Highwoods Properties Q3 FFO Meets Estimates, Revenues Miss

Highwoods Properties Inc. HIW reported third-quarter 2025 funds from operations (FFO) per share of 86 cents, meeting the Zacks Consensus Estimate. However, the figure was lower than the prior-year quarter’s 90 cents.Quarterly results reflect healthy leasing activity with rent growth. However, the decline in occupancy and same-property net operating income (NOI) undermines the results to an extent. HIW revised its outlook for 2025.Rental and other revenues were $201.8 million, missing the Zacks Consensus Estimate of $203.4 million. The figure fell by 1.2% year over year.HIW’s Third Quarter in DetailHighwoods’ second-generation leasing activity encompassed 1.0 million square feet of space in the third quarter, including 326,000 square feet of new leases. The dollar-weighted average term is 6.7 years. GAAP rent growth was 18.3%, while net effective rents were 21.8% higher than the previous five-quarter average.Highwoods’ average in-place cash rent was up 1.6% per square foot from the prior-year quarter. At the end of the reported quarter, the in-service portfolio occupancy (at HIW share) declined 20 basis points from the prior quarter to 85.3%. The same-property cash NOI decreased 3.6% year over year to $131.5 million.The present development pipeline aggregates $474 million (at HIW share) and is 72% pre-leased. During the third quarter, the company also signed 138,000 square feet of first-generation leases.Portfolio Activity of HIWDuring the third quarter, Highwoods purchased Legacy Union Parking Garage for $111.5 million, including planned near-term building improvements. Located at 720 South Church Street in Uptown Charlotte, the 3,057-space garage provides parking for 1.2 million square feet of office space owned by Highwoods at Legacy Union.During the quarter, Highwoods sold off a non-core office building in Richmond, VA, encompassing 107,000 square feet, for $16 million.HIW’s Balance Sheet PositionThe company’s total available liquidity amounted to more than $625 million, including cash on hand, availability on the revolving credit facility and pro rata share of undrawn joint venture construction loans. The reported net debt-to-adjusted EBITDAre ratio was 6.4, unchanged from the previous quarter.HIW’s 2025 Guidance RevisionHighwoods has raised its 2025 FFO per share guidance to the range of $3.41-$3.45 from the earlier guided range of $3.37-$3.45. The Zacks Consensus Estimate is currently pegged at $3.42, which lies within this range.HIW expects growth in same-property cash NOI between -3% and -2%, and year-end occupancy of 85.7% to 86.3%.HIW's Zacks RankHighwoods currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.Highwoods Properties, Inc. Price, Consensus and EPS Surprise Highwoods Properties, Inc. price-consensus-eps-surprise-chart | Highwoods Properties, Inc. QuotePerformance of Other Office REITsBXP Inc.’s BXP third-quarter 2025 FFO per share of $1.74 surpassed the Zacks Consensus Estimate of $1.72. BXP’s quarterly results reflected better-than-anticipated revenues on healthy leasing activity. However, lower occupancy during the quarter marred the performance to some extent.SL Green Realty Corp. SLG reported a third-quarter 2025 FFO per share of $1.58, which beat the Zacks Consensus Estimate of $1.34. Results reflected a strong leasing activity with improved average rental rates on the Manhattan office leases signed in this period.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.#1 Semiconductor Stock to Buy (Not NVDA)The incredible demand for data is fueling the market's next digital gold rush. As data centers continue to be built and constantly upgraded, the companies that provide the hardware for these behemoths will become the NVIDIAs of tomorrow.One under-the-radar chipmaker is uniquely positioned to take advantage of the next growth stage of this market. It specializes in semiconductor products that titans like NVIDIA don't build. It's just beginning to enter the spotlight, which is exactly where you want to be.See This Stock Now for Free >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Highwoods Properties, Inc. (HIW): Free Stock Analysis Report BXP, Inc. (BXP): Free Stock Analysis Report SL Green Realty Corporation (SLG): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks