CTO - Earnings call transcript Q4 2024 | CTO Realty Growth, Inc.

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Operator

Good day, and welcome to CTO's Fourth Quarter and Full Year 2020 Earnings Call. [Operator Instructions] As a reminder, this call may be recorded.

I would now like to turn the call over to Phil Mays, CFO. Please go ahead.

Philip Mays

Thank you. remind forward-looking many laws. statements to today our like considered are under would everyone of that comments I federal securities company's statements, may discussed results statements. duty actual from these The matters the to differ update in we and significantly forward-looking undertake no these future expectations greater XX-Q risks and detail company's XX-K, Form from in other cause from SEC time to differ actual the Factors disclosed results to and filings. could materially that are time in Form

will include certain call measures. financial Today's non-GAAP

you measures, release non-GAAP also refer these earnings of reconciliation should to our and For filings. SEC

SEC can find at earnings You most and recent presentation our website filings, our release supplemental on investor ctoreit.com.

that, With John. to over the will I call turn

John Albright

Thanks, of Phil. accomplishments significant business a towards of our XXXX execution plan. was year strategic

that we and efficient growth XXXX. the CTO Our robust performance of core was reported year, driven for from by per exceeded activity a capital with both share raising, investment and X% of leasing FFO $X.XX volume high for record expectations and

of completed investments in our amounts Beginning with $XXX fourth of and located million retail acquisitions investment of million consisting property X.X%, yield X the million These activity, a we structured $XXX of of target include in $XXX average of investments. closed weighted Southeast investments in Southwest and the XXXX, quarter. markets at

initial Foods originated located November, In Whole retail loan of we in rate the an months loan anchored Atlanta. of XX fixed for center interest development an market first of has by mortgage term a and $XX XX.XX%. million foot XX,XXX initial The square

right of it. to at center as Collection the and neighbors Forsyth we purchase shopping development have refusal our known this Additionally, first The

and by million, to market in market. the the Plaza December, retail X,XXX-square-foot metro densely Tampa shopping growing public acquired and Granada $XX anchor expanding presence area. our in Plaza is populated Tampa In we the Granada is center high-performing an for

we were million our XXXX expanding Orlando Significantly, Charlotte, want able to note our X Carolina in further $X.X With or feet with our to both first over to growth investment we and X.X of activity year complete by million full square portfolio in enterprise of investment XX% Our increased in by and North the while feet. XX% square and million market $XXX our approximately reduced over presence significantly Tampa. year the leverage that ended total rose value billion, liquidity. our XXXX, and I to

Now leasing. transitioning to

XXXX more quarter, signed new we During average at leases, full square feet bringing an feet On a square spread the per per the fourth comparable of leasing full lease foot. and for strong of signed extensions markets. properties demand rent the XX% basis, positive to believe $XX.XX strategic square spreads further we lease XXX,XXX at renewals square We feet than of indication XX,XXX year an comparable leasing that square and year our XXX,XXX activity $XX.XX foot. a high-quality tenant within average our a rent for our of strong cash are of

toward of we'll the receive And pipeline expect The our over of recognize now associated XXXX. with for at of weighted benefit will we pipeline risk Accordingly, of it. not million, X% this commencement cash second in it to leasing open almost representing rents. Significantly, XXXX, signed the $X.X be XX% in-place half XXXX. full stands just

bankruptcies. retailer announced recently to Moving

Late this in occupied majority spaces spaces our negotiating of the with early spaces testament and of LOIs markets we've for X believe Notably, through worked by possession tenants to and are quarter, regain drive all leases value, is demand. embedded which are agreements market with leases big X them. that American in cons spaces X Given an below quickly for were lots, working tenant process in Freight. and have working rents our Furthermore, of fourth We have we that and to our our the impacted and on a city proactive regained we XXXX. a now get meaningfully in already these we favorable were locations court to spaces. been X successfully X-party

Based and lease spread we could spaces that on for estimate potential re-leasing be between XX%. currently these negotiations, current XX%

While leases to new new rent time to making Accordingly, during are takes build-out commence permits, for it tenants, we simply rapid tenants we on expect progress obtain open. their complete XXXX. from with and tenants

our are shopping for of in our The of Collection land adjacent also tenants with several XX anchor Forsyth. center negotiation We acres undeveloped at to

targeting to by to signed pipeline with earnings late tailwinds bankruptcies re-leasing to related combined provide growth. contribute for our should the XXXX. property opportunities recent leasing are retailer open strong have for earnings We the this and this The XXXX property opportunity not

look acquisition is ahead, to X you near more forward portfolio pipeline opportunities anticipate the XXXX growth soon. and the acquisitions X excited we look in and about ability or We're information robust, closing providing at attractive these the term. currently we yields investments our to of As to our and continue high-quality in

And the with hand call to over will Phil. I back that, now

Philip Mays

John. Thanks,

capital As million To for total year with Further, helped million to of support $XXX capitalization proceeds proceeds John raised company year the $XX.XX million million discussed, balance at with of sheet net XXXX. excellent context, weighted average a a capital loan to per at fourth of at importantly, capital with place full improve beginning our of grow price full ATM during of a the share. this term the weighted and the a per $XX equity This and concluding common the our Starting $XXX the XXXX we $XX.XX quarter, brought quarter, over price strong in represents continued an to had raised which of we the under we share, us in XX% EBITDA balance net the average program ended sheet, September fourth X.Xx. along our ending of year provides our raised at $XXX XXXX net significantly liquidity activity, growth. a over closing to by XXXX. debt us ATM to market turn, the with

we In maturity. debt X do XXXX, have

with on convertible stated million X amount an face Our notes of XX. of X/X% a April rate and outstanding $XX interest mature

convertible notices Accordingly, holders the cash fully and notes our the sent these the primarily maturity is to of settle to price. in common recently fixed settlement election the until notes, with price change will have We the based terms not cash. share of notes our of on

for at $XX outstanding equivalent $XX share a common of all purposes, maturity. However, reference a approximately the price to million is notes settlement

earlier. On Moving fourth to operating core increase a reported compared was the $X.X $XX.X FFO XXXX, the in of XXXX. of primarily XXXX. that significant of results. This $X.XX of was fourth per share the the $X.XX a share in in $XX.X million reduction $X.XX the FFO for to compared basis, fourth of to quarter quarter, I fourth change quarter per a is leverage quarter million result million Core and in discussed the

compared share For per in growth. X% XXXX, $X.XX the full per was year representing XXXX, share to $X.XX core FFO

Now guidance. on the

For provide range to XXXX, to like core our matters. The per a detailed assumptions we that an support X are earnings share. are would context of establishing range guidance $X.XX of our to $X.XX but $X.XX release, FFO additional and per I regarding $X.XX AFFO share press in

rate. to to will credit First, XXXX notes per and approximately the the convertible premium rolling the cost in relatively $X.XX at face settling for a coupon to convertible our our settlement facility amount rate the due revolving low cash price being notes of share

night a discussed X of spaces XX posted Second, earlier updated call. presentation of Page on our includes summary the last investor the John

of the a share all end possession regained Our of related includes of the these around of on to $X.XX guidance that them based quarter XXXX. assumptions the per impact spaces we have first

operator, questions. with And please that, open line the for

Operator

Gaurav comes Alliance Partners. question first [Operator Instructions] Global Mehta Our from with

Gaurav Mehta

comments wanted follow I and convertible up to around just on notes your clarify.

share that there's right? conversion, settlement, expecting are guys with with So of expectation issuance cash that you and that no

John Albright

Yes. This Phil. is

is have in intention notice cash. given to We that our settle

noteholders some it so have. And an generally, only settling But anticipate and that's open point, would in at wanted with shares, that do settle to cash. to the we right still this could we be contractually, exchange them. we in If the we

Gaurav Mehta

Okay.

cash -- source And the the credit? of would so be the line

John Albright

Yes.

So then on later. initially, the and termed would be line go out

Gaurav Mehta

Okay.

what if could on was XXXX the provide I more guidance. investments, expecting. on some between of you're Second outlook hoping structural kind question your acquisitions and you color mix

John Albright

Yes.

seeing structured We primarily to us see now, right of opportunities now, some now, investment expect kind we year. later acquisitions. in in it's of right opportunities. just right any we're acquisition core have core presently, but But don't front So the

Gaurav Mehta

And NOI lastly, the then guidance. you color from Okay. trend how on same-property on Can to provide expect some you quarter-to-quarter? that

Philip Mays

on pick X quarter because focus then first, fourth up generally always hopefully, is down say bump even. $XXX,XXX pool. of a little, quarter, but will number it's there generally, a start little in it going to even. to pretty like it like pretty would more. I and the small X%. the kind in And mean, It's I But annual a will be Yes. up I just would $XXX,XXX,

Operator

Montgomery Our next question comes from Rob with Janney Scott. Stevenson

Robert Stevenson

the the helpful, in full in that to Did share a X million impact Slide of with $X.X the deck the million very $X.XX John. get the question for jive impact in and I the you of million rent you'd re-leasing of trying that say That would half that understand $X you, to new but 'XX? guidance. was 'XX a Just

Philip Mays

from But that, and our just in It's recent XX% John Page open all to anticipating of 'XX. is and vacancies, pipeline, that's was signed he Phil, online of about these Page and -- bankruptcies X when Page I'll that. not was in. from he X, separate talking we're is add let in about in On come retailer 'XX, talking X. separate which

anticipating And pickup pipeline, impact in then 'XX and these then the of add separately, open we're of not that picking about signed to the vacancies. up in that on to the 'XX of half full

Robert Stevenson

Waters that? Okay. an like Creek you repay? structured likely back, you're Is How then be expected Is money to down the these little one the that with terms the that -- looking to That's you of in that going back of And recent money your -- wind getting April. are up size? to a have in bringing then that replace in days if And conversations resolved? structured investments, the is helpful. maturing that What bit how is to that is borrower. market extend? the a portfolio Or investment get

John Albright

Yes.

I that with and stay we're property, they're on a week doing think I that hoping and in there. great borrower was ago, we the

probably We we'll a extension. expect short-term have that

year we like But see. back, or maybe it mean that were short said high-quality a at something I we'd a pricing a reinvest there, that, to when yield. to it's center, having our we'll but that, we grocery-anchored higher able anticipate term, given get that be So if

Robert Stevenson

XXX, at if you $XXX how this that's be in to aggressive of XXX? the end that if Is that's should sort comes pushing else portfolio guys expanding the -- upper stay the expect nothing staying in And likely end? out today? to likely and XXXX I in guess current portfolio, Is interim, the to we million

John Albright

Yes, expect, I maybe to process. of can kind $XX got say this XX to upper to would million a of of we've by sort something that add we year grow that bounds -- something balance is as the thought imagine we

Robert Stevenson

performing America then you they That's point how about with one how where releases the talk are the movie are back Captain for concern you past? to at and they And the these last you're more were are AMCs of some cycle? How they Okay. Is much for in stuff helpful. that? me. a like starting this in robust that versus Can And get performing days? to your

John Albright

Captain And lot well, Yes. as had year. a especially definitely these has less they been America because I concerned doing the very in and last locations. mean, good a you mentioned, they're year

have -- market. these that AMCs are the So their in top performers we

terrific. experience you to so everything, though you up and find to it. that it something is we're when Charlotte, that acquisition be and And lighting AMC actually even And it drive look does great, last we're exciting going actually would an to the doesn't the not in paint

Charlotte I them. out go the and area. of they theater to even they that the this it's in of. convenient the way was because with someone mentioned that And get for lives out to of though it's in kind most

a the it's box performing all them yes, them. just so well. as are short, good macro a very office, for backdrop long very has been And story of And

Operator

question Our next Matthew Trading. Jones Erdner comes from with

Matthew Erdner

area. something John, plan next Could me that I again what in additional the believe XX are about with you you that? X those was mentioned remind acres, sites up

John Albright

Yes.

it a right bat, fee of bought really an off a were started originally, dropped having us option other as want and had who their tenant with it, is sort sort back we operations when So paying scale the licensing their they fee of other expansions. they locations, they to we trouble

to be very, with a visitors discussing lot bringing obviously a large tenants that location. And as we're complementary to now took as draw back collection very of and so far several we it would the different and great the

now. negotiations we're So those right in

that in, let's come to but and So wanted probably And we it's closer this say, we're months. we online, then deal it's X to expect in starting or the hopefully XXXX, late something something just kind that something XXXX would because get to there. of yes, a is next highlight whether

Matthew Erdner

guessing include on first in? And similar a those some that, That's helpful. and kind the I'm refusals anticipate others. right would you Yes. to but to to And kind then those right then ways away, little of do closing of of properties a refusal follow-up probably it's of that as ever taking

John Albright

Yes.

that just So on to property. on one, that clear, we acres, XX own be the

a outside right tenants an have could -- would an outside developer, and basis. primary it a developer on right we be now, could It's not we're we -- talking but have So lease and refusal. of to not the it build first ourselves

And where be collection on would then question refusal, a right -- other in done they're high because it's across would such loans, yes, that street, Whole collection. to we your we've that buy a regard be that the the with to have of deals Foods likely I would we complement a first think where

Operator

Our next James. R.J. Milligan with question from Raymond comes

R.J. Milligan

the baking X. Phil, into what vacancies, I unknown. additional obviously is guidance guidance, of expected appreciate for helpful. debt into I'm I'm baked for potential Slide That's curious, known on the but or sort highlight the detail you're But curious in you bad what

Philip Mays

Yes.

different largely, run all X, rate XX%. excluded your as up that, far on then from as and the are pretty Slide X%, that much our on the known, that's nothing after taken Does tenants that. from just question? it's we've that's So place, And historical that in general answer

R.J. Milligan

X that commence then It to the timing expect Can of mentioned XX expected I does. for just in boxes, you -- the in commencement XXXX. give me the 'XX? of guys you of you And those know idea rent an rent

Philip Mays

all Yes. But R.J., soon can working be to it's and first the the sooner 'XX, as we're first we that I half, we than hard, could in be in or mean, half. we them would assuming I half we or latter get be could released. delayed few them of them and a to to have of majority majority them. there a of, X the of timing, are if on early possible could get hoping -- second be paying we up really the But get get longer rent online the hope those to depending online that half mean, the most them and to in can, might but as getting a in hold back And half. half. have have to the on boxes them first in hope back them might first There then X of them take a little would

John Albright

tenants accretive do we the is credit. R.J., it, faster, good to of in as have not that center bit not opportunities but come as would of and kind little be a could And whole to do

higher-quality delivery, commencement And take investment kind to just and because so a that grade we're a willing lease tenants of that lot rent sort longer thing. longer of takes they're for

R.J. Milligan

spaces? those my interested to tenants helpful. That leads as overall is you talking into who space. the curious how those that are tenants into last about just creation you're And in That's of the think which that the get you question, are new sort value John, then

John Albright

lots back talking that mean, at Sanford foot, bought square you mean roughly we that. we for year I coming the Orlando double $XX have roughly low-hanging and big tenant you had X sure. value fruit a about ago, basically a at cap. a and definitely to think And grade an we're creation I Yes. is is that investment

Big just the accretion, income that of mean, it versus the rate only bought when I Lots. So but compression with cap we the not having -- credit in

party backfills thing. that's across enterprising or are of tenants that and So darlings these Wall it's board of of cities, kind Street that -- on growing the sort are the

to we'll here. able So the we're backfill be excited that about mix very

Operator

from with next Our comes Securities. question B. . Riley John Massocca

John Massocca

to kind CapEx, of or more for of say, of going sorry, kind million what what X, of in outlook $X that $XX how versus you're doing you with were XXXX versus, doing run to does Maybe the back Slide mean, impact the million I kind rate in -- XX CapEx XXXX XXXX?

Philip Mays

of so our regular Yes. that's I mean, kind there. rate our we what to -- run incremental

the end of onetime on that, the the like end lower be much there of with boxes So XX ] incremental of we'll of [ the on spreads we're on And top about of we're get kind XX%? that, CapEx if up to a mark-to-market, And way a the it lower larger end that is and but we'll to higher end, too, John. if the would the there, be is higher be again. on these on that spreads running think

John Massocca

kind And I with lease CapEx boxes? into that mean, durations what of today these amount that tenants kind of decent you're about replacement a in there's mind, given potential going with just talking Okay. of

John Albright

Yes, years. roughly XX to XX

So good behind good lease duration and them. credit

John Massocca

tenants I I a faster. seeing variance timing to were macro just see that can of vacancies IG maybe Or in anything other to But smaller forward? specific the is of or on indicative kind environment you in is kind just mean, is the of Okay. you in re-leasing on I versus going timing if vacancies of come X typical it assets? would of these know you've side smaller then of for kind kind vacancies, typical you see things, of the a And maybe that. you're the talked portfolio what historically? bit the seen appreciate of

John Albright

it's Yes. environment. macro of definitely the typical I mean

pipeline they're tenants these delivering national out. next year, of normal With years what these this just we're to, that boxes, have year, talking their highly desired

you and it's quality So just the tenants, you're pipeline of just process. into they their just if want kind higher a have getting

more it So just takes time.

to credits want having you of total operator, lot creation faster. route But go certainly, value looking we're smaller higher with local the a the if centers. Now these at a in it's certainly,

John Massocca

growth one dealing then same-store in vacancies? And you, me, kind been number strokes for last you for you the but broad if have Okay. exact weren't if front NOI these of of what maybe with have XXXX don't expectations

Philip Mays

to X% X%. Yes,

X% X% range. putting more guidance but So been in we're at would out X%, to have the

Operator

with Our next Kucera Lucid Markets. from Craig question comes Capital

Craig Kucera

Got in running I at comfortable to the company any maybe without a in you're 'XX of leverage. neutral higher willing lot dispositions, front-load leverage to plan is equity did lever out? some and you're and be know planned you activity But the or 'XX

John Albright

that we a Yes. to I this leverage feel unique of at kind of But -- trajectory of want what have the we seeing that year. Clearly, the have go are on the right converts down. given price acquisitions mean, kind are even accretive look, lower a we're us, in stock we're the now to like we levels. front situation

depending just hedged stock. basically converts, on these they're are how go. settle So against they Remember, we things when our

they covering on stock. So be will the

good should there a backdrop. be So

size the inclusion. to And company we're given the then year, of and hopefully, did index the REIT what closer growth last getting of we

buying, if So base come in. more see, quarter to starting the in came REIT we're dedicated get lot that BlackRock you in, in the bottle had index investor that December, at look you some new can as of

always get to starting we we're traction that wanted. So that

year. is really this backdrop the think for I good So

going be And see accretive front and to to us. kind on that complementary so looking what forward and have acquisitions in are we of executing of

Craig Kucera

I a you Changing them out? as gears, XX% fourth guess, mark-to-market you the the process, of think of Carolina was underwriting your Okay. that the were in part time want lose Pavilion kick tenants And I number quarter purchase? the it or to attractiveness of was would acquisition, part occupied. aware of opportunity Great. the of at

John Albright

Yes.

the on So tenants call we closed by underwriting that stores, and I which in Pavilion their maybe X say drop was think and sooner, the you go when I be came that our under might time of had basically course, it close, people But Carolina have would is closings. detrimental contract. last the contract highly in we bankrupt most that mentioned that actually, earnings we put the would and unusual, it and

But that faster so just the for level mark-to-market exciting. that is excitement us what opportunity the was for pretty property do extraordinary can to happen

these great as have the So mentioned, we're -- of backfill. and boxes to we tenants we on these activity, process getting in

going in different economics here be months. the property are to XX, this So of totally XX

Craig Kucera

more one for just me. And Right.

revVana Given regarding D.C., you the and changes in have change the anything that administration their some job losses current communicated schedule at in or any folks the development sort? see

John Albright

market and County, area, That great are incredible activity amount for the such They're it's out -- bumps of data Loudon on lot as the Northern on multifamily in No. been a are land. that that front just demand at the but your to and know, center are they they market, demand project, the road. still you has there all there's point, and housing extraordinary, of Virginia have along no seeing that contractors activity the

Operator

you. Thank Great.

question with next from Our comes Michael Gorman BTIG.

Michael Gorman

or you vacancies go of of just but through see through in maybe there'll and want acquisitions by some smaller underwriting. you cycle. these opportunities curious acquisition the maybe some have think loose Are to bankruptcies for go if opportunities discussions the your some acquisitions? maybe yet, around not shaken CapEx additional to new don't of any recent to landlords have seeing don't another marketplace market want of with these starting sticking a some to where if retailer the to in I'm be re-tenanting because or John,

John Albright

No, we're not seeing that.

trade dramatic some of shopping large you're -- complementary into in going seeing be you're of little -- There's think very center out sort starting of in almost to that's to a we bit. the assets expect be the a large to lot into as to market mean, -- going it's going of gotten of seeing little our I capital see creep the market market. we're sovereign migrate to it's one so this a pension, you're I seeing there a opposite. kind that's acquisitions institutional probably capital And space. the

situation and the fire in lucky closed I -- think horrible acquisition everything come closed, and capital there, a California, for like long Blackstone starting in the sort see all to that of that really, would ROIC mean, of you're a was there you mean, we're term. I the little clockwork. Palisade that and on be saw wave so whether I with kind obviously, of going

And as party the for of that's I shopping rents kind mentioned, all the those lots centers. the headwinds a tenants really low at and did cities and deterrent just opportunity are probably really nothing that's of was some big such shopping and because versus cons the centers and actually for

So a this more is opportunity of than an headwind.

Michael Gorman

And I all think of these the any Great. probably discussing, based non-grocery tenants? grocer an of LOIs it. could Got just I any then But you're a center? would that expectations. the existing are for to tell Or CapEx add on

John Albright

we're These -- a of but had They pipeline having their get sit grocer going wait kind than really have to are in which grocer We one great, we of And opportunity, buying had been we was non-grocer. shopping for. of things the deliver though lot center green like and all of just felt a in first. lot grocer a around to a even bananas. to wanted not done just our longer it

Operator

from follow-up Riley a is John question Massocca Securities. next B. with Our

John Massocca

Just for a me. quick one

is I of kind portfolio XXXX mean the cash in of average for a some outlook this. bespoke rents, kind expirations? conversations with noting your it's Given on the but above lease everything the just rent like of per square mark-to-market foot, what's

John Albright

kind situation. of -- is the is the in as Page a higher definitely having not positive -- there's everything in roll-down definitely our is it's of there's Everything but rolling. mark-to-market where we're as But the of rents our X far up, drawdown kind There's no there, presentation. nothing a -- seeing trajectory

John Massocca

kind any like just this for ranges -- of broad stroke kind lease at expirations? looking of Any Okay. you're year's

John Albright

they're say, the rents I If where kind would good of at those are a say minus, is to range coming out, range tenants higher. are plus market rolling XX% or kind least the XX% of to.

Operator

This program. and now you have at does Thank time. may Thank no you. day. the for questions further participation, this a There your conclude great disconnect. are you Everyone,

CTO Realty Growth (CTO) 21 Feb 252024 Q4 Earnings call transcript