Summary of Cousins Properties (CUZ) Q2 2026 Earnings Call

1Key Financial Results and Metrics

Funds from Operations (FFO): Reported at $0.75 per share for Q2 2026.

Full-Year FFO Guidance: Increased midpoint to $2.95 per share, reflecting a 3.9% growth over 2025.

Occupancy Rates: Portfolio occupancy reached 89.4%, with 98.8% leased, marking the highest level since Q1 2020.

Leasing Activity: Completed 924,000 square feet of leases in Q2, contributing to a total of 1.9 million square feet for the first half of 2026.

Cash Rent Roll-Up: Achieved a 9.2% increase, marking 49 consecutive quarters of positive rent roll-ups.

2Strategic Updates and Business Highlights

Market Trends: Notable demand for high-quality lifestyle office space, with a significant flight to quality and ongoing Sun Belt migration.

Investment Activity: Closed on a new $1.2 billion unsecured credit facility, enhancing financial flexibility.

Portfolio Management: Disposed of noncore assets, including Research Park Plaza 5 and One Eleven Congress, to upgrade portfolio quality.

New Developments: Initiated a joint venture for the 5th & Walsh development in Austin, with a focus on high-quality office space.

3Forward Guidance and Outlook

Occupancy Goals: Confident in reaching 90% occupancy by year-end 2026, supported by a robust leasing pipeline.

Market Conditions: Expect continued tightening of office fundamentals in the Sun Belt, with limited new construction projected until 2030.

Earnings Growth: Anticipate sustained internal and external growth opportunities, with a focus on high-quality asset acquisitions.

4Bad News, Challenges, or Points of Concern

Potential Occupancy Fluctuations: Anticipated modest downtick in occupancy next quarter due to large lease expirations in Charlotte.

Market Volatility: Ongoing macroeconomic uncertainties could impact leasing activity and market dynamics.

Competitive Pressures: The bifurcation of the office market may pose risks for lower-quality assets, which could affect overall market stability.

5Notable Q&A Insights

Rent Spreads: Management indicated that while Q2 spreads were strong, they may not reach double digits immediately due to market dynamics. They remain optimistic about future rent increases as occupancy tightens.

Early Lease Renewals: Noted an uptick in early renewal requests from larger customers, indicating confidence in rising rental rates.

AI Demand: Strong demand for office space from AI-related companies, particularly in Austin, was highlighted as a positive trend.

Development Opportunities: Management expressed openness to both build-to-suit and speculative developments, depending on market conditions and potential returns. Overall, Cousins Properties reported a strong Q2 2026, driven by robust leasing activity and strategic portfolio management, while maintaining a cautious outlook amidst potential market challenges.