American Assets Trust(US:AAT)2021-10-27 21:55Financial Data and Key Metrics Changes - The company reported Q3 2021 FFO per share of $0.57, an increase of approximately 11.4% compared to Q2 2021 [16] - Net income attributable to common stockholders per share was $0.17 for Q3 2021 [16] - Total revenue increased by approximately $6.5 million over Q2 2021, representing a 7% increase [19] Business Line Data and Key Metrics Changes - The office portfolio grew by approximately 440,000 square feet or nearly 13% in Q3 due to two new acquisitions [24] - Same-store cash NOI overall was strong at 14% year-over-year, with office properties showing consistent strength [19] - Retail leasing activity improved, with new deals signed with brands like Columbia Sportswear and Williams-Sonoma [13] Market Data and Key Metrics Changes - The multifamily portfolio was 96% leased in Portland and 98% leased in San Diego [14] - Retail collections improved from 93% in July to 96% in October, indicating a recovery in the retail sector [38] - Mixed-use properties saw a drop in collections from 85% in July to 72% in October, attributed to seasonal factors [38] Company Strategy and Development Direction - The company is optimistic about future growth, focusing on high-quality properties in dynamic markets [8] - Recent acquisitions in Bellevue, Washington, are expected to drive rent growth [9] - The company aims to enhance properties with modern amenities to attract high-quality tenants [11] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the recovery trajectory of the multifamily portfolio, particularly in San Diego [31] - The company anticipates further growth in 2022 and beyond, driven by strong local economies and demographics [8] - Management acknowledged challenges due to inflation in construction costs but remains optimistic about the value of their portfolio [50] Other Important Information - The Board of Directors approved a quarterly dividend of $0.30 per share for Q3 2021 [10] - The company had liquidity of approximately $522 million at the end of Q3 2021 [21] Q&A Session Summary Question: What is the outlook for the multifamily portfolio? - Management indicated that the multifamily portfolio is on an upward trend, particularly in San Diego, with a tight rental market [31] Question: Can you comment on the leasing environment for One Beach Street? - A strategic lease termination occurred to facilitate construction, which management believes will enhance the project's value [33] Question: What is driving changes in rent collections? - Retail collections have improved significantly as consumer spending has returned, while mixed-use properties experienced seasonal fluctuations [38][42] Question: What are the expectations for 2022 NOI? - Management expects 2022 to be a formative year, with confidence in recovery and growth in 2023 [48] Question: How is the company addressing inflation in construction costs? - The company has locked in costs for current projects, but anticipates significant inflation in future construction expenses [52]