Executive Summary

Q4 2024 delivered strong top-line and cash metrics: revenues rose to $40.8 million (+8.8% YoY), Core FFO per diluted share increased to $0.28 (+16.7% YoY), and Same-Store NOI rose 5.8% to $25.0 million as leasing spreads remained robust at 21.9% (new: 36.1%, renewal: 19.0%) .
GAAP diluted EPS was $0.33, aided by a $0.23 per-share gain on sale; EBITDAre reached $23.0 million (+9.5% YoY), and debt/EBITDAre improved to 6.6x from 7.5x in Q4 2023, reflecting portfolio quality and leverage progress .
Initial 2025 guidance targets Core FFO per diluted share of $1.03–$1.07, SS NOI growth of 3.0%–4.5%, lower interest expense ($32–$33 million), and ending occupancy of 94%–95%; dividend was raised 9% to $0.135 per quarter for Q1 2025 .
Estimates context: S&P Global Wall Street consensus was unavailable due to data limits; no EPS/revenue comparison versus Street can be provided at this time (Values retrieved from S&P Global).

What Went Well and What Went Wrong

What Went Well
- Sustained pricing power: 11th straight quarter with leasing spreads >17%; Q4 combined GAAP leasing spread 21.9%, with new lease spreads at 36.1% and renewals at 19.0% .
- Earnings and cash flow momentum: Core FFO/share up 11% in 2024 (to $1.01), Q4 Core FFO/share $0.28; CFO highlighted $58.2 million operating cash flow in 2024 vs. $24.9 million dividends, supporting growth reinvestment .
- Balance sheet progress: debt/EBITDAre improved to 6.6x; management targets further reduction toward high-5s/low-6s over time .
What Went Wrong
- GAAP EPS boosted by dispositions: Q4 diluted EPS of $0.33 included $0.23 from gains on asset sales; underlying growth was strong but headline EPS benefited from non-operating items .
- Termination fees elevated: management noted higher-than-normal lease termination fees through 2024, a byproduct of proactive remerchandising; these may not recur at 2024 levels .
- Near-term guidance embeds moderation: 2025 SS NOI guidance (3.0%–4.5%) is below 2024’s 5.1% actual; G&A expected modestly lower, but organic growth easing from 2024 pace .

Financial Results

Metric	Q2 2024	Q3 2024	Q4 2024
Revenues ($USD Millions)	$37.647	$38.633	$40.838
Diluted EPS (GAAP)	$0.05	$0.15	$0.33 (incl. $0.23 gain)
Core FFO per diluted share	$0.24	$0.25	$0.28
EBITDAre ($USD Millions)	$20.172	$21.617	$23.008
Same-Store NOI ($USD Millions)	$24.127	$24.216	$25.042
Occupancy (Wholly Owned)	93.5%	94.1%	94.1%

Leasing Metrics

KPI	Q2 2024	Q3 2024	Q4 2024
GAAP Leasing Spread (Total)	17.5%	25.3%	21.9%
GAAP Leasing Spread – New	33.3%	22.7%	36.1%
GAAP Leasing Spread – Renewal	13.9%	25.9%	19.0%
Net Effective ABR per Leased Sq Ft	$24.00	$23.65	$24.51

Balance Sheet/Leverage

KPI	Q2 2024	Q3 2024	Q4 2024
Total Debt ($USD Millions)	$666.749	$634.6	$632.483
Debt/EBITDAre (Pro Forma)	7.9x	7.2x	6.6x
Cash + Restricted Cash ($USD Millions)	$3.231	$2.534	$15.370

KPIs and Activity

KPI	Q2 2024	Q3 2024	Q4 2024
New Leases (# / GLA / Lease Value)	30 / 78,355 / $16.094M	26 / 47,636 / $7.633M	29 / 123,582 / $40.643M
Renewals (# / GLA / Lease Value)	47 / 232,713 / $20.730M	46 / 184,642 / $15.256M	50 / 167,112 / $15.909M
Total Leases (# / GLA / Lease Value)	77 / 311,068 / $36.824M	72 / 232,278 / $22.889M	79 / 290,694 / $56.553M

Notes: CFO stated "no remaining maturities in 2025" as of the March 4, 2025 call, while the 8-K schedule (as of 12/31/24) showed $17.572 million in 2025 maturities; this likely reflects actions post year-end. Timeframe context explains the difference .

Guidance Changes

Metric	Period	Previous Guidance	Current Guidance	Change
Core FFO per diluted share & OP Unit	FY 2025	N/A	$1.03 – $1.07	Initial
Net income per diluted share	FY 2025	N/A	$0.33 – $0.37	Initial
Same-Store NOI growth	FY 2025	N/A	3.0% – 4.5%	Initial
Bad debt as % of revenue	FY 2025	N/A	0.75% – 1.00%	Initial
G&A expense ($USD Millions)	FY 2025	N/A	$20.8 – $22.8	Initial
Interest expense ($USD Millions)	FY 2025	N/A	$32.0 – $33.0	Initial
Ending occupancy	FY 2025	N/A	94% – 95%	Initial
Dividend per quarter	Q1 2025	$0.12375 (Q4 2024)	$0.135 (+9%)	Raised
Core FFO per diluted share & OP Unit	FY 2024 (Actual)	$0.98 – $1.04 (Guided)	$1.01	Achieved Midpoint
Net income per diluted share	FY 2024 (Actual)	$0.32 – $0.38 (Guided)	$0.72	Above (dispositions)
Same-Store NOI growth	FY 2024 (Actual)	3.75% – 4.75% (Q3 rev.)	5.1%	Above Top End

Earnings Call Themes & Trends

Topic	Previous Mentions (Q2 2024)	Previous Mentions (Q3 2024)	Current Period (Q4 2024)	Trend
Leasing spreads & pricing power	Total 17.5%; new 33.3%; renewal 13.9%	Total 25.3%; new 22.7%; renewal 25.9%	Total 21.9%; new 36.1%; renewal 19.0%	Sustained strength
Same-Store NOI growth	+6.6% Q2; SS NOI engine	+4.6% Q3; guidance raised	+5.8% Q4; +5.1% FY	Above guided range FY
Redevelopment pipeline	Bread-and-butter projects, $10–$20/sf, high returns discussed	Continued positioning and design work	Williams Trace and Lion Square examples; active 2025–26 ramp	Accelerating
Acquisitions & recycling	Accretive deals; debt laddering	New $20mm term loan at 5.2%; leverage 7.2x	Selective acquisitions; disciplined mix of cash/sales/debt/equity	Opportunistic
Balance sheet & leverage	Net debt/EBITDAre ~7.9x	Improved to 7.2x; terming out debt	6.6x; target high-5s/low-6s	Improving
Dividend policy	Q3 dividend $0.12375	TSR focus and payout discipline	+9% to $0.135; ~50% Core FFO payout	Growing payout
Pillarstone proceeds	Redemption exercised 1/25/24	Non-majority interest; estimates used	Properties sold/under contract; proceeds expected; timing uncertain	Resolution nearing

Management Commentary

Strategy and portfolio positioning: “We lead the peer group in concentration of high-value, high-return shop space, 77% of our ABR… allowing us to capitalize on change and deliver consistent earnings growth for investors.” – CEO Dave Holeman .
Growth outlook: “Over the next 5 years, we believe we can deliver consistent organic core FFO growth of 4% to 6% driven by 3% to 5% same-store NOI growth… targeting adding 100 bps of core FFO growth uplift from acquisitions.” – CEO .
Redevelopment efficacy: “Williams Trace… replacement of an underperforming grocer with EOS fitness has boosted center traffic by 60%… we can do most redevelopment for $10 to $20 per square foot and deliver very high returns.” – COO Christine Mastandrea .
Capital and leverage: “We delivered $1.01 in core FFO per share… we have $15 million in cash and $125 million available under the credit facility… we had a long-term goal of getting our debt-to-EBITDA ratio under 7x.” – CFO Scott Hogan .
Dividend commitment: “We raised the dividend by over 9%… while maintaining an approximately 50% core FFO payout ratio.” – CEO .

Q&A Highlights

Redevelopment timing and yields: Bread-and-butter projects staged over time; larger centers positioned; underwriting targets double-digit returns and 20%–30% rent uplift from remerchandising .
Balancing acquisitions and leverage: Free cash generation, disciplined capital mix (operations, dispositions, debt, equity), and focus on accretive growth while reducing leverage .
Competitive environment: More capital active in Whitestone’s markets; firm’s focus on smaller-shop, grocery-agnostic assets and deep local relationships differentiates sourcing .
One-timers and forward run-rate: Higher percent rents in Q4 and elevated termination fees in 2024; base level assumed, larger fees layered as they occur .
Pillarstone update: Properties sold/under contract; liquidation proceeds expected above balance sheet carrying value; guidance to be updated upon receipt .
Leverage target: Ultimately “low 6s, maybe high 5s”; timing depends partly on liquidation proceeds .
Tenant exposure: Minimal exposure to recent small retailer bankruptcies; diversified tenant base with largest at ~2.2% of ABR .

Estimates Context

S&P Global consensus estimates for Q4 2024 and next quarter could not be retrieved due to daily request limits; therefore, we cannot provide a comparison versus Wall Street expectations at this time (Values retrieved from S&P Global).
Based on company guidance and 2024 actuals, Street models may adjust for 2025 SS NOI moderation (3.0%–4.5%) and lower interest expense ($32–$33 million), with redevelopment driving late-2025/2026 uplift .

Key Takeaways for Investors

Pricing power remains durable: 21.9% total leasing spreads and a rising net effective ABR/support continued SS NOI growth; watch leasing mix (new vs renewal) as a driver of cash uplift .
Core FFO trajectory and payout: 2024 Core FFO/share reached $1.01 with a ~50% payout; 2025 guidance suggests sustained growth with dividend support; dividend raised to $0.135 in Q1 2025 .
Redevelopment as alpha: Low-cost ($10–$20/sf) projects with notable traffic and rent benefits (e.g., Williams Trace EOS boosting traffic +60%) should underpin medium-term SS NOI gains .
Balance sheet optionality: Debt/EBITDAre improved to 6.6x; management targets high-5s/low-6s, aided by potential Pillarstone proceeds and lower interest expense guidance [$32–$33 million] .
Rotation to higher-quality revenue: Elevated 2024 termination fees reflect proactive remerchandising and should translate to healthier long-run tenants and rents; monitor fee normalization versus lease-up velocity .
Acquisition discipline intact: Selective approach in supply-constrained Sunbelt markets with shop-space focus differentiates sourcing; recycling supports accretive growth .
Watch guidance cadence and maturities: As of 12/31/24, 2025 maturities were $17.6M; management indicated “no remaining” as of the call—track subsequent refinancing and paydowns for clarity .

Whitestone REIT (WSR)·Q4 2024 Earnings Summary