Urban Edge Properties Q3 FY2025 earnings call

• Jeff Olson: Delivered strong quarter with FFO as adjusted up 4% QoQ and 7% YTD. Completed $39M acquisition of Brighton Mills. Highlighted capital recycling strategy with $600M acquisitions and $500M noncore asset disposals. Raised 2025 FFO as adjusted guidance by $0.01 per share.
• Jeff Mooallem: Leasing activity totaled 31 deals aggregating 347,000 sq ft. Included 20 renewals and 11 new leases. Redevelopment: Stabilized one project ahead of schedule and activated 3 new redevelopments. Discussed positive outlook with national retailers in the Northeast.
• Mark Langer: Third quarter FFO as adjusted $0.36 per share. Same-property NOI increased 4.7% YoY. Secured new $123.6M mortgage. Liquidity strong at over $900M. Raised FFO as adjusted guidance by $0.01 per share, same-property NOI growth midpoint increased to 5.25%.

FFO as adjusted increased 4% over the third quarter of last year, with year-to-date growth at 7% compared to the first 9 months of last year. Same-property net operating income increased by 4.7% for the quarter and 5.4% year-to-date. The company completed the $39 million acquisition of Brighton Mills, a grocery-anchored shopping center in Boston. The property is in a high-growth area with a 3-mile trade area of 449,000 people and average household incomes of $170,000. The acquisition was funded by proceeds from the sale of Kennedy Commons and McDade Commons. The Boston portfolio now includes 7 properties worth approaching $500 million, representing about 10% of the company's value.

• Raised 2025 FFO as adjusted guidance by $0.01 per share at midpoint to $1.42 to $1.44 per share, representing 6% growth over 2024 at midpoint.
• Same-property NOI growth midpoint increased to 5.25%, implying 4.5% growth in Q4.
• $21.5M SNO pipeline contributing to future growth with $5.6M annualized gross rent commenced in Q3 and $300,000 expected in Q4.

• Competitive acquisition market with more institutional capital and tighter spreads. Potential challenges with tenant renewals and maintaining high occupancy levels. Uncertainties in the economic climate affecting tenant demand and property values.

Q: Michael Goldsmith asked about the timeline for lease expirations at Brighton Mills and onetime items in 2025.

A: Jeff Olson said leases expire in 22 years, confident of exceeding 3% NOI growth. Mark Langer discussed onetime collections and G&A/R real estate tax benefits.

Q: Michael Griffin asked about the opportunity at Shoppers World and rent spreads.

A: Jeff Mooallem discussed flexibility with Kohl's parcel, plans for mixed-use/retenanting, and rent spreads driven by HomeGoods/Ross deals.

Q: Floris Van Dijkum asked about creating shop space and acquisition environment.

A: Jeff Mooallem talked about splitting anchor boxes and competitive acquisition market. Jeff Olson discussed underwriting assets and capital recycling.

Q: Michael Gorman asked about nontraditional assets and tenant environment.

A: Jeff Olson said nontraditional assets have limited buyer pool, and Jeff Mooallem discussed balancing food vs grocer demand.

Q: Paulina Rojas-Schmidt asked about same-property NOI growth and retailer expansion.

A: Jeff Olson and Jeff Mooallem discussed supply-demand metrics, retailer expansion in Northeast, and same-property NOI growth outlook.