FR - Earnings call transcript Q2 2020 | First Industrial Realty Trust, Inc.

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Operator

Ladies and gentlemen, thank you for standing by and welcome to the First Industrial Second Quarter Results Call. [Operator Instructions] I would now like to hand the conference over to Art Harmon, Vice President of Investor Relations and Marketing. Thank you. Please go ahead, sir.

Arthur Harmon

Thanks a lot, Shelby. to welcome and everybody, our call. Hello,

laws. discuss guidance, provide. accurate let we the include plans obligation statements date, results we federal and only XX, no our this management's cause our July our based our filings. our may second updated materially and SEC forward-looking be securities today's differ by defined Today's results estimates XXXX as statements factors me our expectations, may Actual and in XX-K assume Thursday, statements are to as on quarter other statements from call Before or These of We XXXX. prospects. remind update are statements and described other of that information could may everyone and forward-looking time-sensitive which

a firstindustrial.com the reconciliation earnings and report non-GAAP and our are of our discussed SEC report, release financial our in call in earnings under can filings You Investors at find tab. today's supplemental release. supplemental The measures available

our President; the Senior President Jojo Officer; are Management. call Officer, Our Yap, and Chief Executive Asset on of your Capital Vice President Investment remarks our Vice Also call Operations; Schultz, and Chris today our Peter Baccile, will Vice Musil, Scott Senior Executive Peter Financial Walter, and questions. by Schneider, Chief which it President up Officer; we Chief open for begin after of will Bob Markets with and

to the Peter. over turn me call let Now

Peter Baccile

Thanks, joining we your health through as times. these work that Art, today. maintaining and are you yours you thank all for and hope us all I challenging

an family. gratitude the express Industrial and we quarter, the important Before we discuss to like First our bid of to member farewell would

Board. has we retired Duncan from Bruce As disclosed, our previously

provided First wish portfolio. our know, role. stabilize Bruce and his as Bruce new taken a Industrial leadership REIT. model new As our joined Bruce challenge and to We as business many in difficult and a in period CEO transform CEO tremendous during help of another XXXX of on well you has

taken over highly of seasoned As also seen, may a Matt you our Chairperson. have XXXX. member as Matt has Board since has Dominski, been FR Director, productive

as We and to our new are leadership. his have to counsel continued forward and thrilled look Matt Chair

quarter. areas, collections, demonstrated strong to leasing, markets. results investment capital We including produced several different the and in now Moving

have their I Our regional continued our teams second fantastic them these in done thank through job a working for in on like the times. diligence tenants quarter difficult to would collections. with

is jurisdictions far, have were billings include we XX%. are the the collected in numerator toward quarter. do believe, ourselves would regularly that clear, application If under quarter we rental rental this right our of we metric, in the experienced calculation collected which we As outstanding pace XQ in on the XX% moratoriums ahead of that a our monthly reflects the factor so and XX% billings percentage for group. receivables for and have collections we XX% rate of billings, in July collection second of be July end yesterday, we've from monthly government-related the month, the pay which of About of the for tenants the at of also the deposit. open evict, this cash landlord's of give second to be To methodology not collections credit security collections contributing our

to rental our debt the and security for tapered expense reduced monthly our second debt addition, surrendered reserves accounts outstanding reserves have to in is only the XQ deposits rent is total in a any requests In related monthly reflects not Including $XXX,XXX. denominator quarter, and receivable billings bad deferrals. minimum. rental Rent billings off the recognized or bad relief for

commerce stimulus number of about appears these to agreements flow totaling deferrals points in of the prospects. well average basis helped are we business It government established annualized general The as rent logistics to-date, $XXX,XXX with business or have for deferment months. our continues billings. crisis XX XX to a The COVID-XX perform leaders industrial about term tenants optimistic customers the is their continues and more X.X through has During facility.

As COVID net activity April million reported moving should surprise prospects XX flash be million of new CBRE caution, and slowdown has a and with March quarter requirements second in not cases. completion. are economic attributable since our square you've seen, resulting feet and the XX in These drop some QX square its leasing improved In feet to albeit space with absorption figures economic and versus customers the given activity. of report, ahead preliminary

are million given If for potential is we absorption our they generating of e-commerce view logistics XXX right, the exceeding are crisis by incremental mark million square This supported XXXX all-time of space. in increased annual by occupancy in our prospects Despite the XXX adoption square optimistic the XXXX. forecast portfolio watermark, for feet long net recent post absorption square term financial in XX.X% completions feet total absorption nationally quarter, for exceed feet additional safety quarter-end. stock, the the acceleration sector that of XXXX. CBRE's to industrial high the will a net than million and more However, great net XXX about and will demand at

lease, property now remaining to asset this of we commenced foot the submarket two-building this at Center our we in Building Baltimore. XXX,XXX square project. which the leased XXX,XXX lease-up Considering With first XXX% in occupied XX-month Logistics ahead achieved leased the at square basis, the June. foot quarter, leading in we this long budgeted provider big XX% feet guidance. purchased are XX,XXX in our in significantly to just We of also a late I-XX North Nottingham on term a a A square e-commerce leasing Ridge win We

Looking more closely performance. at our portfolio

signed XXXX rental rate As of XX% we increase expirations July have XXnd, a at cash of lease our X.X%. of

to after which the begun fairly year, new be and saw market rate awaken a and able based We to and approximately on period as higher. are concerns on make some barrier returned leasing a few XX,XXX investment some bit. in We to full markets. Northern the a were hearing; weighted pricing our with $XX.X X.X%. on XX,XXX feet. of cases during to renewal adjacent in has shelved in quarter approximately the was average building certainly stimulus cash quell is aggregate For some in acquired expect Most asset levels been pre-COVID a The seeing participants bid-ask rental values. we change had to high initial price comprised quiet XX%. we an government clarity more yield a has federal what we in Fremont and of saw those spread helped million The direction and economy and acquisitions square-footer the square actions offerings California purchase The added of of widen the

site. the us the The investment site the land will building. The has also as $X.X $X.X site a a Seattle square million We entitled covered generating Inland foot site have Empire some X% that in-place can we yield cash added development. for in years, XXX,XXX XXX,XXX million. on a several square accommodate X.X-acre a for next for for accommodate Thus in a X.X-acre the far we in third closed quarter, foot

the material leased feet systems. handling initial million at long is Inland excited be square it's investment also Nandina site We will and XXX,XXX Empire. will Total $XX.X cash development building on First manufacturer X.X%. new build-to-suit approximately basis a and term our yield to in are a II the of be to launch The a

We of a X million which developments million are our in at $XX.X square XXth. proceeding and investment with all process, feet of totaled total June

building in foot spec our developments, on the construction to our progressing on-balance sheet venture square joint XXX,XXX addition In is at PVXXX well. Phoenix

million $XX X%. and is the Our our is portion targeted of investment yield

on-balance go. the land majority XX and million Our accommodate future of of to holdings vast is feet which sheet ready entitled approximately will square developments,

on prepared to starts. so to the justify several at that when new work submarkets infrastructure move launch think are ahead economic sites specific conditions continue We we in we

second our Indianapolis. the square feet Moving XXX,XXX and of to Chicago asset buildings These we last in a Detroit, $XX.X three Year-to-date, a in totaling sold for sold one for total square dispositions. in of million. comprised $XX.X feet we quarter, were million. building XXX,XXX In

purchase we third sale close Phoenix, expect on in $XX the its reminder, the which in a in As exercised option to in the tenant quarter, million XXXX.

extension executions on XXth, our for into maturity July agreement with million lengthen loan and a investment was XX issue to an entered weighted scheduled markets to we our $XXX mature us notes provide year in of of schedule. two closed On July term interest capital average our XX private These Moving On of that and of we XXXX. new activity. additional recent placement to January capital total X.XX%. in Xth, a rate

all, in with that, a very Scott. over execution to let great me it turn quarter our With busy by all and So team. successful

Scott Musil

versus $X.XX XQ from $X.XX for diluted to with our NAREIT begin Thanks share second EPS Peter. and EPS per I fully XXXX. one quarter. the operations FFO was Diluted in share and $X.XX funds year-ago were per compared will $X.XX

from pay of FFO X XXXX we basis deferred up accounts related which basis points has includes in July bad up of total to at from guidance. quarter tenant the receivables. August a expense expense up pick quarter are XX.X%, the certain $XXX,XXX receivable year-ago. strong points Pier $XXX,XXX paid and rent related from prior rent, debt assuming non-cash they of XX was XX Occupancy represents our prior Second to bad and rents $XXX,XXX approximately debt write-off cash a and

excluding rent expense XX.X%. and offset helped free XX.X% embedded were on XX.X%. commenced approximately X.X in Cash Same-store on rental X.X during overall Tenant square As by overall up new by renewals were cash new, a XXX,XXX up partially rental renewals of XX.X% was NOI for growth rate were rates renewals up leasing were in XX% by the rental our And in on a for a increase increase was new XXX,XXX straight-line million X.X% rates retention bad were basis, renewal acquisitions lower leasing with was and leasing, volume X.X% slightly new developments rates leases. we basis, million leasing footage and and in bumps leases, debt decrease and square quarter, fees, lease-up. with up with and XX.X%. occupancy. This termination increasing and average feet rental

we capital market ladder Peter on extend the and that at mentioned, maturities transactions third our two in rates. As executed attractive quarter

term First, rate at and in private with a of are a placement a we notes million fixed rate million $XXX senior at $XXX entered $XXX XX-year tranches, X.XX% The of term a offering. agreement million comprised rate of two XX-year a of unsecured into an issue notes X.XX%. with to

On on of to year. XXth September more will close funds to the pay line to XXXX. fund we expect or of investment a which secured our us offering debt credit, on about will give this an new interim liquidity and down basis, in We these maturity use

option. maturity initial unsecured which date of fixed have $XXX savings After points. exercisable due plus one-year that to two in term the end scheduled offering. is loan convert XXXX. X.XX%, about mature private that of created payments extensions at XXXX which one loan, proceeds debt swap term secure XXXX our can loan, our July new the placement million by will has fourth we interest XXXX. refinanced January previously with to pay the the per XXX to executions, XXXX, will rate realize agreements and a line, of our capacity this million push In also maturities entered using the of via our interest February an refinancing. off beginning quarter. XXXX, two The conjunction in rate of features new a interest-only can In basis into July We aforementioned we we loan remaining these new penny of $XX of from our at We LIBOR the additional to bears interest The share rate an loan

line is at another of push we our October XXXX, out option. year credit, through one-year matures of our extension other The that but a which in can exercisable

plus with debt shape -- is X.X EBITDA at stock to at preferred leverage at good in June XXth. times Our also January our net

last our to on press guidance our per release evening. Moving

compared to of a $X.XX $X.XX Nottingham in The is Our $X.XX. by slightly This pay our to Ridge early is of first guidance our interest share well the share for our that the primarily $X.XX lease increase assumption foot months on midpoint with the This call. range to two square offering offset NAREIT the quarter funds is now items near we on X. before additional at midpoint building use our credit rental private income Pier per FFO from line an of due as as one-time up of of Center additional our to expense is FFO increase and from the term. Logistics based XXX,XXX down placement of guidance per the

the receivables any cash assumption rent remains Our guidance third the Please debt average expense remains average of our $XXX,XXX for as and include related to to cash Other fourth basis not before of difficulties. a and follows, for X.XX%, key quarters. assumptions write-offs growth fees NOI are XX% for for increase XX% same-store at that guidance bad termination tightening basis range. potential of an quarter-end -- each financial tenants assumption midpoint of having XX occupancy to X.XX% the of the that the range a on does note of deferred and points are

$X.XX XXXX, guidance First plus G&A to share includes completed our June at related to third expect the $XX II. Nandina developments the per developments. related to costs start million XXXX and remains also about range construction Our to at total, In full interest $XX capitalize anticipated year and XXth, our quarter for guidance we of of million the under

$XXX final damaged which discussed placement, to potential year. other settlement property. XXth expect of insurance excludes Our repayments future to development we the of related previously one in the or call reflect after equity. September The of And third exercised expected I sales, other this impact the the of acquisitions starts issuances, new building which future any about guidance of debt close not other any on repurchases million does for this the than also for a purchase impact gain than option. claim quarter any The private of guidance the debt call future tenant its from Phoenix, issuance of or this the impact after sale

it Let Peter. me back turn over to

Peter Baccile

Thanks, Scott.

to for doing and their am incredibly our environment our and it way that let safely. to Before of questions, customers proud thank it performed dedication has we me up this open say I well the serving team difficult them in

built businesses, drive while by are is needs term shareholders capitalizing for flow positioned growth on a serving secular the emerging essential to cash company we of we logistics range of and of long e-commerce. limit up will now that, With Our one the drivers open for call. well in We and for your you questions move ask to Operator, are please our the get to it please the you you welcome questions? would of back question-and-answer queue. portion to a follow-up that then, plus and

Operator

Your Instructions] is [Operator question Mailman Craig of KeyBanc Capital first from Markets.

Craig Mailman

the little of the Clearly, a guys. bit good maybe Peter, absorption versus here morning second new a Hey, hopefully, your quarter of just net circling temporary but the to imbalance back supply. in here. bit an reference little

are? that terms back? and things with a from off realization and could up it or for what are that backdrop Just concessions they is quick? though, seeing asking you rent Are where pretty here of tenants tenant they pushing rent get levels supply tighten choked in they think could Are more brokers

Peter Baccile

do of imagine in XX things days we there think months different be Well, may terms the some anything certain any boxes. now, what lot existed that's oversupply going be we're are pre last rent were few There different is than a they you where is And the than the as can market, in just the an obviously. big growth, there of it prior in virus. depends to looks but concessions, seeing areas on not

about landlords' before It's know few clearly market a concession there markets there generally had grow strong. additional we the obviously additional You optimistic are virus so, markets a that our the supply, is to pretty that pretty speaking, some still rents. so are there were but maybe and opportunity

Craig Mailman

development And in Okay. didn't get the of good and much there IE Baltimore leasing pipeline, understandably, you -- balance guys some just then, execution done. the had but the on,

and pipeline some like. looks where those curious projects of the kind what stand of Just

Peter Baccile

a some and you go that yet, lot finished Jojo of Peter that. I to projects? have want you our through recognize Jojo, over isn't of but I'll that take Sure.

Johannson Yap

Sure.

But XX% mean, of at buildings, I that Dallas at that, at look been love because and will you Katy, if showings frontage leased a project despite that of point, limited last great in So and there. Houston, year at we're COVID the completed there Houston. end the I-XX there but West two State projects were start XX, I freeway just project. have with Highway that's in this basically

Of as well, in Fossil a -- demographic Louisville. And course, what a is leasing in open look just tenant. and Louisville and XX%. In announcing Fort project in there North deals very really a continue more First forward the we'll one Dallas, there RFPs, is good looking and a that's is much Creek, That market, more tenant tighter of market market, for to market, there. is is terms growth building work improve to and the that lot we're showings supply, the less there. two we right in one to so Worth we that love of

IE, a And proposals getting and and our end period, getting so, development, IE, -- Redwood for there. Peter? Independence we RFPs And those rest Peter, the lease-up month before on Miami, for building I not Logistics just turn XX-month RFPs, it I-XX, First still at to our First Redwood already last completed and Dallas, for are of projects we're well and we're within the completed the Sawgrass, we're and yet. over of

Peter Schultz

with ago, in last which And submarket we've certainly Good little the really Schultz. Craig, weeks. months, in Peter completed halt a supply. a Pennsylvania, sizes. that's Peter our bit for Philadelphia, space minutes the construction it's that impacted you in seen couple limited broadening On had activity may definitely last and delayed and as was as couple so an Jojo. also know, mentioned, Thanks, that's in increase just there, we're industries across of a very project inspections several days morning, activity tight of but XX

seen was the in activity in RFPs and project XXX,XXX there plus last other than two-building leased project the we've traffic months. square second that's more in there couple pickup XX% in in the and may and of Central a XX we'd you inquiries, days, Our seen range foot a Pennsylvania, recall, of the as

we'll you to posted clearly, our and So keep do on work progress.

Operator

Your next of SunTrust. Kim question Ki from is Bin

Ki Bin Kim

Good more really details you behind dialog, morning that out there. can that? customer mean? improving you And what does little When mentioned put a guys

Peter Baccile

Ki Bin, tenants very access we Peter have to we on Look, we early; PPP, them helping here. got we we're mentioned, to got etc. as get close our -- very --

to make sure process make effort think it So that the application to the had to we funding. they available, degree. they were do that give points try and some action was would and make knew to how we off receiving sure what access also, them specific banking a they knew relationship made, that sure to has paid That

we did. don't received XX of Now, PPP had they know invested know do can you many invest we our activity. either how And tenants don't half about non-payroll in it but the of got again, money we because about know they actually how it,

also So the -- good because certain position issues definitely but some in had terms with difficulty having that etc., the and notwithstanding the us a being of with weather we've the everything virus. We've shut taken care of dialog flooding, tenants. at assets that in down environment put of

going things retention, of run. going tenant relationships value all these so, we for in toward long are the And drives toward and think shareholders our ultimately,

Ki Bin Kim

when to and into just time outlook back Okay. capital your maybe reignite for And the improved like right derisk if development? And if allocation, that? translate saying you're is now step you and incorporating kind take everything that endeavors the your does how willingness a of I'm

Peter Baccile

Yes.

So we're opportunities. various evaluating

that our and primary of development. and happen, in confidence and a and lease good with to projects. to first, is of is great that ink when go two that we activity where Now business, we the this business that on Obviously, into terms to tenants speculative we'd to are now, we're that responding source has focused sustainable. we're see dialog -- One like grow decide, turned of so of We're that right RFPs, some when the on example. Nandina business. give with the There number how inked build-to-suit when to the been leases new see eager project's we're will in new us a growth having I'll we're will range our a projects in be II we're things continue obviously, say,

open economy continue looking ground come great with will the activity, chilling that from and see us, a of at we economy have enough albeit second that So The the what's may nationally, going policies and thing state sustainability, to we're in slower protocols happening effect what's or to at it the perhaps, give down tenant and putting again. -- go each is to will a and some with shovels some some pace? said, allow start activities, and I on virus, happening and leadership if sustainability ahead as the confidence to there the on that's the

Operator

of next is Rob from Stevenson question Your Janney.

Robert Stevenson

Hi, the known size through or expirations guys. are XXXX point? at Any tenants at early when that this of likely move-outs looking

Scott Musil

have it's would of year, the at Rob, say from XXX,XXX Atlanta. with square to tenant tenant. When so haven't granular I going with due in on is tenant we got we've that lease That look regional point far you about lease May are out maturities coming a largest view point industry -- the XXXX, is of view. in really a very and we next the of Scott. expiration it's XXXX along our gotten dialog feet,

Robert Stevenson

the limiting market days you assets, pricing do more the these forward? get guys exchanges sell what you about of the or in to the expect urgency for any away the can in and back you demand expect non-core going of on then, is half XXXX for talk that the done this with And and Okay. continue doing year would to to rhetoric given

Johannson Yap

April and market, all the hi, Well, investment in the space terms continues pause, I and grow. that are But they've market, and in the to the continue lease markets sales to knows driven -- May. pause across the we buyers of of product this that's rents market course, all mean, of by business First, Jojo. industrial is hit really seen for types, everybody March, kind first, and back the

the quarter we is want in pulled pricing. year, pause back, don't hearing change the the What but activity portfolios sales back we really for are we expect and -- so, terms see don't we their to growing for are and that take portfolios, expect of -- our pipeline to activity. sellers want sales May, it sellers pre-COVID the the market. for is us, some didn't for back And significant March, the in April to

terms in no us just of continue really For no our a strategy, management at strategy. it in mean; change, and we in I change prior will is do asset-by-asset Peter to it's we said DNA, that, no rush, look of Portfolio part maximizing value, like calls.

Robert Stevenson

that And spend going continue driven a how to to much by spec on development development development of need you pipeline? do to the you lower be what is and guys have If on guys that you're of pipeline, mean in half early of the the XXXX? the sell the year or to cost does construction as early or part in year back fund to end much the that unlikely

Peter Baccile

two lease goes but barrier do value That up, think are there what if different value often two a No. decisions be our outcomes both leasing time, which so in off those won't particular to to they all sales development Those decisions. until high maximizing the connected. that whether market a is in given we that it's decisions, a start really asset, to we may with hold of want maximize have quite are of the market, a it's new we We may the asset. drives with not anything opportunity it time toward

Operator

from RBC of Carroll Capital Your is next Markets. question Michael

Michael Carroll

in are uncollected some that I color guess, any have majority anything you concentrated of mean, I or have Can like to-date? amount assets sectors are jurisdictions of there you restricted tenants are the rents I certain on, within evictions, the in small I of located themes thanks. these that that Yes, that outside bucket, guess, that? guess, any provide

Peter Baccile

have guess, the supply, depend rental not such that kind kinds so fitness those of entertainment, that quarter would sporting tent so as is that that, last those the health are the the club businesses, restaurant overall congregation other health businesses course, or theme people companies, or whose say clubs, of of I goods kinds or are bad. upon businesses not of been than any doing revenues but it's so, of that serve I business well businesses, the that --

Michael Carroll

Okay.

within, XQ those like July sentiment lever then paying mean, back that in guys is been -- try the So and to saying? when through right going -- they basically, now, occupancy they buckets evictions, I were lower space you're tenants those to are what's if of mean, Have I and been to that or going up? talking I guess, highlighted you and to able have what to uncollected you them, are X% get their you -- lease have start just

Peter Baccile

overall some Well, obviously, able very have small their be would happy right those debt, be deferred, and I and become well we're it's collected, say but to that will rent. a number and tenants doing conversations may it's our will that that we're are are some behaving hard to them further with say bad poorly, now. going We're happy just of some to pay that, X%,

Johannson Yap

number negotiated And of be move because in-place will a where in well, below the rents are out, there a cases, some we market. have well cases

Peter Baccile

are who very have well we know where we raise the rent, around can active that doing When we'll be out. we tenants Yes. swapping

Operator

Eric comes Frankel of Green Advisors. Your from Street next question

Eric Frankel

Thank you.

dispositions, you to and sell? is pricing pricing Just seen goal going changing feel do you want about or back to good your all you your change think have the for do you at your assets still pretty overall

Peter Baccile

in second to know, are having pause our didn't take a so standpoint, disrupt plans. as back From timing a the Eric, sales typically quarter really ended, our of most you

pretty and that now conversations market solid. the and So and now the we're having, activity the we're they -- back seeing seem the buyers come to pretty

on the for in a outlook optimistic sales and think still we'll the pretty be have guidance So we balance of year range. that we

Eric Frankel

Thanks. just leasing And to your results. going back Okay.

and your than your spread cash first So so. It's of bit two mentioned your role of or you still around X.X% recorded I a lower little guess the releasing -- XXXX quarters. you XXXX were what in

slight dip not you leases? to around spread So, the are during are you cash or there to that July mentioned XX%, expected of overall just that know or releasing is that just or anything timing be certain -- into I annual that read

Peter Baccile

you Chris, take to want that?

Christopher Schneider

don't in think around to read overall, we're be mix still No, has I little do new seeing the -- it of to right to for rollover we're healthy Yes. expecting that. a rent it XX% there's in some sometimes growth. into there the anything renewal. bit with year. But Again, and pretty I had for

Operator

Your question Mueller JPMorgan. from of is next Mike

Michael Mueller

hi. Yes,

and renewals In years looks like you X.X. color Xs. terms there? new and low-to-mid like were years are us just give X in duration, in If X of looks X.X to were lease little the XXXX new and renewals the your Can the it on XXXX we changes at a year-to-date, it the is leases look

Christopher Schneider

look term Yes. Again, about total overall, this at if years. X.X you were of the

So actually rate than the and that that's going. is run -- higher

and up bit, on renewed in little that are the -- generally, basis, had renewals So the a up but that XX-year -- kind so renewals we a of tenant we a pushed larger you're large going is renewed, but little so new a renewal numbers. pushed we it to be that a of lower higher see had the probably little tenant and a bit to bit kind going

Michael Mueller

it. Got

Peter Baccile

seeing so maintain we in few term that's extend sure last strong change. pretty really to and you're pushing the those been years, make We've where Mike, rent leases, bumps the

Operator

Your David Rodgers is Baird. next question of from

David Rodgers

activity. commencement the the kind we ask the to the volume the leasing to around And then and how and good report? of some third a wanted A maybe quarter, of that numbers of maybe extend in quarter bit you guys kind broader blend as see specifically little commencement tackled a slow up guys. deferrals. just I to in with just Yes, respect morning, about COVID question catches have great that to expect would and second you

Peter Schultz

little bit, a Chris, deferrals? talk about to want You our

Christopher Schneider

Yes.

the talked it under extend, far the about in in As script. deferrals as one we

in we've So agreements into, of about deferrals, entered those of rent, that deferred the by of -- end 'XX. that total deferred the rent repay $XXX,XXX we've all they'll they're

So on in much we done one really haven't extend. the

Peter Baccile

but too it's been early paying all so tell far, And they've so... to

David Rodgers

correct. Correct,

Scott Musil

to methodology our this reached Dave, same-store. -- out the And Yes. you for on morning,

XX as long there within back back the in paid really As pay isn't deferrals the agreements any difference or to months, same-store. timing are

back us June and our $XXX but over are June mind, quarter, the keep third deferrals bill we very the if that same-store paying example, purposes, we an in show tenant's revenue for As minimal. in in

As Peter it's the $XXX,XXX. only about in script, mentioned

David Rodgers

quarter cycling expect commencements really you kind you kind that And third kind of in the just the the expect I that? quote then, were of that not strong. numbers, second. in really through would third you and finally saw in signings to we your -- see which to commencements of quarter Do the activity with quarter see second through you the on know or come lease the that respect

Scott Musil

any the expirations XX%, for Yes, you're that about end third pretty taken care the David, a have the the to to quarter of idea we'd guessing by close should XXXX. our quarter then, the signings of is move-outs. the that XXX%, in good pretty except I'm And there the are lease of be third asking to XXXX. going extent we number call, on for

David Rodgers

me Maybe, let ask different way. maybe Okay. question a different a

from built guys you the and up. a from months took think down of for leasing up, month really a if year to obviously, compared overall how you now mind same it? quite your March, portfolio far just So you down and up the first that for May slowed perspective business a guess I bit the in to seven the your April, And we're about perspective, catch activity a trying and is leasing back as that backlog and year ago, year-to-date, seven

Scott Musil

Having started slow you but if said years. that, the July, very look and going the in similar up what to-date. of renewals David, it's past April, in pick the it's to to XX% June Hey, were been they really pandemic May at statistic, into couple

to-date been the on the signed similar in what past we've to very we're it's So is track, years. back that XX% so

Peter Baccile

know, we're except because immediately. behind not in that asset we for have starts Baltimore and as on actually didn't the you of And developments, leased yet and new we pipeline finished isn't almost much any the

caught from standpoint, that up you too prior will we're with kind So of year if performance.

David Rodgers

be Do you more your bit way? size on liquidity the is down public peers and the on the spread guys you the given in side, the as versus coming maybe given upgrades do private that's side as last a metrics, going your debt about Scott, where feel should you've of the to sense but portfolio the or paying given relative little of if the think mentioned market about created, And and that function debt you using line great, you debt are, maybe there of And kind maybe in helpful. your years? any the right, of collapsing drag you like to that for overall debt All just coming more you you for credit, the is and kind your that the of market a leverage the potential in quarter. one, spreads think

Peter Baccile

the would terms of upgrade, it to In be seems get like bigger. the that an us upgrade to agencies

have -- cost side work an that of capital of spread do, we can capital, think still on things In that, to even narrow some the terms debt we do the cost can we of to upgrade. without we

of sources cost. those looking what debt sources of just debt So at different and

are you means issue to we bit to public So know. a be $X debt too we're have need there we $XXX-plus Typically, future. going in years some can in our you over regular not maturity if be the bond to that is do that million distant you not of in the to that, issuer of billion little market seven average market, and a got as

would like think certainly, gained across there from feedback be us larger board, getting compare they overall. look but metrics -- to the you we're is be want upgrade to we should if it metrics an BBB+ So saving they there want too, be that but standpoint, our we some to our

Operator

Securities. from of is Your Okusanya Mizuho Omotayo next question

Omotayo Okusanya

you're in to specifically, market? what you morning. about good Yes, the Could seeing us talk Houston

Peter Baccile

about to Jojo, Houston take you want that the market?

Johannson Yap

sure. Sure,

versus collection, to to I From about XX% about our that spoke the talked close our -- said standpoint, you I we've a to of of as and so we Actually, there to be there. tell a and the absorbed exact, Katy because there of market, than before you a the our showings North growth little and I Houston market, Let say our we're would I bit there. absorption portfolio PV that is starts imbalance up overall bit there, in that at occupied first XXX% is frontage. the limited would there is freeway then collected XX.X% in our well. a development Grand good, Overall, more submarkets, basically doing submarket you Parkway construction doing portfolio. absorption supply me of in I rents development about more so greater weaker well actually be little rents talked still portfolio, terms on quite but firming submarket's is to earlier we're terms in just again. is the supply there's

Omotayo Okusanya

seems that NOI then, or And space? helpful. cash quarter same-store from excluding rent that's you, are the you There calculation of across happening be practices range industrial a wide deferrals your Got the including number? this them this to quarter

Scott Musil

rent we're it Well, to number. we're doing -- it's ago definitions So my at And look us that --. are peer couple in immaterial all an we in us, example, it. standardize a including got of industrial bunch Again, a you together for years if deferrals way the of group,

Omotayo Okusanya

Yes.

Scott Musil

part. For the most

next the immaterial, rent pretty us, deferring. only and my credit if the in deferral we'll example, it's period. are get billing $XXX,XXX in under But again, June agreement it's rent bill again paid June So over of we're back for deferrals a quarter, we about in

Operator

of Your Jon Jefferies. next question is from Petersen

Jonathan Petersen

of you what Maybe maybe Great, a demand tenant last of geographies your expect where three in thanks. by can through different -- changed or four seen, in the and give maybe behavior like rest I months sizes. and you about has see terms year. guess, behavior to how little the could building maybe Hoping us what more you're the context you've seeing the talk different in on you

Peter Baccile

you your and provide Peter that then great. you Schultz, want would thoughts that to can be Jojo, start with

Peter Schultz

It's John. morning, Peter Good Sure. Schultz.

the would concentrated quarter, first I notably. in during large of most the activity and half tenants, XPLs large the second beverage, of food majority e-commerce spaces, say, was the medical, First, and

the As Nottingham remarks example, on an our that project Baltimore. in our at deal we in Ridge commented

a in about signed we the less. since is requests or the and space second we've quarter seen tours, The paper leases and the feet. requirements; And quarter, as alone, broadening proposals, broaden across dozen of home saw packaging, couple materials, again, for example, or vacant activity last footage for XX,XXX and an the we've was XXX,XXX industries, In noticeable and second uptick a feet we a XX beginning building-related home in the of industries majority fact, the Pennsylvania space in inquiries new building some square communications. a of half seen that XX in days, sizes square of improvement, June, of average the and

months activity update broad-based converted our the in by increase So see accelerate in on we've seen across signed that on overall it's be how confidence continue from and encouraged ranges we been size, country, prospective deals the the and activity certainly the you We'll across much gets into call. tenants. coming next we'll and to of that

Johannson Yap

helping think big activity as that large. were U.S. supply The is an answer example, foreign to small Nandina had some do well, anything of industries, -- has our on as material XPLs, improve they're that give now, Peter shoring of industry. not are there handling are their from on really the the you their businesses will tenants the the food-related And and e-commerce And just on to to -- signs that relocate relate add, other part by been shoring has that active focused the solutions. e-commerce is seeing trying with then, I chain growth for but in pretty we was Give to in our assisting, tenant management activity would very we warehouse some the thing I addition anything add mentioned, as comprehensive to First II, equipment what that, Peter. would That operations XPL, only then, companies in just a I

Jonathan Petersen

shoring? geographies sort of what the expand you on Can we seeing are in

Johannson Yap

U.S. the cost have you a of where Basically, favoring lower across markets business. doing

Jonathan Petersen

list little always historically have just of then, been industrials it. your That's it's sector, just top peers, X%. And similar think I looking on to tenant curious, I'm over all helpful. or I very was the really and Got unlike, guess, you is a if top; themselves your Amazon I mind Amazon finds X%, different at huge you tenants I of kind Amazon at bucket but basis percentage? tenant a a it's tenant what high diversified very worry a with concentration part. certain or do mean, too like point sector you much in having some a put don't about where do been a

Peter Baccile

Right.

We standpoint, we the our Obviously, do tremendous a world. their like to and position we want with too don't competitive in heavy any portfolio. tenant. particular their growth trajectory company concentration concentration from fantastic with pay attention in a a So is Amazon

at rent we Amazon, cut-off yes, certainly at how sit can So would big Amazon, of I today look factor and business I Amazon. we what that We and of don't more that XQ. do end here you the for with the certainly additional plays tell our know a X% capacity but base they're have appetite annual about be

Operator

from question Advisors. next of follow-up a is Eric Your Frankel Street Green

Eric Frankel

essentially for guiding walk Thank to could a forecast. NOI us bit just your about little the Obviously, you're you growth half how thinking second roughly you. end maybe same-store Scott, low through you're increased still you year. of but the the flat

just I'm that So there missing. we might any wondering there be assumptions are in

Scott Musil

have other are couple the cash right, had points, drop A expense off to we increase of half. of of going had free items, bad more big as our that you're XX a impact rent. -- we're of do item quarter second second debt see couple to get our the the to received rent about it X couple lower the well. guidance with in at does August basis And do that, Eric, points of with causing already to but in percentage had in then, the do pieces same-store it to from going of with The assumption and months our assuming a X, Pier we're new Yes. July we've

in of in half have free of in that impact XXXX. the Nandina in the Building So free in free that not of rents new Also, don't have in benefit second half burn-off have same Southern associated helped back do rent we us. year. had that them in half leases period our projection, first the did on with XXXX, some prior have our the that the we that California XXXX, of We rent

moving of piece that So a Pier about big is impact, point occupancy. big assumption. our other drop percentage in piece expense a and recognized rent assumption X and piece of A the $X.X cash big first out of year the the of is say I'd our free the it half the is bad of million. the half is in $XXX,XXX just X debt in back is We debt bad year,

half. those same-store the the three year compared pieces big back are So first causing of the the half to in the decline

Eric Frankel

walking for demand Are months dynamic spec thanks tone pursuing your Is ago. a development optimistic there us Well, few lot that? there than for that more final there might be any through I opportunities? markets that. allow a obviously, that just any -- is question, interest would a supply in where will --

Peter Baccile

earlier we're spoken little what a -- I Yes. this bit about might've but

Eric Frankel

about Sorry that.

Peter Baccile

XX our said our bank acquisition opportunities land entitled to can growth about square looking as call as at now, our at and build portfolio, I in outside go. We're both ready that opportunities and within well right feet, as majority today, of is we the new portfolio. in the million portfolio vast Evaluating,

the on tenants shutdown business is and a will we with all to time Eric, just that period we we'll having pass, current it's to and with of want ready we the the from March-April month talk soon back don't or good coming we As them sure commence a -- leases sustainable, new discussing feel the be environment and time sure as assets soon confident we're go standpoint. so, really now to that as little just that go over We as that more bit make we're make the not conversations get turn on starts. into speculative to that

Operator

are questions remarks. There closing any other I'd no back the for like Eric call Baccile to queue. to in turn

Peter Baccile

safe me participating wish for a to and Thank on you, or free questions. and Please operator, We ones and your thanks to healthy any feel follow-up today. to loved reach everyone out our you with summer. Scott call

Operator

call. conference your you Ladies and concludes today's for this Thank gentlemen, participation.

disconnect. now may You

First Industrial Realty Trust (FR) 23 Jul 202020 Q2 Earnings call transcript