PASADENA, Calif., April 25, 2022 /PRNewswire/ -- Alexandria Real Estate Equities, Inc. (NYSE:ARE) announced financial and operating results for the first quarter ended March 31, 2022.
Key highlights
Operating results
1Q22
1Q21
Total revenues:
In millions
$
615.1
$
479.8
Growth
28.2%
Net (loss) income attributable to Alexandria's common stockholders diluted
In millions
$
(151.7)
$
6.1
Per share
$
(0.96)
$
0.04
Funds from operations attributable to Alexandria's common stockholders diluted, as adjusted
In millions
$
324.6
$
263.0
Per share
$
2.05
$
1.91
Continued strong leasing volume in 1Q22, after a historic year of leasing in 2021
1Q22
Total leasing activity RSF
2,463,438
Leasing of development and redevelopment space RSF
1,439,696
Lease renewals and re-leasing of space:
RSF (included in total leasing activity above)
864,077
Rental rate increases
32.2%
Rental rate increases (cash basis)
16.5%
Excluding short-term renewals executed to allow Bristol-Myers Squibb Company ("BMS") to expand and consolidate into our Alexandria Point development project, described further below:
Rental rate increases
39.8%
Rental rate increases (cash basis)
23.2%
Continued strong net operating income and internal growth
A REIT industry-leading high-quality tenant roster with high-quality revenues and cash flows, strong margins, and operational excellence
Percentage of total annual rental revenue in effect from investment-grade or publicly traded large cap tenants
50%
Occupancy of operating properties in North America
94.7%
Occupancy of operating properties in North America (excluding vacancy at recently acquired properties)
98.6%
(1)
Operating margin
71%
Adjusted EBITDA margin
71%
Weighted-average remaining lease term:
All tenants
7.3
years
Top 20 tenants
10.5
years
(1)
Excludes 1.6 million RSF, or 3.9%, of vacancy at recently acquired properties representing lease-up opportunities that are expected to provide incremental annual rental revenue. Refer to "Occupancy" in our Supplemental Information.
100 Binney Street achieves $1 billion valuation milestone in recapitalization
During 1Q22, we completed the sale of a 70% interest in 100 Binney Street in our Cambridge/Inner Suburbs submarket of Greater Boston for a sales price of $713.2 million, or $2,353 per RSF, at capitalization rates of 3.6% and 3.5% (cash basis), representing an excess of $413.6million above our book value of the 70% interest sold. The sales price at 100% represents a property valuation of $1.02 billion. Proceeds from this sale will be reinvested into our highly leased value-creation pipeline and acquisitions with development and redevelopment opportunities.
Continued high demand drives visibility for future growth aggregating $665 million of incremental annual rental revenue
Our highly leased value-creation pipeline of current and key near-term projects that are under construction or that will commence construction in the next six quarters is expected to generate greater than $665 million of incremental annual rental revenue, primarily commencing from 2Q22 through 1Q25.
Strong and flexible balance sheet with significant liquidity
Continued dividend strategy to share growth in cash flows with stockholders
Common stock dividend declared for 1Q22 of $1.15 per common share, aggregating $4.54 per common share for the twelve months ended March 31, 2022, up 24 cents, or 6%, over the twelve months ended March 31, 2021. Our FFO payout ratio of 57% for the three months ended March31, 2022 allows us to continue to share growth in cash flows from operating activities with our stockholders while also retaining a significant portion for reinvestment.
Key items included in operating results
Key items included in net (loss) income attributable to Alexandria's common stockholders:
(In millions, except per share amounts)
Amount
Per Share Diluted
1Q22
1Q21
1Q22
1Q21
Unrealized losses on non-real estate investments
$ (263.4)
$ (46.3)
$ (1.67)
$ (0.34)
Significant realized gains on non-real estate investments
22.9
Recommendation and review posted by G. Smith
