Allied Properties Real Estate Investment Trust (AP) Q4 2023 earnings summary

Executive summary

• Operating momentum continued through 2023, supported by leasing activity, user-experience initiatives and a five-year capital-allocation plan with minimal reliance on capital markets.

• Q4 operating income from continuing operations rose 6% YoY to $82M; a $499M continuing-operations net loss largely reflected fair value losses on investment properties.

Financial highlights

• FY rental revenue was $564.0M, up 8.6% YoY, and operating income was $317.0M, up 7.4%.

• Q4 FFO was $86M, or $0.614/unit, and AFFO was $79M, or $0.562/unit; YoY per-unit changes were -0.6% and +2.6%, respectively.

• Q4 continuing-operations net loss was $499M, including fair value losses of $70M on development properties and $425M on rental properties.

Outlook and guidance

• Flat FFO/unit, AFFO/unit and Same Asset NOI are the 2024 aim; metrics may contract by up to 5%.

• Management expects metrics to contract in H1, assuming no economic occupancy gains, and expects gains in H2, with magnitude uncertain amid macroeconomic conditions.