Acadia Realty Trust(US:AKR)2025-10-29 17:02Financial Data and Key Metrics Changes - The company reported same-store NOI growth of 8.2%, with street retail portfolio delivering 13% growth during the quarter [29][31] - The quarterly FFO increased by a penny to $0.29 compared to the previous quarter's $0.28, despite short-term dilution from the partial conversion of the City Point loan [36][37] - The company expects total same-store growth of 6%-7% in Q4, aiming to achieve the upper end of the 5%-6% projection for the year [31][32] Business Line Data and Key Metrics Changes - The leasing team executed $3.7 million in AVR during Q3, bringing total signed leases year-to-date to $11.4 million, ahead of last year's record pace [17][18] - The company added, expanded, or renewed leases with several high-demand brands, achieving an average GAAP spread of 36% in high-growth markets [19][20] - The company converted approximately $7 million of AVR from S&O to open and paying tenants during the quarter [18][19] Market Data and Key Metrics Changes - Sales for reporting tenants on the streets showed significant growth, with SoHo sales up 15%, Bleecker Street over 30%, and Gold Coast of Chicago over 40% [23][24] - Despite concerns in Washington, DC, sales on M Street increased by 16% year-over-year, indicating strong tenant demand [24] - The company noted a resurgence in foot traffic and energy in key markets, including San Francisco, driven by economic recovery and demographic trends [10][11] Company Strategy and Development Direction - The company aims to build Acadia Realty Trust into the premier owner-operator of street retail in the U.S., focusing on both internal and external growth opportunities [15][28] - The strategy includes maintaining a 5% plus annual growth rate through internal growth opportunities and accretive external acquisitions [7][12] - The company is confident in its ability to fund acquisitions and redevelopment projects, with a strong balance sheet and liquidity [30][39] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the ongoing economic recovery, particularly among affluent consumers, which is driving demand for street retail [49][50] - The company anticipates continued strong performance in its street retail portfolio, with several years of tailwinds expected [15][40] - Management acknowledged the importance of adapting to market conditions and maintaining flexibility in funding strategies [68][69] Other Important Information - The company plans to refine its FFO definition for 2026 to provide a clearer link between real estate growth and bottom-line earnings [30][38] - The company raised approximately $212 million of equity during the quarter to fund its acquisition pipeline and redevelopment projects [39][40] Q&A Session Summary Question: Can you lift the veil a little bit on the pipeline of acquisitions you're looking at? - The company indicated that the $500 million pipeline is a gross number, with specific conversations ongoing regarding potential deals [42][44] Question: Are you seeing no signs of slowing down in terms of tenant demand? - Management confirmed that the affluent consumer is driving recovery, leading to strong sales and profitability for retailers in key locations [48][49] Question: Could you go into some of the considerations of what would make you hit the 5% versus the 9% growth in 2026? - The company highlighted that achieving the higher end of growth depends on the speed of leasing and opening spaces, with confidence in reaching at least 5% [54][55] Question: What proportion of the mark-to-market opportunity has already been addressed? - Management noted significant sales growth in key markets and indicated that the company has already addressed a portion of the mark-to-market opportunities [76] Question: Any sense what the split might look like on that $500 million pipeline between core and investment management deals? - The company refrained from providing specific numbers but emphasized a robust pipeline and the ability to fund all opportunities [81]