Armada Hoffler Properties Reports $7.2 Million Net Loss in Q1 2025

Armada Hoffler Properties, Inc. reported a net loss attributable to common stockholders of $7.2 million, or $0.07 per diluted share, for the first quarter of 2025, a significant decline from the net income of $14.8 million, or $0.17 per diluted share, recorded in the same period of 2024. Total revenues for the quarter were $114.6 million, down from $193.5 million year-over-year, primarily due to a substantial decrease in general contracting and real estate services revenues, which fell to $46.6 million from $127.0 million. Rental revenues, however, increased slightly to $63.8 million from $61.9 million, reflecting a 3.1% growth driven by improved performance in the office and multifamily segments.

The company's total expenses decreased to $97.5 million from $170.1 million, largely due to reduced general contracting and real estate services expenses, which dropped significantly as the company completed several projects. Operating income for the quarter was reported at $17.2 million, down from $23.4 million in the prior year. The decline in profitability was also impacted by unrealized losses on interest rate derivatives, which negatively affected funds from operations (FFO) by $5.6 million.

In terms of operational metrics, Armada Hoffler's stabilized portfolio occupancy stood at 95.7% as of March 31, 2025, with retail occupancy at 94.5%, office at 97.5%, and multifamily at 95.0%. The company executed 31 commercial lease renewals and 11 new leases, totaling 313,002 square feet. The office segment saw a notable increase in same-store net operating income (NOI) of 9.2% compared to the previous year, attributed to new tenant additions.

Strategically, Armada Hoffler has been active in its financing and investment activities. The company entered into a binding term sheet to acquire additional interests in the Harbor Point Parcel 4 project, which is expected to enhance its portfolio. As of March 31, 2025, the company had $45.7 million in unrestricted cash and $160.4 million available under its revolving credit facility, indicating a solid liquidity position to support ongoing operations and future investments. The outlook remains cautious, with management emphasizing the need to navigate market conditions and operational challenges while focusing on maintaining a resilient balance sheet.