FIRST INDUSTRIAL REALTY TRUST INC Q1 FY2025 earnings call

• Started 2025 solid, advancing leasing objectives and closing attractive new investments. - Renewed line of credit and $200 million term loan, pushing out maturities. - Closely monitoring tariff developments and their potential impact on business. - In-service occupancy at quarter end was 95.3%. - 73% of 2025 rollovers completed by square footage, cash rental rate increase for full year expected 30%-40% (35%-45% excluding fixed rate renewal). - Development activities: Expanded tenant at First 76 in Denver, planned groundbreakings in Dallas and Philly, and closed a site in Philadelphia. - Investments: Acquired 2 fully leased developments in Phoenix.

In terms of segment performance, on the leasing front, First Industrial Realty Trust has made progress on 2025 rollovers, with 73% of square footage taken care of. The overall cash rental rate increase for new and renewal leasing is 30%, and excluding the large fixed rate renewal in Central PA, it's 36%. For development, they successfully expanded a tenant at First 76 in Denver to 100% occupancy, plan to break ground on a 176,000 sq ft facility in Northwest Dallas, and closed a 61-acre site in Philadelphia's New Castle submarket with plans to construct a 226,000 sq ft facility. In investments, they acquired 2 fully leased developments from a joint venture in Phoenix, with the buildings being 100% leased to 3 tenants and a weighted average lease term of approximately 7 years.

• NAREIT FFO guidance remains $2.87 to $2.97 per share. - Average quarter-end in-service occupancy expected 95%-96%, with 1.5 million sq ft of development leasing in 4Q and a 708,000 sq ft building in Central PA in 4Q. - Cash same-store NOI growth before termination fees expected 6%-7%. - Expected $0.09 per share of interest capitalized. - G&A expense guidance range $40.5 million to $41.5 million.

• Tariff developments pose uncertainty for business activity and leasing market. - Uncertainty around trade negotiations could impact decision-making on new investments and growth. - Potential impact of not leasing up certain development projects as assumed in guidance.

Q: Going back to the tariff question, if trade negotiations take extended time, does it pose near-term tangible risk for tenancy perspective, especially with Chinese 3PLs?

A: Jojo Yap said total spaces leased to Chinese 3PLs are approximately 450,000 sq ft, pretty de minimis, and they haven't done much deals with Asian 3PLs in past due to credit.

Q: Craig Mailman asked about shifting development leasing from second half to 4Q and visibility on leasing pipeline?

A: Scott Musil said 1.5 million sq ft of development leasing is still in 4Q with slight adjustments, and Peter Schultz and Jojo Yap mentioned market has good activity but some tenants concerned about tariff impact.

Q: Nicholas Yulico asked about downside scenarios for guidance and if $0.02 impact is part of bottom end of FFO guidance?

A: Scott Musil said those are material lease-up assumptions, and there are other variables like bad debt expense.