FSP - Earnings call transcript Q2 2018 | Franklin Street Properties Corp.

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Operator

Good day and welcome to the Franklin Street Properties Corporation Second Quarter 2018 Results Conference Call and Webcast. All participants will be in listen-only mode. [Operator Instructions] Please note this event is being recorded. I would now like to turn the conference over to Mr. Scott Carter, General Counsel. ahead. go Please

Scott Carter

Financial of welcome XXXX and George and Franklin Properties President our Patty Street our of Director and Director our Good Property Investment Chief Call. to With Quarter Chief Demeritt, and Atlanta John Houston, Earnings Executive are and of Officer; Jeff me Senior Second Carter, Chief President morning Officer; the Officer; this Management. this Vice me Regional Carter, Regional with John President Toby are and Donahue, McMullen, President morning Daley, FSP Also Dallas. Senior Vice and morning

turn the from as the over note Securities must factors, on by that discussed I may our for the statements XXXX. Company plans make December differ with indicated factors section the John Please for on read that remarks these Demeritt, expectations, Actual we may constitute Annual important which XXXX, Harbor XX, Private forward-looking Before I the various ended those the of file SEC. provisions call under various about Litigation purposes of of statements. Report statements materially for the Form Safe Act forward-looking prospects including following Reform the result risk future XX-K to may results year in of is those a and

XXXX. these forward-looking X, as only August addition, In today, statements represent expectations the of Company's

of net release, is from to operations, contained call, in this At available or www.fspreit.com. to our to do may today. or FFO the Company representing not elect any which as at FFO. estimates these date Relations in is any as refer update during forward-looking press Investor so. relied times section Any subsequent website views reconciliation income forward-looking A specifically yesterday's statements obligation may GAAP Company's the the to While upon of funds it be statements, disclaims to of should we

Now, turn John. John? to will I over the call

John Demeritt

brief performance our more a On second results, today's overview some George our his morning, provide our Donahue, leasing discuss and quarter that, with and call, CEO, be you, afterwards, John disposition I'll questions. in discuss Jeff activities begin and and will investment Asset your everybody. will detail happy then remarks. to good discuss our Management After Carter, of Scott, and of our and CIO we'll Thank activities. of take recent President our will Carter President then the

reminder, our funds as SEC filed will a were the $XX.X refer release, from our reported the package with last can XXXX. of $X.XX today our comments or website. to Scott We earnings FFO quarter or operations and second supplemental XX-Q, and share night on found of mentioned, As be for which per million

we fixed times. of Turning long our rates. our debt fixed, XX, rates properties to XX% June we mostly five added X.X we and that believe value more With the term our aligned our debt stack debt have sheet structure our outstanding have $X.X ratio with more our capital have At had was unsecured coverage markets. turned about June core XXXX we at in XXXX out we XX, our of balance debt at billon service and

up wanted feet at the debt had we XXX,XXX at earnings $XX.X maturities for liquidity total a our release in revolver square $XXX announcements out sheet million our of had on second up. wraps at and George? this inadvertently that to fine. Again, and XX-Q on term thing quarter reporting new is on quarter June. that couple were looking a point From reversed in XX With of make our that cash a supplemental issue page and making is just is calls of I’m We’re XX,XXX a after feet. the first or quarter was standpoint, balance confusion. over XXX,XXX expansions the our that end end correctly so tenants. reported; square liquidity quarter and we to didn't leasing George. of call in near for numbers any I that, first of for total available renewals that, on Those when we’ll sorry Once which of however, I'll I numbers and XX,XXX reported QX turn the We’ve $XXX.X two was million million

George Carter

call. John welcome XXXX quarter Street earnings Thank Franklin and Properties second you, to

approximately totaled $X.XX up meaningfully FSP's share. or third As Leasing the per or activity that the John the trend second FFO funds as during quarter, said, for from $XX.X enter operations we is quarter. continuing quarter picked million and

Houston sensitive more than markers experience of are we throughout several tenants with seeing have years, existing early approaching in requests. seen activity are more we also Denver continuing portfolio, to our and of renewal energy Our the potential us leasing and

continuing disposition managed anticipate also efforts We certain of toward our of properties.

reduction. financial managed to a any the primarily debt the has those For in FSP properties turn Donahue, With Company. of company me let comments few received call Property used those John? interest, which made, for President disposition will be over John proceeds by Management

John Donahue

to was end This from Good second leased occupancy XX.X% the leased FSP second seven first quarter subsequent quarter approximately executed. strongest renewed of XXXX exceptional The includes representing That an first At XXXX highest last amount of portfolio leases quarter, of leasing has leasing. square total the feet relatively for ever end. the XXXX XX-months quarter. of at third half the represents the approximately square our surprises, total of our is slow our well. the feet leasing calendar any we regards expect the roll square XXX,XXX We XXXX second believe occupancy years. that of first may with of Thank to year of After in Also, Barring of feet end calendar to over was about at increase the George. everyone. as that the the XXX,XXX rolling you, year XX-months the quarter. in overexposure total end that reduced portfolio. the in the of and morning, leasing in quarter as the half represents again XXXX been million quarter, improve X.XX half announcement the of by XX.X% and a second X% leased. recent This people best

had any also should months. few six large to the nine significantly reduced roll to over that be surprises, XXXX Barring finalized next renewals a for the and expected be tenant time. in We overexposure during XXXX

and made progress our been renewing anchored We large year encouraging. existing urban trend first the in of infill and half properties the have tenants on vacancy through the of tenants the has

to in energy a have expect Denver. into late We growing that to of space positive appears [ph] industry have the corner to and needs for and corridor trend trend downtown lesser This the a near-term Houston is future. energy potential have expected tenants, The witnessed extent a the XXXX. XXXX in turned in and with specifically growing continue in we impact to

upside that, believe five core especially as our turn to Jeff first continue the and ample XXXX. six above months half to Carter. over portfolio the in perform will and there of markets, over translates at Atlanta next execute well our remaining activity that the believe as Minneapolis. expected in With to We of nine portfolio in stabilize then If I the core XX% it will we all leases is Houston, to

Jeff Carter

creation. operate to and properties West and Dallas, core Minneapolis. dynamic infill Good A and Denver, property submarkets morning, growth within and to worked NOI value markets Thank rich Mountain and for efforts continues Houston our and everyone. position metropolitan you, of own We Class our amenity within FSP Sunbelt areas, Atlanta, John. these in concentrate long-term five have

to forward, our look primary portfolio and due As we continue on value efforts unlocking be vacancies to focused of expansions renewals existing and/or leasing on our in of our will tenants.

appropriate. market remainder At portfolio disposition in we Carter of use will our as XXXX for expectation during time any debt. proceeds managed one remarks, economic paydown front, disposition recycling this FSP potential including George somewhere the received his anticipate asset the the have indicated to keep FSP or more and to and the potential interests, properties is On the as our potential posted we may for of the of

as enhancing core XXXX, property in specific portfolio call in markets. value cities. in completed growth We and/or Class coming tenant years Since Our that And potential earnings portfolio that, potential see questions. nearly conference reasons. made at dispositions we've any to concentrated for over transformation for up amenity-rich and/or within the a the in A of $XXX the focused are XX% thank mortgage have located portfolio market open for high properties you resulted is number And submarkets now call infill repayments I this FSP's our to over like million. with a our of we'd our today. listening for

Operator

[Operator We will Instructions]. now the begin session. question-and-answer

with Schiller Baird. Our question first from Please ahead. comes go Dick

Dick Schiller

can Appreciate larger at space. picking morning your in has that smaller good you to up Great everyone. strong, some Hey, potentially and a vacancies backfilling Mae, leasing you. on and speak leasing the job of T-Mobile the but Vail vacancy? King specifically other Corp. Burger activity been comments Fannie Thank

John Donahue

This John is start third the which of this of -- space. the at of prospects Fannie scheduled the year, vacancy we morning, I'll Dallas. quarter, of that leased the quarter Good for pre-leased approximately vacate fourth have the is larger expirations Referring to XX% Donahue. Dick. some the end have Mae in with and to bulk of

at start know as over believe of backfill space got Mae's don't We pre-leasing so depart. all months Burger exactly will that they it hold months. King of six we'll one for Blue when Lagoon we over or may or to the So good that vacancy. Fannie next expires, more

impacting But And so a that great activity. moving target a bit. we little us is had

multi-tenant and is prospects of either single-user. handful a have nearly We building XXXX feet also the square to potential for

So that is that's property going very well well-positioned. and

of have another well. rolling. lion space We SunTrust organic we backfill a share as is activity Innsbrook. vacancy coming that solid have to at And

So we're that'll in happen that short hopeful order.

Hopefully the question. are those that largest expirations. your answers So

Dick Schiller

in from activity definitely. up Marquette you. Yes, Minneapolis? you And can on add the same, Thank XXX the

John Donahue

stream continues to Sure. Marquette XXX get of the activity.

bit or timeliness it mostly work looking when they at take of out to users large in floors, have either it through need so and two negotiations, as front three as the far time they're and a those some space. We

second little we we hopeful have that But have with few user the So here the it's taking been for would now months. do for full building. six that also And over time. we've next about a a that about we're up that working take We wrap floor months. prospects can

year-end by contribution property FFO So, leased of and that the substantially looking we're mostly still to in meaningful a next for year. second expecting half have

Dick Schiller

Got it. for one And me. last Thanks.

managed for some the versus the focus strategy asset the On reason portfolio the in is asset the assets sale portfolio some is a dispositions an change portfolio. managed in owned or of Is it on the what strategy? basis or by non-core it the of of the corporate maybe

George Carter

portfolio the The one do not asset have ownership properties timeframe portfolio asset. property managed out, directly view property it's Dick, properties It's by those does in with But our some of it. it's by in that's were of -- as max George. aspect value. owned associated they

with portfolio months is we also the actually and as our XX% lot and it owned Jeff today. are owned of value has exists upside remaining in create potential said happy our directly believe square as footage. which it We We a lot of non-core directly currently that We opportunity over has non-core coming portfolio a of year. can about think the

believe happy pricing So portfolio what maximum property portfolio existing best this managed we point timeframes. owned certain with within normal and is run-off we're a as is the at each that directly hits its

Dick Schiller

guys. Thanks it. Got

Operator

[Operator go ahead. Rob Please Janney. from Instructions] comes question Stevenson next with The

Rob Stevenson

Good morning, guys.

stuff TIs over on we indicative as what quarter here execute the likely question you and the per quick basis in the the and second of XXXX the a CapEx a of and XXXX and on in continue see leasing that, of to we level commissions foot square saw leasing? Just terms the in remainder on be a like leasing, to is

John Donahue

we've John Hey, of Donahue. will square is Rob, type do. indicative and number would morning. that that I of say done good It's foot the per Yes. leasing

Although a percentage of leasing. mind has new in renewals keep the been that higher versus leasing

square some in with But and others third per higher year percentage break leases continue. And per will that you given potentially So number that We year may been it's T-Mobile in that when below the up be and to quarter. foot per square will per square number that renewals see per like between think have trending the $X have we be tend $X $X I then any could new $X.XX a quarter slightly foot. higher. might to

Rob Stevenson

the Okay. plan the on JPMorgan in at coming this term is November. is loan And what the that million What $XXX up on point?

John Demeritt

working Demeritt. with Hi. It's this John our in maturity. banks near on We're term

something So, be once able make announcement place, we have in for it. an to I'll

long relationships us and that. with time for and a have But as great I have say a as them. now. bank can We They're great right that's with we're group working on much

Rob Stevenson

Thanks Okay. guys. All right.

Operator

is go question follow-up ahead. Schiller Please with Baird. The from Dick next

Dick Schiller

one Hey, fees? non-recurring items I'm else million X.X from included one page is mostly a amount? as that considered lease termination that quick on more you The supplement. me. guys in eight looking what at NOI, is Or a

George Carter

Yes. are Okay. Those fees. correct. termination one second. on Hang That's

Dick Schiller

drove What leases assets what those fees? lease or termination

George Carter

significant The from Yes. more this SunTrust is quarter.

Dick Schiller

Okay. Thank you.

George Carter

Okay.

Operator

this At for answer the session. to back question and this like any George conclude over Instructions] turn today's Carter closing [Operator conference remarks. time, will to I'd

George Carter

Well, thank you next And call. for attending quarter. we much very reporting forward Thank the all you. look to

Operator

now you today's attending for presentation. is Thank much The very concluded. conference

You may now disconnect.

Franklin Street Properties (FSP) 1 Aug 182018 Q2 Earnings call transcript