EastGroup Properties, Inc. Q1 FY2026 earnings call

• Introduced the team including John Coleman, R. Dunbar, and Casey Edgecombe. • Described EastGroup Properties as a shallow bay industrial REIT, focusing on campus - setting near businesses and higher - end residential in smile states. • Highlighted 51 consecutive quarters of FFO growth and 13 years of positive FFO and same - store NOI. • Mentioned low debt to EBITDA (around 3x), low top 10 tenant concentration (below 7% of revenue), and lowest G&A as a percentage of revenue in the sector. • Talked about development leasing picking up in the fourth quarter, with 166 thousand square feet signed recently, and details about tenant expansion and building - on - demand. • Discussed market dynamics like supply being at lowest since 2018, vacancy rates in smaller buildings, and flight to quality in the market. • Spoke about development yields around 7%, low - 7s, and disciplined start approach based on market feedback. • Mentioned pre - lease opportunities and increased conversations with existing tenant base for expansion or consolidation. • Addressed data center development impact on industrial development and initiatives related to AI in areas like accounting automation and cybersecurity training

No specific detailed financial performance for each product segment provided in terms of absolute numbers and revenue contribution % other than general mentions of FFO growth and same-store NOI. Mentioned 51 consecutive quarters of FFO growth and 13 years of positive FFO and same-store NOI. Also, top 10 tenant concentration is a little below 7% of revenue, and debt to EBITDA is around 3x, debt within total market cap is around 14%

• Mentioned same - store NOI growth for the industrial group in 2027 is expected to be around 5.5%. • Stated that in the REIT industry, expects fewer companies from an M&A perspective this time next year

• Uncertainty regarding tariffs as the Supreme Court ruling may not end the topic. • Permitting challenges in fast - growing cities for industrial development, including issues with power and water in some cases, and pushback on data center zonings and permitting

Q: What are you hearing from tenants following the SCOTUS IEPA ruling? Does the ruling reduce uncertainty for tenants, or do pivots to alternative tariff statutes keep uncertainty elevated?

A: It is early to get tenant feedback. First quarter last year was strong, then Liberation Day caused capital decision - making paralysis. Portfolio was full, development leasing slowed. Still not done with tariffs, and people may eventually need more space.

Q: Could you talk about where cap rates are, on a stabilized or market - rent basis, for assets in your markets today?

A: Varies by market. Lower cap rate markets see low - 5s, sometimes upper - 4s. Stronger markets like Nashville have low - 5s, Dallas low - 5s, Austin a bit weaker, Southern California mid - 5s to upper - 5s.

Q: On development yield, your view on incremental starts, build - to - suit versus spec. And in the operating update, your view of equity versus incremental debt?

A: Development yields have hung in there around 7%, low - 7s. Starts come based on market feedback, pull system like retail store. This year starts at $250 million, pre - lease opportunities are more. Equity and debt view is based on market and team discipline.

Q: In the markets you operate in, how much does data center development crimp industrial development?

A: Data centers can be a source of competition, but industrial is harder to come by. They can pay more, but their zoning, permitting, and power requirements are more challenging.

Q: Shifting to development leasing cadence: how should we think about development leasing cadence throughout the year and, subsequently, development starts?

A: Hard to predict cadence. Last year was lumpy. Rents have risen, decision - making has changed. Big companies have longer gestation periods. Disciplined capital allocation is key.

Q: Pivoting to AI: as it relates to EastGroup Properties, Inc., what initiatives are you looking at? How much time or money have you spent on identifying opportunities for productivity enhancement or revenue enhancement?

A: IT team focused on cybersecurity training. AI used in accounting for quarter - end closing automation. Spent time training team, mostly on available tools for accounting.

Q: Same - store NOI growth for the industrial group in 2027?

A: Expected to be around 5.5% Q: From an M&A perspective in your property type, more, same, or fewer companies this time next year?

A: Fewer in the REIT industry