Analyst Note| Kevin Brown |
Regency Centers reported second-quarter results ahead of our expectations, as the retail recovery has occurred faster than anticipated, leading us to reaffirm our $66 fair value estimate. Same-store occupancy increased 30 basis points to 92.5% in the second quarter, better than our estimate of a 50-basis-point decline. Re-leasing spreads improved slightly and beat our estimate of a 0.9% gain with a reported figure of 2.7% for the quarter. Rent collection improved to 96% in the second quarter compared with 93% in the first quarter and far better than the 85% figure reported in the second quarter of 2020. With the elimination of uncollected rent write-offs, Regency's same-store revenue increased 22.3%, and same-store net operating income increased 30.3%, better than our estimate of 23.4% growth. As a result, Regency reported second-quarter core funds from operations of $0.95, ahead of our estimate of $0.83 for the second quarter.