Corporate Office Properties Trust (NYSE:OFC.PRL) Q4 2016 Earnings Conference Call - Final Transcript
Feb 10, 2017 • 12:00 pm ET
Welcome to the Corporate Office Properties Trust Fourth Quarter and Year-End 2016 Earnings Conference Call. As a reminder, today's call is being recorded.
At this time, I will turn the call over to Stephanie Krewson-Kelly, COPT's Vice President of Investor Relations. Ms. Krewson-Kelly, please go ahead.
Thank you, Juniata. Good afternoon and welcome to COPT's conference call to discuss the company's fourth quarter and full year results for 2016. With me today are Steve Budorick, President and CEO; Paul Adkins, Executive Vice President and COO; and Anthony Mifsud, EVP and CFO. In addition to the supplemental package and press release related to our results, we've posted slides on the Investors section of our website to accompany management's remarks. As management discusses GAAP and non-GAAP measures, you will find a reconciliation of such financial measures in the press release and on our website. At the conclusion of management's remarks, we will open up the call for your questions.
Statements made during this call maybe forward-looking within the meaning of the Safe Harbor of the Private Securities Litigation Reform Act of 1995 and actual results may differ materially due to a variety of risks, uncertainties and other factors. Please refer to today's press release and our SEC filings for a detailed discussion of forward-looking statements.
I will now turn the call over to Steve.
Thank you, Stephanie and good afternoon. We are pleased with our performance in 2016. We executed well on all aspects of our plan and capitalized on the rising demand for space throughout our portfolio.
As highlighted on Slide 4, FFO per share of $0.51 in the fourth quarter and $2.01 for the year were both in line with the midpoints of guidance. We achieved same-office cash NOI growth of 4.1% for the year, slightly exceeding the high-end of our guidance range. We sold $344 million of assets during the year, completed another $14 million in January and based on what's under contract, we expect to close between $39 million and $49 million more this quarter.
With these closings, we will have achieved 90% of our disposition goal. We achieved our deleveraging goal finishing the year with debt-to-EBITDA ratio below 6 times, and we outperformed our development leasing goal of 700,000 square feet last year, executing 843,000 square feet. For the past five years, during a difficult defense spending environment, we have averaged over 900,000 square feet of development leasing annually. In addition to achieving our goals, 2016 was an important year because it marks the completion of three company milestones in the beginning of a new outlook for defense spending.
I'll discuss the changes in the outlook for defense spending first, since defense IT locations now account for 87% of our core business. According to industry experts and prime defense contractors, US defense spending has emerged from its multiyear recession and is gearing up for new growth. For the first time since the Budget Control Act of 2011 was passed, there is bipartisan support in Congress to increase defense