CTO Realty Growth Ends Q2 with an Occupancy Rate of 92.6%

CTO Realty Growth (CTO) showcased strong results in the second quarter of 2024, highlighting robust leasing activity and positive investment potential. The company secured new leases, renewals, and extensions totaling 79,000 square feet, with an average rental rate of $25.87 per square foot. The leasing momentum was particularly strong in Atlanta and Richmond. By the end of the quarter, CTO maintained a solid physical occupancy rate of 92.6% and a leased occupancy rate of 94.6%. Moreover, the company adjusted its investment forecast for 2024 to a range of $200 million to $250 million while increasing its core Funds from Operations (FFO) guidance by 12% and Adjusted Funds from Operations (AFFO) by 11%.

### Key Takeaways
– CTO Realty Growth posted 79,000 square feet in new leases at an average rate of $25.87 per square foot for Q2 2024.
– Physical occupancy was at 92.6%, while leased occupancy reached 94.6%.
– Ongoing negotiations include additional leases in Atlanta and Plano, and a property in Utah is under a sales contract.
– The company has raised its 2024 investment outlook to between $200 million and $250 million, with a 12% increase in core FFO guidance and an 11% increase in AFFO guidance.
– The net debt to total enterprise value stands at 48%, with liquidity of $155 million.

### Company Outlook
– The company plans to finalize acquisitions in the upcoming third quarter.
– The revised investment forecast reflects a strong confidence in future growth.
– CTO is targeting core real estate Power Center shopping centers and aiming to acquire assets outside of traditional institutional capital areas.

### Bearish Highlights
– Acknowledged pressures on cap rates for larger assets in major metropolitan areas.
– No immediate plans for early payoff of seller financing loans following a recent repayment.
– Currently, there are no pursuits of mixed-use assets.

### Bullish Highlights
– Notable leasing activity in key markets such as Atlanta and Richmond.
– A pipeline of signed but not yet opened leases is projected to generate nearly $5 million in revenue by 2025.
– Opportunities to boost revenue by replacing below-market tenants with those willing to pay higher rates.

### Misses
– No current strategies to capitalize on early loan payoffs despite favorable debt costs.

### Q&A Highlights
– The company is well-positioned to fund upcoming acquisitions through credit line facilities.
– Preference for unsecured debt to maintain flexibility for potential asset sales.
– While open to equity market funding, the company is not reliant on it for growth.
– The Q&A session concluded without additional inquiries, suggesting thorough information dissemination during the call.

CTO Realty Growth’s second quarter results reflect a strategic focus on leasing and acquisitions. The company’s adept management of its portfolio and financial positioning bode well for upcoming transactions. By aiming to expand its investment capabilities and optimize tenant leases, CTO appears ready for ongoing success in the real estate landscape.

### Performance Insights
CTO Realty’s performance in Q2 is supported by prominent metrics indicating its presence in the real estate sector. The company has a market capitalization of approximately $449.75 million, signifying its substantial status within the industry.

– It has a Price/Earnings (P/E) Ratio of 39.18 and an adjusted P/E Ratio of 79.95 for the trailing twelve months as of Q1 2024, indicating a higher earnings multiple.
– The company recorded impressive revenue growth of 25.27% in the past year, showcasing its capability to enhance earnings.

### Investing Insights
CTO Realty Growth has maintained a significant dividend yield of 8.01%, reflecting its commitment to shareholder value. The company has an impressive streak of 49 consecutive years of dividend payments, establishing itself as a reliable income source for investors.

For more detailed insights into CTO Realty Growth’s financial stability and future growth prospects, investors can explore additional resources available through financial platforms.

In summary, CTO Realty Growth’s strategic leasing and optimistic investment outlook position the company well for continued success in the dynamic real estate market.