Los Angeles-based Alexandria Real Estate Equities Inc. revealed financial and operating results for the second quarter ended June 30, 2018 and showed strength. Common stock dividend for 2Q18 of $0.93 per common share, up 7 cents, or 8.1%, over 2Q17; continuation of the firm’s strategy to share growth in cash flows from operating activities with its stockholders while also retaining a significant portion for reinvestment.
According to analyst firm, BTIG, robust demand for life science real estate supports the REIT’s above-average internal growth.
Key highlights showing internal growth are as follows:
- Total revenues:
- $325.0 million, up 19.0%, for 2Q18, compared to $273.1 million for 2Q17
- $645.2 million, up 18.6%, for 1H18, compared to $543.9 million for 1H17
- Net operating income (cash basis) of $818.7 million for 2Q18 annualized, up $60.4 million, or 8.0%, compared to 1Q18 annualized, and up $125.5 million, or 18.1%, compared to 4Q17 annualized
- Same property net operating income growth:
- 4.1% and 6.3% (cash basis) for 2Q18, compared to 2Q17
- 4.1% and 10.3% (cash basis) for 1H18, compared to 1H17
- Continued solid leasing activity and strong rental rate growth, in light of modest contractual lease expirations at the beginning of 2018 and a highly leased value-creation pipeline:
Acquisitions completed in the quarter were as follows:
- In 2Q18 and July 2018, we acquired 14 properties and four land parcels for an aggregate purchase price of $662.9 million in key submarkets. These acquisitions consisted of:
- Two properties and four land parcels supporting the future development of new Class A buildings aggregating 1,010,000 RSF;
- 389,452 RSF of value-add operating properties with future redevelopment opportunities, including $203.0 million for a fee simple interest in an office building aggregating 349,947 RSF located in New York City, which is currently occupied by Pfizer Inc.; and
- 828,014 RSF of 99% occupied operating properties, including significant below-market leases.