Franklin Street Properties (US:FSP)2021-11-09 19:34Financial Data and Key Metrics Changes - The company reported funds from operations (FFO) of $14.8 million, or $0.14 per share for Q3 2021 [8] - Total debt outstanding decreased to $475 million from $1 billion a year ago, representing a 53% reduction [10][12] - Total liquidity at quarter end was approximately $609.7 million, including cash on hand and availability on the line [10] Business Line Data and Key Metrics Changes - The FSP portfolio was approximately 78.8% leased at the end of Q3, up from 78.5% at the end of Q2, attributed to 172,000 square feet of new leasing [17] - Over 890,000 square feet of total leasing was finalized during the first nine months of 2021, with only 72,000 square feet of tenants expiring in Q4 [20] Market Data and Key Metrics Changes - The company has sold a total of eight properties in 2021 for aggregate gross proceeds of approximately $563 million, exceeding original disposition guidance [12][23] - The weighted average in-place cap rate for sold properties was approximately 5.8%, expected to adjust to about 5.4% with pending sales included [25] Company Strategy and Development Direction - The company has increased the top end of its 2021 disposition guidance from approximately $450 million to a new range of approximately $563 million to $600 million [14] - The strategy focuses on reducing corporate indebtedness and positioning for stronger future returns, with a commitment to high-quality properties in dynamic markets [26] Management's Comments on Operating Environment and Future Outlook - Management believes the current stock price does not accurately reflect the value of underlying real estate assets, indicating a strategy to continue selling select properties to enhance shareholder value [15][16] - The company is optimistic about the potential for leasing appreciation as markets reopen post-COVID [31] Other Important Information - The company intends to use proceeds from future dispositions for debt reduction, stock repurchases, and special dividends to meet REIT requirements [16] Q&A Session Summary Question: What is the expected special dividend based on year-to-date sales? - The CFO stated that no specific amount could be disclosed at this time as calculations are still ongoing [29] Question: Is the Board considering strategic alternatives given the undervaluation of assets? - The CEO confirmed that the Board is considering all avenues to create the best value for shareholders, including strategic alternatives [30][35]