Group 1 - The iREIT®+HOYA Capital investment group focuses on various income-oriented alternatives including REITs, BDCs, MLPs, and Preferreds, supported by a team with over 100 years of combined experience [1] - The iREIT® Tracker provides comprehensive data on more than 250 tickers, including quality scores and buy/trimming targets [1] - Brad Thomas, a key figure in the investment group, has over 30 years of experience in real estate investing and has been involved in transactions exceeding $1 billion [2]

East Group Properties (NYSE:EGP) is an industrial REIT focused on sub-150K square foot warehouses in the Sunbelt. The Buy Thesis EGP has the best-positioned industrial assets in terms of both location and property specs. It's relatively limited competing supply sets EGP up for roughly 10% AFFO per share growth annually. The growth is not reflected in its 21.8X AFFO multiple, which makes it among the cheapest industrial REITs on a leverage-neutral basis. As this is my first focus article on EGP, it will be f ...

Financial Data and Key Metrics Changes - Funds from operations (FFO) were $2.21 per share, up 7.8% for the quarter compared to the prior year, excluding involuntary conversions [8][15] - Quarter-end leasing was 97.1% with occupancy at 96%, while average quarterly occupancy was 95.9%, down 110 basis points from Q2 2024 [8][9] - Cash same store NOI rose 6.4% for the quarter despite lower occupancy [9] - The company’s debt to total market capitalization was 14.2%, with an unadjusted debt to EBITDA ratio of 3.0 times and interest and fixed charge coverage increased to 16 times [16] Business Line Data and Key Metrics Changes - Quarterly re-leasing spreads were 44% GAAP and 30% cash, with year-to-date results at 46% GAAP and 31% cash respectively [8] - The company has the most diversified rent roll in its sector, with the top 10 tenants accounting for only 6.9% of rents, down 90 basis points from last year [9] Market Data and Key Metrics Changes - The market has bifurcated, with smaller spaces (50,000 square feet and below) seeing continued conversion while larger spaces experience elongated decision-making times [11][25] - The company is re-forecasting 2025 starts to $215 million, leaning towards the back end of the year due to current demand levels [12] Company Strategy and Development Direction - The company is focusing on leasing to maintain occupancy and is making quick leasing decisions to adapt to market conditions [10] - The strategy includes targeting geographic and revenue diversity to stabilize earnings regardless of economic conditions [9] - The company aims to capitalize on development opportunities earlier than private peers, leveraging its balance sheet strength and existing tenant expansion needs [14] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the portfolio's quality and the resilience of the industrial market despite macroeconomic uncertainties [7][18] - The company anticipates upward pressure on rents as demand stabilizes due to limited availability of modern facilities [14] - Management noted that the current economic environment is expected to improve, leading to potential rent growth as demand picks up [66] Other Important Information - The company invested $61 million in two new properties, increasing its market ownership in Raleigh to approximately 600,000 square feet [10] - The management team has a proven track record and is focused on driving FFO per share growth and enhancing portfolio quality [19] Q&A Session Summary Question: Can you talk about the cadence of leasing through the second quarter and any color you can provide for July? - Management noted that leasing activity was strong in the first quarter and late last year, but the tariff news has caused some hesitation among tenants, leading to slower decision-making [25][28] Question: Can you discuss the expected downside to average month-end occupancy in the third quarter? - Management clarified that the decrease in occupancy is primarily due to under-leased development properties coming online, impacting overall portfolio occupancy [34][35] Question: How are you focusing on occupancy and what mechanisms are you using? - Management indicated that they are not dropping rents significantly but are maintaining yields on projects, with some concessions noted in specific markets like California [43] Question: What are your thoughts on rent growth in the next 12 to 24 months? - Management expressed optimism for continued rent growth, citing low vacancy rates and a strong demand outlook in their key markets [66][105] Question: How do you view the cost of your credit facility versus equity in the back half of the year? - Management highlighted the flexibility of their balance sheet and the potential to utilize their credit facility as needed, while monitoring market conditions closely [72][76] Question: Are you expecting to be active in further supplementing your land bank? - Management acknowledged the challenges in finding good land sites but indicated they would continue to seek opportunities in various markets [88][90]

Financial Data and Key Metrics Changes - Funds from operations (FFO) were $2.21 per share, up 7.8% for the quarter compared to the prior year, excluding involuntary conversions [6][13] - Quarter-end leasing was 97.1% with occupancy at 96%, while average quarterly occupancy was 95.9%, down 110 basis points from Q2 2024 [6][7] - Cash same store NOI rose 6.4% for the quarter despite lower occupancy [7] - The debt to total market capitalization was 14.2%, with an unadjusted debt to EBITDA ratio of 3.0 times and interest and fixed charge coverage increased to 16 times [14] Business Line Data and Key Metrics Changes - Quarterly re-leasing spreads were 44% GAAP and 30% cash, with year-to-date results at 46% GAAP and 31% cash respectively [6] - The company has the most diversified rent roll in its sector, with the top 10 tenants accounting for only 6.9% of rents, down 90 basis points from last year [7] Market Data and Key Metrics Changes - The market has bifurcated, with smaller spaces (50,000 square feet and below) seeing continued conversions, while larger spaces are experiencing elongated decision-making times [9][24] - The company expects new starts to be re-forecasted to $215 million for 2025, leaning towards the back end of the year due to current demand levels [10] Company Strategy and Development Direction - The company is focusing on leasing to maintain occupancy and is making quick leasing decisions to adapt to market conditions [8] - The strategy includes targeting geographic and revenue diversity to stabilize earnings regardless of economic conditions [7] - The company aims to capitalize on development opportunities earlier than private peers, leveraging its balance sheet strength and existing tenant expansion needs [12] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the portfolio benefiting from long-term trends such as population migration and evolving logistics chains [17] - The management team is navigating through periods of uncertainty and is focused on driving FFO per share growth and raising portfolio quality [16] - There is an expectation that limited availability of modern facilities will put upward pressure on rents as demand stabilizes [12] Other Important Information - The company has invested $61 million in two new properties, increasing its market ownership in Raleigh to approximately 600,000 square feet [8] - Tenant collections remain healthy, with uncollectible rents estimated to be in the 35 to 45 basis point range as a percentage of revenues [15] Q&A Session Summary Question: Can you talk about the cadence of leasing through the second quarter and any color you can provide for July? - Management noted that leasing activity was strong in the first quarter and tail end of last year, but the tariff news has caused some hesitation among tenants, leading to slower decision-making [21][22] Question: Can you discuss the expected downside to average month-end occupancy in the third quarter? - Management clarified that the decrease in occupancy is primarily due to under-leased development properties coming online, impacting overall portfolio occupancy [30][32] Question: How is the company focusing on occupancy and what mechanisms are being used? - The company is focusing on getting deals done without significant concessions, although some markets like Los Angeles are seeing aggressive rent and free rent offers due to negative absorption [38][40] Question: What are the expectations for rent growth over the next twelve to twenty-four months? - Management anticipates continued rent growth, particularly in infill locations, as demand is expected to pick up faster than supply due to low construction levels [62][63] Question: How does the company view its land bank and development activity? - The company is actively looking to supplement its land bank but faces challenges in finding suitable land due to zoning issues and market dynamics [83][85]

Core Viewpoint - EastGroup Properties reported strong Q2 2025 results, exceeding revenue and FFO estimates, but showed early signs of caution in certain markets despite continued demand for logistics assets [1][5][9]. Financial Performance - GAAP revenue for Q2 2025 was $177.3 million, surpassing estimates of $175.19 million, and up 11.4% from $159.1 million in Q2 2024 [2]. - Non-GAAP FFO per share reached $2.21, exceeding analyst expectations and reflecting a 7.8% increase from $2.05 in the same quarter last year [2][5]. - Same property net operating income increased by 6.4% on a cash basis, reaching $113.2 million [2][5]. Portfolio and Occupancy - The operating portfolio average occupancy was 95.9%, down 1.1 percentage points from the previous year [2][6]. - The portfolio remained 97.1% leased and 96.0% physically occupied as of June 30, 2025, indicating strong demand despite slight occupancy decline [6]. Development and Strategic Focus - The company has a measured approach to development, with only two new projects totaling 469,000 square feet started in Q2 2025, while four projects totaling 785,000 square feet transitioned to operations [7]. - A significant development pipeline exists, with 18 projects underway across 13 markets, although management has adopted a cautious stance due to economic uncertainties [7][14]. Financial Discipline - EastGroup maintained conservative leverage ratios, with a debt-to-total market capitalization of 14.2% and a fixed charge coverage ratio of 16.1 times [8]. - Recent equity raises of $74.1 million in Q2 2025 and $117.1 million post-quarter end enhanced liquidity [8]. Dividend Consistency - The company declared its 182nd consecutive quarterly dividend of $1.40 per share, translating to a $5.60 annualized rate and a 3.3% yield [10]. Market Context and Risks - The company emphasized tenant diversification, with no single tenant accounting for more than 1.6% of annualized base rent [4]. - Market-specific challenges were noted, particularly in Los Angeles, where rent growth and absorption lagged behind other regions [9][13]. Future Guidance - For FY2025, management maintained GAAP EPS guidance of $4.76 to $4.90 and adjusted FFO per share guidance to $8.89 to $9.03 [15]. - The outlook for same property net operating income growth was revised upward to 6.0%–7.0% for FY2025, with average operating portfolio occupancy expected to be in the 95.6%–96.4% range [15].

Group 1 - EastGroup Properties reported $177.29 million in revenue for Q2 2025, an 11.4% year-over-year increase, and an EPS of $2.21 compared to $1.14 a year ago [1] - The revenue exceeded the Zacks Consensus Estimate of $175.54 million by 0.99%, while the EPS surprised by 0.45% over the consensus estimate of $2.20 [1] - Income from real estate operations was $177.26 million, surpassing the average estimate of $175.22 million, reflecting a 12.7% year-over-year change [4] Group 2 - Other revenue was reported at $0.01 million, significantly lower than the estimated $0.13 million, marking a 99.3% decline year-over-year [4] - Net Earnings Per Share (Diluted) was $1.20, slightly above the average estimate of $1.19 [4] - Over the past month, shares of EastGroup Properties returned -3.4%, contrasting with the Zacks S&P 500 composite's +5.9% change, indicating underperformance relative to the broader market [3]

分组1 - EastGroup Properties (EGP) reported quarterly funds from operations (FFO) of $2.21 per share, exceeding the Zacks Consensus Estimate of $2.20 per share, and up from $2.05 per share a year ago, representing an FFO surprise of +0.45% [1] - The company posted revenues of $177.29 million for the quarter ended June 2025, surpassing the Zacks Consensus Estimate by 0.99%, compared to year-ago revenues of $159.09 million [2] - Over the last four quarters, EastGroup Properties has exceeded consensus FFO estimates three times and topped consensus revenue estimates three times [2] 分组2 - The stock's immediate price movement will depend on management's commentary on the earnings call and future FFO expectations [3] - EastGroup Properties shares have increased approximately 4.5% since the beginning of the year, while the S&P 500 has gained 7.3% [3] - The current consensus FFO estimate for the coming quarter is $2.26 on revenues of $179.53 million, and for the current fiscal year, it is $8.90 on revenues of $713.15 million [7] 分组3 - The estimate revisions trend for EastGroup Properties was mixed ahead of the earnings release, resulting in a Zacks Rank 3 (Hold) for the stock, indicating expected performance in line with the market [6] - The REIT and Equity Trust - Other industry is currently in the bottom 37% of the Zacks industries, which may impact stock performance [8]

(Mark One) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 __________________________ FORM 10-Q For the quarterly period ended June 30, 2025 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: 1-07094 EASTGROUP PROPERTIES, INC. (Exact Name of Registrant as Specified in its Charter) Mar ...

[Overview and Highlights](index=1&type=section&id=Overview%20and%20Highlights) EastGroup Properties reported strong Q2 2025 results, driven by FFO and NOI growth, maintaining a positive long-term outlook [CEO Commentary and Quarter Highlights](index=1&type=section&id=CEO%20Commentary%20and%20Quarter%20Highlights) EastGroup Properties reported strong Q2 2025 results, with significant FFO and NOI growth, driven by robust rental rate increases - The CEO highlighted the company's resilience in the face of economic uncertainty, emphasizing a **strong balance sheet** and a **diversified portfolio** as key strengths for navigating market challenges. The long-term outlook is considered bullish due to favorable secular trends in the industrial real estate sector[3](index=3&type=chunk) Q2 2025 Key Performance Indicators | Metric | Q2 2025 Result | | :--- | :--- | | **Diluted EPS** | $1.20 (vs. $1.14 in Q2 2024) | | **FFO per Share (Excluding items)** | $2.21 (vs. $2.05 in Q2 2024, an increase of 7.8%) | | **Same Property NOI Growth (Straight-Line)** | +6.6% YoY | | **Operating Portfolio Leased** | 97.1% as of June 30, 2025 | | **Rental Rate Increase (New/Renewal)** | +44.4% on a straight-line basis | | **Development Starts** | 2 projects totaling 469,000 sq. ft. | | **Acquisitions (Subsequent to quarter-end)** | 2 properties in Raleigh for ~$61 million | [Financial Performance](index=1&type=section&id=Financial%20Performance) The company demonstrated robust financial performance in Q2 2025, marked by increased EPS, strong FFO, PNOI, and rental rate growth [Earnings Per Share (EPS)](index=1&type=section&id=Earnings%20Per%20Share%20(EPS)) Q2 2025 diluted EPS increased to $1.20, driven by higher PNOI and lower interest expense, despite a slight H1 decrease EPS Performance: Three Months Ended June 30 | Metric | Q2 2025 | Q2 2024 | | :--- | :--- | :--- | | **Diluted EPS** | $1.20 | $1.14 | | **PNOI per Share** | $2.46 | $2.35 | | **Interest Expense per Share** | ($0.15) | ($0.20) | | **Depreciation & Amortization per Share** | ($1.01) | ($0.94) | EPS Performance: Six Months Ended June 30 | Metric | H1 2025 | H1 2024 | | :--- | :--- | :--- | | **Diluted EPS** | $2.35 | $2.37 | | **PNOI per Share** | $4.88 | $4.68 | | **Interest Expense per Share** | ($0.30) | ($0.41) | | **Gains on Sales per Share** | $0.00 | $0.18 | [Funds from Operations (FFO) and Property Net Operating Income (PNOI)](index=3&type=section&id=Funds%20from%20Operations%20(FFO)%20and%20Property%20Net%20Operating%20Income%20(PNOI)) Strong Q2 2025 FFO per share grew 7.8%, fueled by 13.5% PNOI increase and 44.4% rental rate growth FFO & PNOI Growth: Three Months Ended June 30, 2025 | Metric | Q2 2025 | Q2 2024 | % Change | | :--- | :--- | :--- | :--- | | **FFO per Share (Excl. items)** | $2.21 | $2.05 | +7.8% | | **Total PNOI** | $129.2 million | $113.8 million | +13.5% | | **Same PNOI Growth (Straight-Line)** | N/A | N/A | +6.6% | | **Same PNOI Growth (Cash Basis)** | N/A | N/A | +6.4% | FFO & PNOI Growth: Six Months Ended June 30, 2025 | Metric | H1 2025 | H1 2024 | % Change | | :--- | :--- | :--- | :--- | | **FFO per Share (Excl. items)** | $4.33 | $4.03 | +7.4% | | **Total PNOI** | $255.4 million | $225.1 million | +13.4% | | **Same PNOI Growth (Straight-Line)** | N/A | N/A | +5.9% | | **Same PNOI Growth (Cash Basis)** | N/A | N/A | +5.8% | - Rental rates on new and renewal leases increased significantly, rising by an average of **44.4% in Q2 2025** and **45.8% for the first six months of 2025**, indicating strong demand and pricing power[9](index=9&type=chunk)[14](index=14&type=chunk) [Portfolio Activity](index=4&type=section&id=Portfolio%20Activity) EastGroup actively expanded its portfolio through strategic acquisitions and a robust development program, adding new projects and transferring completed ones [Acquisitions](index=4&type=section&id=Acquisitions) EastGroup actively acquired development land and fully leased properties in key growth markets, expanding its footprint and future pipeline - During Q2 2025, the company acquired significant land parcels for future development: - **Tampa, FL:** 65.9 acres for a planned 550,000 sq. ft. logistics center for **~$32.4 million**[17](index=17&type=chunk) - **Dallas, TX:** 28.6 acres for a planned 350,000 sq. ft. development for **~$17.8 million**[18](index=18&type=chunk) - Subsequent to June 30, 2025, EastGroup expanded its presence in the Raleigh-Durham market by acquiring two 100% leased industrial buildings totaling **318,000 sq. ft.** for approximately **$61.4 million**[19](index=19&type=chunk) - The company also acquired **37 acres of development land in Orlando for $8.5 million** and is under contract to purchase another **40 acres in Dallas for $25 million**, further bolstering its future development pipeline[20](index=20&type=chunk)[21](index=21&type=chunk) [Development and Value-Add Properties](index=5&type=section&id=Development%20and%20Value-Add%20Properties) The company's robust development program started two new projects, transferred four to operations, and maintained a large active pipeline - In Q2 2025, EastGroup started construction on two new development projects in Atlanta and Nashville, totaling **469,000 square feet** with projected costs of **$69.9 million**[22](index=22&type=chunk) - As of June 30, 2025, the company's development and value-add program comprised **18 projects**, totaling **3,714,000 square feet**. These projects were **16% leased** with a total projected cost of **$531.4 million**[23](index=23&type=chunk) - During Q2 2025, four projects totaling **785,000 square feet** in Orlando, Tampa, Fort Worth, and San Antonio were transferred to the operating portfolio. For the first six months of 2025, a total of **1,160,000 square feet** were transferred[24](index=24&type=chunk) [Capital Allocation and Financial Position](index=5&type=section&id=Capital%20Allocation%20and%20Financial%20Position) The company maintained a strong balance sheet with low leverage, declared consistent dividends, and enhanced financial flexibility [Dividends](index=5&type=section&id=Dividends) EastGroup declared a Q2 2025 dividend of $1.40 per share, continuing its 32-year streak of maintaining or increasing distributions - The company declared a Q2 2025 dividend of **$1.40 per share**, its **182nd consecutive quarterly cash distribution**[25](index=25&type=chunk) - EastGroup has a **32-year history of maintaining or increasing its dividend**, with increases in each of the last **13 years**[25](index=25&type=chunk) [Financial Strength and Flexibility](index=7&type=section&id=Financial%20Strength%20and%20Flexibility) The company maintained a strong balance sheet with low leverage (14.2% debt-to-market cap) and high coverage ratios Key Financial Ratios (as of Q2 2025) | Metric | Value | | :--- | :--- | | **Debt-to-Total Market Capitalization** | 14.2% | | **Interest and Fixed Charge Coverage Ratio** | 16.1x | | **Debt to EBITDAre Ratio** | 2.9x | - During Q2 2025, the company settled forward equity sale agreements, issuing **416,067 shares** for net proceeds of approximately **$74.1 million**[28](index=28&type=chunk) - Subsequent to quarter-end, an additional **647,758 shares** were issued from settled forward equity agreements, raising approximately **$117.1 million** in net proceeds[28](index=28&type=chunk) [Outlook for 2025](index=7&type=section&id=Outlook%20for%202025) EastGroup updated its full-year 2025 guidance, raising FFO per share forecasts to $8.89-$9.03, reflecting continued growth [2025 Guidance](index=7&type=section&id=2025%20Guidance) EastGroup updated its full-year 2025 guidance, raising FFO per share forecasts to $8.89-$9.03, reflecting continued growth Full Year 2025 Guidance | Metric (per diluted share) | Low Range | High Range | | :--- | :--- | :--- | | **Net Income (EPS)** | $4.76 | $4.90 | | **Funds from Operations (FFO)** | $8.89 | $9.03 | Revised 2025 Midpoint Guidance Assumptions | Metric | Revised 2025 Guidance | April 2025 Guidance | | :--- | :--- | :--- | | **FFO per share** | $8.96 | $8.94 | | **FFO per share growth (YoY)** | 7.3% | 7.1% | | **Same PNOI growth (cash basis)** | 6.5% | 6.3% | | **Average month-end occupancy** | 96.0% | 96.1% | | **Development starts** | $215 million | $250 million | | **Operating property acquisitions** | $160 million | $150 million | [Appendix](index=8&type=section&id=Appendix) This section provides essential unaudited financial statements and detailed reconciliations of GAAP to non-GAAP measures for performance evaluation [Financial Statements and Non-GAAP Reconciliations](index=12&type=section&id=Financial%20Statements%20and%20Non-GAAP%20Reconciliations) This section includes unaudited financial statements and detailed reconciliations of GAAP to non-GAAP measures like FFO and PNOI Consolidated Statements of Income (In Thousands) | Line Item | Three Months Ended June 30, 2025 | Six Months Ended June 30, 2025 | | :--- | :--- | :--- | | **Total Revenues** | $177,286 | $351,735 | | **Total Expenses** | $106,836 | $214,333 | | **Net Income** | $63,313 | $122,750 | | **Net Income Attributable to Common Stockholders** | $63,299 | $122,722 | FFO Reconciliation (In Thousands) | Line Item | Three Months Ended June 30, 2025 | Six Months Ended June 30, 2025 | | :--- | :--- | :--- | | **Net Income Attributable to Common Stockholders** | $63,299 | $122,722 | | **Depreciation and Amortization** | $53,012 | $105,532 | | **FFO Attributable to Common Stockholders** | $116,341 | $228,314 | PNOI Reconciliation (In Thousands) | Line Item | Three Months Ended June 30, 2025 | Six Months Ended June 30, 2025 | | :--- | :--- | :--- | | **Net Income** | $63,313 | $122,750 | | **Adjustments (Depreciation, Interest, G&A, etc.)** | $65,871 | $132,612 | | **Property Net Operating Income (PNOI)** | $129,184 | $255,362 | [Definitions of Non-GAAP Measures](index=8&type=section&id=Definitions%20of%20Non-GAAP%20Measures) This section defines key non-GAAP financial measures like FFO, PNOI, and EBITDAre, explaining their calculation and purpose - **Funds from Operations (FFO):** Calculated per Nareit standards, it starts with GAAP net income and excludes gains/losses from property sales and real estate depreciation. It is a primary measure of a REIT's operating performance[35](index=35&type=chunk) - **Property Net Operating Income (PNOI):** Defined as income from real estate operations less operating expenses. It is used to evaluate the performance of the company's property portfolio at the property level, separate from corporate-level expenses[37](index=37&type=chunk) - **EBITDA for Real Estate (EBITDAre):** Computed per Nareit standards, it adjusts Net Income for interest, taxes, depreciation, amortization, and gains/losses on property sales. It is used to measure operating performance and the ability to service debt[39](index=39&type=chunk)

Quarter Highlights Net Income Attributable to Common Stockholders of $1.20 Per Diluted Share for Second Quarter 2025 Compared to $1.14 Per Diluted Share for Second Quarter 2024 Funds from Operations ("FFO"), Excluding Gain on Involuntary Conversion and Business Interruption Claims, of $2.21 Per Diluted Share for Second Quarter 2025 Compared to $2.05 Per Diluted Share for Second Quarter 2024, an Increase of 7.8% Same Property Net Operating Income for the Same Property Pool, Excluding Income From Lease Termin ...