First Potomac Outlines Strong Q3 Numbers, Continued Deleveraging Strategy
First Potomac Realty Trust set a goal earlier this year to sell $350M in assets as part of a plan to deleverage its portfolio. In its Q3 earnings call this morning, executives said the REIT has made progress on this strategy as it posted strong numbers in the last three months.
First Potomac reported an NOI attributable to shareholders of $1.6M, or three cents per diluted share. Its same-property NOI grew 4.1% year-over-year. Its portfolio has an occupancy of 92.8%, compared to 89.9% at the end of Q3 2015. Its leased percentage, which includes pre-leases of companies yet to move in, is 94.1%, up from 91% at this time in 2015.
"Properties that have good amenity offerings and access to public transportation are winning the day on the leasing front," First Potomac CEO Bob Milkovich (snapped above at a Bisnow event) said on the call.
As part of its disposition strategy, First Potomac sold Storey Park in NoMa this summer for $55M. It is currently marketing five other properties: Plaza 500 and One Fair Oaks in NoVa, plus Aviation Business Park and Rivers Park I and II in suburban Maryland.
"Our vision is to have better a company with a higher-quality portfolio in the near term," First Potomac EVP and CFO Andrew Blocher said on the call. "We will continue to sell non-core assets and find ways to create value in our portfolio."
Bob says that even with the disposition strategy, First Potomac is keeping its eyes open for possible acquisitions, but has yet to find anything interesting enough to pursue.
"We've always felt this was never going to be sequential, where you worked all the way through the plan and then picked up growth," Bob said. "We felt it could happen concurrently."