Kite Realty Trust(US:KRG)2023-02-15 14:35Financial Data and Key Metrics Changes - The company generated FFO as adjusted per share of $1.93 for the full year, representing a 29% increase over 2021 and exceeding the midpoint of original 2022 guidance by $0.21 [69][74] - Same-property NOI growth for the full year was 5.1%, with a fourth-quarter growth of 6.2% driven by a 420 basis point increase in minimum rent and recoveries [93][94] - The net debt-to-EBITDA ratio improved to 5.2x, indicating a strong balance sheet [70][75] Business Line Data and Key Metrics Changes - The company leased nearly 4.9 million square feet with a 12.6% blended comparable cash leasing spread, showcasing strong demand for its retail spaces [70] - The company opened 245 new tenants, contributing approximately $40 million of annualized NOI [71] Market Data and Key Metrics Changes - The company reported a 90% leased and 86% occupied rate, indicating a healthy occupancy level [4] - The company noted a strong demand from various anchor tenants, including ALDI, Lidl, and Trader Joe's, reflecting a robust retail environment [90] Company Strategy and Development Direction - The company aims to close the 150 basis point spread between current and pre-COVID leased rates, focusing on internal growth through leasing [71] - The strategy includes a measured approach to future development opportunities, with only $44 million remaining for active developments [72] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the ability to navigate an uncertain macro environment while focusing on leasing space [71] - The company anticipates potential disruptions from Bed Bath & Beyond and Party City but remains optimistic about overall retail demand [90][94] Other Important Information - The company has a $33 million signed-not-open pipeline to buffer against potential tenant disruptions in 2023 [71] - Management highlighted the importance of maintaining flexibility in capital allocation, focusing on leasing and potential acquisitions [78] Q&A Session Summary Question: What is the company's long-term target leverage level? - The company targets low to mid-5s for leverage and is currently at 5.2x, indicating a strong balance sheet [77] Question: What are the assumptions behind the guidance for 2023? - The guidance includes a same-property NOI growth of 2.5%, a bad debt assumption of 125 basis points, and an additional 75 basis points of assumed disruption from Bed Bath & Beyond and Party City [94][144] Question: How is the company addressing potential store closures from troubled tenants? - The company identified three potential closures from Bed Bath & Beyond and is actively negotiating with interested tenants for those spaces [107]