HIW earnings analysis
What we found in HIW's 10-Q: the parts that mattered, the offsets in the same document, and what the company said about what comes next.
Our reading of the filing · Free to read, no account needed
Highwoods delivered improving underlying office operations in the second quarter: rental and other revenue increased 7.9%, same-property NOI increased 1.4%, and occupancy reached 85.7%. GAAP EPS rose to $0.85, although the $79.0 million gain on dispositions was the principal driver, while recurring FFO per share increased only $0.01 to $0.90. Liquidity is strong, but expense growth, higher interest costs, and execution on planned dispositions and capital deployment remain key watch items.
The parts that mattered.
Pulled out of the filing itself, with the figures the company reported.
- Revenue rose 7.9% on acquisitions and leasing
- Second-quarter rental and other revenues rose $15.8 million, or 7.9% year over year, led by $15.6 million from acquisitions in Raleigh, Charlotte and Dallas, $5.4 million of same-property revenue growth, and $1.2 million from Raleigh developments; dispositions reduced revenue by $6.4 million.
- GAAP EPS jump was gain-driven
- Diluted GAAP EPS increased $0.68 year over year to $0.85. The improvement was materially aided by $79.0 million of gains on dispositions during the quarter, while FFO per share improved more modestly to $0.90 from $0.89.
- Same-property NOI and occupancy improved
- Consolidated same-property NOI increased $1.8 million, or 1.4%, as a $5.4 million increase in same-property revenue exceeded a $3.7 million rise in same-property expenses. Office occupancy improved to 85.7% at June 30, 2026 from 85.3% at December 31, 2025.
- Leasing spreads remained strongly positive
- Second-generation leases signed in the quarter totaled 1,026,262 square feet at annual GAAP rents of $40.97 per square foot, 20.9% above prior leases in the same spaces.
- Operating cash flow strengthened
- Six-month operating cash flow rose $25.2 million year over year to $188.1 million. Cash used for investing was $101.7 million, reflecting acquired real estate, tenant improvements/deferred leasing costs, and joint-venture investments; filing-defined free cash flow was not disclosed.
- Liquidity remains ample and debt edged down
- Liquidity was substantial, with $145.4 million of cash at June 30 and $749.9 million of unused revolver capacity; no revolver borrowings were outstanding as of July 21, 2026. Net debt declined to $3.516 billion from $3.554 billion at December 31, 2025.
And the other side of it.
The offsets in the same document — the things a summary that only listed the good news would have left out.
- Operating-expense growth exceeded revenue growth
- Property-level expense growth outpaced revenue growth: second-quarter rental property and other expenses rose $6.5 million, or 10.2%, versus a 7.9% increase in rental and other revenue. Management cited higher utilities, repairs and maintenance, and contract services.
- Higher interest burden and 2027 refinancing need
- Interest expense increased $4.0 million, or 10.7%, year over year in the quarter because of higher average debt balances and lower capitalized interest. The company has $350.0 million of floating-rate debt and $289.1 million of unsecured notes maturing in March 2027.
- Non-core disposition execution risk
- The filing adds a transaction-specific forward-looking risk: closing of $73.5 million of planned non-core building dispositions before August 15, 2026 may not occur on the stated terms or at all. Management also expects $100 million to $250 million of further asset sales during 2026, without assurance of timing or terms.
What they reported.
What the company itself reported, taken out of the document.
- Earnings per share
- $0.85
What they said about what is next.
No revenue or EPS guidance was included in the 10-Q. Management expects office-portfolio average occupancy of 86.0% to 87.0% for the remainder of 2026; it also expects $100 million to $250 million of additional non-core property sales, up to $400 million of development starts, and up to $250 million of acquisitions during the remainder of 2026.
The filing reads better than the one before it.
What came before.
- 10-Q · April 28, 2026
- Highwoods reports quarter-over-quarter operating momentum driven by acquisitions and leasing: rental and other revenues rose by $13.7 million (6.8%) in Q1 2026 versus Q1 2025, and consolidated NOI increased by $7.6…
This is our reading of a public filing, not the filing. Read the original on SEC.gov · Educational only. Nothing here is investment advice.
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