Workflow
Safehold (SAFE)
icon
Search documents
Safehold (SAFE) - 2025 Q1 - Earnings Call Transcript
2025-05-07 14:02
Financial Data and Key Metrics Changes - For Q1 2025, GAAP revenue was $97.7 million, net income was $29.4 million, and earnings per share (EPS) was $0.41, with a year-over-year decline in GAAP earnings primarily due to a nonrecurring loss of $1.9 million on a preferred equity investment [11][12] - The total portfolio at quarter end was $6.8 billion, with estimated unrealized capital appreciation at $8.9 billion and a ground lease-to-value (GLTV) ratio of 52% [9][15] - The portfolio currently earns a 3.7% cash yield and a 5.4% annualized yield, with an economic yield of 5.8% that can increase to 7.4% when factoring in unrealized capital appreciation [12][13][14] Business Line Data and Key Metrics Changes - The company funded a total of $20 million in Q1, consisting of $16 million in ground lease fundings and $4 million related to leasehold loans [10] - The ground lease portfolio has grown significantly, with 147 assets and an increase in multifamily ground leases from 8% at IPO to 58% today [10] Market Data and Key Metrics Changes - The company has nonbinding letters of intent (LOIs) totaling approximately $386 million for potential commitments across 11 ground leases and four loans, with a focus on affordable housing [8][9] - The GLTV increased from 49% to 52% quarter over quarter, reflecting the reappraisal of a significant portion of the office portfolio [15] Company Strategy and Development Direction - The company aims to reach a scale that unlocks full value for shareholders while expanding its customer base to provide long-term lower-cost capital [5][6] - The management is actively evaluating opportunities to address the public versus private valuation disconnect, including potential asset sales or joint ventures [21][35] Management's Comments on Operating Environment and Future Outlook - Management noted that while the market remains volatile, there are signs of stabilization, and they are optimistic about the pipeline of deals [5][19] - The company is focused on maintaining a diversified portfolio of ground leases, which is seen as an attractive investment during market fluctuations [19][20] Other Important Information - The company ended the quarter with approximately $1.3 billion in liquidity, supported by joint venture capacity [9] - The weighted average debt maturity is approximately 19 years, with no corporate maturities due until 2027 [17] Q&A Session Summary Question: Can you provide more details on the sponsors and markets related to the LOIs? - The pipeline includes a diverse range of sponsors and markets, with a majority in multifamily, including affordable housing and market-rate construction deals [25][26] Question: What are the benefits of ground leases versus leasehold loans? - Leasehold loans provide more certainty in volatile markets and can help close transactions that may otherwise stall [27] Question: Can you quantify the closed deals from the LOIs? - The majority of the deals are expected to close this year, with timing varying based on the type of deal [32] Question: What is the company's strategy regarding potential joint ventures? - The company is considering joint ventures to unlock portfolio value and is actively seeking partners for larger transactions [50][65] Question: How does the company view the current market volatility? - Management acknowledges the ongoing volatility but sees it as an opportunity to provide certainty to customers through their capital solutions [44][75]
Safehold (SAFE) - 2025 Q1 - Earnings Call Transcript
2025-05-07 14:02
Safehold (SAFE) Q1 2025 Earnings Call May 07, 2025 09:00 AM ET Company Participants Pearse Hoffmann - Senior Vice President of Capital Markets & Investor RelationsJay Sugarman - CEO & ChairmanBrett Asnas - CFORonald Kamdem - Managing Director & Head of US REITs and CRE ResearchTim Doherty - Chief Investment OfficerCaitlin Burrows - Vice PresidentMitch Germain - MD - Real Estate ResearchRichard Anderson - Managing Director - Equity Research Conference Call Participants Haendel Emmanuel St. Juste - Managing D ...
Safehold (SAFE) - 2025 Q1 - Earnings Call Transcript
2025-05-07 14:00
Financial Data and Key Metrics Changes - For Q1 2025, GAAP revenue was $97.7 million, net income was $29.4 million, and earnings per share (EPS) was $0.41, reflecting a decline in GAAP earnings year over year primarily due to a nonrecurring $1.9 million loss on a preferred equity investment [11][12] - Excluding the one-time loss, Q1 EPS increased slightly year over year, driven by higher net earnings on investment fundings and percentage rent [12] - The portfolio currently earns a 3.7% cash yield and a 5.4% annualized yield, with an economic yield of 5.8% [12][13] Business Line Data and Key Metrics Changes - The total portfolio at quarter end was $6.8 billion, with an estimated GLTV of 52% and rent coverage of 3.5 times [9][15] - The company funded a total of $20 million in Q1, consisting of $16 million in ground lease fundings and $4 million related to leasehold loans [10] - The ground lease portfolio has grown 20 times by both book value and estimated unrealized capital appreciation since the IPO, with 85 multifamily ground leases now comprising 58% of the portfolio [10] Market Data and Key Metrics Changes - The company has nonbinding LOIs totaling approximately $386 million for potential commitments across 11 ground leases and four loans, with six of the ground leases focused on affordable housing [7][9] - The portfolio GLTV increased from 49% to 52% quarter over quarter, reflecting the largest office revaluation quarter [14][15] Company Strategy and Development Direction - The company aims to reach a scale that unlocks the full value of the business for shareholders while expanding the customer base that can benefit from long-term lower-cost capital [4][5] - The management is focused on capital recycling and evaluating opportunities to address the public versus private valuation disconnect [35][21] Management's Comments on Operating Environment and Future Outlook - The management noted that while the market remains volatile, there are signs of stabilization, and they are optimistic about the pipeline of deals [6][19] - The management expressed confidence in the ability to close the majority of the deals in the pipeline within the year, despite the challenges posed by market conditions [31][61] Other Important Information - The company ended the quarter with approximately $1.3 billion of liquidity, supported by potential available capacity in joint ventures [9][17] - The company has a weighted average debt maturity of approximately 19 years and no corporate maturities due until 2027 [17] Q&A Session Summary Question: Can you provide more details on the sponsors and markets related to the nonbinding LOIs? - The pipeline includes a robust mix of multifamily deals, with diverse locations across the West Coast, Southeast, Northeast, and Midwest [25][26] Question: What are the benefits of ground leases versus leasehold loans? - Leasehold loans provide more certainty in volatile markets and can help kickstart transactions that are stalled [27] Question: Can you quantify the closed deals from the LOIs? - The majority of the deals in the pipeline are expected to close this year, with timing varying based on construction versus recap deals [31] Question: What is the company's strategy regarding joint ventures? - The company is exploring opportunities for joint ventures to unlock value from the existing portfolio while focusing on larger scale deals with current partners [65][66] Question: How does the company view the current market volatility? - The management acknowledged ongoing volatility but noted that it has tightened, allowing sponsors to make clearer long-term capital decisions [44][61] Question: What is the outlook for S&P ratings? - The company is in dialogue with S&P and aims to achieve a third single A rating through prudent capital management and continued deal origination [82]
Safehold (SAFE) Q1 Earnings: How Key Metrics Compare to Wall Street Estimates
ZACKS· 2025-05-07 00:00
Core Insights - Safehold (SAFE) reported revenue of $97.68 million for Q1 2025, marking a year-over-year increase of 4.8% and exceeding the Zacks Consensus Estimate by 1.94% [1] - The company's EPS for the same quarter was $0.44, slightly up from $0.43 a year ago, with an EPS surprise of 2.33% over the consensus estimate [1] Financial Performance Metrics - Operating lease income was reported at $21.38 million, surpassing the average estimate of $20.68 million, reflecting a year-over-year increase of 1.8% [4] - Other income decreased to $4.30 million, below the average estimate of $4.93 million, representing a significant year-over-year decline of 35.2% [4] - Interest income from sales-type leases was $69.66 million, slightly above the average estimate of $69.35 million, with a year-over-year increase of 10.2% [4] - Interest income from related parties was reported at $2.33 million, slightly below the average estimate of $2.40 million, showing a year-over-year decrease of 1% [4] - The diluted net income per share was $0.41, compared to the estimated $0.43, indicating a shortfall against analyst expectations [4] Stock Performance - Over the past month, Safehold's shares have returned -6%, contrasting with the Zacks S&P 500 composite's increase of 11.5% [3] - The stock currently holds a Zacks Rank 3 (Hold), suggesting it may perform in line with the broader market in the near term [3]
Safehold (SAFE) - 2025 Q1 - Earnings Call Presentation
2025-05-06 22:18
Q1'25 Earnings Results Q1'25 Summary Investment Activity1 | | Non-Binding LOIs | | --- | --- | | | (11 Ground Leases, 4 Leasehold Loans) | | Ground Lease Value | ~$273m | | Leasehold Loan Value | ~$113m | | Markets | 8 | | Sponsors | 11 | | GLTV2a | ~34% | | Rent Coverage3a | ~2.6x | | Economic Yielda | ~7.3% | $6.8b / $8.9b Total Portfolio Aggregate GBV5 / Total Portfolio Estimated UCA Portfolio Metrics4 Capital Sources $1.3bb Cash & Credit Facility Availability 52% / 3.5x GLTV2 / Rent Coverage3 Remaining ...
Safehold (SAFE) - 2025 Q1 - Quarterly Results
2025-05-06 20:17
Exhibit 99.2 Q1'25 Earnings Results Q1'25 Summary afehold Investment Activity1 | | Non-Binding LOIs | | --- | --- | | | (11 Ground Leases, 4 Leasehold Loans) | | Ground Lease Value | ~$273m | | Leasehold Loan Value | -$113m | | Markets | 8 | | Sponsors | 11 | | GLTV2a | ~34% | | Rent Coverage 3a | ~2.6x | | Economic Yieldª | -7.3% | Portfolio Metrics4 $6.8b / $8.9b Total Portfolio Aggregate GBV§ / Total Portfolio Estimated UCA 52% / 3.5x GLTV² / Rent Coverage3 $1.3bb Cash & Credit Facility Capital Sources $ ...
Safehold Sets First Quarter 2025 Earnings Release Date and Webcast
Prnewswire· 2025-04-30 20:05
Core Viewpoint - Safehold Inc. will release its financial results for Q1 2025 on May 6, 2025, after market close [1] - An earnings conference call will take place on May 7, 2025, at 9:00 a.m. ET to discuss these results [2] Company Overview - Safehold Inc. is transforming real estate ownership by offering a new method for owners to unlock land value beneath their buildings [2] - The company established the modern ground lease industry in 2017 and continues to assist owners of various property types in generating higher returns with reduced risk [2] - As a real estate investment trust (REIT), Safehold aims to provide safe, growing income and long-term capital appreciation to its shareholders [2]
Safehold Declares First Quarter 2025 Common Stock Dividend
Prnewswire· 2025-03-14 11:30
Core Points - Safehold Inc. has declared a common stock dividend of $0.177 per share for Q1 2025, which annualizes to $0.708 per share, payable on April 15, 2025, to shareholders of record on March 31, 2025 [1] Company Overview - Safehold Inc. is transforming real estate ownership by offering a new method for property owners to unlock the value of the land beneath their buildings [2] - The company established the modern ground lease industry in 2017 and continues to assist owners of various property types, including multifamily, office, industrial, hospitality, student housing, life science, and mixed-use properties, in generating higher returns with reduced risk [2] - As a real estate investment trust (REIT), Safehold aims to provide safe, growing income and long-term capital appreciation to its shareholders [2]
Safehold (SAFE) - 2024 Q4 - Annual Report
2025-02-06 21:46
Financial Performance - Total revenues for 2024 increased to $365.7 million, up 3.1% from $352.6 million in 2023 [296]. - Interest income from sales-type leases rose to $264.3 million, a 12.2% increase compared to $235.5 million in 2023 [296]. - Net income attributable to Safehold Inc. common shareholders was $105.8 million in 2024, compared to a net loss of $55.0 million in 2023 [296]. - Comprehensive income attributable to Safehold Inc. was $156.1 million in 2024, compared to a comprehensive loss of $59.6 million in 2023 [300]. - Net income for the year ended December 31, 2023, was reported at $107,191,000, compared to a net loss of $54,565,000 in 2022, indicating a significant turnaround [303]. - Net income for 2024 was $106.615 million, a significant recovery from a net loss of $54.565 million in 2023 [307]. - Cash flows from operating activities increased to $37.855 million in 2024, compared to $15.391 million in 2023 [307]. Assets and Liabilities - Total assets as of December 31, 2024, reached $6.9 billion, an increase of 5.3% from $6.5 billion in 2023 [293]. - Total liabilities increased to $4.5 billion in 2024, up from $4.3 billion in 2023, reflecting a rise of 6.4% [293]. - As of December 31, 2024, the company had approximately $4.4 billion in outstanding indebtedness, including $100 million of trust preferred securities [123]. - The company had $3.6 billion in fixed-rate debt and $789 million in floating-rate debt outstanding as of December 31, 2024 [268]. - The carrying value of net investment in sales-type leases is $3,455 million, with a fair value of $3,680 million, compared to a carrying value of $3,255 million and a fair value of $3,118 million as of December 31, 2023 [374]. Cash Flow and Dividends - Cash and cash equivalents decreased to $8.3 million in 2024, down from $18.8 million in 2023 [293]. - The company paid dividends of $50.589 million to common shareholders in 2024, compared to $46.039 million in 2023 [307]. - Future distributions to shareholders will depend on various factors, including actual or anticipated results of operations and cash flows [139]. - The company’s cash flow may be insufficient to meet required principal and interest payments, exposing it to default risks [123]. Risks and Challenges - The company faces risks associated with tenant bankruptcies, which could adversely affect income and property ownership [96]. - The company relies on Property NOI reported by tenants, which may not be independently verified, potentially affecting underwriting decisions [86]. - Ground Leases with developers expose the company to risks related to property development and financing, which could materially affect operations [92]. - Future growth prospects may be adversely affected by health crises, as seen during the COVID-19 pandemic, which impacted tenant financial conditions and operational capabilities [102]. - The company may face risks related to joint venture investments, including lack of sole decision-making authority and reliance on partners' financial positions [127]. Shareholder Relations and Equity - Star Holdings owns approximately 18.9% of the outstanding shares of the company's common stock, which could influence shareholder decisions [112]. - The company’s organizational documents limit shareholder recourse and access to judicial forums, which may inhibit changes in control [135]. - The company may issue new Caret units or sell outstanding units without requiring approval from common stockholders, potentially diluting their interests [142]. - The absence of a drag-along right after a liquidity transaction could deter acquisition interest and affect the market price of common stock [156]. Management and Governance - The company has a management agreement with Star Holdings, which includes an annual management fee of $25 million for the term ended March 31, 2024, declining to $15 million for the term ended March 31, 2025 [109]. - The company faces potential conflicts of interest in its relationship with Star Holdings, which could result in decisions not aligned with shareholder interests [117]. - The Company recognized management fee income of $25.0 million for the term ended March 31, 2024, which will decline to $15.0 million for the term ended March 31, 2025 [358]. Taxation and Compliance - The company must distribute at least 90% of its REIT taxable income annually to qualify as a REIT, or it may incur U.S. federal income tax at regular corporate rates [165]. - The total current income tax expense for the year ended December 31, 2024, was $1.048 million, a decrease from $3.045 million in 2023 [365]. - The Company has a valuation allowance of $(2.052) million against its deferred tax assets as of December 31, 2024, compared to $(2.704) million in 2023 [369]. Market and Competitive Landscape - The company faces competition from various entities including commercial developers, other REITs, and financial institutions, which may adversely affect its ability to acquire and originate investments [98]. - The market price of the company's common stock may not reflect the value of the UCA in the owned residual portfolio, which is difficult to estimate [91]. Cybersecurity and Internal Controls - The company has implemented processes and internal controls to mitigate cybersecurity risks, but there is no assurance that these measures will be fully effective [101]. - The company maintained effective internal control over financial reporting as of December 31, 2024, according to the independent auditor's opinion [285].
Safehold (SAFE) - 2024 Q4 - Earnings Call Presentation
2025-02-06 18:26
Q4'24 & FY'24 Earnings Results FY'24 Summary Capital Markets Activity | | New 5-year unsecured revolving credit | | --- | --- | | $2.0b Revolver | facility (increased credit availability, lowered cost and extended term versus prior $1.85b | | | aggregate facilities) | | | Issued $400m and $300m 10-year unsecured notes (5.84% w.a. coupon, 5.19% | | $700m Notes | w.a. yield to maturity net of $43m total | | | realized hedge gains) | | $750m | Unsecured funding program put in place as | | Commercial Paper | al ...