American Assets Trust Reports Revenue and Net Income Decline in Q2 2025

American Assets Trust, Inc. (AAT) reported its financial results for the second quarter of 2025, revealing a decline in both revenue and net income compared to the same period in 2024. Total revenue for the three months ended June 30, 2025, was $107.9 million, down from $110.9 million in the prior year, primarily due to a 4% decrease in rental income, which fell to $101.1 million. The company’s net income also decreased significantly, dropping to $7.1 million from $15.3 million year-over-year, reflecting a 53% decline. Earnings per share for the quarter were $0.09, compared to $0.20 in the same quarter of the previous year.

In terms of operational performance, AAT's total property operating income decreased by 4% to $67.6 million for the second quarter. The decline was attributed to lower occupancy rates in the office segment, which saw a decrease from 86.6% to 82.0%. Conversely, the retail segment experienced an increase in occupancy, rising to 97.7% from 94.5%. The multifamily segment also reported a slight decrease in occupancy, while the mixed-use properties maintained a stable occupancy rate. The company’s total assets decreased to $2.96 billion as of June 30, 2025, down from $3.27 billion at the end of 2024, largely due to the sale of Del Monte Center and a reduction in cash reserves.

Strategically, AAT made significant moves in its portfolio during the first half of 2025. The company acquired Genesee Park, a 192-unit apartment community in San Diego, for $67.9 million, funded primarily through proceeds from the sale of Del Monte Center, which was sold for approximately $123.5 million. This transaction resulted in a gain of $44.5 million recorded in the first half of 2025. The company continues to focus on enhancing its portfolio through acquisitions and redevelopment opportunities, particularly in high-barrier-to-entry markets across California, Washington, Oregon, Texas, and Hawaii.

Looking ahead, AAT aims to drive growth through its same-store portfolio and ongoing development projects. The company plans to pursue additional acquisitions that align with its strategic goals, although it acknowledges that market conditions and interest rates may impact its ability to achieve these objectives. AAT's management remains optimistic about the long-term potential of its properties, particularly as it seeks to capitalize on redevelopment opportunities that can enhance operational performance. The company also maintains a strong liquidity position, with $143.7 million in cash and cash equivalents as of June 30, 2025, which it believes will support its dividend obligations and operational needs in the near term.