Q2 2026 Eastgroup Properties Inc Earnings Call Transcript
Key Points
- EastGroup Properties Inc (EGP) reported a strong quarter with funds from operations (FFO) of $2.36 per share, exceeding the guidance midpoint and showing a 6.8% increase quarter-over-quarter.
- Leasing momentum reached a new quarterly record with 3.9 million square feet of signed leases, indicating strong demand across markets.
- Development and first-generation leasing also hit a quarterly record with 1.1 million square feet signed, reflecting robust growth potential.
- The company increased its full-year guidance for development starts to $325 million, highlighting confidence in continued demand.
- EastGroup Properties Inc (EGP) maintains a strong balance sheet with no balance drawn on its unsecured bank credit facility, providing flexibility for future growth opportunities.
- Average quarterly occupancy was 95.6%, down 30 basis points from the second quarter of 2025, indicating a slight decline in occupancy rates.
- Some development projects experienced delays due to longer permitting and construction timelines, impacting the timing of revenue recognition.
- The acquisition market remains competitive, with cap rates close to risk-free rates, making strategic acquisitions challenging.
- The San Francisco market showed weaker pricing power compared to other regions, with a notable drop in leasing spreads.
- Despite strong leasing activity, the timing of tenant occupancy delays the immediate impact on FFO, pushing some benefits into future quarters.
Good morning, ladies and gentlemen, and welcome to the East Group Property second quarter 2026 conference call and webcast conference call. At this time, all lines are in reason-only mode. Following the presentation, we will conduct a question-and-answer session.
If at any time during this call you're required for immediate assistance, please press the star zero for the operator.
This call is being recorded on Thursday, July 23rd of 2026.
I would now like to turn the conference over to Marsha Loeb, the CEO.
Please go ahead.
Good morning, and thanks for calling in for our second-quarter 2026 conference call. As always, we appreciate your interest. I'm happy to say that joining me on this morning's call are Reed Dunbar, our President, Stacy Tyler, our CFO, and Brent Wood, our COO.
Since we'll make forward-looking statements, we ask that you listen to the following disclaimer.
Please note that our
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