Latest news with #PeakstoneRealtyTrust
Yahoo
7 days ago
- Business
- Yahoo
Peakstone Realty Trust (PKST) Shifts Focus to Industrial Outdoor Storage REIT
Alluvial Capital Management, an investment advisory firm, released its second-quarter 2025 investor letter. A copy of the same can be downloaded here. The fund rose 8.5% in the quarter, bringing the year-to-date returns to 15.6%. As of June 30, the comparable US benchmarks continued to be in negative territory for the year. In addition, you can check the fund's top 5 holdings to determine its best picks for 2025. In its second-quarter 2025 investor letter, Alluvial Capital Management highlighted stocks such as Peakstone Realty Trust (NYSE:PKST). Peakstone Realty Trust (NYSE:PKST) is a real estate investment trust that focuses on shifting its portfolio composition towards industrial properties. The one-month return of Peakstone Realty Trust (NYSE:PKST) was -12.52%, and its shares gained 2.56% of their value over the last 52 weeks. On August 12, 2025, Peakstone Realty Trust (NYSE:PKST) stock closed at $12.02 per share, with a market capitalization of $442.22 million. Alluvial Capital Management stated the following regarding Peakstone Realty Trust (NYSE:PKST) in its second quarter 2025 investor letter: "Peakstone Realty Trust (NYSE:PKST) continues its transition into an industrial outdoor storage-focused REIT. PeakStone Realty has now sold all its non-core properties, and is currently marketing another office building that is expected to bring in $100 million. Once sold, PeakStone will have reached its leverage target and can then focus entirely on growing its industrial outdoor storage platform. Valuing only currently leased industrial properties using a 6% cap rate and valuing the remaining offices using a 9% cap rate yields net asset value of $30 per share. This should be discounted for ongoing corporate costs, but the company's robust free cash flow yield supports a fair value much higher than current trading around $14." A close-up of a large industrial property, highlighting the size and scale of the company's real estate investments. Peakstone Realty Trust (NYSE:PKST) is not on our list of 30 Most Popular Stocks Among Hedge Funds. While we acknowledge the potential of Peakstone Realty Trust (NYSE:PKST) as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock. In addition, please check out our hedge fund investor letters Q2 2025 page for more investor letters from hedge funds and other leading investors. READ NEXT: The Best and Worst Dow Stocks for the Next 12 Months and 10 Unstoppable Stocks That Could Double Your Money. Disclosure: None. This article is originally published at Insider Monkey.
Yahoo
28-07-2025
- Business
- Yahoo
Are Finance Stocks Lagging Axos Financial (AX) This Year?
For those looking to find strong Finance stocks, it is prudent to search for companies in the group that are outperforming their peers. Has Axos Financial (AX) been one of those stocks this year? By taking a look at the stock's year-to-date performance in comparison to its Finance peers, we might be able to answer that question. Axos Financial is one of 869 individual stocks in the Finance sector. Collectively, these companies sit at #2 in the Zacks Sector Rank. The Zacks Sector Rank includes 16 different groups and is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. The Zacks Rank is a successful stock-picking model that emphasizes earnings estimates and estimate revisions. The system highlights a number of different stocks that could be poised to outperform the broader market over the next one to three months. Axos Financial is currently sporting a Zacks Rank of #2 (Buy). Over the past 90 days, the Zacks Consensus Estimate for AX's full-year earnings has moved 5.8% higher. This signals that analyst sentiment is improving and the stock's earnings outlook is more positive. Based on the most recent data, AX has returned 21.3% so far this year. Meanwhile, stocks in the Finance group have gained about 11.2% on average. This means that Axos Financial is outperforming the sector as a whole this year. Peakstone Realty Trust (PKST) is another Finance stock that has outperformed the sector so far this year. Since the beginning of the year, the stock has returned 24.6%. In Peakstone Realty Trust's case, the consensus EPS estimate for the current year increased 16.2% over the past three months. The stock currently has a Zacks Rank #1 (Strong Buy). To break things down more, Axos Financial belongs to the Financial - Miscellaneous Services industry, a group that includes 93 individual companies and currently sits at #93 in the Zacks Industry Rank. Stocks in this group have gained about 8.2% so far this year, so AX is performing better this group in terms of year-to-date returns. In contrast, Peakstone Realty Trust falls under the REIT and Equity Trust - Other industry. Currently, this industry has 99 stocks and is ranked #92. Since the beginning of the year, the industry has moved +6.8%. Investors with an interest in Finance stocks should continue to track Axos Financial and Peakstone Realty Trust. These stocks will be looking to continue their solid performance. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report AXOS FINANCIAL, INC (AX) : Free Stock Analysis Report Peakstone Realty Trust (PKST) : Free Stock Analysis Report This article originally published on Zacks Investment Research ( Zacks Investment Research Sign in to access your portfolio
Yahoo
25-06-2025
- Business
- Yahoo
Is Peakstone Realty Trust (PKST) Stock Outpacing Its Finance Peers This Year?
For those looking to find strong Finance stocks, it is prudent to search for companies in the group that are outperforming their peers. Is Peakstone Realty Trust (PKST) one of those stocks right now? A quick glance at the company's year-to-date performance in comparison to the rest of the Finance sector should help us answer this question. Peakstone Realty Trust is one of 857 companies in the Finance group. The Finance group currently sits at #5 within the Zacks Sector Rank. The Zacks Sector Rank gauges the strength of our 16 individual sector groups by measuring the average Zacks Rank of the individual stocks within the groups. The Zacks Rank emphasizes earnings estimates and estimate revisions to find stocks with improving earnings outlooks. This system has a long record of success, and these stocks tend to be on track to beat the market over the next one to three months. Peakstone Realty Trust is currently sporting a Zacks Rank of #1 (Strong Buy). Over the past 90 days, the Zacks Consensus Estimate for PKST's full-year earnings has moved 16.2% higher. This signals that analyst sentiment is improving and the stock's earnings outlook is more positive. Based on the latest available data, PKST has gained about 20.6% so far this year. Meanwhile, stocks in the Finance group have gained about 7.2% on average. As we can see, Peakstone Realty Trust is performing better than its sector in the calendar year. Another stock in the Finance sector, Banco Bilbao (BBVA), has outperformed the sector so far this year. The stock's year-to-date return is 57.6%. Over the past three months, Banco Bilbao's consensus EPS estimate for the current year has increased 5.4%. The stock currently has a Zacks Rank #2 (Buy). Looking more specifically, Peakstone Realty Trust belongs to the REIT and Equity Trust - Other industry, which includes 96 individual stocks and currently sits at #142 in the Zacks Industry Rank. On average, stocks in this group have gained 4.8% this year, meaning that PKST is performing better in terms of year-to-date returns. Banco Bilbao, however, belongs to the Banks - Foreign industry. Currently, this 66-stock industry is ranked #16. The industry has moved +24.6% so far this year. Going forward, investors interested in Finance stocks should continue to pay close attention to Peakstone Realty Trust and Banco Bilbao as they could maintain their solid performance. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Peakstone Realty Trust (PKST) : Free Stock Analysis Report Banco Bilbao Viscaya Argentaria S.A. (BBVA) : Free Stock Analysis Report This article originally published on Zacks Investment Research ( Zacks Investment Research Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
23-06-2025
- Business
- Yahoo
Are You Looking for a Top Momentum Pick? Why Peakstone Realty Trust (PKST) is a Great Choice
Momentum investing revolves around the idea of following a stock's recent trend in either direction. In the 'long' context, investors will be essentially be "buying high, but hoping to sell even higher." With this methodology, taking advantage of trends in a stock's price is key; once a stock establishes a course, it is more than likely to continue moving that way. The goal is that once a stock heads down a fixed path, it will lead to timely and profitable trades. While many investors like to look for momentum in stocks, this can be very tough to define. There is a lot of debate surrounding which metrics are the best to focus on and which are poor quality indicators of future performance. The Zacks Momentum Style Score, part of the Zacks Style Scores, helps address this issue for us. Below, we take a look at Peakstone Realty Trust (PKST), which currently has a Momentum Style Score of B. We also discuss some of the main drivers of the Momentum Style Score, like price change and earnings estimate revisions. It's also important to note that Style Scores work as a complement to the Zacks Rank, our stock rating system that has an impressive track record of outperformance. Peakstone Realty Trust currently has a Zacks Rank of #1 (Strong Buy). Our research shows that stocks rated Zacks Rank #1 (Strong Buy) and #2 (Buy) and Style Scores of A or B outperform the market over the following one-month period. You can see the current list of Zacks #1 Rank Stocks here >>> Let's discuss some of the components of the Momentum Style Score for PKST that show why this company shows promise as a solid momentum pick. Looking at a stock's short-term price activity is a great way to gauge if it has momentum, since this can reflect both the current interest in a stock and if buyers or sellers have the upper hand at the moment. It is also useful to compare a security to its industry, as this can help investors pinpoint the top companies in a particular area. For PKST, shares are up 3.5% over the past week while the Zacks REIT and Equity Trust - Other industry is up 0.19% over the same time period. Shares are looking quite well from a longer time frame too, as the monthly price change of 11.19% compares favorably with the industry's 3.99% performance as well. While any stock can see its price increase, it takes a real winner to consistently beat the market. That is why looking at longer term price metrics -- such as performance over the past three months or year -- can be useful as well. Over the past quarter, shares of Peakstone Realty Trust have risen 6.82%, and are up 22.54% in the last year. On the other hand, the S&P 500 has only moved 5.61% and 10.35%, respectively. Investors should also pay attention to PKST's average 20-day trading volume. Volume is a useful item in many ways, and the 20-day average establishes a good price-to-volume baseline; a rising stock with above average volume is generally a bullish sign, whereas a declining stock on above average volume is typically bearish. PKST is currently averaging 142,862 shares for the last 20 days. The Zacks Momentum Style Score also takes into account trends in estimate revisions, in addition to price changes. Please note that estimate revision trends remain at the core of Zacks Rank as well. A nice path here can help show promise, and we have recently been seeing that with PKST. Over the past two months, 1 earnings estimate moved higher compared to none lower for the full year. These revisions helped boost PKST's consensus estimate, increasing from $2.18 to $2.50 in the past 60 days. Looking at the next fiscal year, 1 estimate has moved upwards while there have been no downward revisions in the same time period. Taking into account all of these elements, it should come as no surprise that PKST is a #1 (Strong Buy) stock with a Momentum Score of B. If you've been searching for a fresh pick that's set to rise in the near-term, make sure to keep Peakstone Realty Trust on your short list. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Peakstone Realty Trust (PKST) : Free Stock Analysis Report This article originally published on Zacks Investment Research ( Zacks Investment Research Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Business Wire
08-05-2025
- Business
- Business Wire
Peakstone Realty Trust Reports First Quarter 2025 Results
EL SEGUNDO, Calif.--(BUSINESS WIRE)--Peakstone Realty Trust (the "Company") (NYSE: PKST), a real estate investment trust that is focused on owning and operating industrial assets, with a strategic emphasis on industrial outdoor storage, today announced its financial results for the quarter ended March 31, 2025. 'We are making meaningful progress in our strategic shift to an industrial REIT, with growth in the industrial outdoor storage sector as a key component of our long-term plan,' said Michael Escalante, CEO. 'This quarter, we advanced our strategy through strong leasing performance and successful execution of office sales. We fully leased our largest IOS redevelopment site, driving a 10% quarter-over-quarter increase in IOS annualized base rent (ABR) and reinforcing both the quality of our IOS portfolio and demand it continues to attract. Year-to-date, we have completed over $144 million of office property dispositions, further strengthening our balance sheet and reducing leverage. We remain committed to maintaining—or potentially accelerating—this pace of office sales through year-end as we continue to reposition the portfolio. While we recognize that macroeconomic and capital markets conditions may continue to evolve, we are well-positioned to adapt and execute on these sales. Looking ahead, we believe that placing more emphasis on the IOS subsector will be a key driver of long-term value for shareholders.' Financial Highlights Revenue of approximately $57.0 million. Net loss of approximately $(53.4) million; net loss attributable to common shareholders of approximately $(49.4) million, or $(1.35) per basic and diluted share. Core Funds from Operations ('Core FFO') 1 of $0.62 per basic and diluted share/unit. Adjusted Funds from Operations ('AFFO') of $0.62 per basic and diluted share/unit. Same Store Cash Net Operating Income ('Same Store Cash NOI') of approximately $39.0 million, a 4.0% increase compared to the same quarter last year. 1 The Company has adopted a new metric starting first quarter 2025. See the Funds from Operations, Core Funds from Operations, and Adjusted Funds from Operations section for further information. Expand Portfolio Highlights Industrial Segment Grew Industrial segment ABR by $2.4 million quarter-over-quarter, increasing the Industrial segment to 41% of total ABR during the quarter and 43% of total ABR on a pro forma basis (after giving effect to office dispositions closed subsequent to quarter end). Completed a 9.8-year, full-site lease for all 37 usable acres at the Everett, WA IOS redevelopment property, resulting in the transition of the asset to the operating portfolio. New IOS lease for 3.3 usable acres commenced in the operating portfolio at a releasing spread of 185% (cash) and 218% (GAAP). Increased the average annual rent escalations for IOS properties from 2.3% to 2.8%. Office Segment Sold $144 million of Office segment assets year-to-date, including $34 million in the first quarter of 2025. Portfolio As of March 31, 2025, the Company's portfolio was comprised of 101 properties, consisting of 96 operating properties and five redevelopment properties (those designated for redevelopment or repositioning) reported in two segments – Industrial and Office. The Company's operating properties had the following characteristics: The Company's redevelopment properties had the following characteristics: Disposition Activity Office Segment: During the quarter, the Company sold two properties totaling 251,200 square feet for approximately $34 million. Subsequent to quarter-end, the Company sold three properties totaling 522,100 square feet for $110.3 million. Each of these properties was classified as held for sale at March 31, 2025. Leasing Activity Industrial Segment: Completed a 9.8-year, full-site lease for all 37 usable acres at an IOS property in Everett, WA, resulting in the successful transition of the asset from the redevelopment portfolio to the operating portfolio during the quarter. Completed a six-month, no cost lease extension for 8.7 usable acres at an IOS property in Norcross, GA. Office Segment: Completed a four-month, no cost lease extension for 2,500 square feet at an office property in Phoenix, AZ. Financial Results for the First Quarter Revenue Total revenue was approximately $57.0 million compared to $59.2 million for the same quarter last year. The change in revenue was primarily due to the execution of strategic office dispositions. Net Loss Attributable to Common Shareholders Net loss attributable to common shareholders was approximately $(49.4) million, or $(1.35) per basic and diluted share, compared to net income attributable to common shareholders of approximately $5.0 million, or $0.14 per basic and diluted share, for the same quarter last year. Core FFO and AFFO Core FFO was approximately $24.6 million, or $0.62 per basic and diluted share/unit, compared to $25.6 million, or $0.65 per basic and diluted share/unit, for the same quarter last year. AFFO was approximately $24.8 million, or $0.62 per basic and diluted share/unit, compared to $27.8 million, or $0.70 per basic and diluted share/unit, for the same quarter last year. Same Store Cash NOI Same Store Cash NOI was approximately $39.0 million compared to $37.5 million for the same quarter last year, an increase of 4.0%. Balance Sheet Below is a table showing select balance sheet metrics. (1) Effective January 1, 2025, the Company presents the non-GAAP supplemental measure "Adjusted EBITDAre" to replace the previously disclosed "Normalized EBITDAre". This change is intended to enhance comparability and consistency in evaluating the ongoing operating performance of our business. Refer to the EBITDA, EBITDAre, and Adjusted EBITDAre section for further information. Expand Dividends The Board of Trustees approved a dividend for the quarter ended June 30, 2025 in the amount of $0.225 per common share that is payable on July 17, 2025 to holders of record of the Company's common shares on June 30, 2025. The Company paid a dividend for the first quarter in the amount of $0.225 per common share on April 17, 2025 to holders of record of the Company's common shares on December 31, 2024. First Quarter 2025 Earnings Webcast The Company will host a webcast to present the first quarter 2025 results on Thursday, May 8, 2025 at 5:00 p.m. Eastern Time. To access the webcast, please visit at least ten minutes prior to the scheduled start time to register and install any necessary software. A replay of the webcast will be available on the Company's website shortly after the initial presentation. To access by phone, please use the following dial-in numbers. For domestic callers, please dial 1-877-407-9716; for international callers, please dial 1-201-493-6779. About Peakstone Realty Trust Peakstone Realty Trust (NYSE: PKST) is a real estate investment trust that is executing a strategic transition to an industrial REIT, targeting growth in the industrial outdoor storage ('IOS') subsector. As part of this strategy, PKST is actively reshaping its portfolio by divesting non-core assets, primarily office properties, to position the Company for long-term value creation. Additional information is available at Cautionary Statement Regarding Forward-Looking Statements This document contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, as amended (the 'Securities Act'), and Section 21E of the Securities Exchange Act of 1934, as amended (the 'Exchange Act'). We intend for all such forward-looking statements to be covered by the applicable safe harbor provisions for forward-looking statements contained in Section 27A of the Securities Act and Section 21E of the Exchange Act. Forward-looking statements relate to expectations, beliefs, projections, future plans and strategies, anticipated events or trends and similar expressions concerning matters that are not historical facts. In some cases, you can identify forward-looking statements by the use of forward-looking terminology such as 'may,' 'will,' 'should,' 'expects,' 'intends,' 'plans,' 'anticipates,' 'believes,' 'estimates,' 'predicts,' or 'potential' or the negative of these words and phrases or similar words or phrases which are predictions of or indicate future events or trends and which do not relate solely to historical matters. You can also identify forward-looking statements by discussions of strategy, plans or intentions. The forward-looking statements contained in this document reflect our current views about future events and are subject to numerous known and unknown risks, uncertainties, assumptions and changes in circumstances that may cause our actual results to differ significantly from those expressed in any forward-looking statement. The following factors, among others, could cause actual results and future events to differ materially from those set forth or contemplated in the forward-looking statements: general economic and financial conditions; political uncertainty in the U.S.; the impact of tariffs and global trade disruptions on us and our tenants; market volatility; inflation; any potential recession or threat of recession; interest rates; disruption in the debt and banking markets; concentration in asset type; tenant concentration, geographic concentration, and the financial condition of our tenants; whether we are able to monitor the credit quality of our tenants and/or their parent companies and guarantors; competition for tenants and competition with sellers of similar properties if we elect to dispose of our properties; our access to, and the availability of capital; whether we will be able to repay debt and comply with our obligations under our indebtedness; the attractiveness of industrial and/or office assets; whether we will be successful in renewing leases or selling an applicable property, as leases expire; whether we will re-lease available space above or at current market rental rates; future financial and operating results; our ability to manage cash flows; our ability to manage expenses, including as a result of tenant failure to maintain our net-leased properties; dilution resulting from equity issuances; expected sources of financing, including the ability to maintain the commitments under our revolving credit facility, and the availability and attractiveness of the terms of any such financing; legislative and regulatory changes that could adversely affect our business; changes in zoning, occupancy and land use regulations and/or changes in their applicability to our properties; cybersecurity incidents or disruptions to our or our third party information technology systems; our ability to maintain our status as a real estate investment trust (a "REIT") within the meaning of Section 856 through 860 of the Internal Revenue Code of 1986, as amended (the "Code") and our Operating Partnership as a partnership for U.S. federal income tax purposes; our future capital expenditures, operating expenses, net income or loss, operating income, cash flow and developments and trends of the real estate industry; whether we will be successful in the pursuit of our business plans, objectives, expectations and intentions, including any acquisitions, investments, or dispositions, including our acquisition of industrial outdoor storage assets; the effects on our portfolio from the divestment of our office properties; our ability to meet budgeted or stabilized returns on our redevelopment projects within expected time frames, or at all; whether we will succeed in our investment objectives; any fluctuation and/or volatility of the trading price of our common shares; risks associated with our dependence on key personnel whose continued service is not guaranteed; and other factors, including those risks disclosed in 'Risk Factors' and 'Management's Discussion and Analysis of Financial Condition and Results of Operations' in our most recent Annual Report on Form 10-K and any subsequent Quarterly Reports on Form 10-Q filed with the U.S. Securities and Exchange Commission. While forward-looking statements reflect our good faith beliefs, assumptions and expectations, they are not guarantees of future performance. The forward-looking statements speak only as of the date of this document. We disclaim any obligation to publicly update or revise any forward-looking statement to reflect changes in underlying assumptions or factors, new information, data or methods, future events or other changes after the date of this document, except as required by applicable law. We caution investors not to place undue reliance on any forward-looking statements, which are based only on information currently available to us. Notice Regarding Non-GAAP Financial Measures: In addition to U.S. GAAP financial measures, this document contains and may refer to certain non-GAAP financial measures. These non-GAAP financial measures are in addition to, not a substitute for or superior to, measures of financial performance prepared in accordance with GAAP. These non-GAAP financial measures should not be considered replacements for, and should be read together with, the most comparable GAAP financial measures. Reconciliations to the most directly comparable GAAP financial measures and statements of why management believes these measures are useful to investors are included in the Appendix if the reconciliation is not presented on the page in which the measures are published. PEAKSTONE REALTY TRUST CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited; in thousands, except share and per share amounts) Three Months Ended March 31, 2025 2024 Revenue: Rental income $ 56,971 $ 59,227 Expenses: Property operating expense 4,644 7,090 Property tax expense 4,127 4,510 General and administrative expenses 8,553 9,680 Corporate operating expenses to related parties 141 166 Real estate impairment provision 51,957 1,376 Depreciation and amortization 25,439 23,415 Total expenses 94,861 46,237 (Loss) income before other income (expenses) (37,890 ) 12,990 Other income (expenses): Interest expense (15,978 ) (16,148 ) Other income, net 1,136 4,045 (Loss) gain from disposition of assets (479 ) 9,177 Goodwill impairment provision — (4,594 ) Transaction expenses (190 ) — Net (loss) income (53,401 ) 5,470 Net loss (income) attributable to noncontrolling interests 4,019 (445 ) Net (loss) income attributable to controlling interests (49,382 ) 5,025 Net (loss) income attributable to common shareholders $ (49,382 ) $ 5,025 Net (loss) income attributable to common shareholders per share, basic and diluted $ (1.35 ) $ 0.14 Weighted-average number of common shares outstanding, basic and diluted 36,726,154 36,309,019 Expand PEAKSTONE REALTY TRUST Funds from Operations, Core Funds from Operations and Adjusted Funds from Operations (Unaudited; in thousands except share and per share amounts) We use Funds from Operations ('FFO'), Core Funds from Operation ('Core FFO') and Adjusted Funds from Operations ('AFFO') as supplemental financial measures of our performance. These measures are used by management as supplemental financial measures of operating performance. We do not use these measures as, nor should they be considered to be, alternatives to net earnings computed under GAAP, as indicators of our operating performance, as alternatives to cash from operating activities computed under GAAP or as indicators of our ability to fund our cash needs. The summary below describes the way we use of these measures, provides information regarding why we believe these measures are meaningful supplemental measures of performance and reconciles these measures from net income or loss, the most directly comparable GAAP measures. FFO We compute FFO in accordance with the definition adopted by the Board of Governors of the National Association of Real Estate Investment Trusts ('NAREIT'). FFO is defined as net income or loss computed in accordance with GAAP, excluding gains (losses) from sales of depreciable real estate assets, impairment losses of depreciable real estate assets, real estate related depreciation and amortization and after adjustments for unconsolidated joint ventures. FFO is used to facilitate meaningful comparisons of operating performance between periods and among other REITs, primarily because it excludes the effect of real estate depreciation and amortization and net gains (losses) from real estate sales, which are based on historical costs and implicitly assume that the value of real estate diminishes predictably over time. Since real estate values instead have historically risen or fallen with market conditions, FFO can help facilitate comparisons of operating performance between periods and among other REITs. It should be noted, however, that other REITs may not define FFO in accordance with the current NAREIT definition or may interpret the current NAREIT definition differently than we do, making comparisons less meaningful. Core FFO We compute Core FFO by adjusting FFO, as defined by NAREIT, to exclude certain items such as goodwill impairment, gain or loss from the extinguishment of debt, unrealized gains or losses on derivative instruments, transaction costs, lease termination fees, and other items not related to ongoing operating performance of our properties. We believe that Core FFO is a useful supplemental measure in addition to FFO because it excludes the effects of certain items which can create significant earnings volatility, but which do not directly relate to our core business operations. As with FFO, our reported Core FFO may not be comparable to Core FFO as defined by other REITs. AFFO AFFO is presented in addition to Core FFO. AFFO further adjusts Core FFO for certain other non-cash items, including straight-line rent adjustment, amortization of share-based compensation, deferred rent, amortization of in-place lease valuation and other non-cash transactions. We believe AFFO provides a useful supplemental measure of our operating performance and is useful in comparing our operating performance with other REITs that may not be involved in similar transactions or activities resulting in the aforementioned adjustments. As with Core FFO, our reported AFFO may not be comparable to AFFO as defined by other REITs. Our calculation of FFO, Core FFO, and AFFO is presented in the following table for the three months ended March 31, 2025 and 2024 (dollars in thousands, except per share amounts): (1) Represents weighted-average outstanding OP Units that are owned by unitholders other than Peakstone Realty Trust. Represents the noncontrolling interest in the Operating Partnership. Expand PEAKSTONE REALTY TRUST Net Operating Income, including Cash and Same Store Cash NOI (Unaudited; in thousands) Net operating income ('NOI') is a non-GAAP financial measure calculated as net income or loss, the most directly comparable financial measure calculated and presented in accordance with GAAP, excluding general and administrative expenses, interest expense, depreciation and amortization, impairment of real estate, impairment of goodwill, gains or losses on early extinguishment of debt, gains or losses on sales of real estate, investment income or loss, termination income and equity in earnings of any unconsolidated real estate joint ventures. NOI on a cash basis ('Cash NOI') is NOI adjusted to exclude the effect of straight-line rent and amortization of acquired above- and below-market lease intangibles adjustments required by GAAP. Cash NOI for our Same Store portfolio ('Same Store Cash NOI') is Cash NOI for properties held for the entirety of all periods presented, with an adjustment for lease termination fees to provide a better measure of actual cash basis rental growth for our Same Store portfolio. We believe that NOI, Cash NOI and Same-Store Cash NOI are helpful to investors as additional measures of operating performance because we believe they help both investors and management to understand the core operations of our properties excluding corporate and financing-related costs and non-cash depreciation and amortization. NOI, Cash NOI and Same Store Cash NOI are unlevered operating performance metrics of our properties and allow for a useful comparison of the operating performance of individual assets or groups of assets. These measures thereby provide an operating perspective not immediately apparent from GAAP income from operations or net income (loss). In addition, NOI, Cash NOI and Same Store Cash NOI are considered by many in the real estate industry to be useful starting points for determining the value of a real estate asset or group of assets. Because NOI, Cash NOI and Same Store Cash NOI exclude depreciation and amortization and capture neither the changes in the value of our properties that result from use or market conditions, nor the level of capital expenditures and capitalized leasing commissions necessary to maintain the operating performance of our properties, all of which have real economic effect and could materially impact our results from operations, the utility of NOI, Cash NOI and Same Store Cash NOI as measures of our performance is limited. Therefore, NOI, Cash NOI and Same Store Cash NOI should not be considered as alternatives to net income or loss, as computed in accordance with GAAP. NOI, Cash NOI and Same Store Cash NOI may not be comparable to similarly titled measures of other companies. Our calculation of each of NOI, Cash NOI and Same Store Cash NOI is presented in the following table for the three months ended March 31, 2025 and 2024 (dollars in thousands): Three Months Ended March 31, Net (loss) income $ (53,401 ) $ 5,470 General and administrative expenses 8,553 9,680 Corporate operating expenses to related parties 141 166 Real estate impairment provision 51,957 1,376 Depreciation and amortization 25,439 23,415 Interest expense 15,978 16,148 Other (income) expense, net (1,136 ) (4,045 ) Gain from disposition of assets 479 (9,177 ) Goodwill impairment provision — 4,594 Transaction expenses 190 — Total NOI $ 48,200 $ 47,627 Cash NOI Adjustments Industrial Segment: Industrial NOI $ 20,812 $ 12,517 Straight-line rent (951 ) (604 ) Amortization of acquired lease intangibles (1,715 ) (96 ) Deferred termination income 277 — Industrial Cash NOI 18,423 11,817 Office Segment: Office NOI 27,388 27,514 Straight-line rent (199 ) (689 ) Amortization of acquired lease intangibles (147 ) (126 ) Deferred Termination Income (652 ) — Deferred ground/Office lease 423 433 Other intangible amortization 368 372 Office Cash NOI 27,181 27,504 Other Segment: Other NOI — 7,596 Straight-line rent — 467 Amortization of acquired lease intangibles — (37 ) Deferred ground/Office lease — (17 ) Other Cash NOI — 8,009 Total Cash NOI $ 45,604 $ 47,330 Same Store Cash NOI Adjustments Industrial Cash NOI $ 18,423 $ 11,817 Cash NOI for recently acquired properties (5,924 ) — Industrial Same Store Cash NOI 12,499 11,817 Office Cash NOI 27,181 27,504 Cash NOI for recently disposed (679 ) (1,807 ) Office Same Store Cash NOI 26,502 25,697 Other Cash NOI — 8,009 Cash NOI for recently disposed — (8,009 ) Other Same Store Cash NOI — — Total Same Store Cash NOI $ 39,001 $ 37,514 Expand PEAKSTONE REALTY TRUST EBITDA, EBITDAre, and Adjusted EBITDAre (Unaudited; in thousands) To supplement our consolidated financial statements, which are prepared and presented in accordance with GAAP, we use EBITDA, EBITDAre and Adjusted EBITDAre , collectively, to help us evaluate our business. We use such non-GAAP financial measures to make strategic decisions, establish business plans and forecasts, identify trends affecting our business, and evaluate our operating performance. We believe that these non-GAAP financial measures, when taken collectively, may be helpful to investors because they allow for greater transparency into what measures we use in operating our business and measuring our performance and enable comparison of financial trends and results between periods where items may vary independent of business performance. These non-GAAP financial measures are presented for supplemental informational purposes only and should not be considered a substitute for financial information presented in accordance with GAAP. We believe excluding items that neither relate to the ordinary course of business nor reflect our underlying business performance or that other companies, including companies in our industry, frequently exclude from similar non-GAAP measures enables us and our investors to compare our underlying business performance from period to period. Accordingly, we believe these adjustments facilitate a useful evaluation of our current operating performance and comparison to our past operating performance and provide investors with additional means to evaluate cost and expense trends. In addition, we also believe these adjustments enhance comparability of our financial performance and are similar measures that are widely used by analysts and investors as a means of evaluating a company's performance. There are a number of limitations related to our non-GAAP measures. Some of these limitations are that these measures, to the extent applicable, exclude: (i) historical or future cash requirements for maintenance capital expenditures or growth and expansion capital expenditures; (ii) depreciation and amortization, a non-cash expense, where the assets being depreciated and amortized may have to be replaced in the future and these measures do not reflect cash capital expenditure requirements for such replacements; (iii) interest expense, net, or the cash requirements necessary to service interest or principal payments on our indebtedness, which reduces cash available to us; (iv) share-based compensation expense, which has been, and will continue to be for the foreseeable future, a significant recurring expense for our business and an important part of our compensation strategy; (v) provision for income taxes, which may represent a reduction in cash available to us; and (vi) certain other items that we believe are not indicative of the performance of our portfolio. In addition, other companies, including companies in our industry, may calculate these non-GAAP measures or similarly titled non-GAAP measures differently or may use other measures to evaluate their performance, all of which could reduce the usefulness of our disclosure of non-GAAP measures as a tool for comparison. Because of these and other limitations, you should consider these non-GAAP measures along with other financial performance measures, including our financial results prepared in accordance with GAAP. EBITDA EBITDA is defined as earnings before interest, tax, depreciation and amortization. EBITDAre EBITDAre is defined by The National Association of Real Estate Investment Trusts ('NAREIT') as follows: (a) GAAP net income or loss, plus (b) interest expense, plus (c) income tax expense, plus (d) depreciation and amortization plus/minus (e) losses and gains on the disposition of depreciated property, including losses/gains on change of control, plus (f) impairment write-downs of depreciated property and of investments in unconsolidated affiliates caused by a decrease in value of depreciated property in the affiliate, plus (g) adjustments to reflect the entity's share of EBITDAre of consolidated affiliates. Adjusted EBITDAre Effective January 1, 2025, the Company presents the non-GAAP supplemental measure "Adjusted EBITDAre" to replace the previously disclosed "Normalized EBITDAre". This change is intended to enhance comparability and consistency in evaluating the ongoing operating performance of our business. Adjusted EBITDAre is defined as EBITDAre modified to exclude items such as acquisition-related expenses, employee separation expenses, stock-based compensation expenses, and other items that we believe are not indicative of the performance of our portfolio. We also include an adjustment to reflect a full period of net operating income on the operating properties we acquire during the quarter and to remove net operating income on properties we dispose of during the quarter (in each case, as if such acquisition or disposition, as applicable, had occurred on the first day of the quarter). The adjustment for acquisitions is based on our estimate of the net operating income we would have received from such property if it had been owned for the full quarter; however, the net operating income we actually receive from such properties in future quarters may differ based on our experience operating such properties subsequent to closing of the acquisitions. We may also exclude the annualizing of other large transaction items such as termination income recognized during the quarter. Our reconciliation of Net loss to Adjusted EBITDAre is presented in the following table for the three months ended March 31, 2025 (dollars in thousands): PEAKSTONE REALTY TRUST Appendix Annualized Base Rent, Investment Grade, Net Debt, Occupancy, and WALT Definitions 'Annualized Base Rent' or 'ABR' is calculated as the monthly contractual base rent for leases that have commenced as of the end of the quarter, excluding rent abatements, multiplied by 12 months and deducting base year operating expenses for gross and modified leases, unless otherwise specified. For leases in effect at the end of any quarter that provide for rent abatement during the last month of that quarter, the Company used the monthly contractual base rent payable following expiration of the abatement period. 'Investment grade' means an investment grade credit rating from a NRSRO approved by the U.S. Securities and Exchange Commission (e.g., Moody's Investors Service, Inc., S&P Global Ratings and/or Fitch Ratings Inc.) or a non-NRSRO credit rating (e.g., Bloomberg's default risk rating) that management believes is generally equivalent to an NRSRO investment grade rating; management can provide no assurance as to the comparability of these ratings methodologies or that any particular rating for a company is indicative of the rating that a single NRSRO would provide in the event that it rated all companies for which the Company provides credit ratings; to the extent such companies are rated only by non-NRSRO ratings providers, such ratings providers may use methodologies that are different and less rigorous than those applied by NRSROs. In the context of Peakstone's portfolio, references to 'investment grade' include, and credit ratings provided by Peakstone may refer to, tenants, guarantors, and non-guarantor parent entities. There can be no assurance that such guarantors or non-guarantor parent entities will satisfy the tenant's lease obligations, and accordingly, any such credit ratings may not be indicative of the creditworthiness of the Company's tenants. 'Net Debt' is total debt (excluding deferred financing costs and debt premiums/discounts) less cash and cash equivalents (excluding restricted cash). 'Occupancy" is the leased square footage or usable acres, as applicable, under leases that have commenced as of the end of the quarter. "Occupancy Percentage" is total applicable Occupancy divided by the total applicable leasable square footage or usable acres. 'WALT' is the weighted average lease term in years (excluding unexercised renewal options and early termination rights) based on Annualized Base Rent.
