American Assets Trust, Inc. Reports Third Quarter 2025 Financial Results

Net income available to common stockholders of $4.5 million and $52.5 million for the three and nine months ended September 30, 2025, respectively, or $0.07 and $0.87 per diluted share, respectively.

Funds from Operations ("FFO") of $0.49 and $1.53 per diluted share for the three and nine months ended September 30, 2025, respectively.

Increased 2025 FFO per diluted share guidance to a range of $1.93 to $2.01 with a midpoint of $1.97, a $0.02 increase over prior guidance.

SAN DIEGO, Oct. 28, 2025 (GLOBE NEWSWIRE) -- American Assets Trust, Inc. (NYSE: AAT) (the “company”) today reported financial results for its third quarter ended September 30, 2025.

Third Quarter Highlights

• Net income available to common stockholders of $4.5 million and $52.5 million for the three and nine months ended September 30, 2025, respectively, or $0.07 and $0.87 per diluted share, respectively.
• FFO of $0.49 and $1.53 per diluted share for the three and nine months ended September 30, 2025, respectively, compared to $0.71 and $2.03 per diluted share for the same periods in 2024.
• Same-store cash Net Operating Income ("NOI") decreased 0.8% and increased 0.6% year-over-year for the three and nine months ended September 30, 2025, respectively, compared to the same periods in 2024.
• Increased 2025 FFO per diluted share guidance to a range of $1.93 to $2.01 with a midpoint of $1.97, a $0.02 increase over prior guidance.
• Leased 181,000 of office square feet, of which approximately 122,000 is comparable at an average straight-line basis and cash-basis contractual rent increase of 19% and increase of 9%, respectively, during the third quarter.
• Leased 125,000 of retail square feet, of which approximately 112,000 is comparable at an average straight-line basis and cash-basis contractual rent increase of 21% and 4%, respectively, during the third quarter.

Financial Results

Net income attributable to common stockholders increased $4.7 million for the nine months ended September 30, 2025 compared to the same period in 2024, primarily due to a $44.5 million gain on sale recognized for Del Monte Center. This increase was offset by $12.8 million net decrease in our office segment due to $11.0 million in lease termination fees received at Torrey Reserve Campus in 2024 and lower occupancy and annualized base rents at Torrey Reserve Campus, First & Main and Lloyd Portfolio, $10 million in litigation income received during the first quarter of 2024 relating to building specifications for one of the existing buildings at our office project in University Town Center (San Diego), higher net interest expense of approximately $7.6 million primarily due to the $525 million in principal amount of 6.15% senior notes due 2034 and the decrease in capitalized interest from the completion of La Jolla Commons III and One Beach, $3.5 million decrease in our retail segment due to the sale of Del Monte Center, $2.0 million decrease related to the hotel portion of our mixed-use property due to a decrease in tourism and $1.8 million decrease in our multifamily segment due to a decrease in occupancy.

FFO decreased $38.0 million for the nine months ended September 30, 2025 compared to the same period in 2024, primarily due the litigation income received during the first quarter of 2024, an increase in our interest expense, a decrease in our retail segment due to the sale of Del Monte Center, and a decrease in our office segment due to lower occupancy and annualized base rent and a decrease in the hotel portion of our mixed-use property due to a decrease in tourism.

FFO is a non-GAAP supplemental earnings measure which the company considers meaningful in measuring its operating performance. A reconciliation of net income to FFO is attached to this press release.

Leasing

The portfolio leased status as of the end of the indicated quarter was as follows:

During the third quarter of 2025, the company signed 49 leases for approximately 306,500 square feet of office and retail space, as well as 593 multifamily apartment leases. Renewals accounted for 73% of the comparable office leases, 96% of the comparable retail leases, and 55% of the residential leases.

Office and Retail

The annualized base rent per leased square foot as of the end of the indicated quarter was as follows:

On a comparable basis (i.e., leases for which there was a former tenant) our office and retail leasing spreads as of the end of the indicated quarter are shown below:

On a comparable basis (i.e., leases for which there was a former tenant) during the third quarter of 2025 and trailing four quarters ended September 30, 2025, our office and retail leasing spreads are shown below:

Multifamily

The average monthly base rent per leased unit as of the end of the indicated quarter was as follows:

Same-Store Cash Net Operating Income

For the three and nine months ended September 30, 2025, same-store cash NOI decreased 0.8% and increased 0.6%, respectively, compared to the three and nine months ended September 30, 2024. The same-store cash NOI by segment was as follows (in thousands):

Same-store cash NOI is a non-GAAP supplemental earnings measure which the company considers meaningful in measuring its operating performance. A reconciliation of same-store cash NOI to net income is attached to this press release.

Balance Sheet and Liquidity

At September 30, 2025, the company had gross real estate assets of $3.7 billion and liquidity of $538.7 million, comprised of cash and cash equivalents of $138.7 million and $400.0 million of availability on its line of credit. At September 30, 2025, the company had only 1 out of 31 assets encumbered by a mortgage.

Dividends

The company declared dividends on its shares of common stock of $0.340 per share for the third quarter of 2025. The dividends were paid on September 18, 2025.

In addition, the company has declared a dividend on its common stock of $0.340 per share for the fourth quarter of 2025. The dividend will be paid in cash on December 18, 2025 to stockholders of record as of December 4, 2025.

Guidance

The company increased its 2025 FFO per diluted share guidance to a range of $1.93 to $2.01 per share, an increase of $0.02 at midpoint from the prior 2025 FFO per diluted share guidance range of $1.89 to $2.01 per share.

Management will discuss the company's revised guidance in more detail during tomorrow's earnings call. Except as discussed during the call, the company's revised guidance excludes any impact from future acquisitions, dispositions, equity issuances or repurchases, debt financing or repayments. The foregoing estimates are forward-looking and reflect management's view of current and future market conditions, including certain assumptions with respect to leasing activity, rental rates, occupancy levels, interest rates, credit spreads and the amount and timing of acquisition and development activities. The company's actual results may differ materially from these estimates.

Conference Call

The company will hold a conference call to discuss the results for the third quarter of 2025 on Wednesday, October 29, 2025 at 8:00 a.m. Pacific Time (“PT”). To participate in the event by telephone, please dial 1-833-816-1162 and ask to join the American Assets Trust, Inc. conference call. A live on-demand audio webcast of the conference call will be available on the company's website at www.americanassetstrust.com. A replay of the call will also be available on the company's website.

Supplemental Information

Supplemental financial information regarding the company's third quarter 2025 results may be found on the "Financial Reporting" tab of the “Investors” page of the company's website at www.americanassetstrust.com. This supplemental information provides additional detail on items such as property occupancy, financial performance by property and debt maturity schedules.

Financial Information
American Assets Trust, Inc.
Consolidated Balance Sheets
(In Thousands, Except Share Data)

American Assets Trust, Inc.
Unaudited Consolidated Statements of Operations
(In Thousands, Except Shares and Per Share Data)

Reconciliation of Net Income to Funds From Operations
The company's FFO attributable to common stockholders and operating partnership unitholders and reconciliation to net income is as follows (in thousands except shares and per share data, unaudited):

Reconciliation of Same-Store Cash NOI to Net Income
The company's reconciliation of Same-Store Cash NOI to Net Income is as follows (in thousands, unaudited):

Reported results are preliminary and not final until the filing of the company's Form 10-Q with the Securities and Exchange Commission and, therefore, remain subject to adjustment.

Use of Non-GAAP Information

Funds from Operations
The company calculates FFO in accordance with the standards established by the National Association of Real Estate Investment Trusts ("NAREIT"). FFO represents net income (computed in accordance with GAAP), excluding gains (or losses) from sales of depreciable operating property, impairment losses, real estate related depreciation and amortization (excluding amortization of deferred financing costs) and after adjustments for unconsolidated partnerships and joint ventures.

FFO is a supplemental non-GAAP financial measure. Management uses FFO as a supplemental performance measure because it believes that FFO is beneficial to investors as a starting point in measuring the company's operational performance. Specifically, in excluding real estate related depreciation and amortization and gains and losses from property dispositions, which do not relate to or are not indicative of operating performance, FFO provides a performance measure that, when compared year-over-year, captures trends in occupancy rates, rental rates and operating costs. The company also believes that, as a widely recognized measure of the performance of REITs, FFO will be used by investors as a basis to compare the company's operating performance with that of other REITs. However, because FFO excludes depreciation and amortization and captures neither the changes in the value of the company's properties that result from use or market conditions nor the level of capital expenditures and leasing commissions necessary to maintain the operating performance of the company's properties, all of which have real economic effects and could materially impact the company's results from operations, the utility of FFO as a measure of the company's performance is limited. In addition, other equity REITs may not calculate FFO in accordance with the NAREIT definition as the company does, and, accordingly, the company's FFO may not be comparable to such other REITs' FFO. Accordingly, FFO should be considered only as a supplement to net income as a measure of the company's performance. FFO should not be used as a measure of the company's liquidity, nor is it indicative of funds available to fund the company's cash needs, including the company's ability to pay dividends or service indebtedness. FFO also should not be used as a supplement to or substitute for cash flow from operating activities computed in accordance with GAAP.

Cash Net Operating Income
The company uses NOI internally to evaluate and compare the operating performance of the company's properties. The company believes cash NOI provides useful information to investors regarding the company's financial condition and results of operations because it reflects only those income and expense items that are incurred at the property level, and when compared across periods, can be used to determine trends in earnings of the company's properties as this measure is not affected by (1) the non-cash revenue and expense recognition items, (2) the cost of funds of the property owner, (3) the impact of depreciation and amortization expenses as well as gains or losses from the sale of operating real estate assets that are included in net income computed in accordance with GAAP or (4) general and administrative expenses and other gains and losses that are specific to the property owner. The company believes the exclusion of these items from net income is useful because the resulting measure captures the actual revenue generated and actual expenses incurred in operating the company's properties as well as trends in occupancy rates, rental rates and operating costs. Cash NOI is a measure of the operating performance of the company's properties but does not measure the company's performance as a whole. Cash NOI is therefore not a substitute for net income as computed in accordance with GAAP.

Cash NOI is a non-GAAP financial measure of performance. The company defines cash NOI as operating revenues (rental income, tenant reimbursements (other than tenant improvement reimbursements), ground lease rental income and other property income) less property and related expenses (property expenses, ground lease expense, property marketing costs, real estate taxes and insurance), adjusted for non-cash revenue and operating expense items such as straight-line rent, amortization of lease intangibles, amortization of lease incentives and other adjustments. Cash NOI also excludes lease termination fees, tenant improvement reimbursements, general and administrative expenses, depreciation and amortization, interest expense, other nonproperty income and losses, acquisition-related expense, gains and losses from property dispositions, extraordinary items, tenant improvements, and leasing commissions. Other REITs may use different methodologies for calculating cash NOI, and accordingly, the company's cash NOI may not be comparable to the cash NOIs of other REITs.

About American Assets Trust, Inc.
American Assets Trust, Inc. is a full service, vertically integrated and self-administered real estate investment trust ("REIT"), headquartered in San Diego, California. The company has over 55 years of experience in acquiring, improving, developing and managing premier office, retail, and residential properties throughout the United States in some of the nation’s most dynamic, high-barrier-to-entry markets primarily in Southern California, Northern California, Washington, Oregon, Texas and Hawaii. The company's office portfolio comprises approximately 4.3 million rentable square feet, and its retail portfolio comprises approximately 2.4 million rentable square feet. In addition, the company owns one mixed-use property (including approximately 94,000 rentable square feet of retail space and a 369-room all-suite hotel) and 2,302 multifamily units. In 2011, the company was formed to succeed to the real estate business of American Assets, Inc., a privately held corporation founded in 1967 and, as such, has significant experience, long-standing relationships and extensive knowledge of its core markets, submarkets and asset classes. For additional information, please visit www.americanassetstrust.com.

Forward Looking Statements
This press release may contain forward-looking statements within the meaning of the federal securities laws, which are based on current expectations, forecasts and assumptions that involve risks and uncertainties that could cause actual outcomes and results to differ materially. Forward-looking statements relate to expectations, beliefs, projections, future plans and strategies, anticipated events or trends and similar expressions concerning matters that are not historical facts. In some cases, you can identify forward-looking statements by the use of forward-looking terminology such as “may,” “will,” “should,” “expects,” “intends,” “plans,” “anticipates,” “believes,” “estimates,” “predicts,” or “potential” or the negative of these words and phrases or similar words or phrases which are predictions of or indicate future events or trends and which do not relate solely to historical matters. The following factors, among others, could cause actual results and future events to differ materially from those set forth or contemplated in the forward-looking statements: adverse economic or real estate developments in our markets; defaults on, early terminations of or non-renewal of leases by tenants, including significant tenants; decreased rental rates or increased vacancy rates; our failure to generate sufficient cash flows to service our outstanding indebtedness; fluctuations in interest rates and increased operating costs; our failure to obtain necessary outside financing; our inability to develop or redevelop our properties due to market conditions; investment returns from our developed properties may be less than anticipated; general economic conditions, including the impact of tariffs and other trade restrictions; the potential impact of a prolonged government shutdown; financial market fluctuations; risks that affect the general office, retail, multifamily and mixed-use environment; the competitive environment in which we operate; system failures or security incidents through cyberattacks; the impact of epidemics, pandemics, or other outbreaks of illness, disease or virus and the actions taken by government authorities and others related thereto, including the ability of our company, our properties and our tenants to operate; difficulties in identifying properties to acquire and completing acquisitions; our failure to successfully operate acquired properties and operations; risks related to joint venture arrangements; potential litigation; difficulties in completing dispositions; conflicts of interests with our officers or directors; lack or insufficient amounts of insurance; environmental uncertainties and risks related to adverse weather conditions and natural disasters; other factors affecting the real estate industry generally; limitations imposed on our business and our ability to satisfy complex rules in order for American Assets Trust, Inc. to continue to qualify as a REIT, for U.S. federal income tax purposes; and changes in governmental regulations or interpretations thereof, such as real estate and zoning laws and increases in real property tax rates and taxation of REITs. While forward-looking statements reflect the company's good faith beliefs, assumptions and expectations, they are not guarantees of future performance. For a further discussion of these and other factors that could cause the company's future results to differ materially from any forward-looking statements, see the section entitled “Risk Factors” in the company's most recent annual report on Form 10-K, and other risks described in documents subsequently filed by the company from time to time with the Securities and Exchange Commission. The company disclaims any obligation to publicly update or revise any forward-looking statement to reflect changes in underlying assumptions or factors, of new information, data or methods, future events or other changes.

Source: American Assets Trust, Inc.

Investor and Media Contact:
American Assets Trust
Robert F. Barton
Executive Vice President and Chief Financial Officer
858-350-2607

Source: American Assets Trust, Inc.