidance for Core FFO per share in the range of $2.98 to $3.03, with an expected growth of 2% to 3% [11] - The company plans approximately $140 million in acquisitions and gross development investments of $25 million to $75 million [11] - The quarterly dividend was maintained at $0.45 per share, yielding roughly 8% based on recent share prices [12]

Financial Data and Key Metrics Changes - Net income per share was $0.09 on a fully diluted basis, and core FFO per share was $0.74, reflecting a 3% year-over-year increase [13] - Cash available for distribution was $29.3 million, exceeding consensus expectations for the quarter [13] - The company maintains its full year 2025 core FFO per share guidance in the range of $2.98 to $3.30 on a fully diluted basis [18] Business Line Data and Key Metrics Changes - The company advanced several key development projects backed by long-term non-cancelable leases, indicating a focus on disciplined growth [6][7] - Soft term lease exposure declined from 5.2% at year-end to 4.7%, demonstrating progress on renewals and tenant engagement [15] Market Data and Key Metrics Changes - The company is operating in a challenging market environment with elevated cost of capital, partly due to a recent dividend reset [9][17] - The company expects an additional $115 million in liquidity later this year from the FDA Atlanta lump sum repayment [16] Company Strategy and Development Direction - The company focuses on delivering reliable performance through mission-critical infrastructure and long-term leases [5][6] - The strategy emphasizes disciplined capital deployment and selective growth into high-quality assets that align with government missions [7][8] - The company aims to rebuild its shareholder base with long-term public investors who understand its mission and strategy [9] Management's Comments on Operating Environment and Future Outlook - Management noted that government real estate decisions are becoming more strategic and cost-conscious, positioning the company as a trusted partner [10] - The company is committed to executing its development pipeline with excellence and deepening relationships across federal, state, and local agencies [11] Other Important Information - The company has $122 million of revolver capacity available, maintaining a leverage ratio within the target range of 6.5 to 7.5 times [16][17] - The company is not pursuing growth for its own sake but is targeting opportunities that create durable value [18] Q&A Session Summary Question: Can you talk about your return expectations for the crime lab development project? - The development is expected to create about a 150 basis point spread to the cost of capital, consistent with other development growth targets [21] Question: What's the size of the pipeline of opportunities you're looking at? - The pipeline volume is estimated at $1 billion to $1.5 billion, with a focus on finding the best deals to meet growth goals [22]

分组1 - Easterly Government Properties reported quarterly funds from operations (FFO) of $0.74 per share, matching the Zacks Consensus Estimate, and showing an increase from $0.73 per share a year ago [1] - The company posted revenues of $84.23 million for the quarter ended June 2025, surpassing the Zacks Consensus Estimate by 0.06%, compared to $76.22 million in the same quarter last year [2] - The stock has underperformed, losing about 21.5% since the beginning of the year, while the S&P 500 gained 7.6% [3] 分组2 - The current consensus FFO estimate for the coming quarter is $0.75 on revenues of $86.35 million, and for the current fiscal year, it is $2.98 on revenues of $338.63 million [7] - The Zacks Industry Rank for REIT and Equity Trust - Other is currently in the top 40% of over 250 Zacks industries, indicating a favorable outlook compared to the bottom 50% [8]

[Disclaimers and General Notes](index=2&type=section&id=Disclaimers%20and%20General%20Notes) This section outlines forward-looking statement disclaimers and clarifies financial reporting adjustments [Forward-looking Statement](index=2&type=section&id=Forward-looking%20Statement) This section outlines standard forward-looking statement disclaimers, noting that actual results may differ due to various risks - Forward-looking statements are subject to risks including dependence on **U.S. Government** revenues, **real estate market volatility**, and **debt-related challenges**[2](index=2&type=chunk) [Ratings and Financial Statement Context](index=3&type=section&id=Ratings%20and%20Financial%20Statement%20Context) Ratings are not recommendations, and all share and per share data are adjusted for a 1-for-2.5 reverse stock split - All share and per share data have been adjusted for a **1-for-2.5 reverse stock split**, effective **April 28, 2025**[4](index=4&type=chunk) [Supplemental Definitions](index=4&type=section&id=Supplemental%20Definitions) This section defines key non-GAAP financial measures used by the Company for supplemental investor information [Non-GAAP Financial Measures](index=4&type=section&id=Non-GAAP%20Financial%20Measures) This section defines key non-GAAP financial measures like FFO, CAD, and EBITDA, providing supplemental investor information - The Company utilizes several non-GAAP financial measures to provide additional insights into its financial condition and operating results, including:[5](index=5&type=chunk) - **Annualized Lease Income:** Annualized contractual base rent, straight-line rent adjustments, and net expense reimbursements for the last month of a period[6](index=6&type=chunk) - **Cash Available for Distribution (CAD):** FFO minus normalized recurring real estate-related expenditures and other non-cash/nonrecurring items, used to assess dividend funding ability[7](index=7&type=chunk) - **Core Funds from Operations (Core FFO):** FFO adjusted for items not representative of ongoing operating results, such as liability management costs and credit loss provisions, to reflect core business performance[9](index=9&type=chunk) - **EBITDA:** Net income (loss) before interest, taxes, depreciation, amortization, gains/losses on property sales, and impairment loss, used as a supplemental liquidity disclosure[10](index=10&type=chunk) - **Funds From Operations (FFO):** GAAP net income (loss) excluding real estate-related depreciation/amortization, gains/losses from real estate sales, and impairment write-downs, a widely recognized REIT performance measure[12](index=12&type=chunk) - **Net Debt and Adjusted Net Debt:** Consolidated debt adjusted for unamortized premiums/discounts, deferred financing fees, cash, and property acquisition escrow. Adjusted Net Debt further reduces this for estimated debt financed portions of projects under construction/design or previously completed that may be repaid by US Government reimbursements[13](index=13&type=chunk) - **Net Operating Income (NOI) and Cash NOI:** Net income adjusted for non-operating items and non-cash rent adjustments, respectively, to measure property operating performance[14](index=14&type=chunk) [Overview](index=7&type=section&id=Overview) This section provides corporate information, analyst coverage, and an executive summary of key financial and operational highlights [Corporate Information and Analyst Coverage](index=7&type=section&id=Corporate%20Information%20and%20Analyst%20Coverage) This section details the Company's executive team, stock exchange listing, investor relations contacts, and equity research coverage - Key personnel include **Darrell Crate** (President & CEO), **Michael Ibe** (Vice-Chairman & EVP), and **Allison Marino** (CFO)[16](index=16&type=chunk) - The Company's common stock is listed on the New York Stock Exchange under the ticker **DEA**[17](index=17&type=chunk) - Equity research coverage is provided by firms such as BMO Capital Markets, Citigroup, Raymond James & Associates, RBC Capital Markets, Jefferies, Truist Securities, and Compass Point Research & Trading, LLC[17](index=17&type=chunk)[18](index=18&type=chunk) [Executive Summary](index=8&type=section&id=Executive%20Summary) This executive summary highlights key financial and operational metrics for Q2 2025, showing year-over-year increases in FFO and CAD Key Financial Metrics (Three Months Ended June 30) | Metric | June 30, 2025 | June 30, 2024 | Change (YoY) | Percentage Change (YoY) | | :------------------------------------------ | :------------ | :------------ | :----------- | :---------------------- | | Net income available to Easterly Government Properties, Inc. | $4,071 | $4,611 | -$540 | -11.7% | | Net income available to Easterly Government Properties, Inc. per share (Diluted) | $0.09 | $0.11 | -$0.02 | -18.2% | | Funds From Operations (FFO) | $34,816 | $30,690 | $4,126 | 13.4% | | FFO, per share - fully diluted basis | $0.74 | $0.71 | $0.03 | 4.2% | | Core FFO | $34,592 | $31,373 | $3,219 | 10.3% | | Core FFO, per share - fully diluted basis | $0.74 | $0.72 | $0.02 | 2.8% | | Cash Available for Distribution (CAD) | $29,298 | $24,806 | $4,492 | 18.1% | Key Capitalization and Liquidity Ratios (At June 30, 2025) | Metric | Value | | :------------------------------------------ | :------ | | Total equity market capitalization - fully diluted basis | $1,046,253 | | Net Debt | $1,725,005 | | Total enterprise value | $2,771,258 | | Net debt to total enterprise value | 62.2% | | Net debt to annualized quarterly EBITDA | 7.9x | | Adjusted Net Debt to annualized quarterly pro forma EBITDA | 7.2x | | Cash interest coverage ratio | 3.0x | | Cash fixed charge coverage ratio | 2.8x | | Cash and cash equivalents | $5,789 | | Available under $400 million senior unsecured 2024 revolving credit facility | $122,325 | [Corporate Financials](index=9&type=section&id=Corporate%20Financials) This section presents detailed corporate financial statements, including balance sheets, income statements, and key performance metrics [Balance Sheets](index=9&type=section&id=Balance%20Sheets) The balance sheet shows increased total assets and liabilities as of June 30, 2025, primarily driven by real estate properties and notes payable Balance Sheet Highlights (in thousands) | Item | June 30, 2025 | December 31, 2024 | Change | Percentage Change | | :-------------------------------- | :------------ | :---------------- | :----- | :---------------- | | **Assets** | | | | | | Real estate properties, net | $2,682,915 | $2,572,095 | $110,820 | 4.3% | | Cash and cash equivalents | $4,697 | $19,353 | -$14,656 | -75.7% | | Total assets | $3,359,427 | $3,223,071 | $136,356 | 4.2% | | **Liabilities** | | | | | | Notes payable, net | $1,018,398 | $894,676 | $123,722 | 13.8% | | Total liabilities | $1,972,895 | $1,835,954 | $136,941 | 7.5% | | **Equity** | | | | | | Total stockholders' equity | $1,334,329 | $1,321,118 | $13,211 | 1.0% | | Total equity | $1,386,532 | $1,387,117 | -$585 | -0.04% | - The Company reclassified **$0.6 million** from Common Stock to Additional Paid-in-Capital due to a reduction in shares outstanding from the Reverse Stock Split effective **April 28, 2025**[20](index=20&type=chunk) [Income Statements](index=10&type=section&id=Income%20Statements) Income statements show increased total revenues but decreased net income for Q2 and H1 2025 due to higher expenses Income Statement Highlights (in thousands, except per share amounts) | Item | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Change (YoY) | Percentage Change (YoY) | | :------------------------------------------ | :------------------------------- | :------------------------------- | :----------- | :---------------------- | | Total revenues | $84,234 | $76,221 | $8,013 | 10.5% | | Total expenses | $62,860 | $57,583 | $5,277 | 9.2% | | Interest expense, net | ($18,960) | ($15,165) | ($3,795) | 25.0% | | Net income | $4,254 | $4,850 | ($596) | -12.3% | | Net income available to Easterly Government Properties, Inc. | $4,071 | $4,611 | ($540) | -11.7% | | Diluted EPS | $0.09 | $0.11 | ($0.02) | -18.2% | | Weighted-average common shares outstanding (Diluted) | 45,111,753 | 41,280,249 | 3,831,504 | 9.3% | | Item | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | Change (YoY) | Percentage Change (YoY) | | :------------------------------------------ | :------------------------------- | :------------------------------- | :----------- | :---------------------- | | Total revenues | $162,909 | $149,021 | $13,888 | 9.3% | | Total expenses | $121,697 | $113,078 | $8,619 | 7.6% | | Interest expense, net | ($37,337) | ($29,001) | ($8,336) | 28.7% | | Net income | $7,537 | $9,734 | ($2,197) | -22.6% | | Net income available to Easterly Government Properties, Inc. | $7,198 | $9,237 | ($2,039) | -22.1% | | Diluted EPS | $0.15 | $0.22 | ($0.07) | -31.8% | [Net Operating Income](index=11&type=section&id=Net%20Operating%20Income) This section reconciles net income to NOI and Cash NOI, both showing significant year-over-year increases for improved property performance Net Operating Income (in thousands) | Item | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Change (YoY) | Percentage Change (YoY) | | :----------------------- | :------------------------------- | :------------------------------- | :----------- | :---------------------- | | Net Operating Income | $60,718 | $53,707 | $7,011 | 13.1% | | Cash Net Operating Income | $58,108 | $50,585 | $7,523 | 14.9% | | Item | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | Change (YoY) | Percentage Change (YoY) | | :----------------------- | :------------------------------- | :------------------------------- | :----------- | :---------------------- | | Net Operating Income | $117,839 | $105,187 | $12,652 | 12.0% | | Cash Net Operating Income | $113,243 | $99,047 | $14,196 | 14.3% | [EBITDA](index=12&type=section&id=EBITDA) This section presents EBITDA and Pro forma EBITDA calculations, showing substantial year-over-year increases in operational earnings EBITDA (in thousands) | Item | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Change (YoY) | Percentage Change (YoY) | | :----- | :------------------------------- | :------------------------------- | :----------- | :---------------------- | | EBITDA | $54,282 | $45,889 | $8,393 | 18.3% | | Pro forma EBITDA | $54,542 | N/A | N/A | N/A | | Item | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | Change (YoY) | Percentage Change (YoY) | | :----- | :------------------------------- | :------------------------------- | :----------- | :---------------------- | | EBITDA | $105,243 | $90,749 | $14,494 | 16.0% | - Pro forma EBITDA for the three months ended **June 30, 2025**, includes adjustments assuming a full quarter of operations from two properties acquired in **Q2 2025**[23](index=23&type=chunk) [FFO and CAD](index=13&type=section&id=FFO%20and%20CAD) This section details FFO, Core FFO, and CAD calculations, all showing positive year-over-year growth in operational cash flow FFO, Core FFO, and CAD (in thousands, except per share amounts) | Item | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Change (YoY) | Percentage Change (YoY) | | :-------------------------------- | :------------------------------- | :------------------------------- | :----------- | :---------------------- | | FFO | $34,816 | $30,690 | $4,126 | 13.4% | | Core FFO | $34,592 | $31,373 | $3,219 | 10.3% | | CAD | $29,298 | $24,806 | $4,492 | 18.1% | | FFO, per share - fully diluted basis | $0.74 | $0.71 | $0.03 | 4.2% | | Core FFO, per share - fully diluted basis | $0.74 | $0.72 | $0.02 | 2.8% | | Item | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | Change (YoY) | Percentage Change (YoY) | | :-------------------------------- | :------------------------------- | :------------------------------- | :----------- | :---------------------- | | FFO | $66,924 | $61,125 | $5,799 | 9.5% | | Core FFO | $67,653 | $62,129 | $5,524 | 8.9% | | CAD | $60,443 | $50,691 | $9,752 | 19.2% | | FFO, per share - fully diluted basis | $1.45 | $1.41 | $0.04 | 2.8% | | Core FFO, per share - fully diluted basis | $1.46 | $1.44 | $0.02 | 1.4% | [Unconsolidated Real Estate Venture](index=14&type=section&id=Unconsolidated%20Real%20Estate%20Venture) This section provides financial details for the unconsolidated real estate venture, in which the Company holds a **53.0%** share - The Company owns **53.0%** of the properties through the unconsolidated joint venture[26](index=26&type=chunk)[27](index=27&type=chunk) Unconsolidated Real Estate Venture - Easterly's Share (in thousands) | Item | June 30, 2025 (Balance Sheet) | Three Months Ended June 30, 2025 (Income Statement) | Six Months Ended June 30, 2025 (Income Statement) | | :-------------------------------- | :---------------------------- | :------------------------------------------ | :------------------------------------------ | | Real estate properties - net | $262,827 | N/A | N/A | | Total assets | $316,165 | N/A | N/A | | Total liabilities | $5,960 | N/A | N/A | | Total equity | $310,514 | N/A | N/A | | Net income | N/A | $1,840 | $3,662 | | EBITDA | N/A | $4,181 | $8,344 | | FFO | N/A | $4,120 | $8,221 | | Core FFO | N/A | $4,136 | $8,254 | | CAD | N/A | $4,146 | $8,244 | [Debt](index=16&type=section&id=Debt) This section details the Company's debt structure, including schedules, maturities, and key debt statistics [Debt Schedules](index=16&type=section&id=Debt%20Schedules) This section details the Company's unsecured and secured debt instruments, including maturity dates, interest rates, and key debt statistics Debt Instrument Overview (June 30, 2025, in thousands) | Debt Instrument | Maturity Date | Interest Rate | Balance | Percentage of Total Indebtedness | | :-------------------------- | :------------ | :------------ | :------ | :------------------------------- | | Total unsecured debt | 4.6 years (wtd-avg) | 4.81% (wtd-avg) | $1,577,050 | 91.1% | | Total secured mortgage debt | 2.3 years (wtd-avg) | 3.67% (wtd-avg) | $154,034 | 8.9% | | **Total Debt** | N/A | N/A | **$1,731,084** | **100.0%** | Debt Statistics (June 30, 2025, in thousands) | Statistic | Value | | :------------------------------------------ | :------ | | Variable rate debt - unhedged | $252,050 | | % Variable rate debt - unhedged | 14.6% | | Fixed rate debt | $1,479,034 | | % Fixed rate debt | 85.4% | | Weighted average maturity | 4.4 years | | Weighted average interest rate | 4.7% | | Net Debt | $1,725,005 | | Adjusted Net Debt | $1,576,420 | - The Company uses interest rate swaps to effectively fix interest rates on portions of its revolving credit facility and term loan facilities, with some swaps not coterminous with the debt maturity dates[30](index=30&type=chunk)[31](index=31&type=chunk)[32](index=32&type=chunk)[35](index=35&type=chunk) [Debt Maturities](index=18&type=section&id=Debt%20Maturities) This section outlines the Company's debt maturity schedule by year, detailing secured and unsecured debt and weighted average interest rates Debt Maturity Schedule (in thousands) | Year | Secured Debt Scheduled Amortization | Secured Debt Scheduled Maturities | Unsecured Debt Scheduled Maturities | Total Debt Maturing | Percentage of Debt Maturing | Weighted Average Interest Rate of Scheduled Maturities | | :--- | :---------------------------------- | :-------------------------------- | :---------------------------------- | :------------------ | :-------------------------- | :----------------------------------------------------- | | 2025 | $2,334 | - | - | $2,334 | 0.0% | 0.00% | | 2026 | $3,686 | $6,368 | $174,500 | $184,554 | 10.5% | 5.06% | | 2027 | $1,093 | $134,640 | $95,000 | $230,733 | 13.4% | 3.80% | | 2028 | $983 | - | $427,550 | $428,533 | 24.9% | 5.24% | | 2029 | $1,016 | - | $135,000 | $136,016 | 7.9% | 3.89% | | 2030 | $1,049 | - | $225,000 | $226,049 | 13.1% | 3.25% | | 2031 | $1,081 | - | $100,000 | $101,081 | 5.8% | 3.83% | | 2032 | $1,116 | - | $130,000 | $131,116 | 7.6% | 5.86% | | 2033 | $668 | - | $200,000 | $200,668 | 11.6% | 6.43% | | 2034 | - | - | $90,000 | $90,000 | 5.2% | 3.98% | | **Total** | **$13,026** | **$141,008** | **$1,577,050** | **$1,731,084** | **100.0%** | N/A | - The largest portion of debt, **24.9%** or **$428.5 million**, is scheduled to mature in **2028**, followed by **13.4%** in **2027** and **13.1%** in **2030**[36](index=36&type=chunk) [Properties](index=19&type=section&id=Properties) This section provides an overview of the Company's leased properties, tenant breakdown, lease expiration schedule, and re/development projects [Leased Operating Property Overview](index=19&type=section&id=Leased%20Operating%20Property%20Overview) This section provides a comprehensive overview of leased operating properties, categorized by tenant type, including square footage and annualized lease income Leased Operating Property Summary (As of June 30, 2025) | Category | Total Leased Square Feet | Annualized Lease Income | Percentage of Total Annualized Lease Income | Annualized Lease Income per Leased Square Foot | | :------------------------------------------ | :----------------------- | :---------------------- | :------------------------------------------ | :--------------------------------------------- | | Wholly Owned U.S. Government Leased Properties | 7,946,677 | $283,418,381 | 76.9% | $35.67 | | Wholly Owned State and Local Government Leased Property | 667,424 | $29,522,746 | 8.0% | $44.23 | | Wholly Owned Privately Leased Property | 273,460 | $5,409,571 | 1.4% | $19.78 | | U.S Government Leased to Unconsolidated Real Estate Venture | 1,214,165 | $50,378,017 | 13.7% | $41.49 | | **Total / Weighted Average** | **10,101,726** | **$368,728,715** | **100.0%** | **$36.50** | | Total / Weighted Average at Easterly's Share | 9,531,067 | $345,051,047 | N/A | $36.20 | - The majority of the Company's annualized lease income (**76.9%**) comes from wholly-owned U.S. Government leased properties[39](index=39&type=chunk) - The unconsolidated real estate venture, in which Easterly owns **53.0%**, contributes **13.7%** of the total annualized lease income, primarily from VA outpatient clinics[40](index=40&type=chunk)[46](index=46&type=chunk) [Tenants](index=23&type=section&id=Tenants) This section categorizes tenants by government and private sectors, detailing leased square footage, annualized lease income, and remaining lease terms Tenant Breakdown (As of June 30, 2025) | Tenant Category | Weighted Average Remaining Lease Term | Leased Square Feet | Percentage of Leased Square Feet | Annualized Lease Income | Percentage of Total Annualized Lease Income | | :-------------------------- | :------------------------------------ | :----------------- | :------------------------------- | :---------------------- | :------------------------------------------ | | U.S. Government | 9.9 years | 8,951,206 | 88.6% | $329,012,287 | 89.2% | | State and Local Government | 10.2 years | 597,214 | 5.9% | $26,018,356 | 7.0% | | Private Tenants | 4.5 years | 553,306 | 5.5% | $13,698,072 | 3.8% | | **Total / Weighted Average** | **9.6 years** | **10,101,726** | **100.0%** | **$368,728,715** | **100.0%** | - The Department of Veteran Affairs (VA) is the largest U.S. Government tenant, contributing **26.0%** of annualized lease income with a weighted average remaining lease term of **13.7 years**[47](index=47&type=chunk) - The Federal Bureau of Investigation (FBI) is the second largest U.S. Government tenant, contributing **14.9%** of annualized lease income with an **8.5-year** weighted average remaining lease term[47](index=47&type=chunk) [Lease Expirations](index=25&type=section&id=Lease%20Expirations) This section schedules lease expirations by year, detailing expiring leases, square footage, and annualized lease income, with over **50%** expiring thereafter Lease Expiration Schedule (As of June 30, 2025) | Year of Lease Expiration | Number of Leases Expiring | Leased Square Footage Expiring | Percentage of Total Leased Square Footage Expiring | Annualized Lease Income Expiring | Percentage of Total Annualized Lease Income Expiring | Annualized Lease Income per Leased Square Foot Expiring | | :----------------------- | :------------------------ | :----------------------------- | :------------------------------------------------- | :------------------------------- | :--------------------------------------------------- | :------------------------------------------------------ | | 2025 | 8 | 466,741 | 4.6% | $15,272,598 | 4.1% | $32.72 | | 2026 | 5 | 296,112 | 2.9% | $11,102,918 | 3.0% | $37.50 | | 2027 | 11 | 545,872 | 5.4% | $20,280,347 | 5.5% | $37.15 | | 2028 | 12 | 807,610 | 8.0% | $18,092,114 | 4.9% | $22.40 | | 2029 | 10 | 757,363 | 7.5% | $24,733,328 | 6.7% | $32.66 | | 2030 | 4 | 67,202 | 0.7% | $1,808,571 | 0.5% | $26.91 | | 2031 | 7 | 304,726 | 3.0% | $11,762,560 | 3.2% | $38.60 | | 2032 | 11 | 712,188 | 7.1% | $21,952,563 | 6.0% | $30.82 | | 2033 | 10 | 566,197 | 5.6% | $22,349,592 | 6.1% | $39.47 | | 2034 | 10 | 507,793 | 5.0% | $21,098,786 | 5.7% | $41.55 | | Thereafter | 55 | 5,069,922 | 50.2% | $200,275,338 | 54.3% | $39.50 | | **Total / Weighted Average** | **143** | **10,101,726** | **100.0%** | **$368,728,715** | **100.0%** | **$36.50** | - As of **June 30, 2025**, nine tenants occupying approximately **5.3%** of leased square feet and contributing **4.7%** of annualized lease income have the right to terminate their leases before the stated expiration terms[50](index=50&type=chunk) [Summary of Re/Development Projects](index=27&type=section&id=Summary%20of%20Re%2FDevelopment%20Projects) This section summarizes re/development projects, including properties under construction and in design, detailing costs, timelines, and reimbursements Projects Under Construction (As of June 30, 2025, in thousands) | Property Name | Location | Property Type | Total Leased Square Feet | Lease Term | Anticipated Total Cost | Cost to Date | Anticipated Lump Sum Reimbursement | Anticipated Completion Date | Anticipated Lease Commencement | | :-------------- | :--------- | :------------ | :----------------------- | :--------- | :--------------------- | :----------- | :--------------------------------- | :-------------------------- | :----------------------------- | | FDA - Atlanta | Atlanta, GA | Laboratory | 162,000 | 20-Year | $244,006 | $213,726 | $150,680 | 4Q 2025 | 4Q 2025 | | JUD - Flagstaff | Flagstaff, AZ | Courthouse | 50,777 | 20-Year | $60,916 | $17,558 | $24,700 | 3Q 2026 | 3Q 2026 | | **Total** | N/A | N/A | **212,777** | N/A | **$304,922** | **$231,284** | **$175,380** | N/A | N/A | Projects in Design (As of June 30, 2025) | Property Name | Location | Property Type | Total Estimated Leased Square Feet | Lease Term | Anticipated Completion Date | Anticipated Lease Commencement | | :-------------- | :--------- | :------------ | :--------------------------------- | :--------- | :-------------------------- | :----------------------------- | | JUD - Medford | Medford, OR | Courthouse | 40,035 | 20-Year | 2H 2027 | 2H 2027 | - Lump-sum reimbursements include tenant improvement costs and development fees[56](index=56&type=chunk)

Core Insights - The concept of "return to the office" is misleading as many returning workers are not the same individuals who left during COVID, indicating a significant shift in the workforce [2] - Major cities are experiencing a resurgence in office attendance, with June being the fourth-best month for in-office visits since COVID, although visits are still down about 27% compared to June 2019 [4] Company Analysis - Many companies that are mandating a return to the office lack sufficient space due to lease cancellations in 2021, such as Pinterest and Meta Platforms [3] - Easterly Government Properties REIT (DEA) is identified as a poor investment choice due to its high long-term debt of $1.6 billion, which exceeds its market cap by approximately $600 million, and a recent 32% dividend cut [6][8] - SL Green Realty (SLG) is a more appealing option, with a 5.1% dividend yield and a well-covered payout at 53% of the forecasted funds from operations for 2025, although its focus on New York and occupancy rate of around 91% raise some concerns [9][11] - Equity Residential (EQR) is highlighted as a top investment choice, yielding 4.1% and managing nearly 85,000 units in major markets, with a strong occupancy rate of 96.2% and rising rental rates expected to increase by 2% to 3% this year [12][15] - EQR has effectively reduced its long-term debt to $7.85 billion, which is only 31% of its market cap, and is strategically upgrading its portfolio by selling older properties and acquiring newer ones [16][17]

Group 1 - The stock of Easterly Government Properties, Inc. (DEA) is experiencing significant attention due to high implied volatility in the options market, particularly the Sep 19, 2025 $22.50 Put option [1] - Implied volatility indicates the market's expectation of future price movement, suggesting that investors anticipate a significant change in the stock's price, potentially due to an upcoming event [2] - Analysts currently rate Easterly Government Properties as a Zacks Rank 3 (Hold), with the company positioned in the bottom 40% of the Zacks Industry Rank for the REIT and Equity Trust - Other industry [3] Group 2 - Over the past 30 days, one analyst has raised earnings estimates for the current quarter, resulting in a consensus estimate increase from 73 cents to 74 cents per share [3] - The high implied volatility may indicate a trading opportunity, as options traders often seek to sell premium on options with elevated implied volatility, hoping the stock does not move as much as expected by expiration [4]