First Industrial Realty Trust, Inc. Q4 FY2025 earnings call

• Team performed well in 2025, competitive in volatile economy. • Strong cash rental rate, same-store NOI, FFO growth. • Signed new development leases. • Executed two term loan refinancings. • Overall leasing market had significant activity in 4Q 2025 (record 226M sq ft leasing, 22% higher than year ago; total leasing 941M sq ft for year, second highest on record). • 3PLs active (36% of total leasing), retail and manufacturing occupiers top 3. • Vacancy in 4Q 2025 6.7%, net absorption 58M sq ft, completions $78M. • For 2025, cash rental rate increase on new and renewal leasing 32% (excluding large fixed rate renewal in Central PA, 37%; straight line increase 59%). • Acquired 968,000 sq ft building from Camelback 303 Phoenix joint venture for $125M and a newly constructed 117,000 sq ft facility in Baltimore for $31M. • Breaking ground on two new buildings in 1Q 2026: 220,000 sq ft in First Park Miami and 84,000 sq ft First Arlington Commerce Center III. • Board declared first quarter dividend of $0.50 per share, increase of 12.4%.

For 2025, cash rental rate cash same-store NOI and FFO growth were strong. REIT funds from operations for 4Q 2025 were $0.77 per fully diluted share vs $0.71 in 4Q 2024. Full year 2025 FFO per fully diluted share was $2.96 vs $2.65 in 2024 (12% increase). Cash same-store NOI growth for full year 2025 (excluding termination fees) was 7.1%, 3.7% in 4Q 2025. In 2026, NAREIT FFO midpoint is $3.14 per share with range $3.09 - $3.19. Average quarter-end in-service occupancy expected 94% - 95%. 2026 full year average cash same-store NOI growth expected 5% - 6%.

• NAREIT FFO midpoint for 2026 is $3.14 per share with range $3.09 - $3.19 per share. • Average quarter-end in-service occupancy for 2026 expected 94% - 95%. • 2026 full year average cash same-store NOI growth expected 5% - 6%. • Anticipated 2026 costs related to completed and under construction developments and starts. • Expect to capitalize about $0.08 per share of interest in 2026. • G&A expense guidance range $42M - $43M, with 1Q expense representing approximately 40% of full year G&A due to accelerated expense related to accounting rules.

Q: Maybe on the development leasing, how much of that is in projects that have already delivered or drag on the operating portfolio versus projects that are either under construction or lease-up that may not hit until later in the year, so the contributions more for 2027?

A: Scott Musil said the 2.5 million square foot development opportunity includes properties that have been completed or will be completed in 2026, so the 1.7 million square feet in guidance could come out of any of that 2.5 million square feet.

Q: Can you just give us a sense of where you guys stand on Denver?

A: Peter Baccile said the building is available for either lease or sale, with a couple of active prospects for all of the building on a lease basis as well as a couple of inquiries on portions of the asset, and they'll keep posted on progress.

Q: How is that treated in same store? Because I know it, $4 a foot of property taxes on it. Like does that high probability in the 1.7 million square foot lease up? Or is that more vacant? And how much of an uptick could that be to earnings on the same store for you guys were to sell that?

A: Scott Musil said if sold, taxes wouldn't be there (about $2.4M for year), if leased up, it's back end of year with free rent related, not impacting cash same-store, and all that kind of comes into the 5% - 6% cash same-store range.

Q: I want to circle back on the development in the PA that's included in guidance. How much FFO does that increase your 2026 guidance? Or how much is that contributing to your 2026 guidance range?

A: Scott Musil said if we did not lease up the 1.7 million square feet of the 708,000 square footer, we would still be within our FFO guidance range.

Q: Can you talk about the South Florida campuses?

A: Peter Baccile said at Building 12, only 32,000 ft; at Building 3, active prospect discussions; smaller building in Pompano has active prospects for different submarket; overall activity is pretty steady.

Q: Can you talk a little bit more about the balance between preserving occupancy and pushing on rental rates? Are there any more markets in which you're kind of leaning more towards pushing on rate versus preserving occupancy and maybe on the flip side, any specific markets or size segments that you still see as more vulnerable on the rate side?

A: Peter Baccile said they're always trying to maximize the NPV of those leases that varies by market, remain competitive to meet the market, and Peter Schultz added they're going to meet the market, optimizing all of those economics, and there are assets in the market that are second or third gen struggling, but rents are pretty stable and holding, with concessions and TIs up a little bit, and they don't view lowering rent on a wholesale basis as the solution, and there's been movement from Class B to Class A which plays into their portfolio well.

Q: Amazon remains your largest tenant about 6% of revenue and their demand is sometimes seen as kind of the barometer for the market as a whole. So can you just talk about any recent discussions you've had with them or indications around their appetite for additional space in '26?

A: Peter Schultz said they're seeing Amazon active in a number of markets for additional space including a number of large format buildings in Pennsylvania, and Johannson Yap added Amazon was particularly active in Q4 2025, totaling about 10 million feet just in Amazon and leasing 1 space.

Q: I just want to make sure we understand on the FFO per share guidance the difference between the bottom and top end of the range is primarily related to development pipeline lease-up, or are there other key factors we should be considering as well?

A: Art Harmon said 1 piece is the 1.7 million square feet of development lease up in the 708,000 square footer, and the other piece is bad debt expense, with $1 million for guidance, came in at $700,000 last year but could have volatility.

Q: With the 2026 lease expirations, it looks like you're down to 4.5 million square feet remaining. Are there any like key tenants in there or a larger spaces that you're focusing on?

A: Johannson Yap said they are working with a renewal in SoCal, about 555,000 square feet, and in discussions with the tenant.

Q: Good success on the Camelback JV. I know you guys also had been evaluating potential higher uses for just through land bank and existing assets when it comes to data center opportunity set. So just curious if you had any updates there?

A: Peter Baccile said they're still working on it, pursuing a narrowly defined set of potential opportunities, taking a while to play out, evaluating for both land holdings and existing buildings, and keeping posted on progress.

Q: You mentioned the progress you've made on the '26 lease expirations. I guess if we take a look back on 2025, can you comment on what sort of retention rate you achieved and what do you expect a similar result in '26 and for those that are leaving any sense why?

A: Peter Schultz said 2025 overall retention rate was 71%, expect very similar in 2026, and they've already taken care of 45%, most of the renewals are rollouts and discussions with tenants very close to getting done.

Q: Can you go through who in 4Q, and I guess so far in 1Q has been active like types of tenants in your portfolio? And do you think those are indicative of the industry or more FR specific? And any comment on like why the activity today versus like a year ago?

A: Peter Baccile said generally 3PLs, retail, manufacturing, food and bev have been active, and Peter Schultz added auto-related, energy, building materials and products, and Johannson Yap added a bit more data center-related uses compared to '24, and there's been a slight increase; Peter Baccile also said 3PLs are very active, representing 36% of total leasing, and overall activity has improved with more inquiries, tours, RFPs, and better tenant engagement level.

Q: You mentioned the flight to quality, which is a common theme we've heard from others. So I want to ask a basic question, just like what traits make a building and a building and kind of what factors have changed versus maybe the recent past? And particularly, could you just talk about minimum power load requirements from tenants and how that's changed. I've heard that's come up a lot more in new leasing conversations.

A: Peter Schultz said clear height, trailer parking, column spacing, car parking, building depths and geometry circulation are important, and pretty much every large user wants more power, they design and fit out new buildings with maximum supply, some tenants requiring more than that, but not materially different from recent years.

Q: In terms of potential dispositions that you've been thinking about, where are you seeing the best economics to you? Is it higher and better use land sales basically or user sales? I'm assuming it's not just traditional industrial sales with lower growth prospects?

A: Peter Baccile said higher and better use like potential data center use, and for everyday sales, users and 1031 buyers are target markets, and there are opportunities with institutional capital as well.

Q: So just a finer point on the Inland Empire land, you can create a small company out of all the billable square feet you have there. What is your kind of thought process about holding on to most of that or selling some of it. I mean it could become an incredible asset if we get some real sort of stabilization in Southern California in general. So should we expect that to be remain a very large chunk of your land bank? Or is it possible that you would take the bait and sell some of that land for whatever use? What is your mindset as it relates to your longer-term view of the market?

A: Peter Baccile said they think the land holdings are very valuable, entitlements in SoCal are getting harder, market will come back on a trend line, and they're open to being opportunistic and taking advantage of opportunities to sell land there, but looking to maximize value and balance future opportunity with present opportunity.

Q: One on the power that's available in your building. It sounds like there is some element of stranded power in each asset. Is there an opportunity to either reposition that power elsewhere, or somehow generated rental revenue out of that for edge data centers as we saw with one of your peers recently. Any color around that would be helpful.

A: Peter Schultz said he wouldn't say there's a lot of stranded power, some companies want flexibility for operations, etc., and they pay close attention to have the right power to accommodate tenants, and some jurisdictions may claw back unused power due to power constraints.

Q: To follow up on your comments about concessions being very low on renewals and kind of more aggressive on new leasing. I'd imagine that's typically the scenario, but it seems like it's maybe more of an extreme now. So any commentary on what's driving that dynamic now versus in the past?

A: Johannson Yap said renewal rates are stable in industrial real estate, around 65% - 75%, and tenants have tenant investment and moving costs as deterrents to relocating, and now tenants have a longer view and commit earlier due to potential uncertainty, leading to earlier renewals than in past 5 years.

Q: Just I guess, 2 clarifications. So first of all, just on the lease-up assumptions for developments and kind of how that's translating to occupancy. Do you mind just walking through any other impacts that are driving the occupancy sort of a modest bump up? And just to be clear, if you were to lease those up in the back half, that should be upside to occupancy, correct?

A: Scott Musil said the 1.7 million square feet of development leasing in the 708,000 square footer in the back half of the year, if hit, would be at midpoint occupancy rate, and Vikram Malhotra asked about the PA space and tying it back to large 3PLs or retailers, Peter Schultz said the 708,000 sq ft building in Central PA is more likely single tenant but designed for split, and Pennsylvania has good activity with deals signed not yet in occupancy numbers. Scott Musil also said occupancy will increase more in back end of year due to leasing assumption, and Jojo talked about a renewal in SoCal, and Chris mentioned only one other renewal or expiration above 200,000 sq ft.

Q: Just some of your peers have talked about certain submarkets or markets seeing an ability to push rate after multiple years. And I'm just wondering, are there any markets across your portfolio where you're being able to push, say, rent 3-plus percent?

A: Peter Baccile and Peter Schultz mentioned South Nashville, Texas, Dallas, Houston, and Central PA.