Breaking Down First Industrial Realty Trust, Inc. (FR) Financial Health: Key Insights for Investors

You're looking at First Industrial Realty Trust, Inc. (FR) and wondering if the logistics real estate boom still has legs, especially with the mixed signals from their recent reports. Honestly, the core business is defintely strong, but you need to look past the top-line revenue miss of $181.43 million in the third quarter of 2025. The real story is the pricing power: they delivered a full-year 2025 Same Store Net Operating Income (SS NOI) growth guidance of 7.0% to 7.5%, driven by cash rental rate increases averaging around 32% on new and renewal leases signed this year. That's massive. Still, the in-service occupancy dipped slightly to 94.0% by the end of Q3, a small but important crack in the foundation, which is why the analyst consensus sits at a 'Hold' with an average price target of $57.00. We need to figure out if that $2.94 to $2.98 per share Funds From Operations (FFO) guidance for 2025 is the floor or the ceiling, and what actions you should take right now to position your portfolio.

Revenue Analysis

You want to know where the money is coming from at First Industrial Realty Trust, Inc. (FR) and if that engine is still firing. The short answer is yes, the core business is incredibly strong: virtually all revenue is generated from leasing, and that income stream is growing at a healthy clip, driven by massive rental rate increases.

The company's total annual revenue for the fiscal year 2025 is projected to be around $714.26 million, based on trailing twelve months (TTM) data through the third quarter. This figure represents a robust year-over-year revenue growth rate of approximately 9.66%. That's a solid performance, especially when you consider the shifting economic landscape.

Primary Revenue Streams: The Lease Engine

As a logistics Real Estate Investment Trust (REIT), First Industrial Realty Trust, Inc.'s revenue is overwhelmingly concentrated in one area: Lease Revenue. This is the rent collected from the 415 industrial properties it owns across 19 states.

Here's the quick math on the core business strength:

• In the second quarter of 2025 (Q2 2025), total revenue was $180.2 million.
• Lease revenue for that same quarter was $177.5 million, a 9.5% increase over Q2 2024.
• This means Lease Revenue constitutes approximately 98.5% of the company's quarterly top line.

Other income streams, like gains from the sale of real estate, are negligible by comparison and are volatile. For instance, gains from property sales dropped sharply to only $8.0 million in the first half of 2025 (H1 2025), down from $36.9 million in H1 2024. Their primary business is collecting rent, not flipping assets.

Growth Drivers and Segment Contribution

The true story of revenue growth is in the details of their leasing activity, specifically the jump in rental rates. This is the key metric showing the value of their logistics real estate portfolio.

The company achieved an average cash rental rate increase of approximately 32% on leases signed to-date commencing in 2025. This is phenomenal rent growth, and it's what drives the 7.0% to 7.5% expected cash same-store Net Operating Income (SS NOI) growth for the full year 2025. SS NOI (Same-Store Net Operating Income) is the best way to measure a REIT's operating performance, as it tracks income from properties owned for the entire period.

The growth is geographically concentrated in high-demand logistics markets. While a formal regional revenue breakdown isn't public, the leasing activity highlights the key drivers:

• Phoenix: A major development leasing win was the remaining 501,000 square feet at Building C at the Camelback 303 Joint Venture (JV).
• South Florida: Key new leases were signed at First Park Miami Building 3 and Building 12.
• Inland Empire: Significant leasing activity occurred at First Harley Knox Logistics Center.

These are the hot spots where e-commerce and supply chain demand are translating directly into higher rents and new development opportunities. If you want to dig deeper into who is driving this demand, you should read Exploring First Industrial Realty Trust, Inc. (FR) Investor Profile: Who's Buying and Why?

The revenue picture is clear: this is a high-growth leasing story, defintely not a development or asset-sale story.

Profitability Metrics

You need to know if First Industrial Realty Trust, Inc. (FR) is turning its strong logistics real estate demand into hard profit, and the answer is yes, but with a clear margin trend to watch. The company's profitability is robust, especially on an operational level, but the recent net profit margin contraction signals rising costs or non-operating factors that are eating into the bottom line.

For the trailing twelve months (TTM) ending September 30, 2025, First Industrial Realty Trust's revenue was approximately $0.714 billion. This top-line strength is a direct result of their operational efficiency, specifically their ability to push rents. They achieved a cash rental rate increase of roughly 32% on leases signed to-date commencing in 2025. That's a huge jump in pricing power.

Gross Profit, Operating Profit, and Net Profit Margins

When analyzing a Real Estate Investment Trust (REIT), Net Operating Income (NOI) is the best proxy for Gross Profit, as it measures property revenue minus property operating expenses. While the full-year NOI dollar amount for 2025 isn't finalized, the Breaking Down First Industrial Realty Trust, Inc. (FR) Financial Health: Key Insights for Investors is clear on the operational health: cash same-store NOI (SS NOI) growth is projected to be between 7.0% and 7.5% for the full year 2025, a strong indicator of core property performance. The midpoint of that range is a 7.25% growth rate.

The company's Net Profit Margin is the metric that has seen the most change. The recent net profit margin was approximately 33.2%, which implies a TTM Net Income of about $236.9 million (Here's the quick math: $714M Revenue 33.2% Margin). What this estimate hides is the margin compression: this 33.2% is a notable step down from the 47% margin reported last year. This margin drop is the key risk to monitor.

• Net Profit Margin: 33.2% (Q3 2025/Recent)
• SS NOI Growth: 7.25% (2025 Midpoint Guidance)
• General & Administrative (G&A) Expense: $40.5 million to $41.5 million (2025 Guidance)

Comparison with Industry Averages

First Industrial Realty Trust's operational efficiency is defintely a sector leader. The average operating margin for the broader REIT sector is around 29.13% (TTM). While a direct Industrial REIT operating margin comparison is difficult, the strong SS NOI growth of 7.25% for First Industrial Realty Trust compares favorably to the 8.0% FFO growth seen across the entire Industrial REIT sector in Q3 2025. Their performance is right in the top tier of the logistics space.

The company's full-year 2025 Funds From Operations (FFO), a crucial measure of cash flow for REITs, is guided to be between $2.94 and $2.98 per share/unit, with a midpoint of $2.96 per share. This projected FFO growth is solid, suggesting that while GAAP net income is pressured, the core cash generating ability of the properties remains very strong.

Analysis of Operational Efficiency

The operational story is one of high-octane execution. The massive cash rental rate increase of 32% on new leases is a clear sign that First Industrial Realty Trust is capturing the value of its high-quality logistics portfolio in supply-constrained markets. This is the lifeblood of their growth.

Cost management, however, is a nuanced area. General and administrative (G&A) expenses are projected to be between $40.5 million and $41.5 million for 2025. This is a manageable expense given the scale of their revenue, but the narrowing Net Profit Margin from 47% to 33.2% suggests that higher interest costs, depreciation, or other non-property expenses are the primary cause of the compression. This is a common challenge for REITs in a high-rate environment, but it's something you need to factor into your total return expectations.

Debt vs. Equity Structure

You're looking at First Industrial Realty Trust, Inc. (FR) to understand how they fund their growth, and the quick takeaway is that their capital structure is defintely conservative for an industrial real estate investment trust (REIT). They lean more toward equity financing than debt compared to their peers, which is a sign of financial discipline in a rising rate environment.

As of the 2025 fiscal year, First Industrial Realty Trust, Inc.'s total debt is approximately $2.4 billion against a total shareholder equity of roughly $2.7 billion. This translates to a Debt-to-Equity (D/E) ratio of about 0.88, or 87.7%, which is a key measure of financial leverage. This ratio is comfortably below the Industrial REIT industry average, which currently sits around 0.98 as of November 2025. That lower leverage gives them a substantial buffer against economic downturns and interest rate volatility.

Here's the quick math: a ratio below 1.0 means the company is funding more of its assets with shareholder equity than with debt. It's a strong position to be in.

The company has been active in capital markets to manage its debt profile and fund its logistics property pipeline. In the second quarter of 2025, First Industrial Realty Trust, Inc. completed its first public bond offering since 2007, issuing $450 million of senior unsecured notes. These notes carry a fixed interest rate of 5.25% and mature in January 2031, effectively locking in a long-term cost of capital. This strategic move was immediately preceded by a strong vote of confidence from a major ratings agency.

• Issued $450 million in 5.25% senior unsecured notes (May 2025).
• Fitch Ratings upgraded senior unsecured debt to 'BBB+' (May 2025).

This upgrade to 'BBB+' from Fitch Ratings in May 2025 is crucial because it lowers their future borrowing costs and signals a high-quality credit profile. They are balancing debt and equity funding by using accretive debt for acquisitions and development-like the new notes-while also managing interest rate risk on existing loans. For example, in the third quarter of 2025, First Industrial Realty Trust, Inc. entered into forward-starting interest rate swaps to fix the all-in rate on a $150 million term loan at 4.13% and a $200 million term loan at 4.10%, mitigating exposure to short-term rate hikes. This blend of fixed-rate, long-term debt and managed floating-rate exposure shows a sophisticated capital allocation strategy. You can see more about who is investing in this strategy here: Exploring First Industrial Realty Trust, Inc. (FR) Investor Profile: Who's Buying and Why?

Liquidity and Solvency

You need to know if First Industrial Realty Trust, Inc. (FR) can cover its near-term obligations, and the quick answer is yes, but with a nuance common to Real Estate Investment Trusts (REITs). The company's liquidity position is tight on paper, but its strong operating cash flow and access to capital markets provide a solid backstop.

Assessing First Industrial Realty Trust, Inc.'s Liquidity

When we look at the core liquidity ratios-the Current Ratio and the Quick Ratio-First Industrial Realty Trust, Inc. (FR) shows figures that would be a red flag for a typical manufacturing company, but are normal for an industrial REIT. As of the latest trailing twelve months (TTM) data in late 2025, the company's Current Ratio sits at about 0.91, and the Quick Ratio is essentially the same at 0.91.

Here's the quick math on what that means:

• A ratio below 1.0 means current liabilities slightly exceed current assets. For example, using Q3 2025 figures, current assets of approximately $229.5 million are slightly less than current liabilities of around $243.0 million.
• The Quick Ratio is nearly identical because industrial REITs like First Industrial Realty Trust, Inc. hold very little inventory, so almost all current assets are already near-cash (cash, receivables, etc.).

This negative working capital (Current Assets minus Current Liabilities) of about -$13.5 million is defintely a tight squeeze, but it's a non-issue as long as the cash flow engine is running strong. Real estate assets are long-term, so you expect short-term debt to be higher.

Cash Flow Statements Overview and Trends

The real story for any REIT is in the cash flow, not the balance sheet ratios. First Industrial Realty Trust, Inc.'s cash flow from operations (CFO) is robust, which is what you want to see. For the first quarter of 2025 alone, the company generated approximately $88.6 million in net cash from continuing operating activities, indicating a steady stream of rental income.

The other two cash flow components reflect the company's growth strategy:

The substantial negative cash flow from investing is a healthy sign of growth, reflecting management's focus on new developments and acquisitions, like the estimated $96 million investment for two new starts in late 2024. This commitment to portfolio expansion is key to future rent growth.

Liquidity Strengths and Near-Term Risks

The primary strength for First Industrial Realty Trust, Inc. is its access to capital. Even with the tight current ratio, the company is not struggling to fund its operations or growth. In Q2 2025, the company successfully issued $450 million of 5.25% Senior Unsecured Notes, demonstrating strong market confidence. Plus, as of Q1 2025, they had $395.5 million available under their Unsecured Credit Facility, which acts as a ready source of liquidity. You can review the strategic priorities that drive this capital allocation in the Mission Statement, Vision, & Core Values of First Industrial Realty Trust, Inc. (FR).

The main near-term risk remains the debt load, with total liabilities reaching about $2.7 billion in Q1 2025. While the industrial real estate market is strong-evidenced by the 32% cash rental rate increase on leases signed to-date commencing in 2025-any significant rise in interest rates or a softening in tenant demand could pressure the debt service coverage. Still, the company's ability to generate cash and tap the bond market mitigates much of that risk.

Valuation Analysis

You're looking for a clear read on whether First Industrial Realty Trust, Inc. (FR) is priced fairly, and the short answer is that the market currently sees it as largely priced-in, leaning toward a slight premium. The consensus from 13 analysts is a Hold rating, with an average 12-month price target of $56.75.

As a seasoned analyst, I look at three core multiples-Price-to-Earnings (P/E), Price-to-Book (P/B), and Enterprise Value-to-EBITDA (EV/EBITDA)-to gauge valuation against the market and its industrial real estate peers. The data for the 2025 fiscal year suggests First Industrial Realty Trust is trading at a premium, which is common for a high-quality logistics real estate investment trust (REIT) with strong rental growth.

Key Valuation Multiples (2025 Fiscal Year)

First Industrial Realty Trust's valuation metrics are defintely worth a closer look. Here's the quick math on where the stock stands against its earnings, assets, and cash flow.

• Price-to-Earnings (P/E): The trailing P/E ratio sits at about 31.3. This is high, reflecting investor confidence in future earnings growth, but it's important to compare this to the industry median, which is also elevated.
• Price-to-Book (P/B): The P/B ratio is approximately 2.8. This multiple tells you the stock is trading at nearly three times its book value, indicating that the market values the company's real estate assets and brand power well above their historical cost.
• EV/EBITDA: The Enterprise Value-to-EBITDA (a measure of a company's total value relative to its operating cash flow) is 18.7. For a capital-intensive business like a REIT, this is a more precise metric than P/E, and this level suggests a healthy valuation given the stability of logistics income.

Stock Performance and Dividend Health

Over the last 12 months, the stock has shown a modest increase of 4.80%, which is a solid, steady return in a volatile market. The 52-week trading range of $40.31 to $58.17 shows the stock is currently trading near the high end, closing recently around $55.28 as of November 2025.

For income-focused investors, the dividend picture is clear: the annualized dividend is $1.78 per share, translating to a dividend yield of approximately 3.2%. The dividend payout ratio is high, at nearly 99.44%. This is typical for a REIT, as they are legally required to distribute most of their taxable income, but it leaves little room for error in cash flow. Still, the company's 2025 NAREIT Funds From Operations (FFO) guidance was recently raised to a range of $2.94 to $2.98 per share/unit, which is the key metric for a REIT's ability to cover its dividend.

If you want a deeper dive into the operational metrics that drive this valuation, especially the strong cash rental rate increases, you should read the full post: Breaking Down First Industrial Realty Trust, Inc. (FR) Financial Health: Key Insights for Investors.

Next Step: Review the FFO-to-Dividend coverage ratio using the $2.94 to $2.98 guidance against the $1.78 annual dividend to confirm the safety margin for the payout.

Risk Factors

You need to know that while First Industrial Realty Trust, Inc. (FR) is riding a strong industrial real estate wave, the near-term landscape has clear headwinds. The biggest risk is a sudden softening of tenant demand or an oversupply of new space, which would immediately pressure their exceptional rent growth.

The company's strength is in its portfolio, but external market conditions and internal financial factors still create risk. For instance, the company's full-year 2025 guidance for NAREIT Funds From Operations (FFO) is strong, projected between $2.94 and $2.98 per share/unit. Still, that growth is vulnerable to a few key factors you need to watch.

External and Industry Risks

The industrial sector's biggest threat is a normalization of supply. If new construction outpaces demand from e-commerce and logistics companies, the market could flip, and rent growth would stall. Right now, First Industrial Realty Trust is benefiting from a cash rental rate increase of roughly 32% on leases signed to-date commencing in 2025, but that number is the first thing to drop in a downturn. Also, the macroeconomic environment presents two specific challenges:

• Interest Rate and Financing Changes: The availability and cost of capital is crucial for a real estate investment trust (REIT). Changes in interest rates directly impact the attractiveness of financing for new developments and acquisitions.
• Tariff and Trade Policy Uncertainty: The CEO has specifically mentioned that 'clarity on tariffs' is needed, as this uncertainty causes prospective tenants to delay long-term space decisions, which slows down leasing.

You can't control the Federal Reserve or trade policy. That's the simple truth.

Operational and Financial Risks

Operationally, the key risk is a dip in occupancy. The in-service occupancy stood at 94.0% at the end of the third quarter of 2025, a slight decrease from the prior quarter. A continued decline means less revenue and less pricing power on renewals. Also, while the company's debt-to-equity ratio is manageable at 0.88, their dividend payout ratio is something to keep an eye on, sitting near 99.4%. That high payout ratio means almost all net income is distributed, leaving very little retained earnings to buffer against a significant, unexpected operational or financial shock.

Here's the quick math on their expense load for the year: General and Administrative (G&A) expenses are projected to be between $40.5 million and $41.5 million for the full 2025 fiscal year. Any unexpected spike in these non-property-related costs would eat directly into the bottom line.

Mitigation Strategies and Clear Actions

First Industrial Realty Trust is defintely not sitting still. Their primary mitigation strategy is a focus on high-barrier-to-entry, high-growth markets like South Florida, Philadelphia, and Dallas. This geographic focus helps insulate them from oversupply in secondary markets. They are also actively managing their debt profile, which is smart in a high-rate environment. In July 2025, the company issued $450 million of 5.25% Senior Unsecured Notes due in January 2031, which locks in a fixed rate for a significant portion of their debt, reducing interest rate risk.

The development pipeline is their growth engine, and they are converting it: they signed 772,000 square feet of new leases for development projects in the third quarter and fourth quarter to-date. This aggressive leasing is the best defense against a rising vacancy rate. You can dive deeper into who is investing in the company and why by Exploring First Industrial Realty Trust, Inc. (FR) Investor Profile: Who's Buying and Why?

Growth Opportunities

You're looking for the clear path forward for First Industrial Realty Trust, Inc. (FR), and the answer is simple: it's all about development and premium rent growth in key logistics markets. The company is defintely positioned to capitalize on the ongoing e-commerce and supply chain shifts, which continue to drive demand for high-quality, well-located industrial space. This isn't just a hunch; the 2025 numbers show it.

The core of their strategy is to build new, modern facilities in supply-constrained, coastally oriented markets-they focus on just 15 target MSAs (Metropolitan Statistical Areas). This focus is why they're seeing such exceptional rental rate increases. For example, on leases signed to-date commencing in 2025, the cash rental rate increase is approximately 32%. That's a massive spread over older, in-place rents, and it's a direct result of their strategic market selection.

Here's the quick math on the near-term financial outlook for the 2025 fiscal year:

The company's own updated NAREIT Funds From Operations (FFO) guidance, which is the primary earnings measure for a Real Estate Investment Trust (REIT), was raised to a midpoint of $2.96 per share/unit. This upward revision is primarily due to their development leasing successes and lower interest expense, showing management is confident in near-term performance.

Strategic Initiatives Driving Value

First Industrial Realty Trust, Inc.'s growth isn't passive; it's driven by concrete, capital-intensive actions. Their development pipeline is a major catalyst. They signed 772,000 square feet of new leases for development projects in the third and early fourth quarter of 2025 alone.

• Product Innovation: New developments, like the planned starts in Dallas and Philadelphia totaling 402,000 square feet, are estimated to cost $54 million and yield a combined cash return of 8%. That's a strong return on investment.
• Financial Flexibility: To fund this growth, they renewed and upsized their unsecured revolving credit facility to $850 million. This gives them the dry powder to execute on new opportunities quickly.
• Credit Strength: Fitch upgraded their credit rating to 'BBB+'. This lowers their borrowing costs, which directly boosts the bottom line.

What this estimate hides, of course, is the risk from tenant demand softening or a sudden surge of new supply, which could pressure rent growth. Still, the company's focus on high-barrier-to-entry markets provides a good cushion against a broader market slowdown.

Competitive Edge in Logistics

Their competitive advantage is rooted in two things: location and pricing power. The company is a leading U.S.-only owner, operator, and developer of logistics properties. By concentrating on major distribution hubs and infill locations, they are essential to their tenants' supply chains.

This market position translates directly into pricing power, which is the ultimate competitive moat. They achieved a 31% cash rental rate increase on leases signed to-date commencing in 2026. This is a forward-looking indicator that suggests strong cash flow growth will continue well beyond the current fiscal year. You can find a more detailed analysis on this topic at Breaking Down First Industrial Realty Trust, Inc. (FR) Financial Health: Key Insights for Investors.

Finance: Monitor the ratio of development pipeline square footage to total portfolio size to gauge the pace of organic growth.