Paul McDowell, president & CEO of Orion Office REIT Inc. (NYSE: ONL), sat down for a video interview at Nareit’s REITweek: 2024 Investor Conference, held in New York from June 3-6. He discussed the company's strategic initiatives and growth prospects, highlighting the efforts to stabilize and prepare for future opportunities.
McDowell noted that the office market has faced an "historic meltdown in demand" since the REIT’s spinoff in 2020, leading Orion to rationalize its portfolio by selling non-performing assets and leasing others. Over the past few years, Orion has recycled significant capital, paving the way for potential acquisitions in the latter half of the year.
"We're starting to see some opportunities potentially for acquisition, good pricing with good assets, with long duration leases," he said, noting this will position the company to capitalize on favorable market conditions as they arise.
McDowell expressed excitement about the progress made in strengthening Orion's financial foundation.
"I think what the market doesn't understand with respect to Orion is how much work we've really done. We've sold more than 20 assets and repaid a lot of debt," he said.
Addressing the macro environment, McDowell likened the current office market to a "nuclear winter," acknowledging its unprecedented challenges. He outlined Orion's proactive measures, including selling vacant properties unlikely to be leased and maintaining low leverage with a debt-to-EBITDA ratio of four times.