Office-focused REIT Paramount's Q2 core FFO falls

Overview

• Paramount Group Q2 net loss widens to $19.8 mln, impacted by severance costs

• Core FFO for Q2 falls to $36.9 mln from $43.4 mln yr/yr

• The REIT, which operates and manages office properties, raises 2025 Core FFO guidance

Outlook

• Paramount raises 2025 Core FFO guidance to $0.55-$0.59 per share

• Company expects 2025 net loss per share of $0.37-$0.33

• Higher fee income and lower expenses boost 2025 Core FFO outlook

Result Drivers

• LEASE EXPIRATIONS - Scheduled expiration of Google’s lease at One Market Plaza decreased occupancy rates

• SEVERANCE COSTS - Net loss impacted by $7.5 mln in expenses related to equity awards and severance payments

• PORTFOLIO OPERATIONS - Improved operations contribute to raised full-year Core FFO guidance

Key Details

Analyst Coverage

• The current average analyst rating on the shares is "hold" and the breakdown of recommendations is 2 "strong buy" or "buy", 2 "hold" and 2 "sell" or "strong sell"

• The average consensus recommendation for the commercial reits peer group is "buy."

• Wall Street's median 12-month price target for Paramount Group Inc is $5.75, about 8% below its July 29 closing price of $6.21

Press Release: ID:nBw7hqxz1a