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Highwoods Properties (HIW) shares rose by 14.5% over the past three months, outperforming the industry’s 5.5% increase. The company focuses on premier office properties in high-growth Sun Belt markets, benefitting from the rising demand for high-quality office spaces amid increasing return-to-office mandates. Analysts have slightly adjusted the Zacks Consensus Estimate for HIW’s 2025 funds from operations (FFO) per share to $3.39.
Highwoods is seeing a recovery in leasing volume due to investments and hiring plans from office occupiers in its markets. Its disciplined capital-recycling strategy led to $3.6 billion in buyouts and $3.0 billion in dispositions from 2010 to 2024, with an additional $150 million expected for acquisitions and disposals in 2025. The company maintains a healthy balance sheet with over $700 million in total available liquidity as of March 31, 2025, and projects over $40 million in incremental annual net operating income from its development pipeline, which is 62.8% pre-leased.
However, Highwoods faces risks from competition and a high debt burden. For investors, similarly-ranked stocks include Digital Realty Trust (DLR) and SBA Communications (SBAC), both currently rated Zacks Rank #2 (Buy).
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