PS Business Parks, Inc Q2 2010 Earnings Call Transcript
For additional information about risks and uncertainties that could adversely affect PS Business Parks' forward-looking statements, please refer to the reports filed by the company with the Securities and Exchange Commission, including our annual report on Form 10-K and subsequent reports on Form 10-Q and Form 8-K.
We will also provide certain non-GAAP financial measures. Reconciliation to GAAP of these non-GAAP financial measures is included in our press release, which can be found on our website at www.psbusinessparks.com.
Now, I will turn the call over to Joe.
Joe RussellThank you Ed. Good morning and thank you for joining us. I am going to briefly touch on overall second quarter results. I will go then go on a more detail on our recent and year-to-date investment activity. PSB's result for the second quarter are basically a continuation of the path we have been on for several quarters. Same-park occupancy has picked 30 basis points sequentially to 91.7%, primarily due to our ability compete successfully for value oriented customers, seeking simple, well-located functional space. We executed approximately 1.4 million square feet of leasing transactions where cash rents 15.9%, while still [deflecting] high capital requirements as smaller users are not demanding over-standard tenant improvements. The average lease size was 3300 square feet with an average lease term of 3.3 years, which will enable us to re-price these leases in a more favorable environment in the future. Small user vibrancy continues to drive the leasing activity across all of our markets, which again is no different than what we have seen throughout this correction. PSB's bread and butter product continues to be a good fit for the wide range of users that are right sizing their businesses in this challenging economy. Now, I would like to discuss our recent and year-to-date investment activity. Late last week we completed acquisition of Tycon II and III a two building multi-tenant Class B office park in Tyson's Corner in Northern Virginia. This is PSB's first park in the Tyson submarket and we have purchased an underperforming, low occupied asset that is a perfect fit for our operations team to turnaround.
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