Highwoods Properties (HIW) Q4 2025 earnings summary

Executive summary

• Sun Belt and BBD markets remain strong, with robust demand, limited new supply, and a portfolio leased at 89.2% as of 12/31/2025, supporting rental rate growth and high net effective rents into 2026.

• Strategic capital rotation through $800 million in recent acquisitions and $270 million in non-core sales in 2025, with further $200 million planned for 2026, enhances portfolio quality and supports leverage-neutral growth.

• Strong ESG credentials with progress toward 2030 sustainability goals and industry-leading certifications.

• Q4 2025 net income per share was $0.26 and FFO per share was $0.90, including $0.06 from land sale gains; full-year FFO reached $3.48 per share.

• Signed 526,000 SF of second generation leases in Q4, with 221,000 SF being new leases and GAAP rent growth of 15.4%.

Financial highlights

• Q4 2025 FFO was $0.90 per share, with full-year FFO at $3.48 per share; same property cash NOI growth was 0.0% and GAAP NOI growth was 0.4% for Q4 2025.

• 2026 FFO per share outlook is $3.40–$3.68, compared to $3.48 in 2025.

• Net income for Q4 was $28.7 million, or $0.26 per share.

• Consistent cash flow growth, with a 3.8% CAGR in cash available for distribution since 2010.

• Full year 2025 FFO was $385.0 million ($3.48 per share), down from $391.2 million ($3.61 per share) in 2024.

Outlook and guidance

• Initial 2026 FFO guidance is $3.40–$3.68 per share, midpoint $3.54, up 5.7% from initial 2025 outlook.

• 2026 FFO includes $0.09 per share of temporary headwinds from recent acquisitions, bond issuance, and asset sales, with up to $0.16 per share of land sale gains.

• Year-end 2026 occupancy projected between 86.5% and 88.5%, with sequential improvement expected.

• Up to $200 million of new development announcements included in 2026 outlook.

• Management expects FFO growth in 2026, with occupancy ramping up and embedded NOI growth from the development pipeline.