Cousins Properties Q1 FFO & Revenues Beat Estimates, '25 View Raised

Cousins Properties CUZ reported first-quarter 2025 funds from operations (FFO) per share of 74 cents, surpassing the Zacks Consensus Estimate of 71 cents. The figure also jumped 13.8% on a year-over-year basis.

Results reflect strong leasing activity contributing to occupancy and same-store net operating income (NOI) growth. CUZ also raised its 2025 outlook for FFO per share.

Rental property revenues rose 16.4% year over year to $243 million. It also exceeded the Zacks Consensus Estimate of $242.2 million. Total revenues grew 19.6% year over year to $250.3 million.

Per Colin Connolly, president & CEO of Cousins Properties, “With new construction at historic lows, office fundamentals in our Sun Belt markets are improving.” Connolly also pointed out, "Demand remains robust. We leased over 500,000 square feet of office space this quarter, the most we have leased during a first quarter since 2019."

CUZ’s First Quarter in Detail

Cousins Properties executed leases for 539,063 square feet of office space in the first quarter, including 204,620 square feet of new and expansion leases, representing 38% of total leasing activity.

Same-property rental property revenues on a cash basis rose 1.1% year over year to $192.1 million. The same-property rental property operating expenses on a cash basis fell 0.3% to $69.8 million in the first quarter of 2025. As a result, the same-property net operating income on a cash basis climbed 2% to $122.3 million from the prior-year period.

The weighted average occupancy of the same-property portfolio was 89.4%, up 150 basis points from a year ago.

CUZ ended the quarter with the same-property portfolio being leased 91.7%, up from 90.4% at the end of the year-ago period. The second-generation net rent per square foot (cash basis) climbed 3.2%.

However, interest expenses jumped 27.2% to $36.8 million year over year.

In the first quarter, CUZ completed the development of Domain 9, an office property encompassing 338,000 square feet in Austin at a total project cost of $147,000.

CUZ’s Balance Sheet

CUZ exited the first quarter of 2025 with cash and cash equivalents of $5.3 million, down from $7.3 million as of Dec. 31, 2024.

The company’s net debt-to-annualized EBITDAre ratio in the quarter was 4.87 compared with 5.16 in the prior quarter. Fixed charges coverage (EBITDAre) was 4.05X, up from 3.92X in the prior quarter.

CUZ’s 2025 Outlook Revision

Cousins Properties now expects 2025 FFO per share between $2.75 and $2.83, up from the earlier guided range of $2.73-$2.83. The Zacks Consensus Estimate is presently pegged at $2.79, within the guided range.

CUZ’s Zacks Rank

CUZ currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Cousins Properties Incorporated Price, Consensus and EPS Surprise

Cousins Properties Incorporated price-consensus-eps-surprise-chart | Cousins Properties Incorporated Quote

Performance of Other Office REITs

BXP Inc.’s BXP first-quarter 2025 FFO per share of $1.64 missed the Zacks Consensus Estimate of $1.65. BXP’s quarterly results reflected better-than-anticipated revenues on healthy leasing activity. However, lower occupancy during the quarter marred its year-over-year FFO per share growth. (See the Zacks Earnings Calendar to stay ahead of market-making news.)

SL Green Realty Corp. SLG reported a first-quarter 2025 FFO per share of $1.40, which surpassed the Zacks Consensus Estimate of $1.27. Results reflected improved average rental rates on the signed Manhattan office leases in the period and higher same-store cash NOI. However, elevated interest expenses undermined the results to some extent.

Note: Anything related to earnings presented in this write-up represents funds from operations (FFO), a widely used metric to gauge the performance of REITs.

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This article originally published on Zacks Investment Research (zacks.com).

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