Orion Properties Reports $9.4 Million Net Loss in Q1 2025, Revenue Declines to $38 Million

Orion Properties Inc. reported a net loss of $9.4 million for the first quarter of 2025, a significant improvement compared to a net loss of $26.2 million in the same period of 2024. Total revenues for the quarter were $38.0 million, down from $47.2 million year-over-year, primarily due to a decrease in rental income, which fell to $37.8 million from $47.0 million. The decline in rental revenue was attributed to the expiration of leases totaling $7.1 million and a lack of reimbursements from previous tenants, which were $2.7 million in the prior year.

The company’s total assets decreased slightly to $1.33 billion as of March 31, 2025, from $1.34 billion at the end of 2024. Real estate investments, net of accumulated depreciation, were reported at $1.1 billion, down from $1.1 billion at the end of the previous fiscal year. The company’s liabilities also increased marginally, with total liabilities at $573.1 million compared to $571.2 million at the end of 2024. The equity attributable to common stockholders decreased to $753.5 million from $763.9 million.

Operationally, Orion Properties owned and operated 68 properties with a total of 7.8 million leasable square feet, achieving an occupancy rate of 73.7%. This represents a slight decrease from the previous year’s occupancy rate of 75.3%. The company also reported a weighted average remaining lease term of 5.2 years. In terms of strategic developments, Orion Properties did not acquire any new properties during the quarter but continued to focus on its portfolio management strategy, which includes the sale of non-core assets. In April 2025, the company sold three vacant properties for a total of $19.1 million.

Looking ahead, Orion Properties is navigating a challenging market environment characterized by rising interest rates and changing demand for office space. The company has expressed its intention to shift its portfolio focus from traditional office properties to dedicated use assets, which include government and medical office spaces. The management remains cautious about future leasing activity, particularly given the significant lease expirations expected in the coming years. The company has also maintained compliance with its financial covenants under its credit agreements, which include a total debt to total asset value ratio of 43.6%, well below the required maximum of 60%.