EastGroup Properties Announces Recent Business Activity and Participation in Upcoming Conference

Rhea-AI Summary

EastGroup Properties (NYSE: EGP) reported strong portfolio performance with 97.1% leasing and 95.8% occupancy rates as of February 27, 2025. The company secured 1,438,000 square feet of new and renewal leases in Q1 2025, achieving significant rental rate increases of 45.0% on a straight-line basis and 30.9% on a cash basis.

In Charlotte, following Conn's Inc.'s lease rejection due to bankruptcy, EastGroup successfully re-leased the 300,000 square foot space with a 20% rental rate increase for a 7.5-year term starting March 31, 2025. The company also executed three development property leases totaling 151,000 square feet.

On the financial front, EastGroup entered forward equity sale agreements for 611,956 shares at $180.27 per share, potentially generating $110 million in proceeds. Additionally, the company settled previous forward equity agreements by issuing 214,138 shares for net proceeds of approximately $37 million.

JACKSON, Miss., Feb. 28, 2025 /PRNewswire/ -- EastGroup Properties, Inc. (NYSE: EGP) (the "Company", "we", "our", "us" or "EastGroup") announced today its recent business activity.

As of February 27, 2025, EastGroup's portfolio was 97.1% leased and 95.8% occupied. During the first quarter of 2025 to date, 1,438,000 square feet of new and renewal leases were signed with rental rate increases averaging 45.0% on a straight-line basis and 30.9% on a cash basis.

Also, since our earnings release dated February 6, 2025, the Company executed three leases on development properties totaling approximately 151,000 square feet.

As previously announced, in Charlotte, Conn's Inc. rejected their lease of 300,000 square feet effective October 31, 2024, as part of the Chapter 11 bankruptcy proceedings. EastGroup has leased the entire space for 7.5 years, commencing March 31, 2025, with a rental rate increase of approximately 20%.

During the first quarter of 2025 to date, EastGroup entered into forward equity sale agreements with respect to 611,956 shares of common stock with an initial weighted average forward price of $180.27 per share and approximate gross sales proceeds of $110,000,000, based on the initial forward price. The Company did not receive any proceeds from the sale of common shares by the forward purchasers at the time it entered into forward equity sale agreements. Also, during the first quarter of 2025 to date, the Company settled outstanding forward equity sale agreements that were previously entered into under its continuous common equity offering program by issuing 214,138 shares of common stock in exchange for net proceeds of approximately $37,005,000.

Management is scheduled to present at the Citi 2025 30^th Annual Global Property CEO Conference on March 4, 2025 at 11:00 a.m. Eastern Time. The webcast will be broadcast live and is accessible through a link on the investor relations page of the Company's website at investor.eastgroup.net. During the conference, EastGroup executives may discuss the Company's transaction activity, leasing environment, market trends and conditions, financial matters and other business that may be affecting the Company. Presentation materials that may be referenced during the EastGroup presentations are available on the "Investor Relations" page of the Company's website.

Commenting on the Company's activity, Marshall Loeb, CEO, stated, "We are pleased to see the occupancy and leasing trends we experienced late last year continuing thus far into 2025. Occupancy is trending in line to slightly ahead of our forecast. We look forward to speaking with many of you next week at the Citi conference and for those we'll miss, we're available for any questions."

About EastGroup Properties, Inc.

EastGroup, a member of the S&P Mid-Cap 400 and Russell 2000 Indexes, is a self-administered equity real estate investment trust focused on the development, acquisition and operation of industrial properties in major Sunbelt markets throughout the United States with an emphasis in the states of Texas, Florida, California, Arizona, and North Carolina. The Company's goal is to maximize shareholder value by being a leading provider in its markets of functional, flexible and quality business distribution space for location sensitive customers (primarily in the 20,000 to 100,000 square foot range). The Company's strategy for growth is based on ownership of premier distribution facilities generally clustered near major transportation features in supply-constrained submarkets. EastGroup's portfolio, including development projects and value-add acquisitions in lease-up and under construction, currently includes approximately 63.1 million square feet. EastGroup Properties, Inc. press releases are available at www.eastgroup.net.

Forward-Looking Information

The statements and certain other information contained herein, which can be identified by the use of forward-looking terminology such as "may," "will," "seek," "expects," "anticipates," "believes," "targets," "intends," "should," "estimates," "could," "continue," "assume," "projects," "goals," "plans" or variations of such words and similar expressions or the negative of such words, constitute "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and are subject to the safe harbors created thereby. These forward-looking statements reflect the Company's current views about its plans, intentions, expectations, strategies and prospects, which are based on the information currently available to the Company and on assumptions it has made. Although the Company believes that its plans, intentions, expectations, strategies and prospects as reflected in or suggested by those forward-looking statements are reasonable, the Company can give no assurance that such plans, intentions, expectations or strategies will be attained or achieved. Furthermore, these forward-looking statements should be considered as subject to the many risks and uncertainties that exist in the Company's operations and business environment. Such risks and uncertainties could cause actual results to differ materially from those projected. These uncertainties include, but are not limited to: international, national, regional and local economic conditions; the competitive environment in which the Company operates; fluctuations of occupancy or rental rates; potential defaults (including bankruptcies or insolvency) on or non-renewal of leases by tenants, or our ability to lease space at current or anticipated rents, particularly in light of ongoing interest rate uncertainty; disruption in supply and delivery chains; increased construction and development costs, including as a result of the recent inflationary environment; acquisition and development risks, including failure of such acquisitions and development projects to perform in accordance with our projections or to materialize at all; potential changes in the law or governmental regulations and interpretations of those laws and regulations, including changes in real estate laws or real estate investment trust ("REIT") or corporate income tax laws, potential changes in zoning laws, or increases in real property tax rates, and any related increased cost of compliance; our ability to maintain our qualification as a REIT; natural disasters such as fires, floods, tornadoes, hurricanes, earthquakes, or other extreme weather events, which may or may not be caused by longer-term shifts in climate patterns, could destroy buildings and damage regional economies; the availability of financing and capital, increases in or long-term elevated interest rates, and our ability to raise equity capital on attractive terms; financing risks, including the risks that our cash flows from operations may be insufficient to meet required payments of principal and interest, and we may be unable to refinance our existing debt upon maturity or obtain new financing on attractive terms or at all;  our ability to retain our credit agency ratings; our ability to comply with applicable financial covenants; credit risk in the event of non-performance by the counterparties to our interest rate swaps; how and when pending forward equity sales may settle; lack of or insufficient amounts of insurance; litigation, including costs associated with prosecuting or defending claims and any adverse outcomes; our ability to attract and retain key personnel or lack of succession planning; risks related to the failure, inadequacy or interruption of our data security systems and processes, including security breaches through cyber attacks; pandemics, epidemics or other public health emergencies, such as the coronavirus pandemic; potentially catastrophic events such as acts of war, civil unrest and terrorism; and environmental liabilities, including costs, fines or penalties that may be incurred due to necessary remediation of contamination of properties presently owned or previously owned by us. All forward-looking statements should be read in light of the risks identified in Part I, Item 1A. Risk Factors within the Company's most recent Annual Report on Form 10-K, as such factors may be updated from time to time in the Company's periodic filings and current reports filed with the SEC. The Company assumes no obligation to update publicly any forward-looking statements, whether as a result of new information, future events or otherwise.

Contact: investor@eastgroup.net

View original content to download multimedia:https://www.prnewswire.com/news-releases/eastgroup-properties-announces-recent-business-activity-and-participation-in-upcoming-conference-302388595.html

SOURCE EastGroup Properties

FAQ

What are the rental rate increases for EastGroup Properties' new leases in Q1 2025?

EGP achieved rental rate increases of 45.0% on a straight-line basis and 30.9% on a cash basis for 1,438,000 square feet of new and renewal leases.

How did EastGroup Properties handle the Conn's Inc. bankruptcy lease rejection in Charlotte?

EGP successfully re-leased the entire 300,000 square foot space with a 20% rental rate increase for 7.5 years, starting March 31, 2025.

What is EastGroup Properties' current portfolio occupancy rate in 2025?

As of February 27, 2025, EGP's portfolio was 97.1% leased and 95.8% occupied.

How much potential proceeds will EGP generate from its recent forward equity sale agreements?

EGP entered agreements for 611,956 shares at $180.27 per share, potentially generating approximately $110 million in gross proceeds.

What development property leasing activity has EGP reported in early 2025?

EGP executed three leases on development properties totaling approximately 151,000 square feet.