Whitestone REIT Reports Q1 2025 Financial Results with Revenue Growth but Declining Net Income

Whitestone REIT reported its financial results for the first quarter of 2025, revealing total revenues of $38.0 million, a 2.3% increase from $37.2 million in the same period last year. The growth in revenue was primarily driven by an increase in rental income, which rose to $37.4 million from $36.7 million year-over-year. However, net income attributable to Whitestone REIT decreased significantly to $3.7 million, or $0.07 per share, compared to $9.3 million, or $0.19 per share, in the prior year. This decline in profitability was attributed to higher operating expenses and a lack of gains from property sales, which had positively impacted the previous year's results.

In terms of operational metrics, Whitestone REIT maintained an occupancy rate of approximately 93% across its portfolio of 55 properties, which collectively encompass 4.9 million square feet of gross leasable area. The company completed 84 new and renewal leases during the quarter, totaling 199,610 square feet, with a total lease value of approximately $31.3 million. This reflects an increase in leasing activity compared to the same period in 2024, when 70 leases were signed for a total of 192,349 square feet and a lease value of $18.5 million.

Strategically, Whitestone REIT has been active in property acquisitions and dispositions. The company acquired several properties, including the Village Shops at Dana Park for $5.6 million and Scottsdale Commons for $22.2 million, both of which align with its Community Centered Properties® strategy. Additionally, the company sold the Providence property for $16.3 million, realizing a gain of $11.9 million. These transactions are part of Whitestone's ongoing strategy to optimize its portfolio by acquiring properties in high-growth markets while divesting non-core assets.

Financially, Whitestone REIT's total assets as of March 31, 2025, stood at $1.1 billion, with total liabilities of $690.1 million. The company reported cash and cash equivalents of $5.6 million, alongside restricted cash of $10.2 million. The REIT's debt profile includes $641.3 million in notes payable, with a significant portion subject to fixed interest rates, which helps mitigate exposure to interest rate fluctuations. The company anticipates that its cash flows from operations and available credit will support its ongoing capital needs, including property acquisitions and distributions to shareholders.

Looking ahead, Whitestone REIT remains focused on expanding its portfolio and enhancing shareholder value through strategic acquisitions and effective property management. The company plans to continue leveraging its operational expertise and market knowledge to navigate potential challenges, including rising interest rates and economic uncertainties, while maintaining its commitment to delivering consistent returns to its investors.