W. P. Carey (WPC) Q2 2024 earnings summary

Executive summary

• Completed strategic exit from office assets, including NLOP spin-off and Office Sale Program, with dispositions totaling over $1 billion, including U-Haul and Marriott hotels.

• Portfolio now consists of 1,291 net lease properties, 89 self-storage, 4 hotel, and 2 student housing properties, with 98.8% occupancy and a 12-year weighted-average lease term.

• Investment activity YTD totals $641 million at a 7.7% initial weighted average cash cap rate and over 9% average yield.

• Issued €650 million of 4.25% Senior Notes due 2032 and $400 million of 5.375% Senior Notes due 2034; repaid $500 million and €500 million in senior notes due in 2024.

• Declared $1.735 per share in dividends for H1 2024; quarterly dividend maintained at $0.870 per share.

Financial highlights

• Q2 2024 AFFO was $257.1 million ($1.17 per share), down 14% year-over-year; H1 AFFO was $509.0 million ($2.31 per share).

• Q2 2024 net income was $142.9 million, down 1.2% year-over-year; H1 net income was $302.1 million.

• Total revenues for Q2 2024 were $389.7 million, down from $452.6 million in Q2 2023.

• Contractual same-store rent growth was 2.9% year-over-year; rent collections exceeded 99% for Q2 and H1.

• Operating property NOI for Q2 was $21.8 million; H1 total was $42.1 million.

Outlook and guidance

• 2024 AFFO guidance lowered to $4.63–$4.73 per share, reflecting reduced investment volume and self-storage NOI.

• Full-year investment volume expected between $1.25 billion and $1.75 billion, down $250 million from prior guidance.

• Disposition volume guidance unchanged at $1.2–$1.4 billion, including completion of office exit strategy.

• Same-store rent growth expected to average 2.8% for the year; comprehensive same-store growth expected to be flat.

• G&A expense for 2024 expected at $98–$101 million; non-operating income for 2024 expected at $45–$50 million.