One Liberty Properties(US:OLP)2024-11-05 21:10Portfolio Overview - Total square footage of the portfolio is 10.8 million square feet with an occupancy rate of 98.2%[7][11] - The company owns 106 properties across 31 states, with industrial properties making up 56 of these, contributing $48,096,061 or 67.7% to the 2024 contractual rental income[15][19] - The average lease term remaining across the portfolio is 5.5 years, providing stability in rental income[12] Financial Performance - The 2024 contractual rental income totals $71,079,476, with the top five tenants contributing 21.4% of this income[16][20] - The company's gross assets amount to $944.5 million, with total debt representing 44.4% of gross assets[24][25] - The company reported a stable occupancy rate of 99.1% as of September 30, 2024, maintaining high occupancy levels over the years[34] - The current annualized dividend is $1.80, resulting in a dividend yield of 6.5%[22] - As of June 30, 2024, the adjusted funds from operations (AFFO) per share is $0.95, with an AFFO payout ratio of 95%[23] - The market capitalization is $588.8 million, with 21.4 million shares outstanding and an insider ownership of 25.5%[21][22] Debt and Liquidity - The company maintains a debt service coverage ratio of 2.3 to 1.0, indicating strong financial health[29][30] - The weighted average interest rate on fixed-rate debt is 4.41%, with approximately $11.3 million scheduled for mortgage amortization for the twelve months ending June 30, 2025[32] - As of September 30, 2024, the company has $100 million available on its Line of Credit and liquidity to acquire properties exceeding $250 million[32] Acquisitions and Dispositions - The company completed acquisitions totaling $79.5 million in 2023, with a notable acquisition of a multi-tenant property for $33 million in August 2024[34] - The company has maintained a consistent acquisition strategy, with a total of $120 million in acquisitions over the past few years[34] - The company has a history of opportunistic dispositions, with a net gain of $11.3 million from sales in 2024[35] - The company reported a net gain of $3.997 million from the sale of a retail property in December 2023, contributing to total net proceeds of $46.6 million for the year[36] Lease and Rental Income - For the twelve months ending June 30, 2025, expiring leases represent 4.6% of the 2024 contractual rental income, totaling $3,273,962[33] - The company has a total of 162 expiring leases by 2035, representing 100% of the contractual rental income of $71,079,476[33] - The company’s top tenant, FedEx, represents 5.3% of the 2024 contractual rental income, with properties located in multiple states[54] - The current base rent for the St. Louis property increased by 32% after a lease extension with CHEP USA, which accounts for 50% of the gross leasable area[40] Financial Metrics and Adjustments - NAREIT funds from operations (FFO) per share of common stock for the latest period is $1.90, compared to $1.82 in the previous period, reflecting a growth of 4.4%[125][188] - Adjusted funds from operations (AFFO) per share of common stock is reported at $1.95, showing a slight decrease from $1.98 in the prior period[185][188] - The company deducted $0.25 from income due to other income and income on settlement of litigation, which impacted the overall FFO calculation[144][188] - The total deductions for straight-line rent accruals and amortization of lease intangibles amounted to $0.16, affecting the FFO results[132][188] - The company emphasizes that FFO and AFFO are useful measures for evaluating operating performance, excluding GAAP historical cost depreciation and amortization[190] - Management believes that FFO and AFFO provide insights into trends in occupancy rates, rental rates, and operating costs, which may not be apparent from net income alone[190] - The company does not consider FFO and AFFO as alternatives to net income or cash flows from operations as defined by GAAP[191] - The FFO calculation excludes depreciation and amortization related to real estate, which is crucial for understanding the company's operational performance[189][190] - The company recognizes limitations in using FFO and AFFO and examines GAAP measures such as net income and cash flows for a comprehensive performance evaluation[191] - The adjusted FFO reflects various adjustments, including amortization of restricted stock and debt prepayment costs, which are critical for accurate financial assessment[188] Property Specifics - The company acquired the River Road Logistics Building I in Council Bluffs, IA for a purchase price of $33 million, with a mortgage amount of $18.425 million[39] - The building has a total area of 302,347 square feet and is net leased to three tenants, with a base rent of $7.12 per square foot, which is below market[38] - In 2024, the company refinanced a property in St. Louis, MO, resulting in $6.3 million in net proceeds based on appreciated asset value and increased rent[40] - The company reported a Year 1 net cash flow of $1.032 million from the River Road Logistics Building I, yielding a 5-year cash on cash return of 7.97%[40] - The market rent for the Bensalem, PA property has increased from $5.50 per square foot at acquisition to over $10.00 per square foot today[48] Company Strategy - The company has a disciplined track record through economic cycles, focusing on industrial properties[4][5] - The company has a disciplined track record focused on industrial properties, which are expected to perform well through economic cycles[50]