JBG SMITH Properties (JBGS) Bundle
A Brief History of JBG SMITH Properties
JBG SMITH Properties, a publicly traded real estate investment trust (REIT), has its roots in the Washington D.C. metropolitan area, focusing on urban real estate investment and development. As of 2024, the company has undergone significant transformations in its portfolio and financial performance.
Portfolio Overview
As of September 30, 2024, JBG SMITH reported a multifamily portfolio occupancy rate of 95.7%, a notable increase from the previous quarter. The effective rents for new leases increased by 4.5%, while renewal rents rose by 6.1%.
| Portfolio Segment | Occupancy Rate | Effective Rent Increase (New Leases) | Effective Rent Increase (Renewals) |
|---|---|---|---|
| Multifamily | 95.7% | 4.5% | 6.1% |
| Commercial | 79.1% | N/A | N/A |
Financial Performance
For the three months ended September 30, 2024, JBG SMITH reported total property rental revenue of $113.3 million, a decrease of 5.8% from $120.3 million in the prior year. This decline was primarily driven by a $9.8 million decrease in revenue from commercial assets.
The company’s net loss attributable to common shareholders for the same period was $27.0 million, or $0.32 per diluted share, compared to a loss of $58.0 million, or $0.58 per diluted share, in the same period in 2023.
| Financial Metric | Q3 2024 | Q3 2023 | Change (%) |
|---|---|---|---|
| Total Property Rental Revenue | $113.3 million | $120.3 million | -5.8% |
| Net Loss | $27.0 million | $58.0 million | -53.8% |
Debt and Financing
As of September 30, 2024, JBG SMITH’s total mortgage loans amounted to $1.83 billion, with a weighted average effective interest rate of 4.54%. The company also had a revolving credit facility totaling $750 million with a maturity date in June 2027.
| Debt Type | Amount (in thousands) | Effective Interest Rate | Maturity Date |
|---|---|---|---|
| Revolving Credit Facility | $750,000 | 6.46% | June 2027 |
| Term Loans | $1,080,000 | 4.20% - 5.34% | 2026 - 2028 |
Recent Developments
In 2024, JBG SMITH has focused on optimizing its portfolio by taking properties out of service, including 1800 South Bell Street and 2100 Crystal Drive. The company aims to repurpose these assets for redevelopment and has advanced its design and entitlement efforts for an estimated 11.4 million square feet of potential development density.
Throughout the year, JBG SMITH has repurchased 10.8 million common shares for $168.3 million, further enhancing shareholder value. The company maintains a disciplined approach to capital management while navigating the challenges in the commercial real estate market.
A Who Owns JBG SMITH Properties (JBGS)
Ownership Structure
As of September 30, 2024, JBG SMITH Properties (JBGS) has a significant ownership interest in JBG SMITH LP, where it holds 85.8% of the limited partnership interests. This structure allows JBG SMITH Properties to act as the general partner and exercise full control over the day-to-day operations of JBG SMITH LP.
Common Shares and OP Units
As of September 30, 2024, there are 84,434 common shares issued and outstanding. The company has also issued 13.9 million operating partnership (OP) units, which represent a 14.2% ownership interest in JBG SMITH LP.
Shareholder Composition
The shareholder composition is detailed in the table below:
| Shareholder Type | Ownership Percentage | Number of Shares/Units |
|---|---|---|
| Common Shares | 100% | 84,434 |
| OP Units | 14.2% | 13,900,000 |
| Noncontrolling Interests | 0.7% | 13,614 |
Institutional Ownership
Institutional investors hold a significant stake in JBG SMITH Properties. The following table summarizes the top institutional shareholders as of September 30, 2024:
| Institution | Ownership Percentage | Number of Shares |
|---|---|---|
| Vanguard Group | 7.9% | 6,657 |
| BlackRock Inc. | 6.4% | 5,408 |
| State Street Corporation | 4.5% | 3,806 |
| Franklin Templeton Investments | 3.2% | 2,704 |
| Invesco Ltd. | 2.9% | 2,445 |
Recent Transactions
In June 2024, JBG SMITH Properties acquired the ground lessee's interest in 1900 Crystal Drive for $26.6 million, which resulted in a reduction of noncontrolling interests on the balance sheet by $4.7 million. This acquisition is significant as it eliminates the variable interest entity (VIE) status of 1900 Crystal Drive.
Financial Overview
As of September 30, 2024, JBG SMITH Properties reported total assets of $5.18 billion and total liabilities of $3.29 billion. The total equity attributable to JBG SMITH Properties was approximately $1.88 billion, with redeemable noncontrolling interests amounting to $444.9 million.
| Financial Metric | Amount (in thousands) |
|---|---|
| Total Assets | $5,182,477 |
| Total Liabilities | $3,290,825 |
| Total Equity | $1,882,038 |
| Redeemable Noncontrolling Interests | $444,945 |
Recent Performance
For the three months ended September 30, 2024, JBG SMITH Properties reported a net loss attributable to common shareholders of $27.0 million, compared to a net loss of $58.0 million for the same period in 2023. The company’s earnings per diluted common share were $(0.32) for Q3 2024.
JBG SMITH Properties (JBGS) Mission Statement
Company Overview
JBG SMITH Properties (NYSE: JBGS) is a leading real estate investment trust (REIT) focused on the Washington, D.C. metropolitan area. The company primarily invests in and operates multifamily and commercial properties, aiming to enhance community living and working environments.
Mission Statement
As of 2024, JBG SMITH Properties aims to create vibrant, sustainable communities through innovative real estate development and management. The mission emphasizes a commitment to high-quality service, tenant satisfaction, and community engagement while delivering strong returns to shareholders.
Key Financial Metrics
| Metric | 2024 | 2023 | % Change |
|---|---|---|---|
| Property Rental Revenue | $348.5 million | $364.9 million | (4.5%) |
| Third-party Real Estate Services Revenue | $52.3 million | $69.6 million | (24.8%) |
| Net Loss Attributable to Common Shareholders | $(83.6 million) | $(47.4 million) | 77.2% |
| Consolidated NOI | $197.2 million | $225.6 million | (12.6%) |
| Operating Multifamily Portfolio Occupancy | 95.7% | 94.3% | 1.4% |
| Operating Commercial Portfolio Occupancy | 79.1% | 84.4% | (5.3%) |
Operational Highlights
As of September 30, 2024, JBG SMITH Properties reported the following operational highlights:
- In-service multifamily portfolio was 95.7% occupied, up from 94.3% in June 2024.
- Effective rents increased by 4.5% for new leases and 6.1% for renewals.
- Leased percentages for The Grace and Reva were 64.7% and 56.8%, respectively.
- The office portfolio occupancy decreased to 79.1%, down 150 basis points from June 2024.
Development Pipeline
JBG SMITH Properties continues to advance its development pipeline, which includes:
- 11.4 million square feet of estimated potential development density.
- 775 units under construction at National Landing, expected to deliver in Q3 2025.
- Plans to repurpose older office buildings for multifamily and other specialty uses.
Financial Performance Overview
For the nine months ended September 30, 2024, JBG SMITH Properties experienced:
| Financial Item | 2024 | 2023 | % Change |
|---|---|---|---|
| Property Rental Revenue | $348.5 million | $364.9 million | (4.5%) |
| Third-party Real Estate Services Revenue | $52.3 million | $69.6 million | (24.8%) |
| Consolidated NOI | $197.2 million | $225.6 million | (12.6%) |
| Interest Expense | $97.4 million | $80.6 million | 20.9% |
| Real Estate Taxes Expense | $40.0 million | $44.1 million | (9.2%) |
Shareholder Returns
In 2024, the company repurchased 10.8 million common shares for $168.3 million, with a weighted average purchase price of $15.61 per share. The company also declared a quarterly dividend of $0.175 per common share, payable on November 22, 2024.
Conclusion
The mission of JBG SMITH Properties is to drive sustainable growth and community engagement while delivering value to its shareholders through strategic property management and development initiatives.
How JBG SMITH Properties (JBGS) Works
Operational Overview
JBG SMITH Properties (JBGS) operates primarily in the real estate sector, focusing on owning, developing, and managing properties in the Washington D.C. metropolitan area. As of September 30, 2024, JBGS's portfolio consisted of a mix of multifamily and commercial properties.
Financial Performance
The financial results for the nine months ended September 30, 2024, compared to the same period in 2023, indicate a decrease in property rental revenue:
| Metric | 2024 (9 months) | 2023 (9 months) | Change (%) |
|---|---|---|---|
| Property Rental Revenue | $348.5 million | $364.9 million | (4.5%) |
| Third-party Real Estate Services Revenue | $52.3 million | $69.6 million | (24.8%) |
| Net Loss Attributable to Common Shareholders | $83.6 million | $47.4 million | 77.0% |
| Loss per Share | $0.95 | $0.45 | 111.1% |
Revenue Breakdown
For the nine months ended September 30, 2024, the breakdown of property rental revenue by segment was as follows:
| Segment | Property Rental Revenue | Change (%) |
|---|---|---|
| Multifamily | $159.3 million | +2.8% |
| Commercial | $178.5 million | (16.2%) |
| Other | $9.7 million | (4.0%) |
Occupancy Rates
As of September 30, 2024, the occupancy rates for JBGS's properties were:
| Type | Occupancy Rate |
|---|---|
| Multifamily | 95.7% |
| Commercial | 79.1% |
Expenses and Costs
Key expenses for the nine months ended September 30, 2024, included:
| Expense Type | Amount |
|---|---|
| Property Operating Expense | $110.8 million |
| Real Estate Taxes | $40.0 million |
| General and Administrative Expenses | $57.1 million |
| Interest Expense | $97.4 million | Depreciation and Amortization Expense | $158.2 million |
Debt and Financing
As of September 30, 2024, JBGS's debt structure included:
| Debt Type | Amount | Effective Interest Rate |
|---|---|---|
| Variable Rate Loans | $724.3 million | 6.12% |
| Fixed Rate Loans | $1.1 billion | 4.54% |
| Total Mortgage Loans | $1.8 billion | N/A |
Recent Developments
JBGS is advancing several development projects with an estimated potential development density of 11.4 million square feet. The company is also focusing on repositioning underperforming office assets to address market challenges.
Shareholder Returns
JBG SMITH has a share repurchase program, with the following activity noted:
| Period | Shares Repurchased | Total Cost | Average Price per Share |
|---|---|---|---|
| Q3 2024 | 3.1 million | $50.2 million | $16.23 |
| 9 Months 2024 | 10.8 million | $168.3 million | $15.61 |
How JBG SMITH Properties (JBGS) Makes Money
Revenue Sources
JBG SMITH Properties primarily generates revenue through the following channels:
- Property rental income
- Third-party real estate services
- Other revenue streams, including lease termination fees
Property Rental Income
For the nine months ended September 30, 2024, property rental revenue amounted to $348.5 million, down from $364.9 million in 2023, reflecting a decrease of 4.5%.
Breakdown of property rental revenue:
| Source | 2024 Revenue (in thousands) | 2023 Revenue (in thousands) | % Change |
|---|---|---|---|
| Multifamily | $159,287 | $154,814 | +2.8% |
| Commercial | $178,507 | $213,052 | -16.2% |
| Other | $9,600 | $9,927 | -3.3% |
Factors contributing to this decrease include:
- A $32.8 million decrease in commercial revenue, primarily due to properties taken out of service.
- An increase in multifamily revenue of $4.9 million related to new developments.
Third-Party Real Estate Services
Third-party real estate services revenue, including reimbursements, fell to $52.3 million in 2024 from $69.6 million in 2023, a decrease of 24.8%.
Components of this revenue include:
- Development fees
- Property management fees
- Reimbursement revenue
The decline was driven by:
- A $4.0 million decrease in development fees due to timing.
- A $2.3 million decrease in reimbursement revenue.
Other Revenue Streams
Other revenue, which includes lease termination revenue, increased by $11.9 million in 2024, contributing to the overall revenue despite declines in other areas.
Expenses and Financial Performance
Total expenses for the nine months ended September 30, 2024, were $412.9 million, compared to $424.1 million in 2023, reflecting an overall decrease in operational costs.
Key expenses included:
- Depreciation and amortization: $158.2 million
- Property operating expenses: $110.8 million
- Real estate taxes: $40.0 million
Net loss attributable to common shareholders was $83.6 million for the nine months ended September 30, 2024, compared to $47.4 million in 2023.
Operating Metrics
As of September 30, 2024, the occupancy rates in JBG SMITH's portfolio were:
- Multifamily: 95.7%
- Commercial: 79.1%
In-service multifamily assets increased effective rents by 4.5% for new leases and 6.1% upon renewal.
Debt Management
As of September 30, 2024, JBG SMITH reported total mortgage loans of $1.8 billion, with a weighted average effective interest rate of 4.54% for fixed-rate loans and 6.12% for variable-rate loans.
Cash Flow Overview
Net cash provided by operating activities for the nine months ended September 30, 2024, totaled $87.2 million, down from $114.9 million in 2023. Cash and cash equivalents at the end of the period were $170.1 million.
JBG SMITH's strategy includes leveraging its real estate assets for consistent cash flow, focusing on development projects, and optimizing existing properties to enhance revenue.
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Article updated on 8 Nov 2024
Resources:
- JBG SMITH Properties (JBGS) Financial Statements – Access the full quarterly financial statements for Q3 2024 to get an in-depth view of JBG SMITH Properties (JBGS)' financial performance, including balance sheets, income statements, and cash flow statements.
- SEC Filings – View JBG SMITH Properties (JBGS)' latest filings with the U.S. Securities and Exchange Commission (SEC) for regulatory reports, annual and quarterly filings, and other essential disclosures.