Cousin Properties CUZ recently announced that it has secured a significant deal, leasing out an entire 320,000 square feet Domain 12 property in Austin, TX, to a Fortune 100 tech giant. This move marks a substantial addition to Cousins’ portfolio, as it takes over the lease from Meta Platforms and extends the maturity from 2031 to 2040.
Spanning approximately 2.5 million square feet, Cousins’ Domain portfolio boasts over 99% occupancy, exemplifying the robust demand for space in the property sector. Domain 12, inaugurated in 2020, is strategically located near The Domain’s thriving dining and entertainment hub.
Offering a suite of amenities such as cafes, outdoor terraces, a fitness center, and bike storage, all complemented by direct access to various hiking and biking trails, this lifestyle office property by Cousins promises a holistic experience for its tenants.
“We are thrilled that our teams were able to devise a creative solution to welcome another global tech innovator to this premier property in The Domain,” stated Colin Connolly, the president, and CEO of Cousins Properties. He added, “The Domain provides a highly amenitized experience that leading companies recognize as integral to driving employee recruitment, retention, and fostering a vibrant corporate culture.”
Cousins Properties Leverages Recovering Demand
Noteworthy is Cousins Properties’ resurgence amidst a pickup in demand for its top-tier office properties, evidenced by a surge in new leasing activity. In the first half of 2024, the company closed 77 leases covering a total of 794,240 square feet with an average lease term of 7.8 years. These agreements comprised new leases, renewals, and expansions, showcasing the company’s strong market positioning.
Image Source: Cousins Properties
Looking ahead, the combination of Cousins Properties’ premium office portfolio, diverse tenant base, strategic investments, and developments in prime sub-markets, coupled with a solid financial foundation, is expected to fuel its growth trajectory. However, the prevailing hybrid work environment and oversupply in the office real estate domain could exert pressure on its pricing dynamics.
Over the last three months, shares of this Zacks Rank #2 (Buy) firm have climbed 24.3%, outperforming the industry’s 16.7% uptick.
Image Source: Zacks Investment Research
Exploring Other Investment Opportunities
Investors seeking exposure to the REIT sector may also consider Paramount Group PGRE and Lamar Advertising LAMR, both currently holding a Zacks Rank #2.
The Zacks Consensus Estimate for Paramount Group’s 2024 Funds From Operations (FFO) per share has inched up over the past three months to 78 cents.
Similarly, Lamar Advertising’s estimated FFO per share for the current year has been nudged slightly higher over the last month to $8.09.
Kindly note that any earnings references in this context are related to Funds From Operations (FFO), a widely used metric for evaluating REIT performance.
