Cousins Properties Inc Q1 2025 Earnings Call Summary

The following is excerpted from the question-and-answer section of the transcript.

Question: Dylan Burzinski - Green Street Advisors - Analyst : Talked about how the demand pipeline remains fairly robust. Obviously, occupancy within the portfolio is high. even though it's expected to dip throughout the rest of the year, it should continue to grow over the near term. I guess just given that backdrop in your comments around the supply expectations moving forward, I mean you guys get the sense that you're going to start to see rent spikes eventually across the portfolio? And can you guys talk about sort of the ability to push net effective rents in today's environment?

Question: Dylan Burzinski - Green Street Advisors - Analyst : Appreciate that color, Colin. And then maybe just one, Gregg, you alluded to sort of the acquisition pipeline and looking for -- continuing to look for opportunities. I guess, given you guys did the forward equity raise -- at the start of the year, I mean, is it safe to assume that there's something in the near-term hopper as it relates to the pipeline? And then maybe if you can just sort of talk further about sort of the pipeline today versus maybe at the start of the year, are you seeing any changes with regards to seller appetite, wanting to part ways with their properties given volatility in the capital markets?

Question: Steve Sakwa - Evercore ISI - Analyst : Richard, I didn't know if you could maybe provide a little bit more color on the pipeline, maybe either by market where you're seeing kind of the most activity? And then maybe by kind of industry? Is it legal, financial services? Is it tech? I'm kind of interested in where if, in fact, you're seeing any big tech kind of picking up.

Question: Steve Sakwa - Evercore ISI - Analyst : Okay. And then maybe just to kind of follow up on Colin -- some of Colin's comments about development. Obviously, you have some attractive land parcels down in the Austin market. I'm just curious, how do you sort of think about new development? It doesn't sound like maybe large tech is maybe as robust on in Austin today. But how do you sort of think about activating a new development? And I guess, how would you think about a yield requirement for new development today versus some of the acquisitions you've recently done?

Question: John Kim - BMO Capital Markets - Analyst : I think this is the first time you mentioned office removals in your markets accelerating. So I was wondering what markets, in particular, you're seeing that at? And what's driving some of the removals. And is this going into multifamily redevelopment or some other use? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. MAY 02, 2025 / 2:00PM, CUZ.N - Q1 2025 Cousins Properties Inc Earnings Call

Question: John Kim - BMO Capital Markets - Analyst : Okay. That's interesting. In recent weeks, Blackstone has made office investments in Manhattan and San Francisco. And I was wondering if you comments on either Blackstone or the large private equity firms, their interest in office in your markets?

Question: John Kim - BMO Capital Markets - Analyst : Are you seeing them in your markets in particular?

Question: Blaine Heck - Wells Fargo - Analyst : Just following up on the investment side, are you seeing any more or better opportunities on the debt side, given the uncertainty that's come about and some disruption in the credit market. Just wondering if we could see debt opportunities come back to the forefront you guys.

Question: Blaine Heck - Wells Fargo - Analyst : All right. Great. That's helpful. And then can you talk a little bit more about the strong increase in leasing you guys saw at the multifamily portion at Neuhoff this quarter, maybe touch on whether you've adjusted rents or concessions to kind of increase that velocity of lease signings?

Question: Blaine Heck - Wells Fargo - Analyst : Okay. Great. And related to that, can you talk a little bit about the activity you have on the commercial space at Neuhoff? I'm assuming you have some kind of large contiguous blocks of space -- are there any large tenant requirements in the Nashville market that you think might sit there and be kind of a quick boost to leasing? Or are you still more focused on some of the smaller tenants and slowly making progress towards that stabilization? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. MAY 02, 2025 / 2:00PM, CUZ.N - Q1 2025 Cousins Properties Inc Earnings Call

Question: Upal Rana - KeyBanc Capital Markets - Analyst : Great. Richard, you went through some of the implications of some of the renewal leasing in the quarter, but lease term did come down a bit to 5.5 years. Was there anything that was particularly driving that?

Question: Upal Rana - KeyBanc Capital Markets - Analyst : Okay. Great. And then you guys noted that you're seeing parking revenues increase, which is driving the guidance. How much of that is a function of higher office utilization versus increased pricing? And is there any markets that stick out to you the most?

Question: Nicholas Thillman - Baird - Analyst : Maybe I just wanted to follow up on something and broaden the discussion. But -- what are you guys seeing on the new-to-market requirements. Obviously, understanding corporate relocate large corporate relocations aren't like a huge driver of this business, but we've been hearing in Atlanta that there is a big pickup or not a big pickup, but a slight pickup here on requirements. Just curious if you could broaden that scope to the entire portfolio on markets kind of we didn't touch.

Question: Nicholas Thillman - Baird - Analyst : No, that's helpful. And then maybe just following up on acquisitions and I don't know if I actually get an answer on this one, but are there any markets in particular where there's a little bit more of a priority to kind of enter, I think of the likes of like Dallas, you have the Saint Ann Court loan. Is that a market that you view as one that definitely needs more exposure on this next round of kind of deployment?

Question: Michael Lewis - Truist Securities - Analyst : Some other office REITs are reporting good leasing volume, but their cash flow is suffering you didn't have as big an occupancy dip to kind of recover from. But could you talk about -- is there anything in terms of timing of free rent or leasing concessions that might pressure the cash flow? And then also talk about kind of how the leasing concessions are trending in your markets? I know you got some questions about whether there could be rent spikes, but maybe you might see changes in concessions first? And I wonder if you're seeing that at all. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. MAY 02, 2025 / 2:00PM, CUZ.N - Q1 2025 Cousins Properties Inc Earnings Call

Question: Michael Lewis - Truist Securities - Analyst : Okay. Great. And then Gregg mentioned when he talked about lease termination fee income, that you initiated three tenant move-outs. Is there a theme among those? Or maybe explain what's going on there?

Question: Michael Lewis - Truist Securities - Analyst : Okay. Got it. And then my last question, and maybe it's too early to ask this one. You guys have really low financial leverage, but the maturities you do have are going to be at low interest rates. So I know the unsecured notes this year are in your guidance you're a year out from Fifth Third Center in Colorado Tower, those both have fixed interest rates below 3.5%. Is there anything at this early stage to talk about in the strategy or the pricing for refinancing those low interest rate maturities? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. MAY 02, 2025 / 2:00PM, CUZ.N - Q1 2025 Cousins Properties Inc Earnings Call

Question: Peter Abramowitz - Jefferies - Analyst : Yes. Just wondering if you could touch on specifically leasing requirements in your Charlotte portfolio and specifically progress on Fifth Third Center.

Question: Peter Abramowitz - Jefferies - Analyst : Thanks, Richard. And then maybe one for Gregg. So you did a fair amount of capital raising to fund the acquisitions in the fourth quarter of last year. I think on a weighted average cost of capital basis, it was somewhere in sort of the mid 6s, maybe high 6s. So just curious, where do you kind of see your cost of debt and cost of equity today and if you did find opportunities, would you be comfortable issuing more equity where the stock is today? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. MAY 02, 2025 / 2:00PM, CUZ.N - Q1 2025 Cousins Properties Inc Earnings Call

Question: Brendan Lynch - Barclays - Analyst : You've been redeveloping assets for the past couple of years and improving the quality of the portfolio. At a high level, where do you see where you kind of stand in that process when looking at the portfolio as a whole?

Question: Brendan Lynch - Barclays - Analyst : Great. That's helpful. And maybe one for Gregg. The lease with the Parsley Energy included a onetime mid-lease abatement. Can you just walk through the details of that? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. MAY 02, 2025 / 2:00PM, CUZ.N - Q1 2025 Cousins Properties Inc Earnings Call