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STAG Industrial Announces Fourth Quarter And Full Year 2019 Results

Cision

BOSTON , Feb. 12, 2020 /PRNewswire/ -- STAG Industrial, Inc. (the "Company") (NYSE: STAG), today announced its financial and operating results for the quarter ended December 31, 2019.

"The fourth quarter concludes an historic year for STAG," said Ben Butcher , Chief Executive Officer of the Company. "STAG achieved a record level of acquisition volume and demonstrated continued acceleration of internal growth, both of which provide significant momentum as we enter 2020."

Fourth Quarter and Full Year 2019 Highlights

  • Reported $0.12 of net income per basic and diluted common share for the fourth quarter of 2019, as compared to $0.40 of net income per basic and diluted common share for the fourth quarter of 2018. Reported $16.1 million of net income attributable to common stockholders for the fourth quarter of 2019 compared to net income attributable to common stockholders of $44.3 million for the fourth quarter of 2018. For the year ended December 31, 2019 , net income attributable to common stockholders was $43.8 million as compared to net income attributable to common stockholders of $82.4 million in 2018.
  • Achieved $0.47 of Core FFO per diluted share for the fourth quarter of 2019, an increase of 2.2% compared to the fourth quarter of 2018. Generated Core FFO of $65.5 million for the fourth quarter of 2019 compared to $52.4 million for the fourth quarter of 2018, an increase of 24.8%. Achieved $1.84 of Core FFO per diluted share for the year ended December 31, 2019 , an increase of 2.2% compared to the same period last year. Generated Core FFO of $237.3 million for the year ended December 31, 2019 compared to $193.6 million for the same period last year, an increase of 22.6%.
  • Produced Cash NOI of $89.0 million for the fourth quarter of 2019, an increase of 21.7% compared to the fourth quarter of 2018 of $73.1 million . For the year ended December 31, 2019 , Cash NOI increased 17.8% in the aggregate compared to the same period last year.
  • Acquired 23 buildings in the fourth quarter of 2019, consisting of 5.8 million square feet, for $455.9 million with a Cash Capitalization Rate of 6.1% and a Straight-Line Capitalization Rate of 6.7%.
  • Sold three buildings in the fourth quarter of 2019, consisting of 475,740 square feet for $19.4 million , resulting in a gain of $4.1 million .
  • Achieved an Occupancy Rate of 95.0% on the total portfolio and 96.6% on the Operating Portfolio as of December 31, 2019 .
  • Commenced Operating Portfolio leases of 2.4 million square feet for the fourth quarter of 2019, resulting in a Cash Rent Change and Straight-line Rent Change of 6.4% and 13.2%, respectively.
  • Experienced 87.4% Retention for 2.0 million square feet of leases expiring in the quarter.
  • Produced Same Store Cash NOI of $60.3 million for the fourth quarter of 2019, an increase of 1.2% compared to the fourth quarter of 2018 of $59.6 million . For the year ended December 31, 2019 , Same Store Cash NOI increased 2.4% in the aggregate compared to the same period last year.
  • Subsequent to quarter end, raised net proceeds of $311.0 million of equity through a follow-on offering during the first quarter of 2020, inclusive of a forward component.

Please refer to the Non-GAAP Financial Measures and Other Definitions section at the end of this release for definitions of capitalized terms used in this release.

The Company will host a conference call tomorrow, Thursday, February 13, 2020 at 10:00 a.m. (Eastern Time) , to discuss the quarter's results and provide information about acquisitions, operations, capital markets and corporate activities. Details of the call can be found at the end of this release.

Key Financial Measures

FOURTH QUARTER 2019 KEY FINANCIAL MEASURES



Three months ended
December 31,




Year ended December
31, 2019



Metrics

2019


2018


% Change


2019


2018


% Change

(in $000s, except per share data)












Net income attributable to common stockholders

$16,077


$44,256


(63.7)

%


$43,811


$82,385


(46.8)

%

Net income per common share basic

$0.12


$0.40


(70.0)

%


$0.35


$0.80


(56.3)

%

Net income per common share diluted

$0.12


$0.40


(70.0)

%


$0.35


$0.79


(55.7)

%

Cash NOI

$88,990


$73,129


21.7

%


$323,997


$275,073


17.8

%

Same Store Cash NOI (1)

$60,319


$59,598


1.2

%


$242,136


$236,485


2.4

%

Adjusted EBITDA re

$79,940


$66,470


20.3

%


$294,455


$248,274


18.6

%

Core FFO

$65,451


$52,440


24.8

%


$237,345


$193,573


22.6

%

Core FFO per share / unit basic

$0.48


$0.46


4.3

%


$1.84


$1.81


1.7

%

Core FFO per share / unit diluted

$0.47


$0.46


2.2

%


$1.84


$1.80


2.2

%

(1) The Same Store pool accounted for 68.2% of the total portfolio square footage as of December 31, 2019.

Definitions of the above-mentioned non-GAAP financial measures, together with reconciliations to net income (loss) in accordance with GAAP, appear at the end of this release. Please also see the Company's supplemental information package for additional disclosure.

Acquisition and Disposition Activity

For the three months ended December 31, 2019, the Company acquired 23 buildings for $455.9 million with an Occupancy Rate of 92.4% upon acquisition. The chart below details the acquisition activity for the quarter:

FOURTH QUARTER 2019 ACQUISITION ACTIVITY


Market

Date
Acquired

Square Feet

Buildings

Purchase
Price
($000s)

W.A. Lease
Term (Years)

Cash
Capitalization
Rate

Straight-Line
Capitalization
Rate

Chicago, IL

10/10/2019

105,925

1

$11,621

14.0



Portland, OR

10/10/2019

141,400

1

14,180

10.1



Jacksonville, FL

10/15/2019

231,030

1

15,603



Indianapolis, IN

10/18/2019

1,027,678

1

52,736

10.2



St. Louis, MO

10/21/2019

127,464

1

12,055

7.1



Minneapolis/St Paul, MN

10/29/2019

236,479

2

18,833

6.1



Minneapolis/St Paul, MN

11/4/2019

276,550

1

23,598

12.0



Minneapolis/St Paul, MN

11/5/2019

136,589

1

17,601

10.3



Chicago, IL

11/7/2019

574,249

1

34,989

5.9



Milwaukee/Madison, WI

11/12/2019

111,000

1

5,107

2.8



Knoxville, TN

11/21/2019

227,150

1

10,089

5.1



Columbia, SC

11/21/2019

464,206

1

35,050

12.0



Greenville/Spartanburg, SC

12/4/2019

273,000

1

19,224

4.8



Houston, TX

12/5/2019

90,000

1

11,276

5.1



Milwaukee/Madison, WI

12/16/2019

192,800

1

18,750

9.5



Houston, TX

12/17/2019

250,000

1

21,864

10.1



Denver, CO

12/18/2019

132,194

1

15,749

10.4



Des Moines, IA

12/19/2019

200,011

1

17,335

7.3



Indianapolis, IN

12/19/2019

558,994

1

53,259

15.1



Northern New Jersey, NJ

12/23/2019

113,973

1

14,784

5.8



Sacramento, CA

12/30/2019

147,840

1

10,680

4.3



Kansas City, MO

12/31/2019

230,116

1

21,490

5.0



Total / weighted average


5,848,648

23

$455,873

9.2

6.1%

6.7%

The chart below details the 2019 acquisition activity and Pipeline through February 12, 2020:

2019 ACQUISITION ACTIVITY AND PIPELINE DETAIL



Square Feet

Buildings

Purchase Price
($000s)

W.A. Lease
Term (Years)

Cash
Capitalization
Rate

Straight-Line
Capitalization
Rate

Q1

2,363,623

10

$185,363

7.4

6.6%

7.0%

Q2

3,029,812

14

260,158

11.3

6.1%

6.9%

Q3

4,738,380

22

302,567

5.7

6.8%

7.2%

Q4

5,848,648

23

455,873

9.2

6.1%

6.7%

Total / weighted average

15,980,463

69

$1,203,961

8.3

6.4%

6.9%








As of February 12, 2020







Subsequent to quarter-end acquisitions

1.4 million

7

$103.3 million











Pipeline

27.3 million

117

$2.1 billion




The chart below details the disposition activity for the year ended December 31, 2019:

2019 DISPOSITION ACTIVITY



Square Feet

Buildings

Sale Price ($000s)

Q1

973,305

5

$17,939

Q2

1,125

Q3

132,365

1

6,250

Q4

475,740

3

19,390

Total

1,581,410

9

$44,704

Note: Sold two parcels of land in the second quarter of 2019 for $1.1 million.

Operating Portfolio Leasing Activity

The chart below details the leasing activity for leases commenced during the three months ended December 31, 2019:

FOURTH QUARTER 2019 LEASING ACTIVITY


Lease Type

Square
Feet

W.A.
Lease
Term
(Years)

Cash
Base
Rent
$/SF

SL Base
Rent
$/SF

Lease
Commissions
$/SF

Tenant
Improvements
$/SF

Cash Rent
Change

SL Rent
Change

Retention


New leases

700,731

5.6

$4.73

$4.99

$1.71

$3.45

8.7%

19.6%



Renewal Leases

1,735,170

3.8

$4.22

$4.31

$0.61

$0.09

5.6%

11.0%

87.4%


Total / weighted average

2,435,901

4.3

$4.37

$4.50

$0.92

$1.06

6.4%

13.2%



Note: The table above represents leases commencing during the quarter.

The chart below details the leasing activity for leases commenced during the year ended December 31, 2019:

2019 LEASING ACTIVITY


Lease Type

Square
Feet

W.A.
Lease
Term
(Years)

Cash
Base
Rent
$/SF

SL
Base
Rent
$/SF

Lease
Commissions
$/SF

Tenant
Improvements
$/SF

Cash Rent
Change

SL Rent
Change

Retention


New leases

1,869,573

5.6

$4.26

$4.46

$1.47

$1.42

14.5%

...