Federal Realty Investment Trust Reports Third Quarter 2025 Results

Oct 31 2025 11:30 BST

NORTH BETHESDA, Md. , Oct. 31, 2025 /PRNewswire/ -- Federal Realty Investment Trust (NYSE:FRT) today reported its results for the third quarter ended September 30, 2025. For the three months ended September 30, 2025 and 2024, net income available for common shareholders was $0.69 per diluted share and $0.70 per diluted share, respectively. Operating income for the same periods was $110.7 million and $105.8 million, respectively.

Highlights for the third quarter and subsequent to quarter-end include:

Generated NAREIT funds from operations available to common shareholders (FFO) per diluted share of $1.77 for the quarter, compared to $1.71 for the third quarter of 2024, an increase of 3.5%.
Achieved an all-time record leasing volume of 727,029 square feet of comparable retail space over 123 leases with rent growth of:
- 28% on a cash basis
- 43% on a straight-line basis
Generated comparable property operating income (POI) growth of 4.4%, excluding lease termination fees and prior period rents collected.
Reported comparable portfolio occupancy of 94.0% and a leased rate of 95.7% at quarter end, with:
- Occupancy up 40 basis points and leased rate up 10 basis points quarter-over-quarter
- Occupancy up 20 basis points and leased rate down 10 basis points year-over-year
Continued strong small shop leased rate, ending the quarter at 93.3% leased representing an increase of 20 basis points year-over-year.
Subsequent to quarter end, announced the acquisition of Annapolis Town Center in Annapolis, Maryland totaling 479,000 square feet for a purchase price of $187 million.
Ended the quarter with approximately $1.3 billion in total liquidity.
Updated guidance for 2025 earnings per diluted share to $3.93 - $3.99.
Raised guidance for 2025 FFO per diluted share to $7.05 - $7.11, which excludes $0.15 of one-time new market tax credit ("NMTC") transaction income that occurred in the second quarter, representing 4.6% growth at the midpoint year-over-year.

"Our third quarter performance reflects the strength of our portfolio and the discipline of our strategy," said Donald C. Wood, Chief Executive Officer of Federal Realty. "Record leasing volume and some of the strongest rent spreads in our history underscore the demand for our properties and the power of our platform. We're driving NOI growth and maintaining sharp focus on disciplined capital allocation that drives compounding growth over time."

Financial Results

Net Income

For the third quarter 2025, net income available for common shareholders was $59.6 million and earnings per diluted share was $0.69 versus $58.9 million and $0.70, respectively, for the third quarter 2024.

FFO

For the third quarter 2025, FFO was $153.0 million, or $1.77 per diluted share. This compares to $144.6 million, or $1.71 per diluted share for the third quarter 2024.

FFO is a non-GAAP supplemental earnings measure which the Trust considers meaningful in measuring its operating performance. A reconciliation of FFO to net income is attached to this press release.

Operational Update

Occupancy

The following operational metrics for the commercial portfolio are as of September 30, 2025:

The comparable portfolio occupancy was 94.0%, up 40 basis points sequentially and up 20 basis points year-over-year.
Comparable portfolio leased rate was 95.7%, up 10 basis points sequentially and down 10 basis points year-over-year.
Small shop leased rate was 93.3%, down 10 basis points sequentially and up 20 basis points year-over-year.

The residential leased rate was 96.0% as of September 30, 2025.

Leasing Activity

During the third quarter 2025, Federal Realty signed 132 leases totaling 774,890 square feet of retail space. On a comparable space basis, the company signed 123 leases for 727,029 square feet at an average rent of $35.71 per square foot, compared to $27.85 under prior leases, representing a 28% increase on a cash basis and 43% increase on a straight-line basis.

Transaction Activity

October 10, 2025 – acquired Annapolis Town Center, a premier open-air retail center in Annapolis, MD totaling approximately 479,000 square feet, for $187 million.
July 1, 2025 – acquired Town Center Crossing and Town Center Plaza, two dominant open-air retail centers in Leawood, KS totaling approximately 552,000 square feet, for $289 million.

Regular Quarterly Dividends

Federal Realty announced today that its Board of Trustees declared a regular quarterly cash dividend of $1.13 per common share, resulting in an indicated annual rate of $4.52 per common share. The regular common dividend will be payable on January 15, 2026 to common shareholders of record as of January 2, 2026.

Federal Realty's Board of Trustees also declared a quarterly cash dividend on its Class C depositary shares, each representing 1/1000 of a 5.000% Series C Cumulative Preferred Share of Beneficial Interest, of $0.3125 per depositary share. All dividends on the depositary shares will be payable on January 15, 2026 to shareholders of record as of January 2, 2026.

2025 Guidance

Federal Realty has tightened its 2025 earnings per diluted share guidance and raised and tightened its 2025 FFO guidance, as summarized in the table below:

Full Year 2025 Guidance	Revised Guidance	Prior Guidance
2025 Earnings per diluted share	$3.93 to $3.99	$3.91 to $4.01
2025 FFO per diluted share	$7.20 to $7.26	$7.16 to $7.26
2025 FFO per diluted share, excluding NMTC transaction income¹	$7.05 to $7.11	$7.01 to $7.11

1.	See further discussion of NMTC transaction income in Form 10-Q filed with the Securities and Exchange Commission on August 6, 2025.

Conference Call Information

Federal Realty's management team will present an in-depth discussion of Federal Realty's operating performance on its third quarter 2025 earnings conference call, which is scheduled for Friday, October 31, 2025 at 9:00 AM ET. To participate, please call 833-821-4548 or 412-652-1258 prior to the call start time. The teleconference can also be accessed via a live webcast at www.federalrealty.com in the Investors section. A replay of the webcast will be available on Federal Realty's website at www.federalrealty.com. A telephonic replay of the conference call will also be available through November 14, 2025 by dialing 844-512-2921 or 412-317-6671; Passcode: 10203351.

About Federal Realty

Federal Realty is a recognized leader in the ownership, operation and redevelopment of high-quality retail-based properties located primarily in major coastal markets and select underserved regions with strong economic and demographic fundamentals. Founded in 1962, Federal Realty's mission is to deliver long-term, sustainable growth through investing in communities where retail demand exceeds supply. This includes a portfolio of open-air shopping centers and mixed-use destinations—such as Santana Row, Pike & Rose and Assembly Row—which together reflect the company's ability to create distinctive, high-performing environments that serve as vibrant destinations for their communities. Federal Realty's 103 properties include approximately 3,600 tenants in 27.9 million commercial square feet, and approximately 3,000 residential units.

Federal Realty has increased its quarterly dividends to its shareholders for 58 consecutive years, the longest record in the REIT industry. The company is an S&P 500 index member and its shares are traded on the NYSE under the symbol FRT. For additional information about Federal Realty and its properties, visit www.federalrealty.com.

Safe Harbor Language

Certain matters discussed within this Press Release may be deemed to be forward-looking statements within the meaning of the federal securities laws. Although Federal Realty believes the expectations reflected in the forward-looking statements are based on reasonable assumptions, it can give no assurance that its expectations will be attained. These factors include, but are not limited to, the risk factors described in our Annual Report on Form 10-K filed on February 13, 2025 and include the following:

risks that our tenants will not pay rent, may vacate early or may file for bankruptcy or that we may be unable to renew leases or re-let space at favorable rents as leases expire or to fill existing vacancy;
risks that we may not be able to proceed with or obtain necessary approvals for any development, redevelopment or renovation project, and that completion of anticipated or ongoing property development, redevelopment or renovation projects that we do pursue may cost more, take more time to complete or fail to perform as expected;
risks normally associated with the real estate industry, including risks that occupancy levels at our properties and the amount of rent that we receive from our properties may be lower than expected, that new acquisitions may fail to perform as expected, that competition for acquisitions could result in increased prices for acquisitions, that costs associated with the periodic maintenance and repair or renovation of space, insurance and other operations may increase, that environmental issues may develop at our properties and result in unanticipated costs, and, because real estate is illiquid, that we may not be able to sell properties when appropriate;
risks that our growth will be limited if we cannot obtain additional capital, or if the costs of capital we obtain are significantly higher than historical levels;
risks associated with general economic conditions, including inflation, tariffs, and local economic conditions in our geographic markets;
risks of financing on terms which are acceptable to us, our ability to meet existing financial covenants and the limitations imposed on our operations by those covenants, and the possibility of increases in interest rates that would result in increased interest expense;
risks related to our status as a real estate investment trust, commonly referred to as a REIT, for federal income tax purposes, such as the existence of complex tax regulations relating to our status as a REIT, the effect of future changes in REIT requirements as a result of new legislation, and the adverse consequences of the failure to qualify as a REIT; and
risks related to natural disasters, climate change and public health crises (such as worldwide pandemics), and the measures that international, federal, state and local governments, agencies, law enforcement and/or health authorities implement to address them, may precipitate or materially exacerbate one or more of the above-mentioned risks, and may significantly disrupt or prevent us from operating our business in the ordinary course for an extended period.

Given these uncertainties, readers are cautioned not to place undue reliance on any forward-looking statements that we make, including those in this Press Release. Except as required by law, we make no promise to update any of the forward-looking statements as a result of new information, future events, or otherwise. You should review the risks contained in our Annual Report on Form 10-K, filed with the Securities and Exchange Commission on February 13, 2025 and subsequent quarterly reports on Form 10-Q.

Investor Inquiries:

Jill Sawyer

Senior Vice President, Investor Relations

301.998.8265

jsawyer@federalrealty.com

Media Inquiries:

Brenda Pomar

Senior Director, Corporate Communications

301.998.8316

bpomar@federalrealty.com

Federal Realty Investment Trust
Consolidated Balance Sheets
September 30, 2025
	September 30,	December 31,
	2025	2024
	(in thousands, except share and per share data)
	(unaudited)
ASSETS
Real estate, at cost
Operating (including $1,827,346 and $1,825,656 of consolidated variable interest entities, respectively)	$ 11,035,704	$ 10,363,961
Construction-in-progress (including $25,395 and $9,939 of consolidated variable interest entities, respectively)	338,990	539,752
	11,374,694	10,903,713
Less accumulated depreciation and amortization (including $456,303 and $424,044 of consolidated variable interest entities, respectively)	(3,326,160)	(3,152,799)
Net real estate	8,048,534	7,750,914
Cash and cash equivalents	111,311	123,409
Accounts and notes receivable, net	239,887	229,080
Mortgage notes receivable, net	9,105	9,144
Investment in partnerships	32,708	33,458
Operating lease right of use assets, net	83,860	85,806
Finance lease right of use assets, net	6,465	6,630
Prepaid expenses and other assets	330,355	286,316
TOTAL ASSETS	$ 8,862,225	$ 8,524,757
LIABILITIES AND SHAREHOLDERS' EQUITY
Liabilities
Mortgages payable, net (including $183,493 and $186,643 of consolidated variable interest entities, respectively)	$ 511,318	$ 514,378
Notes payable, net	849,558	601,414
Senior notes and debentures, net	3,362,468	3,357,840
Accounts payable and accrued expenses	224,540	183,564
Dividends payable	99,792	96,743
Security deposits payable	31,275	30,941
Operating lease liabilities	72,960	74,837
Finance lease liabilities	12,872	12,783
Other liabilities and deferred credits	231,613	227,827
Total liabilities	5,396,396	5,100,327
Commitments and contingencies
Redeemable noncontrolling interests	180,684	180,286
Shareholders' equity
Preferred shares, authorized 15,000,000 shares, $.01 par:
5.0% Series C Cumulative Redeemable Preferred Shares, (stated at liquidation preference $25,000 per share), 6,000 shares issued and outstanding	150,000	150,000
5.417% Series 1 Cumulative Convertible Preferred Shares, (stated at liquidation preference $25 per share), 392,878 shares issued and outstanding	9,822	9,822
Common shares of beneficial interest, $.01 par, 200,000,000 shares authorized, 86,265,563 and 85,666,220 shares issued and outstanding, respectively	869	862
Additional paid-in capital	4,306,262	4,248,824
Accumulated dividends in excess of net income	(1,254,627)	(1,242,654)
Accumulated other comprehensive income	2,232	4,740
Total shareholders' equity of the Trust	3,214,558	3,171,594
Noncontrolling interests	70,587	72,550
Total shareholders' equity	3,285,145	3,244,144
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY	$ 8,862,225	$ 8,524,757

Federal Realty Investment Trust
Consolidated Income Statements
September 30, 2025
	Three Months Ended		Nine Months Ended
	September 30,		September 30,
	2025	2024	2025	2024
	(in thousands, except per share data)
	(unaudited)
REVENUE
Rental income	$ 313,183	$ 295,119	$ 917,954	$ 866,199
Other property income	8,789	8,233	24,143	23,973
Mortgage interest income	281	281	833	836
Total revenue	322,253	303,633	942,930	891,008
EXPENSES
Rental expenses	67,481	63,898	196,894	184,448
Real estate taxes	38,178	36,053	111,426	105,402
General and administrative	11,649	10,822	34,449	34,920
Depreciation and amortization	94,277	87,028	270,464	255,481
Total operating expenses	211,585	197,801	613,233	580,251

Gain on sale of real estate	—	—	77,672	52,280
New market tax credit transaction income	—	—	14,176	—

OPERATING INCOME	110,668	105,832	421,545	363,037

OTHER INCOME/(EXPENSE)
Other interest income	845	978	2,493	3,512
Interest expense	(47,619)	(44,237)	(134,692)	(132,242)
Income from partnerships	605	888	1,687	1,825
NET INCOME	64,499	63,461	291,033	236,132
Net income attributable to noncontrolling interests	(2,850)	(2,508)	(9,700)	(6,461)
NET INCOME ATTRIBUTABLE TO THE TRUST	61,649	60,953	281,333	229,671
Dividends on preferred shares	(2,008)	(2,008)	(6,024)	(6,024)
NET INCOME AVAILABLE FOR COMMON SHAREHOLDERS	$ 59,641	$ 58,945	$ 275,309	$ 223,647

EARNINGS PER COMMON SHARE, BASIC AND DILUTED
Net income available for common shareholders	$ 0.69	$ 0.70	$ 3.20	$ 2.68
Weighted average number of common shares	85,978	83,994	85,808	83,180

Federal Realty Investment Trust
Funds From Operations
September 30, 2025
	Three Months Ended		Nine Months Ended
	September 30,		September 30,
	2025	2024	2025	2024
	(in thousands, except per share data)
Funds from Operations available for common shareholders (FFO)
Net income	$ 64,499	$ 63,461	$ 291,033	$ 236,132
Net income attributable to noncontrolling interests	(2,850)	(2,508)	(9,700)	(6,461)
Gain on sale of real estate	—	—	(77,672)	(52,280)
Depreciation and amortization of real estate assets	81,155	76,581	236,251	225,676
Amortization of initial direct costs of leases	12,029	8,757	30,464	24,673
Funds from operations	154,833	146,291	470,376	427,740
Dividends on preferred shares (1)	(1,875)	(1,875)	(5,625)	(5,625)
Income attributable to downREIT operating partnership units	596	688	1,868	2,068
Income attributable to unvested shares	(509)	(506)	(1,558)	(1,524)
FFO (2)	$ 153,045	$ 144,598	$ 465,061	$ 422,659
Weighted average number of common shares, diluted (1)(3)	86,599	84,714	86,463	83,904

FFO per diluted share (2)(3)	$ 1.77	$ 1.71	$ 5.38	$ 5.04

Dividends and Payout Ratios
Regular common dividends declared	$ 97,474	$ 93,442	$ 287,282	$ 275,006

Dividend payout ratio as a percentage of FFO	64 %	65 %	62 %	65 %

Notes:

For the three and nine months ended September 30, 2025 and 2024, dividends on our Series 1 preferred stock were not deducted in the calculation of FFO available to common shareholders, as the related shares were dilutive and are included in "weighted average number of common shares, diluted."
FFO available for common shareholders includes new market tax credit transaction income, net of noncontrolling interest of $13.0 million. Excluding this income, FFO for the nine months ended September 30, 2025 would have been $452.0 million, and FFO per diluted share would have been $5.23 per share.
The weighted average common shares used to compute FFO per diluted common share includes downREIT operating partnership units that were excluded from the computation of diluted EPS. Conversion of these operating partnership units is dilutive in the computation of FFO per diluted share for all periods presented, but is anti-dilutive for the computation of diluted EPS.

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SOURCE Federal Realty Investment Trust