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lexandria Real Estate Equities, the nation's largest life sciences real estate owner, reported a modest second-quarter performance due to a supply glut and dwindling funding for lab tenants. The Pasadena, Calif.-based REIT posted adjusted funds from operations (FFO) of $396.4 million, ahead of the first quarter but below last year's second quarter. FFO per share was $2.33, up from $2.30 in the previous quarter but below $2.36 a year earlier.

    Despite this, Alexandria's operating properties in North America were nearly 91% occupied by the end of the second quarter, with no significant changes from the first quarter. The company also sealed its largest lease ever: a multinational pharmaceutical tenant took 466,598 square feet for 16 years at an Alexandria project in San Diego.

    Alexandria reported liquidity of $4.6 billion and said only 9% of its total debt matures before 2028. The REIT plans to sell off properties that don't fit with its focus on megacampus complexes in key markets, aiming to add $1.1 billion to its executable sales pipeline over the next two quarters.

    Executives downplayed concerns about federal cuts to pharmaceutical and life sciences research funding, saying tenants haven't faced delays in drug approvals or funding issues. They also expect borrowing costs to ease starting this year due to anticipated interest rate reductions from the Federal Reserve.