Essex Property Q3 FFO and Revenues Beat, '24 View Raised

Core Insights - Essex Property Trust Inc. (ESS) reported a third-quarter 2024 core funds from operations (FFO) per share of $3.91, exceeding the Zacks Consensus Estimate of $3.88 and reflecting a 3.4% year-over-year improvement [1] - The company raised its full-year 2024 guidance following favorable growth in same-property revenues and net operating income (NOI) [1] Financial Performance - Total revenues for the third quarter reached $450.7 million, surpassing the Zacks Consensus Estimate of $445.9 million, and showing a year-over-year increase of 7.5% [2] - Same-property revenues increased by 3.5% year-over-year, while same-property operating expenses rose by 5.5% [3] - Same-property NOI grew by 2.6% year-over-year, with financial occupancy at 96.2%, down 20 basis points year-over-year [3] Growth Metrics - The blended rate growth for the third quarter was 2.5%, a decrease from 3.4% in the second quarter of 2024 [4] - Essex Property acquired two joint venture apartment communities in San Jose, CA, valued at a combined $290.5 million [4] Balance Sheet Overview - At the end of the third quarter, the company had cash and cash equivalents of $80.2 million, up from $64.2 million at the end of the previous quarter [5] - Total net debt stood at $6.37 billion, with a net debt-to-Adjusted EBITDAre ratio of 5.5X and a weighted average interest rate of 3.6% [6] 2024 Guidance - For the fourth quarter of 2024, Essex Property projects core FFO per share between $3.82 and $3.94, with a midpoint of $3.88, aligning closely with the Zacks Consensus Estimate of $3.89 [7] - The full-year 2024 core FFO per share guidance has been revised to a range of $15.50 to $15.62, with the midpoint at $15.56, compared to the previous range of $15.38 to $15.62 [7] - Same-property revenue growth is now projected between 3.1% and 3.4%, with operating expense growth expected to remain at 4.5% to 5% [8]