Good morning. Thank you for attending today's Franklin Street Properties Corporation. Q3 2022 Earnings Call. My name is Megan, and I'll be your moderator for today's call. All lines will be muted during the presentation portion of the call with an opportunity for questions and answers at the end. If you would like to ask a question, please press star one on your telephone keypad. I would now like to pass the conference over to our host, Scott Carter, General Counsel. Scott, please go ahead.
Good morning and welcome to the Franklin Street Properties third quarter 2022 earnings call. Joining me this morning are George Carter, our Chief Executive Officer, John Demeritt, our Chief Financial Officer, Jeff Carter, our President and Chief Investment Officer, John Donahue, President of FSP Property Management, and Toby Daley, Executive Vice President of FSP Property Management. Please note that various remarks that we may make about future expectations, plans, and prospects for the company may constitute forward-looking statements for purposes of the Safe Harbor Provisions under the Private Securities Litigation Reform Act of 1995.
Actual results may differ materially from those indicated by these forward-looking statements as a result of various important factors, including those discussed in the Risk Factors section of our annual report on Form 10-K for the year ended December 31, 2021, as amended by our quarterly reports on Form 10-Q, which are on file with the SEC. In addition, these forward-looking statements represent the company's expectations only as of today, November 2nd, 2022. While the company may elect to update these forward-looking statements, it specifically disclaims any obligation to do so. Any forward-looking statements should not be relied upon as representing the company's estimates or views as of any date subsequent to today. At times during this call, we may refer to funds from operations or FFO.
Reconciliations of FFO and other non-GAAP financial measures to GAAP net income are contained in yesterday's press release, which is available in the Investor Relations section of our website at www.fspreit.com. Now I'll turn the call over to John DeMeritt. John.
Thank you, Scott, and good morning, everyone. I'm going to give a very brief overview of our third quarter results, and afterward I'll pass the call to George for his comments. As a reminder, our comments today will refer to our earnings release, which Scott just mentioned can be found on our website, and also there is our supplemental package and 10-Q. We reported funds from operations or FFO of about $9 million or $0.09 per share for the third quarter of 2022 and reported GAAP net income of $17.2 million or $0.17 per share for the third quarter. On August 31st, 2022, we sold two office properties located in Broomfield, Colorado, for an aggregate sale price of $102.5 million and achieved a gain of $24.1 million on those sales.
On September 6th, 2022, we prepaid the remaining balance of our $110 million term loan and have no debt maturities at this point until January 2024. Primarily as a result of this debt reduction, our net debt to EBITDA decreased to 6.9x at September 30, 2022, compared to 8.3 x at the end of June 2022. As of September 30, 2022, we had $430 million of debt outstanding, and our debt service coverage ratio was 2.5 x. These calculations are disclosed in our supplemental filing if you'd like to look at them. As of September 30th, we had liquidity of about $181.2 million between availability on our revolver and cash on hand. As a reminder, all of our debt remains unsecured.
With that, I'll turn the call over to George. George.
Thank you, John, and again, welcome to Franklin Street Properties third quarter 2022 earnings call. As the fourth quarter of 2022 begins, we continue to believe that the current price of our common stock does not accurately reflect the value of our underlying real estate assets. Our primary objectives for the balance of the year remain to increase shareholder value through the potential sale of select properties where we believe that short to intermediate term valuation potential has been reached, and to increase occupancy in our continuing portfolio of real estate. During the third quarter, we did sell two properties in Broomfield, Colorado, 380 and 390 Interlocken, for $102.5 million, and as John said, prepaid in full a $110 million term loan.
Our funds from operations or FFO was approximately $9 million or $0.09 per share for the quarter. As 2022 has progressed, we are finding that both debt and equity capital available for potential purchasers of office properties and other commercial real estate has been more and more negatively impacted. We believe that current economic conditions, office market conditions, geopolitical events, and other factors are contributing to this circumstance.
Volatility in the capital markets has created funding uncertainty among potential purchasers of office properties and has generally resulted in longer periods of time to close dispositions. As a result, we are updating our property disposition guidance for full- year 2022 to be in the range of approximately $102.5 million-$200 million in aggregate gross proceeds, compared to our previously estimated range of $200 million-$300 million. While we are not providing disposition guidance for 2023 at this time, we believe that some of the disposition activity that we had anticipated would occur in 2022 will now likely occur in the first quarter of 2023.
We are currently working with identified potential purchasers on new potential dispositions that would result in approximately $180 million in aggregate gross proceeds in addition to the $102.5 million already closed. We will continue to update our disposition guidance quarterly in our earnings releases. Now, I will turn the call over to John Donahue, President of FSP Property Management Corp. John?
Thank you, George. Good morning, everyone. The FSP portfolio was approximately 75.9% leased at the end of the third quarter, compared to 76.3% leased at the end of the second quarter. The decrease was primarily attributable to asset dispositions and lease maturities. Economic occupancy was approximately 72.7% at the end of the third quarter, compared to 72.0% occupied at the end of the second quarter. The increase was largely due to new tenant lease commencements. FSP has finalized approximately 342,000 sq ft of total leasing year to date and approximately 67,000 sq ft during the third quarter of 2022. For the first nine months of the year, FSP has finalized approximately 217,000 sq ft of new tenant leases, which represents 63% of total leasing year to date.
Leasing activity and new tenant demand across the nation for office space cooled and trailed off during the second quarter, and that slowdown continued throughout the third quarter. As the worries of an economic recession have mounted, many companies have shifted to a defensive mode in regards to occupancy decisions. The large majority of demand for the past six months or so has been small to mid-size requirements, and particularly in professional and business services. FSP is currently tracking approximately 400,000 sq ft of new prospective tenants, including approximately 200,000 sq ft of prospects that have identified FSP assets on the respective shortlists. In addition, FSP has roughly 300,000 sq ft of large new tenant prospects that have appeared to hit the pause button due to postponement or reevaluation of occupancy decisions and needs.
Lease expirations for the remainder of calendar 2022 total approximately 53,000 sq ft, representing 0.8% of FSP's portfolio. In addition, there are approximately 443,000 sq ft or 6.9% of FSP's portfolio expiring in 2023. However, FSP has upcoming lease commencements in the near future of approximately 187,000 sq ft, representing 2.9% of FSP's portfolio. The majority of which are expected to produce FFO in late 2022 or early 2023. Thank you. I will now turn it over to Jeff Carter.
Thank you, John. Good morning, everyone. We hope that everyone remains safe and healthy. FSP continues working to unlock value for our shareholders that we believe is not being accurately reflected in our current public share price. We continue our efforts to achieve positive results, primarily through the sale of select properties in the private marketplace that we judge to have met their near to intermediate term potential, and also through efforts to lease our vacant space and renew existing tenant customers. To date, FSP has and will continue to utilize sales proceeds principally to reduce indebtedness. More specifically, since December of 2020, when our recent disposition efforts began, FSP has reduced corporate indebtedness by approximately $600 million or approximately 58%.
In recent months, growing economic uncertainty and geopolitical risks have been making headlines, which when combined with rising interest rates, have added stress to the commercial office real estate landscape. Within this environment, FSP and our national brokerage partners are generally still experiencing interest, albeit at a reduced level, in the acquisition of high-quality , well-located office properties. However, there has been a decline nationally in both the ability and amount of time it is taking for investors to procure both debt and equity capital to facilitate potential purchases, which has elongated closing time frames. As mentioned, on the disposition front, FSP announced on August 31st the sale of 380 and 390 Interlocken in Greater Denver for $102.5 million in total gross sales proceeds, which resulted in a gain of approximately $24 million.
While we are unable to disclose specific property sales metrics, when looking at all of our disposition efforts to unlock value that began in December of 2020 and have totaled approximately $800 million in gross proceeds, we have achieved an aggregate weighted average in place cap rate of approximately 5.8% on both a cash and a GAAP basis. FSP continues to source prospective buyers for our targeted dispositions, which currently includes our working with specific prospective buyers on approximately $180 million in additional potential sales. Given current market conditions, however, we recognize that if successful, some of these prospective dispositions may spill into the first quarter of 2023.
With this in mind, and as mentioned, FSP updated our property disposition guidance for full year 2022 to be in the range of $102.5 million-$200 million in aggregate gross sales proceeds. With that, we thank you for listening to our earnings conference call today. Now at this time we'd like to open up the call for any questions. Megan?
Thank you. There are no questions waiting at this time, so I'll pass the conference back over to George Carter for closing remarks. I do apologize.
Thank you, Megan. Thank you everyone for tuning in to our call, and look forward to speaking with you all next quarter.
That concludes the Franklin Street Properties Corp. Q3 2022 earnings call. Thank you for your participation. You may now disconnect your line.