FR - Earnings call transcript Q4 2024 | First Industrial Realty Trust, Inc.

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Operator

Good day, and welcome to the First Industrial Realty Trust, Inc. fourth quarter results call. [Operator Instructions] Please note, this event is being recorded. I would now like to turn the conference over to Art Harmon, Senior Vice President of Investor Relations and Marketing. Please go ahead.

Art Harmon

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

forward-looking the Before We XXXX for estimates results our These fourth statements may XXXX, securities our our by only full year quarter date, today's as and include Today's call and our me are everyone we as laws. expectations, information assume obligation may remind update statements defined federal discuss let that other XXXX. statements our based to initial no management's or on of be provide. plans statements of February and prospects. time-sensitive accurate we X, and guidance

Actual could from cause materially XX-K our which described are and in our factors filings. results may this SEC and forward-looking differ other statements,

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

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

Now let me hand Peter. it over to

Peter Baccile

when our strong Based we're highlighted achieving the year our delivering addresses impact since us First grow our will and relaunched this Industrial approximately expecting XXXX XX%. you The highest details midpoint about of guidance. by XXXX. volume for rental in team FFO is on success today. Thank a lease Art, for the later guidance, joining the program having you through up equally to successful walk thank Scott signing he second FFO our excited on you, XXXX, on growth. We're all and rate we our wrapped development leasing cash growth

on rise basis let X.X% CBRE reports the industrial XX specifics 'XX. EA vacancy me QX market our into comment U.S. point of industrial from getting Before a performance, hit year-end, market broadly. at

start million markets, construction future ground XXX square the the of than well under lower In target feet, million below square XX construction quarter XX fall million just breaking XX with square in in totals quarterly completions quarter New XX% XXXX QX our volume space peak, 'XX. feet delivered 'XX. is feet fourth third could the signaling

On was of side, the target nationally million net the demand XX XX in absorption in million which feet was quarter, square our fourth markets.

investing, lead that the a this With stronger to hopeful leasing. development will commitment more uncertainty reduction pace to turn, behind us, a election in we're consistent growth and in in

we the year shortly. From point touch in-service aided ended I occupancy some fourth a of quarter of portfolio view, XX.X%, upon development with will leasing, which by

year, rate increase is back-to-back of highest cash rental for delivered the also team XX% XX-plus for This Our marks our in second a this which years the of metric. XX-year percent history.

XXXX with Looking our signed footage. at expirations, date through rate solid new and leasing, XXXX square XX%. now progress by XX% is rental for commencement increase our making Together cash we're are lease with leases

in cash a fixed date to XX%. run Excluding rate X.X signed of XXXX Central rate million square call, discussed leases renewal foot last our had we the increase on Pennsylvania

Central cash XX% to expect full the from excluding renewal. and For XX% XX% range we growth PA to overall year, aforementioned XX% rental rate to the

customer with footer venture. Phoenix ahead square positive anticipated we in XXX,XXX for development X X completion. feet another We and repeat a with of note our months signed on a On sheet building building million on of our feet leasing joint about XXX,XXX in a full sheet, balance quarter ended lease the fourth the square signed square Nashville balance

and Center XX,XXX Empire. XXX% Logistics leased the Elm feet in Pennsylvania square in at [ square foot at Building Inland XXX,XXX of also the First our our remaining ] B We First XXX building

markets, thanks regional only the the Houston, Southern I development a at guidance. development for leases, we leasing. our Northern XX year Not Pennsylvania, an this XXXX joint venture. inclusive delivered budgeted compares teams we of X.X team In Phoenix, Nashville, Denver. square of fantastic our of were start total, of This million excellent of call, leasing, signed number signings XX our and Chicago, our representing Miami the with to of and were California, to pleased the million amount feet our Central broad-based, Many original feet X.X were As performance. of square target noted in Seattle, which for XXXX,

which We've also long-term new X growth. developments our started will to contribute

the of a started Rockdale First square we Park in lease foot XXX,XXX XXX,XXX Nashville, the heels On at building. square-foot our

projected Nashville's fundamentals growth $XX new total of current long-term stands and investment is drivers total Our as strong, vacancy around million. supply X.X% stock. are and unleased represents X%

allow feet There, square Lehigh XXX,XXX the a X investment our First we're $XX I-XX/XX targeting building new XX. million. square sizes is In segment, will estimated Valley and up. totaling we feet construction, tenants in at buildings, we by the depths The XXX,XXX of Park and corridor, believe first most total which to as tenant smaller with target the underserved constructing us availabilities phase started are

be First total, feet of X.X positions warrant. the the submarket were We're pleased our park. this markets feet $XX XX million we the of development additional future target our conditions addition, square starts square growth. can and yield for a at can will our product X%. close well square land an quarter In fourth Park cash final we accommodate for of of Miami project now quarter, develop fourth is With also what to parcel across The foot north for positioned be to as opportunities each expected million. land on million ultimately million In X.X

should XXX,XXX bring $XXX Moving the in to the total we've We achieving square prospects. now assets, of quarter XXXX, X completed assume than prior objectives sales totaling feet for lower portfolio million. for years. $XX to property growth be year and volumes functionality will for you buildings dispositions. $X.X fourth legacy sold our moving of the million to forward, location, Since billion sale Therefore,

sales expect up to of asset we For $XX million. XXXX,

our to dividend. respect with Lastly,

Given our performance declared is flow is which per Directors with XX.X%, share. of anticipated $X.XXX Board growth. of aligned of outlook, and cash an a increase our This our dividend

With do Scott, physical none able unprecedented, to have to of and been it Before to heartfelt express families impacted over Scott. we I'd affected. their sympathies buildings destruction will the our by we people emotional who I sound, properties, to and thankful are and safe and been continue over our that, and like our say California The turn have turn to With tragic and can it our Southern impacted is the support to the wildfires. of be teammates FR communities. people to what to and I'll respect fortunate to are and

Scott Musil

Thanks, Peter.

compared me diluted share XXXX. recap results. refunds operations $X.XX in Let our NAREIT XQ share to per $X.XX per from fully were

per FFO diluted NAREIT X.X% to year, $X.XX in the $X.XX For fully grew compared to share XXXX.

Our leasing, higher excluding in termination cash The embedded in quarter quarter, the by NOI was rental in offset growth free same-store our new increases driven were fees, for rate rental rent. by the primarily partially results and renewal bumps leases, on X.X%. rates

of improvement third of cash same-store and X.X%, similar Pennsylvania reimbursement quarter For reimbursement tenant accelerated a XXXX, quarter NOI of from tenant with in in-service the XX a the XXXX a Dallas. of year-end from up to year XXXX excluding Central XXXX. was the in basis third We the accelerated recognition XX.X%, quarter full in growth the finished occupancy basis quarter first XXX points points and related

in lease-up service from and 'XX we stand basis developments placed XXX in points As today, opportunity approximately we have XXXX.

commenced. Of our Summarizing activity X.X during leasing feet XXX,XXX of these, were new fourth quarter, approximately the million leases square

Gap] [Audio

about million per $XX.X our G&A capitalized interest. is million. range share to guidance $X.XX And of expense $XX.X

to Peter. Let back me turn it over

Peter Baccile

year, would once to Industrial again to XXXX was the extend my First team. like thanks an entire I outstanding and

dedication are in ready leasing shareholder future you and serving ahead for lie customers Your And opportunities development XXXX Operator, the I my driving in we're know growth it from and for rate growth questions. beyond. driving with open and value. up growth flow to meaningful to that, increases share excitement that rental our cash strong

Operator

Bin with from first Truist. comes question Our [Operator Ki Instructions] Kim

Ki Bin Kim

Can demand green seeing maybe start views -- Angeles your Empire and the Inland getting first for we any refreshed markets Los you're if off shoots growth? with on and

Peter Baccile

that? do to take you want Jojo,

Johannson Yap

Ki at election, post we've -- more Jojo. of terms in Sure. year-to-date, it's more XX%. so look Bin, tours, proposals, for When touring ports hi, The up terms requests it's you guided Sure. up. activities

seen haven't big a We impact of that.

that as of the That our First big coverage productivity. Although, leased Elm, we're predict impacted leasing have but stated not positively asset, we've which we going low here, because of might move a a is have site. to

IE is start this Completions there's Overall, pick down. trend bit. in Vacancy a for of did to good. terms little a L.A. significantly is down closely, we're for quarter-to-quarter, couple and IE were construction LA under watching also both and But of things that quarter-to-quarter. down up

been absorb of trend So if enough. continues what's should should be delivered to that market in and QX XXXX, firm the the be market -- we continues

Ki Bin Kim

And development pipeline, you Okay. leasing guidance, much footage square your that I guess, how midpoint at like the roughly, up, assuming your are you're please? on for

Scott Musil

year. Ki We're second weighted of square vast to majority it million Scott. it's of the of -- the feet It's Bin, Sure. X.X half development the assuming lease-up,

Operator

our question Nicholas next Scotiabank. And from comes with Yulico

Greg McGinniss

Nick. on is for McGinniss This Greg

appreciated. on into Just occupancy any being leasing what service seeing Aurora the has talk placed is Denver market, on could down hoping Center And with would you there Commerce ticked about updates be the you're assets there?

Peter Schultz

Peter. It's Greg. Sure,

you of fourth to a rather, Market So working improved Decision-making Denver, tenants has of to has with supply continues occupancy elevated the bit leased. know, or been in bit quarter. little some Demand as the prospective continues little a tenants, okay. been through in elongated get market. be that the

California a tenants of as in we couple bit about we're an what still last than are urgency Southern do But part a increased momentum last seeing today months, seen, feel little and more just we from optimistic market. of clearly Jojo felt have level have to work with some in the but commented, we year. We Denver, the good of that in

Greg McGinniss

Okay. to focusing you regards development, And then on Yes, stop do there. geographies which I'll future on? plan with

Peter Baccile

we state starts, talk not are about Pennsylvania, really, We're to places Texas we the go new but now would markets right and that next. just volumes, Sure. by I'll focus going think Florida on about the would that

Greg McGinniss

Okay.

X And follow-up here. sorry, final just

funding thinking development? you of funding dispositions, in the how decrease are with terms about In the

Scott Musil

development, on excess 'XX in and the flow, spend formula in expected sources. line cash be sales million past, going are borrowings to Same as the of in the credit to we're million $XXX

Operator

question Mailman Citi. And with comes the Craig next from

Craig Mailman

can construction? currently the feet lease-up how portion basis that much guidance, maybe XXX embedded be would opportunity X.X points of development go through leasing that are versus that a square under of -- projects of on Scott, in million you of

Scott Musil

a do calculation. me quick Let

I think majority of it's going it. vast to be the

of feet in million the square X.X placed basically not So least. is Craig, service, comprised our developments

in service. not So that's already completed number. And the in occupancy developments then

the So pieces are the 'XX. not in any any assuming million. make up completions those We're lease-up X development that in X.X

Craig Mailman

Okay.

So that's also on not only drag because well a same-store helping helping currently FFO, as but that's NOI?

Scott Musil

just service, what could rent Because [indiscernible]... not same-store placed that's depends help least, in Developments NOI. assumption that the is. It not free

Craig Mailman

thinking kind bottoming 'XX Kind saying Okay. this in point what the guys That leasing big to reacceleration a getting context of of is And the had -- net where maybe on what seeing of been guys supporting when I kind you things some on current peers absorption. ground? of trend guys the second your you you know helpful. maybe And broadly, and bit your happen? about of demand the you half maybe could most kind as and ground. alluded just getting an a development do better a inflection more then are just -- little have And of year better year. on But what's of

Peter Baccile

can this, the in. I'll start and jump kind Jojo look classic a U-shape, not of a -- you're we looking with this, at Peter V-shape. The at and then way

we In how country. not rebound third So the a that's leasing to referred across this development square though foot assets signed the getting are of going history. leased. leases you bit is What to year have were XXXX, seen, be XXX predicting highest elongated, is times in even are And strong that easy. million

we the rent getting little little rents some falling signed talk markets that see always are markets fact we leases while is and Those are starts with tenant about new to and at growth or space. talk now obviously, pretty are that dramatically shrink. is staying additional levels. pipeline helpful low that, we in So slowly and some low when markets, equally beginning in alternatives alternatives about the shrinking to national methodically, and by And

about Craig, feel say, what good conservative We're see to hard to the on is look we and inflection that So front, that it coming, but pretty going prospects. we like.

Peter Schultz

specific examples. on X last Craig, year. all give deal We've just almost it's The Pennsylvania. working we I'll been Peter. you of announced in that

electrical the deal some repeat engagement. up higher customer done. urgency of our in get to level and there. of Nashville in the they lease with The seeing They're and more finally lot a that manufacturing components, we reported So early business have

So as we've and and What see, things be year. we seeing are a point, Peter's momentum. to is little the more really continue said, engagement that better, momentum we're want during higher persistent to to

Peter Baccile

One thing while we're to on subject development last and of I'll the add frames. that time leasing

the of we XX-month you Some and completed assets as in that service are the some are have, and know, beyond downtime.

completion. completion. we at also in million roughly XXX I'm We completion. assets the at footer Philly ahead did X in last like Stockton Nashville And XXX X have the the completion, year, in months at sorry, of leased market the

the group have if by we've the started vintages. of you projects. at at look kind vintages, we to our you That's them when year So look --

going if leased every average, months. XXXX, on by has to vintage So below you at vintage, X back look

X of So it downtime. was less than months

going are happen projects going the of it's to are depth and size difficult the those to it's judge And today take the So of in quickly. been for some some asset, last as of longer. as they're are simply the frames in. time years. couple particular the demand market they've to Maybe the Maybe

Operator

question from Advisors. with Street Vince The comes next Green Tibone

Vince Tibone

move-outs tenant aware large year trend rates there in you should the we Are versus be do generally, any how could of? that levels? 'XX this 'XX And retention think

Peter Baccile

that? you do Chris, take to want

Christopher Schneider

in XXX,XXX at highest Central year, we've last the X our or the X move-outs. we're and we square up move move retention Obviously, XX%. of out We're aware in other -- significant PA, not talked foot any of Tenant about were X last years. rates

number So we be very similar to going that expect forward.

Vince Tibone

bad Maybe 'XX? bad you that's be any maybe commentary of for How follow-up. seeing categories? could No, percentage a revenue cracks helpful. 'XX? certain in in debt debt, a How any would if where And as just quick you you thinking about about there came share tenant Are are on great. related

Scott Musil

expense assuming we in several like low assumption a have Bad 'XX gross It's basis so debt number. of XXXX. points very, $X Vince. was past in Scott. years. was million very Sure, $XXX,XXX in XX That revenue, We're the

do the payment rent And material the we form day letter As have that far January based any a about paid in talked months tenant, deposit in with list, that expected keep boohoo. of as of of security tenants on They watch takes XX were upon February's a rent, history. mind have we credit care of rent.

Operator

Todd Thomas next the from Markets. And comes with KeyBanc question Capital

Todd Thomas

the back to to you development in that projects sounds transition can transition? for just remainder space portfolio And are guidance, the square guidance as have is the wanted just and it's embedded those I like portfolio. on Inland the X Miami, during for there X.X the that related Can update but You go million a projects which Park provide assets? already at anything to that half will to in properties first leasing the in of an the interest X the feet a mostly on in-service First comment 'XX? of of leasing you in-service little Empire

Johannson Yap

range It's Jojo. and square from are scheduled XXXX, projects. the Miami. XXX,XXX X Sure. is and a data at XXX,XXX Inland They footer. in in-service in foot now X buildings range square to Empire our for is Right the X XXX,XXX is X X of X

Todd Thomas

interest year the for leasing they level any whether on expected comment just transition? you Can and during assets as those there's the

Johannson Yap

Sure.

over the in me building I'll Park the buildings Empire, Park First to on turn comment and on Miami. First Inland Peter X it Let in --

we're like facility XXX,XXX very feet, A, looking and we're feet. RFPs. feet state-of-the-art are the to in XXX,XXX XXX,XXX square having said, projects, XXX -- I X those they're at very, all buildings, and the and responding corridor, the again, of square In street Class For all also tours

In terms second assumed in half they that will of basically, leasing leasing, year. we've be this of the

Peter Schultz

Todd, And it's Peter. then,

the of building. for out RFPs active have we Miami, space For in that all remaining

Todd Thomas

the Okay. market the that you're markets if or if portfolio's forecast sort -- across an could for update provide rent for And eyeing? there's then of any just growth just portfolio across targeting curious XXXX you

Peter Baccile

generally we're rent expecting So growth. speaking, modest

up Some will down, be markets or be point X will some X.

what year. it this call plus inflation expecting is maybe we're So a point

SoCal little down flat probably to a bit.

Operator

Heck next Fargo. Blaine Wells question from comes with The

Blaine Heck

was you early I China in markets, I guess, hesitation are seeing noticed you've of on, talk any change Houston behavior tariffs but on or the know lease any on even activity? to Mexico. potential tenant and the pull implementation side, it's on California in or but the Southern those hoping delayed any flip forward you the could I about given Phoenix in market increased or

Peter Baccile

going jump you It start said, Jojo can question, of too. very with I'm your like at to this is, the and beginning in early.

around this put at could going a this. topic, of time, and long lot -- tariffs who's to that's the very long a on to Clearly, there's very as But what's think I seen being were topic a negotiating be tariffs. kind large case place for point, you've for if of to the of in this negative. happen it a a anyone's going chaos of for what end term, up say what's really guess with ploy period is

haven't one the that we're any has tours not properties giving up have or this this. and because terms of seen of that subject. yet actually brought stepped to We reaction this in away we're No it having. on People conversations

too point. unpredictable that? again, it's this You Jojo, too So to good? to anything want you and at early add

Johannson Yap

go No, ahead.

Peter Baccile

Okay.

Blaine Heck

year. have second effect on development? economics what Just growth, trending Okay. And slowdown that given bit on color incremental expectations you've construction might question, seen you Great. the expected in And this can the little how and cost some if then yields, cost a helpful. talk on rent any? That's more side on the about

Johannson Yap

down a average, came Well, the costs in in at XXXX, if margins XX% look range. and and on Jojo. materials. by construction driven This stabilizing Sure. slight the decrease decrease construction It's primarily in you contractor is

'XX, flat has if looking a maybe X% to to to you're by total impact late, the to X% And your down. way it's down. going investment. on our investment, on course, Going to to we're to -- it's slightly. slightly an it forward improving have yield of yes, would say I XX% XX% Whatever anywhere

Peter Baccile

invest We feet about holdings. just a put would that. That million earlier around land billion. X% numbers can Today, some XX high square about in $X having we yield. I'll out pencil of growth to talked our

today's rents expected X. well for anticipated as a So framework our today, development -- includes building yield of X that north projects, market that's in that The as those some just and costs. started projects we and cost reduction in

Operator

question Stevenson next from Janney. comes The with Rob

Robert Stevenson

you broader best a which today are little besides fundamentals core overview of but markets demand your relatively give about operating Cal? talked ones think I bit, it of sort seeing a Southern you you're and and can the which tenant weaker the of

Peter Baccile

mean It's bad. X%, opportunity. fortunate have Yes. Pennsylvania Nashville in best I that market. Lehigh is growth there limited get Valley is lot easy new not around decent. a We're vacancy now, not entitlements market is to right of very the so starts. to is

hot South very Florida on focused its blue cooled still has Florida. but we're from very, phase, South

well. opportunities looking Houston Texas Texas, We're and X state in Dallas, of markets. for in more doing and so those the land very certainly

vacancy, attracting finding we're lot got that the have say, And Of lease traffic we're the is a improving, product Those of would there. around I aside on to big signings SoCal, the Phoenix offer, with still tenant and right Dallas. would has a strongest while Denver very, markets. be course, run. but it's that good very submarkets That's from market. room we some

that's location pluses that call being great benefited the would offering the and But minuses. So and greatly the, it, I very and sized early in how a market. and summarize right there us in product being

Robert Stevenson

better demand terms widespread any Okay. footage That's today, fairly in then is square wise? helpful. what of various are buckets, across demand certain levels? there And at tenants size you is seeing the -- Or out

Peter Schultz

robust Florida as Pennsylvania, say are in would What's for midsize last Denver or that an varies calls, the the not There it Amazon or small it's had small I prior been is Peter. market. larger. small as we've it's midsizes speaking, different pretty in active And example. markets in is generally than midsize or what in about more Rob, but couple active, on by talked of as as is demand year. larger today. a smaller sizes, than

Operator

Carroll comes Capital question And from the with RBC next Markets. Michael

Michael Carroll

on wanted Florida support mean, underwrite really mean, I Texas to up said Blaine's is pursuing current maybe developments the markets how to follow question. rents I start only interested and you broadly? market a in work today difficult few development a in them? that where does it actually new Or versus ago? you're those I development Pennsylvania, years do

Peter Baccile

-- While the just those that opportunities positive. existing you the in markets is of state mentioned

deals going other be those when It's there So bit on that's for underwriting like California, ready those which more fine. is out problem. why we're to focused Southern markets and markets, not markets, Projecting new are example, little difficult. a a is

Michael Carroll

in to and don't market market, Texas yield that you the At rents up not go the So percent rents, you're ground that deals your to underwriting broke need rents Pennsylvania, get you developments? discussed just current recently? X-ish can up to you those you with Florida justify the or go

Peter Baccile

Correct.

Michael Carroll

going noticeable you more of Or I that tenants for mean, elections? steady talk active just with and elections? Peter, been any activity? you after it mean, has Okay. the driver? kind just making wasn't there broader much on I I a one, And change really tenant guess, has decisions then been after about the state last can been what's has specifically

Peter Baccile

entrepreneurial risk, and What lease topic, it of product on Friday, more This on dollars millions in that tens into lot going that thing. a a equipment more evolutionary be been will off. and prior, is most some an that it's That taking there's investing risk is new around light fact have a growth, is noticed really of This definitely confidence rewarded. whereas product, means the of that move. Investing Monday, being meaning isn't isn't there a more to does. it and we switch sense exist didn't

more now, I than that is so result sending proposals, traffic. unsolicited more a That foot RFPs. out were has prior receiving to seeing that, we're more lot were receiving RFPs. of changed. say, right equation we We're we would And the perhaps,

want I cautiously we're caution, optimistic. Now to

have to keeping consistent development mark, question want as mentioned Peter that lease not And and that's see and eye We seen we we're our on. earlier, the what persistent -- is signings. what is

Operator

The next Goldman Caitlin Burrows question comes from Sachs. with

Caitlin Burrows

You mentioned concern been expect and earlier is it that quite retention continue, much to have reducing I high people a has that too tenants space, so but think some some you have have. what they

your that think what's could there needs view much wondering through? worked space do Just are how be tenants needs? to have end space that too impacting And automation you up

Peter Baccile

Yes, part I'll of take the that. first

double about standpoint. which none the yes, X.X% of nationally impacting from stock. our we have revenue own the sublet sublease is long-term space approximately space, So That's portfolio, of us existing some Within average. a is

good have leases of almost all with tenants that We good on space.

second So your part through that. we'll we're was just question? have and that an to the on of What eye work keeping time, over

Unknown Executive

Automation.

Johannson Yap

-- portfolio, seeing look don't that when you tenants the of board in space. drives utilization massively I our not see We're the we in automation mean, across investing

big tenants automated, large are the have like course, Of heavily you that e-commerce company. the

that's but we're X. for not change. the business but a sea -- of seeing -- plan And day So part

Caitlin Burrows

Got it.

is need taken somebody longer does projects do then it's more an in you help? that case reducing price point of space I not that's just a have really price, up the topic came Or it -- lease that terms in the this And would issue of or not? up, development past. Okay. to think think some But where

Peter Baccile

to want Peter, do take you that?

Peter Schultz

as space. finally just I okay, market we really about We're of Caitlin, and we've it's the would about, decision-making say companies the Sure. pace price. talked more saying, several sensitive. on the calls, need It's not last

leasing last year, the throughout quarter. You in in fourth what culminating development saw that announced in results we our

lease but So that that We're we years, we at all just always pace the It's to to as want the aren't making have. that. decision to for tenants space, it's to do not a see seen we going price. a last what need we've sure, do about more the of frustrating, several

Operator

next And Thillman Nick with the Baird. question from comes

Nicholas Thillman

Maybe know efforts markets likely I a rebuilding the is what effort? rebuilding it's wildfire But days starting. proper? I Is on most helpful. think just do be are where the touch kind would L.A. wanted of little thoughts it and Just some the just to are of or early it that IE bit benefit the you County there L.A. impact.

Johannson Yap

Jojo. is This Yes.

be the redevelopment First going how But to that infrastructure and cleanup depending of timing and investment what need I if process under process, of at how of permit new on setting the and hard for to house needed you construction. ground. house process, predict, all, will And to a aside, be very dedicated the process all design timing components look basically the mean is in. shakes that materials would construction, infrastructure infrastructure actual goes storage building and lot

happened. of So to where in we going forward, the materials surge I fires outside tragic think -- think necessitate that will closer it

So L.A. benefit County is most. the our that thought

Nicholas Thillman

helpful. opportunities, And on across build-to-suit just on markets? then of increase in development, have little bit sort your a maybe you touching That's that any maybe activity seen

Peter Schultz

were the ahead something completion. are building glad that months existing X particularly to really tenants have inventory there given Certainly, really, Not we of national some the today on in specific unique. pre-lease and unless choices it's

the So tenants over some in essence, who for design that the in and still them. somebody influence specifications But market. have today wanted choices

is So less build-to-suit probably active.

Operator

question Mike JPMorgan. from Mueller next our And with comes

Michael Mueller

you've 'XX addressed expirations. know the about of I XX%

leased there out you've XX%, same remaining Looking Or or as in is of already? to stands of size? is what at that geography anything of it the kind more the terms

Christopher Schneider

of so on. [ the our our much ], pretty it's Jeary across makeup broad-based nothing stands -- Yes,

Michael Mueller

underway. It you maybe half are that Okay. then, applies think looks the I of that development And already mentioned for Scott, about $XXX like million spend to projects year. of

of starts could there is be So a you what you way development the kind ballpark think for can year?

Scott Musil

Peter at now. looking I'm

Peter Baccile

development move not that to have to global economy volume markets change. starts certain that as ahead and give the going We're turns we going with. that change, think we as we're But on could opportunities

So go. that's the are is we mentioned, Florida about Pennsylvania, And why location we don't talk and as about places Texas volume. would fine. I Talking

Operator

comes And the Vikram question with next Mizuho. from Malhotra

Vikram Malhotra

'XX. in execution strong Congrats very

one, of and you've get hit Just that it. 'XX? 'XX flow hits development next maybe and Is in Or clarify leased have actually of a you've if year? FFO 'XX. for it what first wanted done You cash this better just addressed understanding XXXX the is in may or lease-up in AFFO I this you to can 'XX? mostly some baked when

Scott Musil

So in start to deal, Jojo. quarter in fourth I joint [ the the Peter the if started date. Steel that Nashville leasing, in expected you else XXXX. Everything first think deals ] X venture or is that's then look are quarter, expected 'XX XQ And at a start

Vikram Malhotra

you it. of just kind do of this the visibility further all XX% of in or than covered. you I'm looked X.X year development And given average? mentioned the the in also than then higher it's mentioned sort at prior lease years wondering occupancy, up normal are kind like as visibility expirations XX% you've of Got you or million, model, developments average of the the just have lease-up of

Peter Baccile

leasing, more It's more say with the we we point average. year. development respect visibility time with at as wouldn't And of We're at to always than a have I this last we similar any are rollovers year. our had

Vikram Malhotra

just occupancy then Got it. lastly, And map. the

to you like outlined half of sort have expectation the a guide perhaps on percent Can half, through of then of a up. dependent Some recovery? pick of XX%, of in and first the sort back your is down an peers XX-plus back a of much sort walk just how dip

Unknown Executive

Yes.

Central for second coming we're quarter. XXXX, be PA occupancy the second our in and going foot to XXX,XXX first we're quarter. developments are the the at the about talked and X the look We've service that move-out in in square and down first you projecting quarter in If

the definitely quarters have year. occupancy with So in X last of pickup the we'll a

Operator

And comes Deutsche [ the next Oksana Teo with Bank. question ] from

Unknown Analyst

'XX. and Yes. a go really Again, strong to Southern outlook I California. congrats in strong execution to really Jojo's comments on back about wanted

pre-pandemic rental from I even in XX% rates rental think I'm flat rent levels. you number and 'XX and of some anywhere still about above your even brokers of a down peers basis to rates on to XX% year-over-year that I be maybe talking 'XX to expected mentioned context is in be of And in the that to sort trying kind growth understand slightly to down. guess of

flat of in the So understand to on California. comment stuff other just trying kind to some all Southern down of relative going that to

Peter Baccile

Delivering And meets of several start the Yes. I portfolio that primary all going more that's we when our term its demand or And detail, for been X competitive matters. has public remain the has I composition peers, take out long mean private. the focuses. provide whether our Jojo can I in been mean, all, always in product -- key I'll submarket focus. a We and product delivering operate markets. say but to

And can tenants So product that deliver is markets maybe we the to different perhaps amongst on why our growth first a that's for others nowhere. out can't as growth we competitive slightly that's create view But rent rent so of lease. and a have we do.

Operator

next Lynch Barclays. the with from And question Brendan comes

Brendan Lynch

more up at that, follow guidance? you the embedded broadly to around market looking in on other your that Maybe are markets talk about pricing country. Can assumptions

Peter Baccile

We from our up the budgets build up lease. ground by lease

inputs in really market necessarily take to on who asking. little the offer. the question with we in comment We on that with think, It's the I you're about market tenants the question your metrics bit for. think the it's to maybe you're tougher match the the brokers demand, based a that we don't So to stats, market have little talking economic and looking that product are up than what of and leaders the all We go decide that. a the different

Brendan Lynch

types Okay. That's about in particular, different still and understand Maybe levels the demand between XPLs? process. of talk that you're color you helpful could of to different tenants, also seeing

Peter Baccile

Sure. Peter, want to... you

Peter Schultz

as it's active but still we're remain would of active. I say the over years, on they're talked last the Certainly, the quarters. and we've to Sure, broad-based prospect couple over of e-comm, space seeing XPLs number they a continues leased autos, is about very some for be Peter. beverage. activity food manufacturing,

As most to But in which should we responded have our in better part, for existing speaking, the availability. midsized comment by Rob and continues pretty market. activity earlier, we the smaller smaller portfolio around quickly highly fairly the our varies ranges, and re-leased And generally midsize be broad-based. are to leased country, spaces, an Stevenson's it

Operator

Ki question next with from Truist. the Kim comes And Bin

Ki Bin Kim

I after we to to, dissolutions of this ideal Going not quite I should is versus $XX of much expect we your perhaps pricing reduced closer there $X.X being are going back disposition to function perhaps continue? selling and longer-term being how was forward, up a curious, guess, to much level billion, that comments million. your about portfolio

Peter Baccile

We're Yes. Bin. Ki have. happy the latter, we It's what basically with

some do. have trimming we'll We

in to -- those every we always have going guess, meaningful terms They don't year. I'll XX% right? call But always and You're anymore. I year, were bottom volume the sell. every you're to a any going something we'll of targets, -- goals We're it pull at going have GE,

Operator

turn concludes our closing back conference Baccile like session. question-and-answer to Peter would This for any over remarks. to the I

Peter Baccile

and on operator, Thank you, call today. everyone for thanks our to participating

we appreciate You very all questions, that. good have and

Scott out from have If weekend. any or call, follow-up And you me. our Art, great reach a please to have

Operator

conference you for attending The concluded. now Thank presentation. has today's

may You disconnect. now

First Industrial Realty Trust (FR) 6 Feb 252024 Q4 Earnings call transcript