Saul Centers Reports 7.7% Revenue Growth but Decline in Net Income for Q1 2025

Saul Centers, Inc. reported its financial results for the first quarter of 2025, revealing a total revenue of $71.9 million, a 7.7% increase from $66.7 million in the same period last year. The growth was primarily driven by an 8.0% rise in rental revenue, which reached $70.5 million, up from $65.3 million in the prior year. However, net income for the quarter decreased to $12.8 million, down from $18.3 million in the first quarter of 2024, largely due to increased expenses associated with the initial operations of the Twinbrook Quarter Phase I project.

Total expenses surged by 21.8% to $59.0 million, compared to $48.4 million in the previous year. This increase was attributed to higher property operating expenses, which rose by 30.3% to $13.7 million, and a significant jump in interest expenses, which increased by 34.5% to $16.7 million. The company also reported a decline in net income available to common stockholders, which fell to $7.0 million, or $0.29 per share, from $10.8 million, or $0.45 per share, in the same quarter of 2024.

In terms of operational developments, Saul Centers is actively progressing on its Twinbrook Quarter project in Rockville, Maryland, which includes 452 residential units and retail space. As of May 5, 2025, 274 residential units have been leased, and 96% of the retail space has been leased, including a Wegmans supermarket. The company is also developing the Hampden House project in Bethesda, Maryland, which will feature up to 366 apartment units and retail space, with an expected completion in late 2025.

The company’s total assets as of March 31, 2025, stood at $2.1 billion, slightly up from $2.1 billion at the end of 2024. The total liabilities increased to $1.6 billion, compared to $1.6 billion at the end of the previous year. Saul Centers maintains a strong liquidity position, with cash and cash equivalents totaling $6.5 million. The company continues to focus on its strategy of diversifying its asset portfolio through development and expansion of grocery-anchored shopping centers in the Washington, D.C. metropolitan area.

Looking ahead, Saul Centers remains cautious about the economic environment and its impact on retail and residential real estate markets. The company plans to continue evaluating acquisition and development opportunities while managing its debt levels prudently. The management believes that the current market conditions may present challenges, but they are positioned to capitalize on attractive investment opportunities as they arise.