Piedmont Office Realty Trust (PDM) Q2 2025 earnings summary

Executive summary

• Achieved record leasing activity in Q2 2025, with over 712,000 sq ft leased and a year-to-date total exceeding 1 million sq ft, driven by strong demand for high-quality office assets and large tenant commitments.

• In-service lease percentage rose 140 bps year-over-year to 88.7%, with a year-end target of 89%-90%.

• Net loss applicable to common stockholders for Q2 2025 was $16.8 million ($0.14 per share), compared to $9.8 million ($0.08 per share) in Q2 2024, mainly due to a $7.5 million loss on early extinguishment of debt.

• Portfolio comprised 29 in-service projects and three redevelopment projects, totaling 14.9 million sq ft at 88.7% leased as of June 30, 2025.

• Portfolio repositioning continues, focusing on increasing Sunbelt market exposure and pruning non-core northern assets.

Financial highlights

• Core FFO per diluted share was $0.36 in Q2 2025, down year-over-year due to higher net interest expense from refinancing.

• Q2 2025 total revenues were $140.3 million, down from $143.3 million in Q2 2024.

• AFFO for Q2 2025 was approximately $16.2 million, down from $24.7 million in Q2 2024.

• $68 million of 9.25% bonds repurchased, resulting in a $7.5 million loss on early extinguishment but expected to save $7.5 million in interest over three years.

• No final debt maturities until 2028; $450 million available under revolving credit line.

Outlook and guidance

• Annual leasing guidance raised to 2.2-2.4 million sq ft, over 50% above original 2025 guidance.

• 2025 annual core FFO guidance affirmed at $1.38-$1.44 per diluted share.

• Most new leasing will benefit earnings in 2026 and beyond, with 80%-90% of $71 million in future annual rent expected to commence by end of 2026.

• Dividend resumption targeted for 2027, with focus on accretive leasing capital and occupancy growth above 90%.