Piedmont Office Realty Trust, Inc. Q4 FY2025 earnings call

• Leasing accomplishments in 2025: Completed 2,500,000 sq ft of leases, 16% of portfolio, 1M sq ft ahead of guidance. Over five years, leased ~11,600,000 sq ft (75% of portfolio) with positive cash same-store NOI growth each year.
• Fourth quarter results: Completed ~679,000 sq ft of leases, 89.6% lease percentage, out-of-service portfolio 62% leased. Rental rates up 12% and 21% on cash and accrual basis for leases in vacant <1 year. Backlog of uncommenced leases ~2,000,000 sq ft with $68M annualized cash rents.
• Promotions: Alex Valente promoted to Co-Chief Operating Officer to lead new operations initiatives and oversee Eastern portfolio.

No specific product segment breakdown provided. Overall, in 2025, the company leased 2,500,000 square feet (approximately 16% of the portfolio), which was 1,000,000 square feet ahead of original guidance. In the fourth quarter, approximately 679,000 square feet of leases were completed, with 89.6% lease percentage at year-end, and the out-of-service portfolio was 62% leased.

• 2026 Core FFO guidance: $1.47 to $1.53 per diluted share, midpoint increase of $0.08 from 2025. Reflects property NOI increase $0.08-$0.13, decreased interest expense $0.01-$0.02, $0.04 interest savings partially offset by out-of-service portfolio, $0.01 NOI decrease from 2025 dispositions, and slightly higher G&A and share count.
• Projected leasing activity: 1,700,000 to 2,000,000 sq ft. Out-of-service portfolio expected to stabilize by year end, year-end lease percentage 89.5%-90.5%, mid-single-digit same-store NOI growth on cash and accrual basis.
• Mid-single-digit organic FFO growth anticipated in 2026 and 2027.

• Forward-looking statements subject to risks and uncertainties discussed in SEC filings. Examples include impacts of market conditions on leasing, occupancy, and financial results. Risks related to future revenues, operating income, dividends, financing, leasing, and investment activity are outlined in SEC filings.

Q: On leasing retention and new lease assumption.

A: Roughly 50-50 between new activity and renewal activity. Retention around 60-65% for remaining portion of portfolio.

Q: On lease percentage cap.

A: Believes portfolio can reach 91-92% leased, potentially higher with momentum.

Q: On transaction activity and disposition.

A: Land parcels under contract, DC building held for now, Houston assets noncore.

Q: On demand environment driving leasing.

A: Upgrade of office experience, workplace strategy, portfolio being uniquely positioned.

Q: On rent growth.

A: Lease-up, mark-to-market, and pushing rental rates, potential 25% movement in next year.