Curbline Properties Corp.'s Q2 2025 Earnings Call: Unraveling Contradictions in Cap Rate Trends and Tariff Impacts

Cap rate trends and acquisition strategy, tariff impact on leasing spreads are the key contradictions discussed in Curbline Properties Corp.'s latest 2025Q2 earnings call.



Acquisition Activity and Growth:
- Curbline Properties Corp. acquired $415 million of properties in Q2 and Q3, with an additional $300 million of debt capital raised or in process.
- The company exceeded its 2025 guidance range of $500 million in acquisitions, reaching over $750 million in assets acquired since its spin-off.
- This growth was driven by increased marketing efforts, proactive engagement with brokers and sellers, and strategic partnerships with sophisticated owners.

Leasing Volume and Success:
- Curbline reported its highest quarterly new leasing volume since tracking began, signing almost 50,000 square feet of new leases in Q2.
- The leasing volume contributed to a company lease rate increase to 96.1%.
- The strong demand was attributed to the economics of the convenience property type and the company's targeted marketing efforts.

Financial Performance and Cash Flow:
- Curbline's NOI increased by over 8% sequentially in Q2, driven by strong base rent, recoveries, and other income.
- The company retained nearly $25 million in cash before distributions, with CapEx as a percentage of NOI at just over 7%.
- This performance was supported by the capital efficiency of the small format asset class and strong tenant renewal rates.

Balance Sheet Strength and Funding:
- As of quarter-end, Curbline maintained a net cash position of almost $430 million and over $1 billion in liquidity.
- The company raised $150 million via a private placement and issued a $150 million new term loan, bringing total expected aggregate proceeds to $300 million.
- This financial strength was critical for acquisitions and contributed to the company's ability to maintain a strong balance sheet.