BPG(US:BRX)2022-05-03 20:21Financial Data and Key Metrics Changes - The company reported a year-over-year FFO growth of 11.4%, primarily driven by same-store NOI growth of 8.4% [7][16] - Nareit FFO was $0.49 per share in the first quarter, with same property NOI growth reflecting approximately $8 million of cash collected on previously reserved base rent [16][22] - The company revised its 2022 same property NOI growth expectations from 2%-4% to 3%-4.5% due to significant out-of-period collections [22] Business Line Data and Key Metrics Changes - The company signed nearly 1.4 million square feet of new and renewal leases during the quarter at a cash spread of 18.1%, with new leases at a comparable spread of 35.9% [8][19] - Small shop occupancy reached an all-time record of 87%, with a drag of 120 basis points from in-process redevelopment [8][18] - The average in-place ABR increased to a record of $15.64 per square foot, with significant growth in traffic levels over pre-pandemic peaks [9][54] Market Data and Key Metrics Changes - The company reported a total signed but not commenced pool of $52 million at a blended rate of nearly $19 per square foot, expected to commence throughout the year [18][22] - The forward leasing pipeline includes an additional $50 million of ABR from new leases at an average rent of over $18 per square foot [9][22] Company Strategy and Development Direction - The company continues to focus on its value-added strategy, which has shown resilience and growth potential even in less favorable market conditions [6][10] - The company is actively pursuing attractive investment opportunities in core markets, emphasizing the importance of clustering investments [12][34] - The company has delivered over $720 million of accretive reinvestments impacting over 30% of its portfolio, with a strong pipeline of nearly $1 billion in opportunities [11][12] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the strength of the leasing environment, noting that consumer demand remains robust despite macroeconomic concerns [56][57] - The company anticipates continued growth in small shop occupancy and rates, driven by its value-added strategy [49][50] - Management highlighted the importance of maintaining a disciplined approach to acquisitions and investments, focusing on opportunities that meet return requirements [82] Other Important Information - The company repaid $250 million of floating rate notes upon maturity and amended its unsecured credit facilities, improving pricing and extending maturities [20][21] - The company's credit rating was upgraded to BBB flat by Fitch, reflecting improvements made to its balance sheet [21] Q&A Session Summary Question: How much further can small shop occupancy increase? - Management expects to continue setting new records in small shop occupancy, despite a current drag from redevelopment projects [26][27] Question: What is the investment activity outlook for the year? - The company remains focused on value-added opportunities and expects to see more dispositions in the pipeline [34][35] Question: How is the company addressing last-mile fulfillment needs? - Tenants are integrating fulfillment capabilities into their store designs, and the company is accommodating these needs through its leasing strategies [29][30] Question: What is the current mark-to-market for the portfolio? - The current mark-to-market is approximately $15 per square foot, with new leases being signed between $17 and $20 per square foot [65][66] Question: How does the company view tenant retention? - The company is prioritizing growth in ROI over retention, willing to take vacancies if it leads to higher returns [75][76] Question: What is the company's acquisition capacity? - The company is opportunistic in its acquisition strategy, focusing on opportunities that meet return requirements without feeling pressured to acquire [82]