Douglas Emmett (DEI) Overview Fully-Integrated Operating Platform ✓ Includes in-house leasing, space planning, legal, construction and design ✓ Major competitive advantage with our small affluent tenants ✓ Lowers operating, G&A, leasing and tenant improvement costs Strong Internal and External Growth ✓ Better long-term rent growth and less volatility than other gateway markets ✓ Our leases benefit from strong 3% to 5% annual rent increases ✓ Strong portfolio growth since IPO: office up 56% and multifamily u ...

Financial Data and Key Metrics Changes - For the full year 2025, the company reported FFO per share of $2.00, which is approximately 3% above initial expectations [3] - Fourth quarter FFO per share was $0.47, a decrease of about $0.02 compared to Q3 2025, primarily due to non-recurrence of termination fees recognized in Q3 [20] - Same-store cash NOI for the full year increased by 0.5% compared to 2024, with office increasing by 2.3%, retail by 1.2%, multifamily declining by 3.2%, and mixed-use declining by 6.7% [21][22] Business Line Data and Key Metrics Changes - The office segment saw continued leasing progress, with same-store office NOI increasing just over 1% for the quarter and nearly 2.5% for the full year [8] - Retail segment ended the year at 98% leased, with positive cash and GAAP leasing spreads for the quarter, and leasing spreads for the year were 7% on a cash basis and 22% on a GAAP basis [11] - Multifamily segment ended the year 95.5% leased, achieving approximately 1% net effective rent growth year over year, despite competitive leasing conditions [12][13] Market Data and Key Metrics Changes - In West Coast office markets, signs of stabilization and gradual improvement in leasing activity were noted, with vacancy trends showing early signs of stabilization [6][7] - The company reported that occupancy averaged roughly 82% in the mixed-use segment, with RevPAR down approximately 7% to about $296 due to softer tourism trends [22] - Retail availability is expected to remain near record lows nationally, supporting asking rents [12] Company Strategy and Development Direction - The company aims to drive office leasing by converting prospect activity into signed leases and maintaining retail momentum by managing expirations and focusing on tenant quality [18] - The strategy includes managing through the multifamily supply cycle with disciplined revenue management and cost control [18] - The company is focused on maintaining a strong balance sheet and improving valuation over time, with a target to achieve long-term net debt to EBITDA of 5.5x or below [24][17] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the company's coastal infill locations and high-quality real estate positioning to capture demand as it materializes [5] - The outlook for 2026 includes a FFO guidance range of $1.96-$2.10 per share, with a midpoint of $2.03, reflecting a conservative approach to guidance [25][19] - Management acknowledged macroeconomic uncertainties but emphasized the importance of consistent operational execution and cash flow durability [16] Other Important Information - The company declared a quarterly dividend of $0.34 per share for the first quarter, with expectations to maintain the dividend at current levels [17] - Liquidity at the end of the fourth quarter was approximately $529 million, with a leverage ratio of 6.9x on a trailing twelve-month basis [23][24] Q&A Session Summary Question: Regarding elevated TIs for renewals, is this a strategic decision or reflective of weak demand? - Management indicated that higher capital burdens for office leasing are expected to moderate as occupancy improves and availability tightens, with specific examples of tenant renewals driving elevated TIs [36][37] Question: What is the timeline to achieve the target leverage of 5.5x? - Management stated that leasing up La Jolla Commons III and One Beach will help achieve the target leverage, aiming for a timeline as soon as those properties are leased up [40] Question: Are there any strategic asset sales planned to improve stock valuation? - Management remains pragmatic about asset sales, willing to sell at fair value but not at a discount, focusing on discipline and long-term value creation [42][43] Question: What is the current status of leasing activity and tenant types? - Management reported a diverse range of high-quality tenants driving demand, with significant leasing activity at La Jolla Commons III and One Beach [72][73] Question: Can you elaborate on the credit reserves included in guidance? - Management clarified that the credit reserves are a conservative measure, with no acute concerns about specific tenants, but a general reserve for potential issues [84][85] Question: What is the path back to 90% occupancy in the office segment? - Management believes achieving 90% occupancy is reasonable within two years, emphasizing the investments made in spec suites and the quality of inventory available [86][88]

Financial Data and Key Metrics Changes - For the full year 2025, the company reported FFO per share of $2.00, which is about 3% above initial expectations [3] - Same-store cash NOI increased by 0.5% compared to 2024 [18] - Fourth quarter FFO per share was $0.47, a decrease of approximately $0.02 compared to Q3 2025 [18] Business Line Data and Key Metrics Changes - Office segment same-store NOI increased by 2.3% for the year, driven by higher base rent and improved expense recoveries [19] - Retail segment same-store NOI increased by 1.2% for the year, reflecting strong growth in the first half of 2025 [19] - Multifamily segment declined by 3.2% for the year due to flat to modestly lower rents and elevated concessions [20] - Mixed-use segment declined by 6.7% in 2025, impacted by softer hotel demand in Waikiki [20] Market Data and Key Metrics Changes - The office portfolio ended the quarter 83% leased, with same-store office portfolio at 86% leased, up about 150 basis points from Q3 [6] - Retail segment ended the year at 98% leased, with positive cash and GAAP leasing spreads [10] - Multifamily ended the year 95.5% leased, with approximately 1% net effective rent growth year over year [11] Company Strategy and Development Direction - The company aims to drive office leasing by converting prospect activity into signed leases and commenced revenue [16] - Retail momentum will be maintained by keeping centers full and managing expirations [16] - The company plans to manage through the multifamily supply cycle with disciplined revenue management and cost control [16] - The focus will be on prudent hotel operations while responding to market demand [16] Management's Comments on Operating Environment and Future Outlook - Management believes that coastal infill locations and high-quality real estate position the company to capture demand as it materializes [5] - The company views 2026 as an opportunity to build upon the progress made in 2025, with a focus on operational execution and long-term value creation [15][16] - Management expressed frustration with the current share price, indicating that it does not reflect the intrinsic value of the company's assets [14] Other Important Information - The company declared a quarterly dividend of $0.34 per share for the first quarter, with expectations to maintain the dividend at current levels [15] - Liquidity at the end of the fourth quarter was approximately $529 million, with a leverage ratio of 6.9x on a trailing twelve-month basis [22][23] Q&A Session Summary Question: Regarding elevated TIs for office renewals - Management acknowledged that higher capital burdens for office leasing are expected to moderate over time as occupancy improves [35][36] Question: Timeline to achieve target leverage of 5.5x - Management indicated that leasing up La Jolla Commons 3 and One Beach will help achieve the target leverage [40] Question: Steps to reinvigorate stock price - Management is open to strategic asset sales if they reflect long-term value but will not sell at a discount [42][43] Question: Guidance assumptions for office segment lease rates - Management reported that 68,000 sq ft has been signed year-to-date, with a significant pipeline of leasing activity [49] Question: Credit reserves in guidance - Management clarified that credit reserves are a conservative measure and not indicative of specific tenant concerns [84]

Core Viewpoint - American Assets Trust, Inc. reported its financial results for the fourth quarter and the year ended December 31, 2025, showing a decline in net income and funds from operations (FFO) compared to the previous year [1][2]. Financial Results - For the fourth quarter of 2025, net income was $4.2 million, down from $11.6 million in Q4 2024, and for the full year, net income was $71.4 million, a decrease from $72.8 million in 2024 [3][26]. - Basic and diluted income attributable to common stockholders per share was $0.05 for Q4 2025, compared to $0.15 in Q4 2024, and $0.92 for the full year 2025, down from $0.94 in 2024 [3][22]. - FFO attributable to common stock and common units was $36.0 million for Q4 2025, down from $42.1 million in Q4 2024, and $153.4 million for the full year, compared to $197.5 million in 2024 [3][4][28]. Leasing Activity - The company leased 193,000 square feet of office space and 43,000 square feet of retail space in Q4 2025, with average contractual rent increases of 11.5% for office and 24.3% for retail [5][10]. - The total portfolio leased status as of December 31, 2025, was 83.1% for office, 97.7% for retail, and 93.7% for multifamily properties [6][7]. Same-Store Cash Net Operating Income (NOI) - Same-store cash NOI remained flat for Q4 2025 and increased by 0.5% for the full year compared to the same periods in 2024 [12][25]. - The cash NOI by segment for Q4 2025 was $34.5 million for office, $17.1 million for retail, and $8.9 million for multifamily [12]. Balance Sheet and Liquidity - As of December 31, 2025, the company had gross real estate assets of $3.8 billion and liquidity of $529.4 million, including $129.4 million in cash and cash equivalents [14]. - The company had only one asset encumbered by a mortgage at the end of 2025 [14]. Dividends - The company declared a dividend of $0.340 per share for Q4 2025, which was paid on December 18, 2025, and has declared the same amount for Q1 2026, payable on March 19, 2026 [16]. Guidance - The company introduced guidance for 2026, projecting FFO per diluted share to be in the range of $1.96 to $2.10, with a midpoint of $2.03 [17].

Core Insights - AvalonBay Communities, Inc. (AVB) is set to announce its fourth-quarter and full-year 2025 results on February 4, with a previous negative surprise of 2.14% in core funds from operations (FFO) per share in the last quarter, attributed to weaker-than-expected top-line growth [1][2] Company Performance - Over the past four quarters, AvalonBay's earnings have surpassed the Zacks Consensus Estimate twice, with an average negative surprise of 0.36% [2] - The Zacks Consensus Estimate for fourth-quarter revenues is $768.33 million, indicating a year-over-year increase of 3.75% [10] - The consensus for same-store economic occupancy is projected at 95.65% for the fourth quarter [10] - The quarterly core FFO per share estimate has been revised down by 2 cents to $2.84, reflecting a year-over-year growth of 1.43% [11] Market Conditions - The US apartment market experienced a softening in fundamentals during the fourth quarter of 2025, with net move-outs of approximately 40,400 units, marking the first seasonal pullback in three years [3] - Full-year absorption totaled over 365,900 units, indicating a return to long-term leasing trends rather than a demand collapse [3] - Approximately 409,500 units were delivered in 2025, with 89,400 units in the fourth quarter, leading to increased competition despite a slowdown in completions [4] Financial Outlook - AvalonBay has lowered its core FFO per share growth outlook to 2.2% from 3.5%, with same-store residential NOI growth reduced to 2% from 2.7% due to lower revenue growth and higher expense growth [7] - The company has faced challenges from lower-than-expected job growth, leading to revenue moderation and higher operating costs in the second half of 2025 [8] - For full-year 2025, the Zacks Consensus Estimate for core FFO per share has been revised down by 3 cents to $11.24, indicating a year-over-year increase of 2.09% on revenues of $3.04 billion [12] Competitive Landscape - Market performance remains uneven, with supply-heavy Sun Belt markets experiencing the steepest rent pressure, while coastal and tech-oriented metros continue to see rent growth due to tighter supply [5] - AvalonBay's near-term outlook has moderated amid decelerating rent growth and rising expenses, but a solid balance sheet and limited upcoming supply in core markets position the company for long-term stability [6]

Core Viewpoint - Transcontinental Realty Investors, Inc. reported a decrease in net income for the quarter ended September 30, 2025, despite an increase in revenues, primarily due to higher operating expenses and a decrease in interest income [1][5]. Financial Highlights - Revenues increased by $1.2 million from $11.6 million in Q3 2024 to $12.8 million in Q3 2025, driven by a $0.3 million increase from multifamily properties and a $1.0 million increase from commercial properties [3]. - Total occupancy was reported at 82% as of September 30, 2025, with multifamily properties at 94% and commercial properties at 58% [7]. Operating Results - Net operating loss decreased by $0.3 million from $1.7 million in Q3 2024 to $1.4 million in Q3 2025, attributed to increased revenue offset by a $1.0 million rise in operating expenses [4]. - Operating expenses rose primarily due to increased costs associated with lease-up properties and general administrative expenses [4]. Income Analysis - Net income attributable to the Company decreased by $1.0 million from $1.7 million in Q3 2024 to $0.7 million in Q3 2025, mainly due to a decrease in interest income and an increase in tax provision [5]. - Interest income fell from $5.9 million in Q3 2024 to $4.7 million in Q3 2025, while interest expense decreased from $2.1 million to $1.7 million during the same period [8]. Transaction Activity - The Company sold Villas at Bon Secour, a 200-unit multifamily property in Gulf Shores, Alabama, for $28 million, using the proceeds to pay off an $18.767 million loan and for general corporate purposes [7].

Core Insights - Douglas Emmett (DEI) reported revenue of $250.58 million for the quarter ended September 2025, reflecting a slight decline of 0.1% year-over-year, while EPS increased to $0.34 from $0.03 in the same quarter last year [1] - The revenue exceeded the Zacks Consensus Estimate of $249.92 million by 0.27%, but the EPS met the consensus estimate without delivering a surprise [1] Revenue Breakdown - Total multifamily revenues were reported at $49.52 million, slightly below the two-analyst average estimate of $49.57 million, showing a year-over-year increase of 3% [4] - Total office revenues reached $201.06 million, surpassing the two-analyst average estimate of $200.32 million, but reflecting a year-over-year decline of 0.8% [4] Stock Performance - Over the past month, shares of Douglas Emmett have decreased by 15.1%, contrasting with a 2.1% increase in the Zacks S&P 500 composite [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]

Core Insights - Newmark Group, Inc. has arranged a $600 million loan package for West Shore, which includes refinancing over $250 million in existing debt and acquiring three multifamily assets totaling 1,496 units across multiple states [1][2][5] Financing Details - The loan package consists of a $550 million senior mortgage and a $50 million mezzanine loan, making it the third-largest multifamily transaction in the U.S. in 2025 [2] - The transaction closed within 60 days, showcasing efficient execution by Newmark's team [2] Company Growth - This transaction marks West Shore's second SASB transaction in the past year, indicating its growth as a significant multifamily owner in the Sunbelt region [3] - Under President Lee Rosenthal, West Shore has expanded to over 18,500 units across nine states [3] Market Context - The financing reflects strong demand for well-leased, institutionally managed multifamily properties, particularly in high-growth markets [5] - U.S. multifamily investment volume reached $41 billion in Q2 2025, a 15% increase quarter-over-quarter, driven by improved lending conditions and institutional capital flows [6]

Financial Data and Key Metrics Changes - Funds from operations (FFO) per share for Q3 2025 was reported at $1.74, which is $0.04 above the forecast and $0.02 above market consensus [5][37] - The midpoint of the earnings guidance for the full year 2025 was raised by $0.03, now projected at $6.89 to $6.92 per share [5][39] - Occupancy in the same property pool increased by 20 basis points from the previous quarter, reaching 86.6% [21][37] Business Line Data and Key Metrics Changes - Over 1.5 million square feet of leasing was completed in Q3 2025, a 39% increase compared to Q3 2024 and 130% of the last five-year average for the same quarter [6][5] - Year-to-date leasing activity totaled 3.8 million square feet, which is 14% greater than the first three quarters of 2024 [6] - The total portfolio percentage leased for the quarter was 88.8%, a decline of 30 basis points, but an increase of 10 basis points from June 30 [22] Market Data and Key Metrics Changes - Office transaction volume in private markets reached $12.9 billion in Q3 2025, up 6% from Q2 2025 and 55% from Q3 2024 [8] - Direct vacancy for premier workplaces in key markets is 11.7%, which is 22% lower than the broader market [10] - The overall mark-to-market on leases signed in Q3 was up almost 7%, with notable increases in Boston and New York [24] Company Strategy and Development Direction - The company aims to sell 27 non-strategic assets for approximately $1.9 billion by the end of 2027, with 23 transactions either closed or underway totaling roughly $1.25 billion in estimated net proceeds [7][8] - Focus on increasing portfolio concentration of premier workplace assets in core gateway markets, with a strategy to reallocate capital to high-quality developments [10][11] - Plans to grow FFO through new development, particularly in multifamily projects, while being selective in office developments due to market conditions [13][14] Management's Comments on Operating Environment and Future Outlook - Management noted that clients are growing and utilizing their spaces more intensively, leading to positive leasing market conditions [16] - The company expects to achieve a 200 basis point increase in occupancy by the end of 2026, supported by a strong leasing pipeline [51][68] - The overall economic environment is improving, with debt and equity investors becoming more constructive on the office sector [16] Other Important Information - The company recorded $212 million in impairments related to assets part of the strategic sales program [38] - The debt markets have improved, allowing the company to successfully access both secured and unsecured markets, including a $1 billion issuance of exchangeable notes [34][36] Q&A Session Summary Question: Thoughts on reallocating capital into premier locations and smaller markets like Seattle and LA - Management acknowledged that LA and Seattle are smaller markets with weaker leasing conditions and currently do not see development opportunities in those areas [46] Question: Confidence level regarding occupancy increases in 2026 - Management expressed confidence in achieving a 200 basis point increase in occupancy by the end of 2026, supported by ongoing leasing activity [51] Question: Recovery in San Francisco and Salesforce's investment impact - Management noted that AI demand is focused on low-rise buildings rather than high-rise, and Salesforce's commitment is seen as positive for job growth and office demand [54][58] Question: Percentage of pre-pandemic leases still to be addressed - Management indicated that a significant portion of the portfolio consists of long-term leases, and most growth is coming from existing clients expanding their space [63][65] Question: Addressing vacancy and occupancy build - Management stated that projections are based on annual expectations, with confidence in achieving occupancy increases driven by current leasing activity [68]

Core Insights - Veris Residential achieved the highest score among U.S. listed residential multifamily companies in the GRESB 2024 assessment and secured the third-highest score globally [1] - The company increased the share of green-certified properties (LEED or equivalent) to 79% of its managed multifamily portfolio [1] - Veris Residential secured sustainability-linked financing, resulting in a 5-basis-point margin reduction [1] Sustainability Performance - The 2024 Sustainability Report highlights strategic sustainability investments that generate measurable returns [1] - These investments are positioned to strengthen the company's competitive position in the multifamily market [1]