• LXP Industrial Trust Reports Fourth Quarter 2022 Results

    Источник: Nasdaq GlobeNewswire / 16 фев 2023 05:00:53   America/Chicago

    NEW YORK, Feb. 16, 2023 (GLOBE NEWSWIRE) -- LXP Industrial Trust (“LXP”) (NYSE:LXP), a real estate investment trust focused on single-tenant warehouse/distribution real estate investments, today announced results for the fourth quarter and year ended December 31, 2022.

    Fourth Quarter 2022 Highlights

    • Recorded Net Income attributable to common shareholders of $36.9 million, or $0.13 per diluted common share.
    • Generated Adjusted Company Funds From Operations available to all equityholders and unitholders - diluted (“Adjusted Company FFO”) of $47.9 million, or $0.17 per diluted common share.
    • Completed 0.6 million square feet of new leases and lease extensions, raising industrial Base and Cash Base Rents by 38.1% and 42.6%, respectively.
    • Industrial Same-Store NOI increased 6.7% quarter to date 2022 compared to 2021.
    • Leased approximately 100 acres of industrial development land in the Phoenix, Arizona market for 20 years.
    • Completed construction of a warehouse/distribution facility containing 0.8 million square feet in the Greenville-Spartanburg, South Carolina market.
    • Invested an aggregate of $67.6 million in development activities, including $53.3 million in six ongoing development projects.
    • Disposed of four properties for an aggregate gross sales price of $49.6 million.

    Full Year 2022 Highlights

    • Recorded Net Income attributable to common shareholders of $107.3 million, or $0.38 per diluted common share.
    • Generated Adjusted Company FFO of $193.1 million, or $0.67 per diluted common share.
    • Completed 4.1 million square feet of new leases and lease extensions, raising industrial Base and Cash Base Rents by 30.7% and 25.6%, respectively.
    • Industrial Same-Store NOI increased 5.3% in 2022 compared to 2021.
    • Acquired three warehouse/distribution facilities for an aggregate cost of $131.2 million.
    • Completed construction of two warehouse/distribution facilities containing 1.1 million and 0.8 million square feet in the Columbus, Ohio and Greenville-Spartanburg, South Carolina markets, respectively.
    • Invested an aggregate of $298.2 million in development activities, including $204.4 million in six ongoing development projects and 60 acres of developable land.
    • Amended unsecured credit facility extending the maturity of the revolving credit portion to July 2026.
    • Leased approximately 100 acres of industrial development land in the Phoenix, Arizona market for 20 years.
    • Repurchased and retired 12.1 million common shares at an average price of $10.78 per share.
    • Disposed of 10 properties and one land parcel for an aggregate gross sales price of $197.0 million.

    T. Wilson Eglin, Chairman and Chief Executive Officer of LXP, commented “Our strong operating performance in the fourth quarter was driven by notable accomplishments in leasing, dispositions and leverage reduction. Additionally, we delivered 6.7% Same-Store NOI growth in the fourth quarter, demonstrating the value of our industrial portfolio, which has modern specs, average age of 8.8 years, attractive locational attributes and a diversified and strong credit tenant base. We expect 2023 Adjusted Company FFO to be in the range of $0.66 to $0.70 per diluted common share and Same-Store NOI growth of approximately 4-5%, reflecting the strong demand we are seeing for our high-quality assets and our progress optimizing our portfolio.”

    FINANCIAL RESULTS

    Revenues

    For the quarter ended December 31, 2022, total gross revenues were $81.1 million, compared with total gross revenues of $86.5 million for the quarter ended December 31, 2021. The decrease is primarily attributable to property sales, including the recapitalization of our special purpose industrial portfolio in 2021 now owned in a non-consolidated joint venture, which was partially offset by acquisitions.

    Net Income Attributable to Common Shareholders

    For the quarter ended December 31, 2022, net income attributable to common shareholders was $36.9 million, or $0.13 per diluted share, compared with net income attributable to common shareholders for the quarter ended December 31, 2021 of $260.5 million, or $0.90 per diluted share.

    Adjusted Company FFO

    For the quarter ended December 31, 2022, LXP generated Adjusted Company FFO of $47.9 million, or $0.17 per diluted share, compared to Adjusted Company FFO for the quarter ended December 31, 2021 of $53.8 million, or $0.18 per diluted share.

    Dividends/Distributions

    As previously announced, during the fourth quarter of 2022, LXP declared its quarterly common share/unit dividend/distribution for the quarter ended December 31, 2022 of $0.125 per common share/unit, which was paid on January 17, 2023 to common shareholders/unitholders of record as of December 30, 2022. LXP previously declared a dividend of $0.8125 per share on its Series C Cumulative Convertible Preferred Stock (“Series C Preferred”) for the quarter ended December 31, 2022, which was paid February 15, 2023 to Series C Preferred shareholders of record as of January 31, 2023.

    TRANSACTION ACTIVITY

    PROPERTY DISPOSITIONS
    Location Property Type Gross Disposition
    Price
    ($000)    		 Annualized Net Income(1) ($000) Annualized
    NOI(1)
    ($000)    		 Month of Disposition % Leased
    Kalamazoo, MI Other $1,175  $(968) $(948) October 35%
    Henderson, NC (2) Industrial  6,841   279   497  December 100%
    Phoenix, AZ Other  5,250   507   629  December 56%
    Romulus, MI Industrial  36,378   594   2,484  December 100%
        $49,644  $412  $2,662     
                       
    1. Generally, quarterly period prior to sale, annualized.
    2. Tenant exercised fixed-rate purchase option in the lease.

    The above properties were sold at aggregate weighted-average GAAP and Cash capitalization rates of 5.4%, respectively. As of December 31, 2022, total consolidated 2022 property disposition volume was $197.0 million at aggregate weighted-average GAAP and Cash capitalization rates of 5.6%, respectively.

    STABILIZED DEVELOPMENT  
    Property Type Market Sq. Ft. Initial Cost Basis
    ($000)    		 Approximate Lease Term (Yrs) % Leased at Completion
    Warehouse/distribution(1) Greenville-Spartanburg, SC 797,936 $64,067  12.3 100%
                  
    1. Substantially completed and placed into service development project. LXP owns 90%. Initial cost basis excludes $3.0 million of lease commissions and certain remaining costs, including developer partner promote, if any. LXP funded an aggregate of $60.1 million as of December 31, 2022 for this project, of which, $12.8 million was funded in the fourth quarter of 2022.
    ONGOING DEVELOPMENT PROJECTS    
                  
    Project (% owned)# of BuildingsMarketEstimated
    Sq. Ft.    		 Estimated Project
    Cost(1)
    ($000)    		 GAAP Investment Balance
    as of
    12/31/22
    ($000)    		 LXP Amount Funded
    as of
    12/31/22
    ($000)(2)    		 Actual/Estimated Building Completion Date % Leased
    as of
    12/31/22
    Consolidated:             
    The Cubes at Etna East (95%)(3)1Columbus, OH1,074,840 $72,850  $61,171 $58,455 3Q 2022 —%
    Ocala (80%)1Central Florida1,085,280  83,100   73,737  63,388 1Q 2023 —%
    Mt. Comfort (80%)1Indianapolis, IN1,053,360  65,500   59,379  49,848 1Q 2023 —%
    South Shore (100%)2Central Florida270,885  40,500   25,782  13,553 2Q 2023 —%
    Cotton 303 (93%)(4)2Phoenix, AZ880,678  84,200   64,682  56,570 1Q 2023 - 2Q 2023 45%
    Smith Farms (90%)(5)2Greenville-
    Spartanburg, SC    		1,396,884  101,550   77,173  67,780 1Q 2023 - 2Q 2023 —%
         $447,700  $361,924 $309,594    
                      
    1. Estimated project cost includes estimated tenant improvements and leasing costs and excludes potential developer partner promote, if any.
    2. Excludes noncontrolling interests' share.
    3. Base building achieved substantial completion. Property is not in service as of December 31, 2022.
    4. Pre-leased 392,278 square foot facility subject to a 10-year lease commencing upon substantial completion of the facility and notice to the tenant.
    5. In December 2022, substantially completed and placed into service a 797,936 square foot facility subject to a 12-year lease that commenced upon substantial completion of the facility. Remaining two projects ongoing.

    LAND HELD FOR INDUSTRIAL DEVELOPMENT

    Project (% owned) Market Approx. Developable Acres  GAAP Investment Balance
    as of
    12/31/22
    ($000)    		 LXP Amount Funded
    as of
    12/31/22
    ($000)(1)
    Consolidated:         
    Reems & Olive (95.5%)(2) Phoenix, AZ 320  $77,379  $73,957 
    Mt. Comfort Phase II (80%) Indianapolis, IN 116   5,301   4,213 
    ATL Fairburn (100%) Atlanta, GA 14   1,732   1,736 
        450  $84,412  $79,906 


    Project (% owned) Market Approx. Developable Acres  GAAP Investment Balance
    as of
    12/31/22
    ($000)    		 LXP Amount Funded
    as of
    12/31/22
    ($000)(1)
    Non-consolidated:         
    ETNA Park 70 (90%) Columbus, OH 66  $12,975  $13,599 
    ETNA Park 70 East (90%) Columbus, OH 21   2,126   2,363 
        87  $15,101  $15,962 
                  
    1. Excludes noncontrolling interests' share.
    2. Ground leased approximately 100 acres of the original 420 acre developable land parcel located in the Phoenix, AZ market.

    LEASING

    During the fourth quarter of 2022, LXP executed the following new leases and extensions:

      NEW LEASES - FIRST GENERATION(1)     
             
      Location Lease Expiration Date Sq. Ft. 
      Industrial     
    1 GreerSC 12/2027 81,058 
             
    1 TOTAL NEW LEASES - FIRST GENERATION                81,058  


      LEASE EXTENSIONS - SECOND GENERATION
               
      Location Prior
    Term    		 Lease
    Expiration Date    		 Sq. Ft. 
      Industrial       
    1 DallasTX 08/2023 09/2026 510,400 
               
    1 TOTAL LEASE EXTENSIONS - SECOND GENERATION     510,400 


      INDUSTRIAL DEVELOPMENT LEASED LAND
             
      Location Lease
    Expiration Date    		 Approx. Acres 
    1 Glendale(2)AZ 11/2042 100 
             
    1 TOTAL INDUSTRIAL DEVELOPMENT LEASED LAND   100 
             
    1. No prior leases, acquisition vacancy.
    2. Leased approximately 100 acres of the original 420 acre developable land parcel located in the Phoenix, AZ market, subject to a 20-year ground lease (with three, 10-year extension options) commenced in November 2022. The initial annual rental payments are $5.2 million and escalate by 4% annually.

    As of December 31, 2022, LXP's stabilized industrial portfolio was 99.5% leased. A total of 4.0 million square feet of new and extended industrial leases were entered into in 2022, with Base and Cash Base Rents increasing by 30.7% and 25.6%, respectively.

    BALANCE SHEET/CAPITAL MARKETS

    During the fourth quarter of 2022, LXP repurchased and retired 0.4 million common shares for an average price of $9.10 per share, which brought total 2022 repurchases to 12.1 million common shares for an average price of $10.78 per share.

    In the fourth quarter of 2022, LXP issued 16.0 million common shares previously sold on a forward basis as part of an underwritten offering for net proceeds of $183.4 million. Thus, LXP issued 3.9 million common shares, net of repurchases in 2022, at $13.53 per common share in this transaction.

    As of December 31, 2022, LXP ended the quarter with net debt to Adjusted EBITDA at 6.4x. LXP's total consolidated debt was $1.5 billion at quarter end with 91.4% at fixed rates. The total consolidated debt had a weighted-average term to maturity of 6.5 years and a weighted-average interest rate of 3.2% as of December 31, 2022.

    2023 EARNINGS GUIDANCE

    LXP estimates that its net income attributable to common shareholders for the year ended December 31, 2023 will be within an expected range of $0.35 to $0.39 per diluted common share. LXP estimates its Adjusted Company FFO for the year ended December 31, 2023, will be within an expected range of $0.66 to $0.70 per diluted common share. This guidance is forward looking, excludes the impact of certain items and is based on current expectations.   

    FOURTH QUARTER 2022 CONFERENCE CALL

    LXP will host a conference call today February 16, 2023, at 8:30 a.m. Eastern Time, to discuss its results for the quarter ended December 31, 2022. Interested parties may participate in this conference call by dialing 1-888-660-6144 (U.S.) or 1-929-203-0865 (All other locations). Access code is 5974526. A replay of the call will be available through May 17, 2023, at 1-800-770-2030 (U.S.) or 1-647-362-9199 (All other locations); pin code for all replay numbers is 5974526. A link to a live webcast of the conference call is available at www.lxp.com within the Investors section.

    LXP Industrial Trust (NYSE: LXP) is a publicly traded real estate investment trust (REIT) focused on single-tenant industrial real estate investments across the United States. LXP seeks to expand its industrial portfolio through acquisitions, build-to-suit transactions, sale-leaseback transactions, development projects and other transactions. For more information, including LXP's Quarterly Supplemental Information package, or to follow LXP on social media, visit www.lxp.com.

    Contact:
    Investor or Media Inquiries for LXP Industrial Trust:
    Heather Gentry, Senior Vice President of Investor Relations
    LXP Industrial Trust
    Phone: (212) 692-7200 E-mail: hgentry@lxp.com

    This release contains certain forward-looking statements which involve known and unknown risks, uncertainties or other factors not under LXP's control which may cause actual results, performance or achievements of LXP to be materially different from the results, performance, or other expectations implied by these forward-looking statements. Factors that could cause or contribute to such differences include, but are not limited to, those discussed under the headings “Management's Discussion and Analysis of Financial Condition and Results of Operations” and “Risk Factors” in LXP's periodic reports filed with the Securities and Exchange Commission, including risks related to: (1) national, regional and local economic and political climates, (2) the outbreak of highly infectious or contagious diseases, (3) the authorization by LXP's Board of Trustees of future dividend declarations, (4) LXP's ability to achieve its estimates of net income attributable to common shareholders and Adjusted Company FFO for the year ending December 31, 2023, (5) the successful consummation of any lease, acquisition, build-to-suit, disposition, financing or other transaction, (6) the failure to continue to qualify as a real estate investment trust, (7) changes in general business and economic conditions, including the impact of any legislation, (8) competition, (9) inflation, increases in real estate construction costs and construction schedule delays, (10) changes in financial markets and interest rates, (11) changes in accessibility of debt and equity capital markets, (12) future impairment charges, and (13) risks related to our investments in our non-consolidated joint ventures. Copies of the periodic reports LXP files with the Securities and Exchange Commission are available on LXP's web site at www.lxp.com. Forward-looking statements, which are based on certain assumptions and describe LXP's future plans, strategies and expectations, are generally identifiable by use of the words “believes,” “expects,” “intends,” “anticipates,” “estimates,” “projects”, “may,” “plans,” “predicts,” “will,” “will likely result,” “is optimistic,” “goal,” “objective” or similar expressions. Except as required by law, LXP undertakes no obligation to publicly release the results of any revisions to those forward-looking statements which may be made to reflect events or circumstances after the occurrence of unanticipated events. Accordingly, there is no assurance that LXP's expectations will be realized.

    References to LXP refer to LXP Industrial Trust and its consolidated subsidiaries. All interests in properties and loans are held, and all property operating activities are conducted, through special purpose entities, which are separate and distinct legal entities that maintain separate books and records, but in some instances are consolidated for financial statement purposes and/or disregarded for income tax purposes. The assets and credit of each special purpose entity with a property subject to a mortgage loan are not available to creditors to satisfy the debt and other obligations of any other person, including any other special purpose entity or affiliate. Consolidated entities that are not property owner subsidiaries do not directly own any of the assets of a property owner subsidiary (or the general partner, member of managing member of such property owner subsidiary), but merely hold partnership, membership or beneficial interests therein which interests are subordinate to the claims of the property owner subsidiary's (or its general partner's, member's or managing member's) creditors.

    Non-GAAP Financial Measures - Definitions

    LXP has used non-GAAP financial measures as defined by the Securities and Exchange Commission Regulation G in this Quarterly Earnings Release and in other public disclosures.

    LXP believes that the measures defined below are helpful to investors in measuring our performance or that of an individual investment. Since these measures exclude certain items which are included in their respective most comparable measures under generally accepted accounting principles (“GAAP”), reliance on the measures has limitations; management compensates for these limitations by using the measures simply as supplemental measures that are weighed in balance with other GAAP measures. These measures are not necessarily indications of our cash flow available to fund cash needs. Additionally, they should not be used as an alternative to the respective most comparable GAAP measures when evaluating LXP's financial performance or cash flow from operating, investing or financing activities or liquidity.

    Adjusted EBITDA: Adjusted EBITDA represents EBITDA (earnings before interest, taxes, depreciation and amortization) modified to include other adjustments to GAAP net income for gains on sales of properties, impairment charges, debt satisfaction gains (losses), net, non-cash charges, net, straight-line adjustments, non-recurring charges, the non-cash impact of sales-type leases and adjustments for pro-rata share of non-wholly owned entities. LXP's calculation of Adjusted EBITDA may not be comparable to similarly titled measures used by other companies. LXP believes that net income is the most directly comparable GAAP measure to Adjusted EBITDA.

    Base Rent: Base Rent is calculated by making adjustments to GAAP rental revenue to exclude billed tenant reimbursements and lease termination income and to include ancillary income. Base Rent excludes reserves/write-offs of deferred rent receivable, as applicable. LXP believes Base Rent provides a meaningful measure due to the net lease structure of leases in the portfolio.

    Cash Base Rent: Cash Base Rent is calculated by making adjustments to GAAP rental revenue to remove the impact of GAAP required adjustments to rental income such as adjustments for straight-line rents related to free rent periods and contractual rent increases. Cash Base Rent excludes billed tenant reimbursements, non-cash sales-type lease income and lease termination income, and includes ancillary income. LXP believes Cash Base Rent provides a meaningful indication of an investments ability to fund cash needs.

    Company Funds Available for Distribution (“FAD”): FAD is calculated by making adjustments to Adjusted Company FFO (see below) for (1) straight-line adjustments, (2) lease incentive amortization, (3) amortization of above/below market leases, (4) lease termination payments, net, (5) non-cash income related to sales-type leases, (6) non-cash interest, (7) non-cash charges, net, (8) capitalized interest and internal costs, (9) cash paid for second generation tenant improvements, and (10) cash paid for second generation lease costs. Although FAD may not be comparable to that of other real estate investment trusts (“REITs”), LXP believes it provides a meaningful indication of its ability to fund cash needs. FAD is a non-GAAP financial measure and should not be viewed as an alternative measurement of operating performance to net income, as an alternative to net cash flows from operating activities or as a measure of liquidity.

    First Generation Costs: Represents cash spend for tenant improvements and leasing costs for in-service development projects and expenditures contemplated at acquisition for recently acquired properties. Because all companies do not calculate First Generation Costs the same way, LXP's presentation may not be comparable to similarly titled measures of other companies.

    Funds from Operations (“FFO”) and Adjusted Company FFO: LXP believes that Funds from Operations, or FFO, which is a non-GAAP measure, is a widely recognized and appropriate measure of the performance of an equity REIT. LXP believes FFO is frequently used by securities analysts, investors and other interested parties in the evaluation of REITs, many of which present FFO when reporting their results. FFO is intended to exclude GAAP historical cost depreciation and amortization of real estate and related assets, which assumes that the value of real estate diminishes ratably over time. Historically, however, real estate values have risen or fallen with market conditions. As a result, FFO provides a performance measure that, when compared year over year, reflects the impact to operations from trends in occupancy rates, rental rates, operating costs, development activities, interest costs and other matters without the inclusion of depreciation and amortization, providing perspective that may not necessarily be apparent from net income.

    The National Association of Real Estate Investment Trusts, or NAREIT, defines FFO as “net income (calculated in accordance with GAAP), excluding depreciation and amortization related to real estate, gains and losses from the sales of certain real estate assets, gains and losses from change in control and impairment write-downs of certain real estate assets and investments in entities when the impairment is directly attributable to decreases in value of depreciable real estate held by the entity. The reconciling items include amounts to adjust earnings from consolidated partially-owned entities and equity in earnings of unconsolidated affiliates to FFO.” FFO does not represent cash generated from operating activities in accordance with GAAP and is not indicative of cash available to fund cash needs.

    LXP presents FFO available to common shareholders and unitholders - basic and also presents FFO available to all equityholders and unitholders - diluted on a company-wide basis as if all securities that are convertible, at the holder's option, into LXP’s common shares, are converted at the beginning of the period. LXP also presents Adjusted Company FFO available to all equityholders and unitholders - diluted which adjusts FFO available to all equityholders and unitholders - diluted for certain items which we believe are not indicative of the operating results of LXP's real estate portfolio. LXP believes this is an appropriate presentation as it is frequently requested by security analysts, investors and other interested parties. Since others do not calculate these measures in a similar fashion, these measures may not be comparable to similarly titled measures as reported by others. These measures should not be considered as an alternative to net income as an indicator of LXP’s operating performance or as an alternative to cash flow as a measure of liquidity.

    GAAP and Cash Yield or Capitalization Rate: GAAP and cash yields or capitalization rates are measures of operating performance used to evaluate the individual performance of an investment. These measures are estimates and are not presented or intended to be viewed as a liquidity or performance measure that present a numerical measure of LXP's historical or future financial performance, financial position or cash flows. The yield or capitalization rate is calculated by dividing the annualized NOI (as defined below, except GAAP rent adjustments are added back to rental income to calculate GAAP yield or capitalization rate) the investment is expected to generate, (or has generated) divided by the acquisition/completion cost, (or sale price). Stabilized yields assume 100% occupancy and the payment of estimated costs to achieve 100% occupancy including partner promotes, if any.

    Net Operating Income (“NOI”): NOI is a measure of operating performance used to evaluate the individual performance of an investment. This measure is not presented or intended to be viewed as a liquidity or performance measure that presents a numerical measure of LXP's historical or future financial performance, financial position or cash flows. LXP defines NOI as operating revenues (rental income (less GAAP rent adjustments, non-cash income related to sales-type leases and lease termination income, net), and other property income) less property operating expenses. Other REITs may use different methodologies for calculating NOI, and accordingly, LXP's NOI may not be comparable to other companies. Because NOI excludes general and administrative expenses, interest expense, depreciation and amortization, acquisition-related expenses, other nonproperty income and losses, and gains and losses from property dispositions, it provides a performance measure that, when compared year over year, reflects the revenues and expenses directly associated with owning and operating commercial real estate and the impact to operations from trends in occupancy rates, rental rates, and operating costs, providing a perspective on operations not immediately apparent from net income. LXP believes that net income is the most directly comparable GAAP measure to NOI.

    Same-Store NOI: Same-Store NOI represents the NOI for consolidated properties that were owned, stabilized and included in our portfolio for two comparable reporting periods. As Same-Store NOI excludes the change in NOI from acquired and disposed of properties, it highlights operating trends such as occupancy levels, rental rates and operating costs on properties. Other REITs may use different methodologies for calculating Same-Store NOI, and accordingly, LXP's Same-Store NOI may not be comparable to other REITs. Management believes that Same-Store NOI is a useful supplemental measure of LXP's operating performance. However, Same-Store NOI should not be viewed as an alternative measure of LXP's financial performance since it does not reflect the operations of LXP's entire portfolio, nor does it reflect the impact of general and administrative expenses, acquisition-related expenses, interest expense, depreciation and amortization costs, other nonproperty income and losses, the level of capital expenditures and leasing costs necessary to maintain the operating performance of LXP's properties, or trends in development and construction activities which are significant economic costs and activities that could materially impact LXP's results from operations. LXP believes that net income is the most directly comparable GAAP measure to Same-Store NOI.

    Second Generation Costs: Represents cash spend for tenant improvements and leasing costs to maintain revenues at existing properties and are a component of the FAD calculation. LXP believes that second generation building improvements represent an investment in existing stabilized properties.

    Stabilized Portfolio: All real estate properties other than acquired or developed properties that have not achieved 90% occupancy within one-year of acquisition or substantial completion. Non-stabilized, substantially completed development projects are classified within investments in real estate under construction.

    LXP INDUSTRIAL TRUST AND SUBSIDIARIES
    CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
    (Unaudited and in thousands, except share and per share data)

     Three months ended December 31, Twelve months ended December 31,
      2022   2021   2022   2021 
    Gross revenues:       
    Rental revenue$79,243  $85,374  $313,992  $339,944 
    Other revenue 1,861   1,108   7,253   4,053 
    Total gross revenues 81,104   86,482   321,245   343,997 
    Expense applicable to revenues:       
    Depreciation and amortization (45,922)  (46,135)  (180,567)  (176,714)
    Property operating (12,647)  (13,553)  (54,870)  (47,314)
    General and administrative (9,621)  (10,763)  (38,714)  (35,458)
    Transaction costs (4,121)  (227)  (4,177)  (432)
    Non-operating income 582   411   935   1,364 
    Interest and amortization expense (12,659)  (11,538)  (45,417)  (46,708)
    Debt satisfaction losses, net —   (672)  (119)  (13,894)
    Impairment charges (580)  (3,493)  (3,037)  (5,541)
    Change in allowance for credit loss (93)  —   (93)  — 
    Gains on sales of properties 6,143   262,507   59,094   367,274 
    Selling profit from sales-type leases 37,745   —   47,059   — 
    Income before provision for income taxes and equity in earnings (losses) of non-consolidated entities 39,931   263,019   101,339   386,574 
    Provision for income taxes (151)  (307)  (1,102)  (1,293)
    Equity in earnings (losses) of non-consolidated entities 426   59   16,006   (190)
    Net income 40,206   262,771   116,243   385,091 
    Less net income attributable to noncontrolling interests (1,733)  (481)  (2,460)  (2,443)
    Net income attributable to LXP Industrial Trust shareholders 38,473   262,290   113,783   382,648 
    Dividends attributable to preferred shares – Series C (1,572)  (1,572)  (6,290)  (6,290)
    Allocation to participating securities (35)  (258)  (186)  (510)
    Net income attributable to common shareholders$36,866  $260,460  $107,307  $375,848 
    Net income attributable to common shareholders – per common share basic$0.13  $0.93  $0.38  $1.35 
    Weighted-average common shares outstanding – basic 274,928,363   281,383,061   279,887,760   277,640,835 
    Net income attributable to common shareholders – per common share diluted$0.13  $0.90  $0.38  $1.34 
    Weighted-average common shares outstanding – diluted 276,118,668   292,782,489   282,473,458   287,369,742 
                    

    LXP INDUSTRIAL TRUST AND SUBSIDIARIES
    CONDENSED CONSOLIDATED BALANCE SHEETS
    As of December 31,
    (Unaudited and in thousands, except share and per share data)

      2022   2021 
    Assets:   
    Real estate, at cost$3,691,066  $3,583,978 
    Real estate - intangible assets 328,607   341,403 
    Land held for development 84,412   104,160 
    Investments in real estate under construction 361,924   161,165 
    Real estate, gross 4,466,009   4,190,706 
    Less: accumulated depreciation and amortization 800,470   655,740 
    Real estate, net 3,665,539   3,534,966 
    Assets held for sale 66,434   82,586 
    Right-of-use assets, net 23,986   27,966 
    Cash and cash equivalents 54,390   190,926 
    Restricted cash 116   101 
    Investment in non-consolidated entities 58,206   74,559 
    Deferred expenses, net 25,207   18,861 
    Investment in a sales-type lease, net 61,233   — 
    Rent receivable - current 3,030   3,526 
    Rent receivable - deferred 71,392   63,283 
    Other assets 24,314   8,784 
    Total assets$4,053,847  $4,005,558 
        
    Liabilities and Equity:   
    Liabilities:   
    Mortgages and notes payable, net$72,103  $83,092 
    Term loan payable, net 298,959   298,446 
    Senior notes payable, net 989,295   987,931 
    Trust preferred securities, net 127,694   127,595 
    Dividends payable 38,416   37,425 
    Liabilities held for sale 1,150   3,468 
    Operating lease liabilities 25,118   29,094 
    Accounts payable and other liabilities 74,261   77,607 
    Accrued interest payable 9,181   8,481 
    Deferred revenue - including below market leases, net 11,452   14,474 
    Prepaid rent 15,215   14,717 
    Total liabilities 1,662,844   1,682,330 
        
    Commitments and contingencies   
    Equity:   
    Preferred shares, par value $0.0001 per share; authorized 100,000,000 shares,   
    Series C Cumulative Convertible Preferred, liquidation preference $96,770 and 1,935,400 shares issued and outstanding 94,016   94,016 
    Common shares, par value $0.0001 per share; authorized 600,000,000 shares, 291,719,310 and 283,752,726 shares issued and outstanding in 2022 and 2021, respectively 29   28 
    Additional paid-in-capital 3,320,087   3,252,506 
    Accumulated distributions in excess of net income (1,079,087)  (1,049,434)
    Accumulated other comprehensive income (loss) 17,689   (6,258)
    Total shareholders’ equity 2,352,734   2,290,858 
    Noncontrolling interests 38,269   32,370 
    Total equity 2,391,003   2,323,228 
    Total liabilities and equity$4,053,847  $4,005,558 
            

    LXP INDUSTRIAL TRUST AND SUBSIDIARIES
    EARNINGS PER SHARE
    (Unaudited and in thousands, except share and per share data)

     Three Months Ended
    December 31,    		 Twelve Months Ended
    December 31,
      2022   2021   2022   2021 
    EARNINGS PER SHARE:       
            
    Basic:       
    Net income attributable to common shareholders$36,866  $260,460  $107,307  $375,848 
            
    Weighted-average common shares outstanding - basic 274,928,363   281,383,061   279,887,760   277,640,835 
            
    Net income attributable to common shareholders - per common share basic$0.13  $0.93  $0.38  $1.35 
            
    Diluted:       
    Net income attributable to common shareholders - basic$36,866  $260,460  $107,307  $375,848 
    Impact of assumed conversions 9   1,853   156   7,962 
    Net income attributable to common shareholders$36,875  $262,313  $107,463  $383,810 
            
    Weighted-average common shares outstanding - basic 274,928,363   281,383,061   279,887,760   277,640,835 
    Effect of dilutive securities:       
    Unvested share-based payment awards 354,750   1,223,218   457,597   989,177 
    Shares issuable under forward sales agreements —   4,568,350   1,274,842   2,110,315 
    Operating Partnership Units 835,555   897,290   853,259   1,918,845 
    Preferred shares - Series C —   4,710,570   —   4,710,570 
    Weighted-average common shares outstanding - diluted 276,118,668   292,782,489   282,473,458   287,369,742 
            
    Net income attributable to common shareholders - per common share diluted$0.13  $0.90  $0.38  $1.34 
                    

    LXP INDUSTRIAL TRUST AND SUBSIDIARIES
    ADJUSTED COMPANY FUNDS FROM OPERATIONS & FUNDS AVAILABLE FOR DISTRIBUTION
    (Unaudited and in thousands, except share and per share data)

     Three Months Ended
    December 31,    		 Twelve Months Ended
    December 31,
      2022   2021   2022   2021 
    FUNDS FROM OPERATIONS:      
    Basic and Diluted:       
    Net income attributable to common shareholders$36,866  $260,460  $107,307  $375,848 
    Adjustments:       
    Depreciation and amortization 45,125   45,391   177,725   173,833 
    Impairment charges - real estate, including our share of non-consolidated entities 838   3,493   8,137   5,541 
    Noncontrolling interests - OP units 9   281   156   1,672 
    Amortization of leasing commissions 797   744   2,842   2,881 
    Joint venture and noncontrolling interest adjustment 2,527   2,026   11,112   8,370 
    Gains on sales of properties, including our share of non-consolidated entities (7,759)  (262,507)  (83,562)  (367,274)
    FFO available to common shareholders and unitholders - basic 78,403   49,888   223,717   200,871 
    Preferred dividends 1,572   1,572   6,290   6,290 
    Amount allocated to participating securities 35   258   186   510 
    FFO available to all equityholders and unitholders - diluted 80,010   51,718   230,193   207,671 
    Selling profit from sales-type leases (1) (37,745)  —   (47,059)  — 
    Allowance for credit loss 93   —   93   — 
    Transaction costs (2) 4,121   227   4,177   432 
    Debt satisfaction losses, net, including our share of non-consolidated entities 1   672   1,615   13,894 
    Other non-recurring costs (3) —   1,199   2,573   1,199 
    Noncontrolling interest adjustments 1,469   —   1,469   — 
    Adjusted Company FFO available to all equityholders and unitholders - diluted 47,949   53,816   193,061   223,196 
            
    FUNDS AVAILABLE FOR DISTRIBUTION:       
    Adjustments:       
    Straight-line adjustments (2,519)  (4,178)  (11,412)  (12,324)
    Lease incentives 127   175   518   780 
    Amortization of above/below market leases (449)  (340)  (1,865)  (1,551)
    Lease termination payments, net —   (330)  —   551 
    Sales-type lease non-cash income (342)  —   (342)  — 
    Non-cash interest 819   825   3,278   3,300 
    Non-cash charges, net 1,846   1,796   7,483   7,137 
    Capitalized interest and internal costs (2,549)  (850)  (8,014)  (2,974)
    Second generation tenant improvements (78)  (4,214)  (5,094)  (8,392)
    Second generation lease costs (475)  (1,810)  (2,613)  (7,151)
    Joint venture and non-controlling interests adjustment (103)  (194)  (211)  (375)
    Company Funds Available for Distribution$44,226  $44,696  $174,789  $202,197 
            
    Per Common Share and Unit Amounts       
    Basic:       
    FFO$0.28  $0.18  $0.80  $0.72 
            
    Diluted:       
    FFO$0.28  $0.18  $0.80  $0.72 
    Adjusted Company FFO$0.17  $0.18  $0.67  $0.78 
            
    Weighted-Average Common Shares       
    Basic:       
    Weighted-average common shares outstanding - basic EPS 274,928,363   281,383,061   279,887,760   277,640,835 
    Operating partnership units(4) 835,555   897,290   853,259   1,918,845 
    Weighted-average common shares outstanding - basic FFO 275,763,918   282,280,351   280,741,019   279,559,680 
            
    Diluted:       
    Weighted-average common shares outstanding - diluted EPS 276,118,668   292,782,489   282,473,458   287,369,742 
    Unvested share-based payment awards —   70,114   17,381   44,261 
    Preferred shares - Series C 4,710,570   —   4,710,570   — 
    Weighted-average common shares outstanding - diluted FFO 280,829,238   292,852,603   287,201,409   287,414,003 
                    

    (1) Aggregate gains recognized upon entering into a sales-type lease and exercises of tenant's purchase options in leases.
    (2) Includes initial direct costs incurred in connection with entering into investments classified as sales-type leases and other acquisition related costs.
    (3) Includes strategic alternatives and costs related to shareholder activism.
    (4) Includes OP units other than OP units held by us.

    LXP INDUSTRIAL TRUST AND CONSOLIDATED SUBSIDIARIES
    RECONCILIATION OF NON-GAAP MEASURES

    2023 EARNINGS GUIDANCE   
     Twelve Months Ended
    December 31, 2023
     Range
    Estimated:   
    Net income attributable to common shareholders per diluted common share(1)$0.35  $0.39 
    Depreciation and amortization 0.65   0.65 
    Impact of capital transactions (0.34)  (0.34)
    Estimated Adjusted Company FFO per diluted common share$0.66  $0.70 
            

    (1) Assumes all convertible securities are dilutive.


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