Alexandria Real Estate Equities (ARE) Q1 2025 earnings summary

Executive summary

• Reported a Q1 2025 net loss of $11.6 million ($(0.07) per share), with FFO per share (diluted, as adjusted) at $2.30 and total revenues of $758.2 million, down from $769.1 million in Q1 2024.

• Leasing volume exceeded 1 million RSF for the fifth consecutive quarter, with 89% of leasing from existing tenants and rental rate increases of 18.5% (7.5% cash basis).

• Occupancy of operating properties in North America was 91.7% as of March 31, 2025, with 99.9% tenant collections.

• Maintained strong liquidity of $5.3 billion and a top 10% credit rating among U.S. REITs.

• Disposed of $176 million in assets in Q1 and have $434 million in process, supporting self-funding of the development pipeline.

Financial highlights

• Total revenues were $758.2 million, down 1.4% from Q1 2024; excluding dispositions, revenues would have increased 3.9%.

• Adjusted EBITDA margin was 71%, among the highest since 2019.

• Net operating income (cash basis) annualized at $2.0 billion, up 4.4% year-over-year.

• Same property NOI decreased 3.1% (up 5.1% cash basis), impacted by lease expirations; excluding these, same property NOI would have been up 0.1% (9.0% cash basis).

• General and administrative expenses fell 35% to $30.7 million, reflecting cost-control initiatives.

Outlook and guidance

• 2025 FFO per share (diluted, as adjusted) guidance midpoint reduced by $0.07 to $9.26, reflecting slower re-leasing and lease-up.

• Year-end 2025 occupancy guidance lowered by 70 bps to 90.9%-92.5%.

• Same property NOI growth guidance reduced by 70 bps (GAAP) and 20 bps (cash basis).

• G&A cost savings expected to total $49 million in 2025, with run rate similar to Q1.

• Capitalized interest for 2025 reduced by $20 million as some projects pause capitalization.