Orion Office REIT Inc. reported its financial results for the three and nine months ended September 30, 2024, revealing significant changes in revenue and profitability compared to the previous fiscal period. Total revenues for the third quarter decreased to $39.2 million from $49.1 million in the same period of 2023, primarily due to a decline in rental income, which fell to $39.0 million from $48.9 million. For the nine-month period, total revenues were $126.5 million, down from $151.3 million in 2023. The decrease in rental income was attributed to reduced occupancy levels and property dispositions, with occupancy rates dropping to 74.0% from 80.4% year-over-year.

Despite the revenue decline, Orion reported a net loss of $10.2 million for the third quarter, an improvement from a loss of $16.5 million in the same quarter of 2023. For the nine months ended September 30, 2024, the net loss increased to $70.2 million from $41.1 million in the prior year. The basic and diluted net loss per share for the third quarter was $(0.18), compared to $(0.29) in 2023, indicating a reduction in losses per share.

The company’s total assets decreased to $1.37 billion from $1.42 billion at the end of 2023, while total liabilities rose to $566.5 million from $536.9 million. Stockholders’ equity also declined to $800.9 million from $885.6 million. Orion's real estate investments at cost remained relatively stable, totaling $1.32 billion, with net real estate investments decreasing to $1.14 billion.

Strategically, Orion completed the acquisition of a 97,000 square foot flex/laboratory facility in San Ramon, California, for $34.6 million, fully leased to a single tenant for 15 years. The company also reclassified six properties as non-operating during the reporting period and completed a parcel split in Amherst, New York, resulting in two separate operating properties.

In terms of cash flow, net cash provided by operating activities for the nine months ended September 30, 2024, was $41.8 million, down from $69.6 million in 2023. The company’s cash and cash equivalents decreased to $51.6 million from $100.2 million year-over-year. Orion also reported a significant reduction in proceeds from the settlement of property-related insurance claims, totaling $171.8 million for the nine months ended September 30, 2024, compared to $175.0 million in 2023.

Orion Office REIT continues to navigate a challenging market environment, focusing on managing its portfolio and addressing occupancy challenges while maintaining compliance with its financial covenants.