JACKSON,
Miss., March 1, 2023 /PRNewswire/ -- EastGroup
Properties, Inc. (NYSE: EGP) (the "Company" or
"EastGroup") announced today its recent business activity.
Year to date in 2023, EastGroup began construction of three
development projects located in Atlanta, Orlando and Miami which will contain 810,000 square feet
and have projected total costs of $111,700,000. Also, the Company transferred two
development projects totaling 200,000 square feet with projected
total costs of $25,600,000 to the
operating portfolio (at the earlier of 90% occupancy or one year
after completion). These projects, located in Ft. Myers and
Houston, are currently 100%
leased. As of March 1, 2023,
EastGroup's development and value-add program consisted of 21
projects (4,591,000 square feet) in 12 cities. The projects, which
were collectively 37% leased as of March 1,
2023, have a projected total cost of $580,200,000.
As of March 1, 2023, EastGroup's
portfolio was 98.4% leased and 98.2% occupied. Year to date in
2023, rental rates on new and renewal leases (1.4% of total square
footage) increased an average of 50.0% on a straight-line basis and
31.6% on a cash basis.
During the first quarter of 2023 to date, EastGroup issued and
sold 533,580 shares of common stock under the continuous common
equity offering program at a weighted average price of $163.01 per share, providing aggregate gross
proceeds to the Company of approximately $86,979,000.
Effective January 10, 2023,
EastGroup and a group of banks expanded the capacity on its
unsecured bank credit facilities by $200,000,000, from $475,000,000 to $675,000,000. In conjunction with the amendment,
LIBOR was replaced by SOFR as the benchmark interest rate. The
maturity date remains July 30,
2025.
Also, effective January 13, 2023,
the Company closed on a $100,000,000
senior unsecured term loan with a seven-year term and interest only
payments, bearing interest at the annual rate of SOFR plus an
applicable margin based on the Company's senior unsecured long-term
debt rating. The Company also entered into an interest rate swap
agreement to convert the loan's SOFR rate component to a fixed
interest rate for the entire term of the loan, providing a total
effectively fixed interest rate of 5.27%.
Management is scheduled to present at the Citi 2023 Global
Property CEO Conference on March 6,
2023 at 2:20 PM E.T. The
presentation will be broadcast live and is accessible at
https://kvgo.com/citi/eastgroup-properties-march-2023. During the
conference, EastGroup executives may discuss the Company's
transaction activity, leasing environment, market trends and
conditions, financial matters and other business that may be
affecting the Company. A replay of the webcast will be available
until March 6, 2024.
Commenting on the Company's activity, Marshall Loeb, CEO, stated, "We are pleased to
see the strength and resiliency of the industrial market continuing
over from 2022 into this year. We've had a busy quarter in terms of
continuing to enhance our financial flexibility. The balance sheet
positioning allows us the ability to continue pursuing attractive
opportunities in a volatile capital market."
About EastGroup Properties, Inc.
EastGroup, a member of the S&P Mid-Cap 400 and Russell 1000
Indexes, is a self-administered equity real estate investment trust
focused on the development, acquisition and operation of industrial
properties in major Sunbelt markets throughout the United States with an emphasis in the
states of Florida, Texas, Arizona, California and North
Carolina. The Company's goal is to maximize shareholder
value by being a leading provider in its markets of functional,
flexible and quality business distribution space for location
sensitive customers (primarily in the 20,000 to 100,000 square foot
range). The Company's strategy for growth is based on ownership of
premier distribution facilities generally clustered near major
transportation features in supply-constrained submarkets.
EastGroup's portfolio, including development projects and value-add
acquisitions in lease-up and under construction, currently includes
approximately 56.9 million square feet.
EastGroup Properties, Inc. press releases are available at
www.eastgroup.net.
Forward-Looking Information
The statements and certain other information contained herein,
which can be identified by the use of forward-looking terminology
such as "may," "will," "seek," "expects," "anticipates,"
"believes," "targets," "intends," "should," "estimates," "could,"
"continue," "assume," "projects," "goals" or "plans" and variations
of such words or similar expressions or the negative of such words,
constitute "forward-looking statements" within the meaning of
Section 27A of the Securities Act of 1933, as amended, and Section
21E of the Securities Exchange Act of 1934, as amended, and are
subject to the safe harbors created thereby. These forward-looking
statements reflect the current views of EastGroup Properties, Inc.
about its plans, intentions, expectations, strategies and
prospects, which are based on the information currently available
to the Company and on assumptions it has made. Although the Company
believes that its plans, intentions, expectations, strategies and
prospects as reflected in or suggested by those forward-looking
statements are reasonable, the Company can give no assurance that
such plans, intentions, expectations, strategies and prospects will
be attained or achieved. Furthermore, these forward-looking
statements should be considered as subject to the many risks and
uncertainties that exist in the Company's operations and business
environment. Such risks and uncertainties could cause actual
results to differ materially from those projected. These
uncertainties include, but are not limited to: international,
national, regional and local economic conditions; disruption in
supply and delivery chains; construction costs could increase as a
result of inflation impacting the costs to develop properties;
availability of financing and capital, increase in interest rates,
and ability to raise equity capital on attractive terms; financing
risks, including the risks that our cash flows from operations may
be insufficient to meet required payments of principal and
interest, and we may be unable to refinance our existing debt upon
maturity or obtain new financing on attractive terms or at all; our
ability to retain our credit agency ratings; our ability to comply
with applicable financial covenants; the competitive environment in
which the Company operates; fluctuations of occupancy or rental
rates; potential defaults (including bankruptcies or insolvency) on
or non-renewal of leases by tenants, or our ability to lease space
at current or anticipated rents, particularly in light of the
impacts of inflation; potential changes in the law or governmental
regulations and interpretations of those laws and regulations,
including changes in real estate laws or real estate investment
trust ("REIT") or corporate income tax laws, and potential
increases in real property tax rates; our ability to maintain our
qualification as a REIT; acquisition and development risks,
including failure of such acquisitions and development projects to
perform in accordance with projections; natural disasters such as
fires, floods, tornadoes, hurricanes and earthquakes; pandemics,
epidemics or other public health emergencies, such as the
coronavirus pandemic; the terms of governmental regulations that
affect us and interpretations of those regulations, including the
costs of compliance with those regulations, changes in real estate
and zoning laws and increases in real property tax rates; credit
risk in the event of non-performance by the counterparties to our
interest rate swaps; the discontinuation of London Interbank
Offered Rate; lack of or insufficient amounts of insurance;
litigation, including costs associated with prosecuting or
defending claims and any adverse outcomes; our ability to attract
and retain key personnel; risks related to the failure, inadequacy
or interruption of our data security systems and processes;
potentially catastrophic events such as acts of war, civil unrest
and terrorism; and environmental liabilities, including costs,
fines or penalties that may be incurred due to necessary
remediation of contamination of properties presently owned or
previously owned by us. All forward-looking statements should be
read in light of the risks identified in Part I, Item 1A. Risk
Factors within the Company's Annual Report on Form 10-K for the
year ended December 31, 2022. The
Company assumes no obligation to update publicly any
forward-looking statements, whether as a result of new information,
future events or otherwise.
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SOURCE EastGroup Properties