Federal Realty raises FFO forecast after leasing gains

Federal Realty (FRT) said on Oct. 30 in its quarterly release that third-quarter Nareit FFO rose to $1.87 per diluted share from $1.77 a year earlier. The company also raised its 2026 forecast for the same measure.

Shares were little changed in regular trading as of 9:41 a.m. ET, from a regular-session close of $111.44.

The company owns 102 properties with about 3,700 tenants and 28.8 million commercial square feet, according to its release.

Quarterly results

Here's how the company did:

• Nareit FFO and Core FFO: $1.87 per diluted share vs. $1.77 a year earlier
• Net income available for common shareholders: $0.74 per diluted share vs. $0.69 a year earlier
• Total revenue: $339.02 million vs. $322.25 million a year earlier, against $340.71 million expected, according to Finnhub

Net income available for common shareholders was $64.2 million. Operating income was $116.9 million, up from $110.7 million a year earlier.

Revenue of $339.02 million was in line with the $340.71 million consensus estimate compiled by Finnhub.

"This was a really powerful quarter from a company that uses all the tools in its toolbox to make its portfolio more and more valuable," said Donald C. Wood, President and Chief Executive Officer of Federal Realty.

2026 guidance

The company raised its 2026 Nareit FFO and Core FFO per diluted share guidance to $7.54 to $7.58, from $7.48 to $7.56.

It tightened its 2026 net income per diluted share guidance to $4.23 to $4.27, from $4.22 to $4.30.

Leasing and occupancy

The company signed 117 comparable retail leases for 532,220 square feet in the quarter. Rent growth was 14% on a cash basis and 25% on a straight-line basis.

The overall leased rate reached 96.5% at quarter end, up 40 basis points sequentially. Occupancy was 93.8%, flat from the prior quarter.

Acquisition, financing and buybacks

On Oct. 1 the company acquired The Summit, an approximately 870,000-square-foot open-air property in Birmingham, Alabama, for $508.0 million. Its tenants include Apple, Trader Joe's, RH, Nordstrom Rack, ALO, Sephora and North Italia.

In August the company issued $460.0 million of 3.50% exchangeable senior notes due Aug. 15, 2031, with net proceeds of about $451 million.

The company repurchased 869,748 common shares at a weighted average price of $108.82, for $94.7 million, through Oct. 9.

The board declared a regular quarterly dividend of $1.16 per common share, payable Jan. 15, 2027 to shareholders of record as of Jan. 4, 2027.