FRP HOLDINGS, INC. (FRPH) Q4 2024 Earnings Summary

Executive Summary

Q4 2024 delivered resilient topline and NOI growth despite lower GAAP net income: total revenues rose 4.2% year over year to $10,531k, pro rata NOI rose 21% to $9,103k, while net income fell to $1,679k ($0.09) due to lapping a prior-year one-time gain and higher G&A tied to succession planning .
Mining Royalty Lands led performance with revenue up 19% and NOI up 34%; Multifamily NOI rose 22% on continued lease-up at The Verge and improving same-store metrics; Industrial & Commercial NOI declined 15% on an uncollectible tenant, with occupancy to trough in 2025 as leases roll at Cranberry .
Management guided 2025 pro rata NOI to be flat to slightly down versus 2024 given industrial vacancies (Cranberry and Chelsea), non-repeatable 2024 one-time royalty income, and DC multifamily supply pressure; counterbalancing, FRPH plans ~$71M equity deployment into industrial and two new multifamily projects (810 units) to seed multi-year NOI growth .
Near-term stock narrative catalysts: explicit caution on 2025 NOI trajectory, Chelsea completion/leasing timeline (Q2 2025 shell; NOI drag until stabilized), Florida industrial JV timing shift to Q2 2025, and investor push for capital returns (dividend discussion) alongside management’s illustrative NAV of $34.63–$39.22 per share .

What Went Well and What Went Wrong

What Went Well

Mining strength: Q4 revenue +19% and NOI +34% on higher tons and positive swing in unrealized revenue; “Net operating income in this segment was $3,505,000, up $895,000 or 34%” .
Multifamily momentum: combined pro rata NOI +22% YoY to $4,286k driven by The Verge lease-up (+$508k YoY) and same-store NOI +12%; management: “We are pleased to have renewal success rates over 60% with renewal rental rates trending over 2.5% in Q4” .
Strategic pipeline: clear pivot to industrial development with ~$71M equity investment planned in 2025, two Florida JVs (Lakeland and Broward) moving to vertical construction in Q2 2025, and multi-year plan to double industrial square footage; CEO: “2025 is where we begin delivering on average 3 new industrial assets every 2 years” .

What Went Wrong

GAAP earnings compression: Q4 net income declined 41.7% YoY to $1,679k ($0.09) due to lapping a $1.886M loan guarantee gain in Q4 2023 and higher G&A from succession plan; equity in loss of JVs rose $1,425k YoY .
Industrial tenant issue: $222k allowance for uncollectible revenue and higher operating expenses reduced segment NOI by 15% YoY; occupancy at Cranberry expected to fall materially in 2025 as multiple tenants depart .
2025 growth pause: Management does not expect to match recent ~30% NOI CAGR; guidance flags flat/slightly lower 2025 NOI due to vacancies and non-repeatable royalty catch-up; DC multifamily faces a “glut of new projects” challenging rent growth .

Financial Results

Metric	Q2 2024	Q3 2024	Q4 2024
Total revenues ($USD Thousands)	10,477	10,633	10,531
Net income ($USD Thousands)	2,044	1,361	1,679
Diluted EPS ($USD)	$0.11	$0.07	$0.09
Pro rata NOI ($USD Thousands)	9,230	11,272	9,103

Segment performance (Q4 YoY):

Segment	Q4 2023	Q4 2024
Multifamily Lease Revenue ($USD Thousands)	7,249	8,162
Multifamily Net Operating Income ($USD Thousands)	3,528	4,286
Industrial & Commercial Lease Revenue ($USD Thousands)	1,422	1,268
Industrial & Commercial Net Operating Income ($USD Thousands)	1,172	992
Mining Royalty & Rent Revenue ($USD Thousands)	2,899	3,459
Mining Net Operating Income ($USD Thousands)	2,610	3,505

KPIs (Multifamily assets – Q4 2024 vs Q4 2023):

Asset	Units	Pro rata NOI Q4 2023 ($USD Thousands)	Pro rata NOI Q4 2024 ($USD Thousands)	Avg. Occupancy Q4 2023	Avg. Occupancy Q4 2024	Renewal Success Q4 2024	Renewal % Increase Q4 2024
Dock 79 (DC)	305	886	958	94.8%	94.4%	65.4%	4.0%
Maren (DC)	264	855	956	94.1%	93.9%	58.1%	3.5%
Riverside (SC)	200	124	179	95.2%	92.6%	60.0%	3.0%
Bryant Street (DC)	487	1,254	1,205	93.7%	89.7%	60.3%	2.5%
.408 Jackson (SC)	227	227	298	90.4%	96.2%	71.0%	3.8%
The Verge (DC)	344	182	690	79.0%	90.9%	72.1%	4.3%

Estimates versus results: Wall Street consensus (S&P Global) for FRPH’s Q4 2024 EPS and revenue was unavailable at the time of analysis; comparisons to estimates could not be made.

Guidance Changes

Metric	Period	Previous Guidance	Current Guidance	Change
Pro rata NOI (Company)	FY 2025	Growth to moderate from ~26% trailing CAGR; continued pipeline-driven growth	Flat to slightly below 2024 on industrial vacancies and non-repeatable royalty; DC multifamily supply pressure	Lowered/More conservative trajectory
Industrial JV construction start (Lakeland & Broward, FL)	2025	“Anticipated construction start for both in March 2025”	Vertical construction to take place in Q2 2025; loan term sheets executed	Timing pushed back ~1 quarter
Chelsea (Aberdeen, MD – 258k sf)	2024–2025	“Due to be complete in Q4 2024”	Shell completion expected Q2 2025; NOI drag until leased/stabilized	Delay; explicit NOI impact until stabilized
Industrial footprint growth	2025–2030	Focus on industrial; 649k sf near-term deliveries	Deliver ~3 industrial assets every 2 years; goal to double segment over 5 years	Expansion plan clarified
Multifamily development	2025+	Monitoring conditions; DC phases under PUD modification	Proceeding with two projects (SC, SW FL), +810 units; ~$6M pro rata NOI upon stabilization	New projects added
Macro inputs: rates & tariffs	2024–2025	Fed cuts and stabilizing construction costs	SOFR likely stable; potential late-2025 rate cut; monitoring steel/lumber/gypsum tariffs for cost impacts	Macro stance updated

Earnings Call Themes & Trends

Topic	Q2 2024 (Prior-2)	Q3 2024 (Prior-1)	Q4 2024 (Current)	Trend
Industrial development pipeline	Land closed for Lakeland & Broward JVs; underwritten 6–7% unlevered yields	649k sf near-term; 6–7% return on cost; entitlement progress	Q2 2025 vertical starts; Chelsea completion Q2 2025; 5-year plan to double industrial footprint	Steady execution; slight timing delays; larger pipeline articulation
DC multifamily supply and rents	Lease-up (.408 Jackson); steady renewals; some deceleration	Supply pressure; positive trade-outs and renewals	Renewals >60%, trade-outs >2.5%; expect organic rent growth but competition in DC	Stable but competitive
Mining royalties	Withholding credits pressured YTD; tons -10% in H1	$1.9M one-time minimum royalty payment (straight-lined) boosted NOI	Strong Q4; 2025 mining NOI strong but lacks 2024 one-time catch-up	Normalizing after one-time boost
Rates and financing	Fed cut tailwinds; costs stabilizing	—	SOFR stable; potential late-2025 cut; watching 10Y and spreads	Neutral-to-cautious
Tariffs/costs	—	—	Monitoring steel/lumber/gypsum tariffs; could impact costs (more multifamily than industrial)	Emerging risk consideration
Capital returns	—	—	Shareholder advocates dividend; management receptive to revisiting NAV inputs; no commitment to dividend	Active dialogue, no formal change

Management Commentary

“We expect NOI in 2025 to remain flat, if not slightly below 2024… vacancies in our Industrial and Commercial segment at our Cranberry Business Park and our new Chelsea building will take time to fill” (CEO) .
“These 4 [industrial] buildings represent 850,000 square feet… with total project cost of $146 million… FRP share of NOI ranging from $7.9 million to $9.2 million” (COO) .
“Our analysis yielded a per share value in the range of $34.63 to $39.22” (CFO, illustrative NAV framework) .
“We anticipate moving forward with two multifamily projects… which will add 810 units and $6 million in pro rata NOI upon stabilization” (CEO) .
“Average rental rate of expiring industrial leases was $6.55 triple net… we are hopeful most of our new rental rates start in the 7s or greater” (COO) .

Q&A Highlights

Geographic focus: Targeting Southeast for industrial acquisitions/development; Maryland is “harder to get entitlements,” but still opportunistic given it’s FRPH’s backyard .
Acquisition market/cap rates: Stabilized industrial assets trading high-4% to low-5% caps; management views those yields as thin for their underwriting standards .
Tariff impacts: Steel/lumber/gypsum tariffs could affect costs—more on multifamily; Florida industrial projects expected to be unaffected due to timing .
Underwriting returns: Trended return on cost generally 6.5%–7% at stabilization, flexed by market resilience (lower for core Fort Lauderdale industrial) and geography .
Cranberry leasing: Multiple tenants leaving; occupancy expected to get “very, very low” before re-tenanting at market rents (~$7+ NNN) over 1–2 years .
Investor capital returns: Shareholder advocated initiating a dividend (~1% yield) to improve liquidity and alignment; management acknowledged feedback and will revisit NAV cap rate assumptions, but emphasized focus on cash flow and growth .

Estimates Context

Wall Street consensus (S&P Global) for Q4 2024 EPS, revenue, and EBITDA was unavailable; FRPH’s coverage appears limited, and SPGI data could not be retrieved at analysis time. As a result, estimate comparisons and beat/miss designations cannot be provided reliably.

Key Takeaways for Investors

Expect a near-term growth pause: 2025 pro rata NOI guided flat/slightly down on industrial vacancies and the absence of 2024’s one-time mining royalty catch-up; prepare for muted earnings momentum near term .
Industrial development is the core growth engine: Q2 2025 vertical starts in Florida and multi-year plan to double segment square footage underpin medium-term NOI acceleration; monitor leasing at Chelsea to gauge timing of NOI inflection .
Multifamily fundamentals are stable but competitive: Same-store DC assets show positive renewals/trade-outs; however, supply glut tempers rent growth—expect organic rather than lease-up-driven gains in 2025 .
Mining remains durable: Strong Q4 performance, but 2025 will normalize without the 2024 one-time payment; segment still provides high-margin cash flows .
Watch Cranberry/Industrial leasing risk: Occupancy expected to trough with multiple tenant departures; successful backfill toward ~$7+ NNN is critical to 2026+ NOI trajectory .
Capital allocation optionality: ~$71M planned equity deployment in 2025; investor push for dividends noted, but management prioritizes reinvestment; any move on capital returns would be a sentiment catalyst .
Valuation framing: Management’s illustrative NAV of $34.63–$39.22 signals embedded value; refinements to cap rate assumptions could narrow perceived discount if communicated and supported by market comps .