Piedmont Office Realty Trust(PDM) - 2025 Q3 - Quarterly Results

Financial Performance - Piedmont Realty Trust reported a net loss of $13.5 million, or $0.11 per diluted share, for Q3 2025, compared to a net loss of $11.5 million, or $0.09 per diluted share, in Q3 2024[12]. - The company reported a net loss applicable to Piedmont of $(13,462,000) for the three months ended September 30, 2025, compared to a net loss of $(11,519,000) for the same period in 2024[47]. - The company’s total revenues for Q3 2025 were $139,163, slightly down from $139,293 in Q3 2024[31]. - Total revenues for the nine months ended September 30, 2025, were $422,141, a decrease of 1.2% from $427,093 in the same period of 2024[39]. - The company reported a GAAP net loss applicable to common stock of $(13,462,000) for the three months ended September 30, 2025, compared to $(16,808,000) in the previous quarter[130]. Leasing Activity - The company executed approximately 724,000 square feet of total leasing in Q3 2025, with over 551,000 square feet being new tenant leases, marking the highest amount in over a decade[11]. - The leased percentage of the portfolio stood at 89.2% as of September 30, 2025, an increase of 50 basis points from 88.7% as of June 30, 2025[16]. - Piedmont's leasing activity in October 2025 included over 150,000 square feet executed and an additional 400,000 square feet in the legal stage[16]. - The company executed leasing for approximately 2.2 to 2.4 million square feet, increasing the anticipated year-end leased percentage[23]. - Total leasing executed during the three months ended September 30, 2025, was 724,415 square feet[74]. Income and Expenses - Interest expense for Q3 2025 was $31.9 million, up from $30.1 million in Q3 2024, reflecting elevated costs due to refinancing in a higher interest rate environment[12]. - Core FFO for Q3 2025 was $0.35 per diluted share, a slight decrease from $0.36 per diluted share in Q3 2024, attributed to the sale of three projects[15]. - The company reported property operating costs of $55,890,000 for the quarter ended September 30, 2025, compared to $55,610,000 in the previous quarter[35]. - General and administrative expenses for the three months ended September 30, 2025, were $7,607,000, up from $6,809,000 in the same quarter of the previous year, representing an increase of approximately 11.7%[131]. - The company incurred impairment charges of $15,400,000 during the previous quarter, which were not present in the current quarter[130]. Net Operating Income - Same Store NOI increased by 2.8% on a cash basis and 3.2% on an accrual basis for Q3 2025, driven by the commencement of new leases[12]. - Same Store Net Operating Income (cash basis) for Q3 2025 was $75,069,000, reflecting a 2.8% increase from $73,023 in Q3 2024[45]. - Same store net operating income (accrual basis) for the three months ended September 30, 2025, was $83,203,000, representing a 3.2% increase compared to $80,595,000 for the same period in 2024[50]. Debt and Equity - The company has no debt maturity requirements until 2028, with total debt standing at $2,193,324 as of September 30, 2025[19]. - The total liabilities of the company were $2,466,681,000 as of September 30, 2025, an increase from $2,432,253,000 as of June 30, 2025[34]. - The company reported a total depreciation and amortization expense of $57,315,000 for the three months ended September 30, 2025, compared to $56,047,000 in the same period of 2024, reflecting a slight increase[131]. - The weighted average cost of debt decreased to 5.95% from 6.01%[17]. - The company has 1.1 million square feet of leases currently under abatement, equating to $35.7 million in future annual cash rent[81]. Future Outlook - Piedmont anticipates nearly $40 million of annual contractual rent from recently executed leases to commence, contributing to earnings growth in 2026[11]. - Major leases expiring in Q4 2025 total 334,000 square feet, generating $13.0 million in expiring lease revenue[87]. - The company anticipates significant lease expirations in 2026, with an estimated $61.3 million in lease revenue from 1.4 million square feet[91]. - The company has 920,000 square feet of uncommenced leases representing $38.7 million in future annual cash rent[80]. Sustainability and Ratings - The company received a "5 Star" sustainability rating from GRESB® for the third consecutive year, ranking in the top decile among listed American companies[19].