Financial Data and Key Metrics Changes - The company reported a 6.4% growth in FFO for Q4 and a 4.3% growth for the year, with guidance for 2026 close to 6% at the midpoint [6][18] - The overall portfolio was 96.1% leased and 94.1% occupied, with a 50 basis points increase when excluding newly acquired centers [6][12] - FFO per share for Q4 was $1.84, reflecting a 6.4% growth year-over-year [18] Business Line Data and Key Metrics Changes - In Q4, 601,000 sq ft of comparable deals were completed at a 12% rollover, with 2.3 million sq ft for the year at a 15% rollover, resulting in an incremental $11 million of new rent under contract [7][14] - The company signed 105 comparable deals in Q4, achieving a 12% rollover, with a weighted average contractual rent bump of 2.6% [14][15] Market Data and Key Metrics Changes - The company noted strong demand in California, which is expected to be a significant source of growth in the coming years [69] - Foot traffic in the greater Washington, D.C. area increased by 3% in Q4, with annual sales moving higher year-over-year [15][17] Company Strategy and Development Direction - The company is focused on driving rent growth, disciplined expense management, and capitalizing on quality real estate for multi-year growth opportunities [14] - The redevelopment pipeline includes $500 million in projects, with 780 residential units planned at existing retail properties [20][22] - The company plans to maintain a strong leverage metric, with annualized adjusted net debt to EBITDA expected to trend further to the low- to mid-5 times range [21] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the strong demand for assets and the ability to achieve near 6% growth in 2026 [6][12] - The company anticipates a temporary drag on comparable POI growth due to turnover in anchor space, but expects occupancy levels to improve by year-end 2026 [24][57] Other Important Information - The company will report both NAREIT FFO and core FFO going forward to enhance comparability across periods [22] - Guidance for 2026 includes a forecast for comparable POI growth of 3%-3.5% and assumes a full year's contribution from $750 million of high-quality assets acquired in 2025 [23][25] Q&A Session Summary Question: Can you provide insight into the investment pipeline? - The company is targeting large, dominant shopping centers and expects more opportunities in the second half of the year [30][31] Question: How much more peripheral multifamily could be marketed for sale this year? - There are opportunities to monetize residential products, with an estimated $400 million-$500 million available for sale [34][35] Question: Is the pricing power driving rent spreads broad-based? - Management indicated that the pricing power is broad-based, driven by high demand and limited supply across various property types [41][42] Question: Can you break down the same-store NOI growth? - The company expects about 3%-3.5% growth, with a significant portion coming from rent bumps and rollover [46] Question: What is the status of tenant credit and any watch list items? - The company has limited exposure to tenant credit issues, with Saks and Container Store being monitored [62][64] Question: What is driving the robust performance in California? - California is expected to be a major growth contributor due to leasing and development activity [69] Question: What is the timing for the development expansion pipeline? - The increase in the development pipeline is expected to be pro rata throughout the year [71] Question: What percentage of NOI is captured in the comp pool today? - Approximately 85%-90% of NOI is captured in the comparable pool [75]

Financial Data and Key Metrics Changes - The company reported a 6.4% growth in FFO for Q4 2025 and a 4.3% growth for the full year, with guidance for 2026 indicating close to 6% growth at the midpoint [6][18] - FFO per share for Q4 was $1.84, reflecting a strong operational quarter, slightly below the midpoint of guidance due to a non-cash charge related to Saks' bankruptcy [18][80] - Liquidity at year-end stood at $1.3 billion, with a new $250 million delayed draw term loan enhancing financial flexibility [19] Business Line Data and Key Metrics Changes - The overall portfolio was 96.1% leased and 94.1% occupied, with leasing driving future results [6][14] - The company signed 105 comparable deals in Q4, achieving a 12% rollover, and 20 non-comparable deals at an average rate of $48.18 [7][14] - The leasing platform achieved record-breaking volumes in 2025, with the highest annual square footage leased in company history [14] Market Data and Key Metrics Changes - Strong demand for assets was noted in both historical locations and newer markets, particularly in California, which is expected to be a major growth source [6][70] - Foot traffic in the greater Washington, D.C. area increased by 3% quarterly, with annual sales moving higher year-over-year [15][17] Company Strategy and Development Direction - The company is focused on driving rent growth, disciplined expense management, and capitalizing on quality real estate for multi-year growth opportunities [14] - A total of $280 million has been allocated for new residential development, with projects expected to add over 500 units to the portfolio [10][11] - The company plans to continue its asset recycling program, targeting both residential and retail assets for sale to fund acquisitions [35][86] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the strong demand across all categories and the ability to drive rents higher, with expectations for improved occupancy levels by the end of 2026 [15][42] - The company anticipates a temporary drag on comparable POI growth due to turnover in anchor spaces, but expects to recover and achieve growth in the mid-3% range historically [59] - The refinancing of bonds is expected to be managed efficiently, with no special dividends anticipated [49][80] Other Important Information - The company will report both NAREIT FFO and core FFO going forward to enhance comparability across periods [22] - Guidance for 2026 indicates core FFO of $7.42-$7.52 per share, representing about 5.8% growth compared to 2025 [23][25] Q&A Session Summary Question: Can you provide insight into the investment pipeline? - The company is targeting large, dominant shopping centers and expects more opportunities in the second half of the year [31] Question: How much more peripheral multifamily could be marketed for sale this year? - There are opportunities to monetize residential products, with an estimated $400 million-$500 million available for sale [35] Question: Is the pricing power driving rent increases broad-based? - Management indicated that the pricing power is broad-based, driven by high demand and limited supply across the portfolio [41] Question: Can you break down the same-store NOI growth? - The growth is driven by comparable POI growth, acquisitions, and redevelopment, with term fees expected to be slightly higher than last year [46] Question: What is the status of tenant credit and any watch list items? - The company has limited exposure to tenant credit issues, with Saks and Container Store being monitored closely [62][64] Question: What is driving the robust performance in California? - California is expected to be a major growth source due to leasing and development activity [70]

Financial Data and Key Metrics Changes - The company reported a 6.4% growth in FFO for Q4 2025 and a 4.3% growth for the full year, with guidance for 2026 at close to 6% at the midpoint [4][17] - FFO per share for Q4 was $1.84, slightly below the midpoint of guidance due to a non-cash charge related to Saks' bankruptcy [17][80] - Comparable POI growth averaged 3.8% for the year and 3.1% for Q4, with cash basis metrics at 3.6% and 4.3% respectively [17] Business Line Data and Key Metrics Changes - The overall portfolio was 96.1% leased and 94.1% occupied, with leasing driving future results [4] - In Q4, 601,000 sq ft of comparable deals were completed at a 12% rollover, and 2.3 million sq ft for the year at a 15% rollover, resulting in an incremental $11 million of new rent under contract [5] - The company signed 105 comparable deals in Q4, achieving a 12% rollover and a weighted average contractual rent bump of 2.6% [12] Market Data and Key Metrics Changes - Strong demand for assets was noted in both historical and newer markets, particularly in California, which is expected to be a major growth source [10][68] - Foot traffic in the greater Washington, D.C. area increased by 3% quarterly, with annual sales moving higher year-over-year [15] Company Strategy and Development Direction - The company is focusing on driving rent growth, disciplined expense management, and capitalizing on quality real estate for multi-year growth opportunities [12] - A total of $280 million has been allocated for new residential development, with projects expected to add over 500 units to the portfolio [8] - The company plans to continue its asset recycling strategy, targeting both residential and retail assets for sale to fund acquisitions [85] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the strong demand across all categories and the ability to drive rents higher, indicating a positive outlook for 2026 [12][41] - The company anticipates a temporary drag on occupancy due to lease turnovers but expects to recover and improve occupancy levels by year-end 2026 [56] - Management highlighted the importance of maintaining a stable interest rate environment, which could lead to lower rates as the year progresses [10] Other Important Information - The company will report both NAREIT FFO and core FFO going forward to enhance comparability across periods [21] - Guidance for 2026 includes a core FFO of $7.42-$7.52 per share, representing about 5.8% growth compared to 2025 [22] Q&A Session Summary Question: Investment pipeline and potential deals - Management is targeting large, dominant shopping centers and expects more opportunities in the second half of the year [29] Question: Multifamily development and recycling plan - There are opportunities to monetize residential products, with potential sales of $400 million-$500 million in the pipeline [34] Question: Rent spreads and pricing power - The pricing power is broad-based, driven by high demand and limited supply across the portfolio [41] Question: Same-store NOI growth breakdown - The growth is driven by rent bumps, rollover, and parking, with term fees expected to be slightly higher than last year [46] Question: Anchor movement and timing - The anchor movement is primarily due to timing of lease expirations, with a non-cash charge related to Saks amounting to approximately $0.03 per share [80]

Financial Performance - Total property revenue increased by $76.5 million, or 6.4%, to $1.28 billion in 2025 compared to $1.20 billion in 2024[207]. - Rental income rose to $1.25 billion in 2025, up from $1.17 billion in 2024, reflecting a growth of 6.4%[206]. - Property operating income increased by $49.4 million, or 6.1%, to $860.1 million in 2025 compared to $810.7 million in 2024[212]. - The gain on sale of real estate was $150.1 million in 2025, significantly higher than the $54.0 million gain in 2024, marking a 177.8% increase[219][220]. - Total property expenses rose by $27.1 million, or 6.9%, to $418.9 million in 2025 compared to $391.8 million in 2024[209]. - General and administrative expenses decreased by $2.8 million, or 5.7%, to $46.9 million in 2025 compared to $49.7 million in 2024[213]. - Rental expenses increased by $17.9 million, or 7.2%, to $267.4 million in 2025, with rental expenses as a percentage of rental income rising to 21.5%[210]. - Real estate tax expense increased by $9.2 million, or 6.5%, to $151.4 million in 2025 compared to $142.2 million in 2024[211]. - Depreciation and amortization expense increased by $25.2 million, or 7.4%, to $367.8 million in 2025 from $342.6 million in 2024[217]. Property Management and Operations - As of December 31, 2025, the company owned or had a majority interest in 104 retail real estate projects comprising approximately 28.8 million commercial square feet, with a leasing rate of 96.1% and an occupancy rate of 94.1%[24]. - The company actively manages its properties to maximize rents and maintain occupancy levels, focusing on attracting and retaining a diverse tenant base[27]. - The company continuously evaluates its operating strategies to adapt to market changes and enhance property performance[27]. - The company intends to develop and construct additional buildings on existing projects to maximize real estate value, but this carries inherent risks[57]. - The company is focused on acquiring quality retail and mixed-use properties in densely populated areas with high barriers to entry for further development[31]. - The company has properties concentrated in 14 states and the District of Columbia, making it vulnerable to localized economic downturns[54]. - The company has a total of 314 full-time employees and 6 part-time employees, with no collective bargaining representation[32]. - The company had approximately 3,700 commercial leases and 2,700 residential leases, with no single tenant accounting for more than 2.4% of annualized base rent[120]. - The company’s leases are structured to require monthly payment of minimum rents in advance, with periodic increases and percentage rents based on tenant sales[124]. Market and Economic Conditions - The company continues to monitor macroeconomic conditions, including inflation and interest rates, which may impact its business and tenants[39]. - The company is subject to various federal, state, and local environmental regulations, but does not expect these to materially affect its financial condition[43]. - The shift from brick-and-mortar retail to online shopping poses risks to cash flow and financial performance, although a diverse portfolio may mitigate some of these risks[53]. - Revenue from properties is dependent on tenants' ability to pay rent, which may be impacted by economic conditions and competitive pressures[51]. - The company faces competition from numerous commercial developers and real estate companies, which may limit its ability to attract tenants and acquire new properties[66]. - Natural disasters and climate change could negatively impact cash flow and operating results, potentially delaying development projects and increasing costs[73]. Debt and Financial Obligations - As of December 31, 2025, the company had approximately $5.0 billion of debt outstanding, with about $523.2 million secured by 8 real estate projects[75]. - Approximately 82.6% of the company's debt is fixed rate or fixed via interest rate swap agreements[75]. - The company has a $1.25 billion revolving credit facility, with $310.0 million outstanding as of December 31, 2025[83]. - Rising interest rates could increase interest expenses on the company's variable rate debt, adversely affecting cash flow and shareholder distributions[83]. - The company is required to distribute at least 90% of its taxable income to maintain its REIT status, which limits available capital for growth[82]. - The company must derive at least 95% of its gross income from qualifying rents to maintain its REIT status, which could be challenging if tenant defaults occur[87]. - The company is subject to a 4% excise tax if it fails to distribute sufficient income to meet minimum distribution tests[92]. - Compliance with financial covenants related to debt obligations could restrict the company's operating activities and result in defaults if breached[78]. Shareholder and Dividend Information - The company has paid quarterly dividends continuously since its founding in 1962, increasing dividends per common share for 58 consecutive years[24]. - The total annual dividends paid per common share for 2025 and 2024 were $4.43 and $4.37, respectively, reflecting a continuous increase in dividends for 58 consecutive years[150]. - The ordinary dividend per share for 2025 was $3.810, while capital gain dividends amounted to $0.620, contributing to the total distribution of $4.430 per share[151]. - The company’s ability to pay dividends at historical rates depends on various factors, including its financial condition and performance[105]. - The company currently owns 100% of the OP Units issued by the Partnership and is its sole Limited Partner, but may issue additional OP Units in the future[107]. - The company is reliant on distributions from the Partnership to meet its obligations and make shareholder distributions[106]. Sustainability and Environmental Initiatives - The company has installed on-site solar systems at 28 properties with a total capacity of 15.3 MW and operates nearly 500 electric vehicle charging stations[168]. - The company has 25 LEED certified buildings, demonstrating its commitment to sustainable development practices[171]. - Environmental laws and regulations could adversely affect the value or profitability of the company’s properties[93]. Risks and Challenges - The company may experience delays and unexpected costs in enforcing lease terms if tenants default, which could adversely affect financial results[51]. - The company may face challenges in renewing leases or re-leasing space, which could negatively impact net income[56]. - The company is subject to risks related to joint investments, including potential bankruptcy of partners and disputes that may arise[68]. - The loss of key management could negatively impact the company’s performance and the value of its common shares[108]. - The company may adjust its business policies without shareholder approval, which could affect its financial condition and results of operations[109]. - The company has not experienced any cybersecurity incident that has had a material impact on its business strategy or financial condition[118]. - The company employs various cybersecurity measures, including password encryption and multi-factor authentication, to mitigate risks[116].

Financial Performance - For the full year 2025, net income available for common shareholders was $403.0 million, or $4.68 per diluted share, compared to $287.2 million and $3.42 per diluted share for 2024, representing a 40.5% increase in net income[9]. - Nareit FFO for 2025 was $624.3 million, or $7.22 per diluted share, an increase of 9.1% from $570.2 million, or $6.77 per diluted share in 2024[11]. - Total revenue for the year ended December 31, 2025, was $1,278,975,000, an increase from $1,202,452,000 in 2024[31]. - Operating income for the year ended December 31, 2025, was $602,199,000, compared to $472,356,000 in 2024, showing significant growth[31]. - Net income attributable to the Trust for the year ended December 31, 2025, was $411,077,000, up from $295,208,000 in 2024[31]. - Nareit FFO per diluted share for 2024 and 2025 were $6.77 and $7.22, respectively, with an estimated range of $7.42 to $7.52 for 2026, reflecting a growth of 2.8% to 4.2% over 2025[24]. - Core FFO for 2024 and 2025 were $6.77 and $7.06, respectively, with an estimated range of $7.42 to $7.52 for 2026, indicating a growth of 5.1% to 6.5% over 2025[24]. - The company reported a net income available for common shareholders per diluted share of $4.68 for 2025, with guidance for 2026 set between $3.90 and $4.00[96]. - The Nareit FFO per diluted share for 2025 was $7.22, with guidance for 2026 projected between $7.42 and $7.52[96]. Leasing Activity - The company achieved a record total leasing volume of 2.5 million square feet of retail space in 2025, with comparable rent spreads of 15% on a cash basis and 27% on a straight-line basis[8]. - The company signed 454 leases for 2,471,099 square feet of retail space in 2025, with an average rent of $37.98 per square foot, compared to $33.12 per square foot for the previous leases[15]. - In Q4 2025, Federal Realty Investment Trust signed 105 comparable leases totaling 600,684 square feet at an average rent of $39.09 PSF, reflecting a 12% annual increase over prior rent[81]. - For the full year 2025, the company signed a total of 434 comparable leases covering 2,340,282 square feet with an average rent of $37.98 PSF, achieving a 15% annual increase in rent[81]. - The renewal lease summary for Q4 2025 indicates 52 leases signed, covering 339,602 square feet at an average rent of $41.17 PSF, with a 4% annual increase in rent[83]. - The average lease term for new leases in Q4 2025 was 9.7 years, indicating a strong commitment from tenants[82]. - Federal Realty Investment Trust's overall leasing activity demonstrates a robust demand for retail spaces, with significant annual increases in rental rates across various lease categories[86]. Property and Portfolio Management - Comparable portfolio occupancy was 94.5% at year-end, up 50 basis points year-over-year, while the leased rate was 96.6%, up 40 basis points year-over-year[17]. - Federal Realty operates 104 properties with approximately 3,700 tenants across 28.8 million commercial square feet and about 2,700 residential units as of December 31, 2025[26]. - The company has significant redevelopment opportunities across various properties, including 1.5 million square feet of commercial-use buildings and 326 residential units at Assembly Row[65]. - The total portfolio of Federal Realty Investment Trust consists of 28,798,000 square feet across 2,318 properties, with an overall occupancy rate of 96% and an average rent of $32.79 per square foot[80]. - The company has ongoing expansion/conversion opportunities at successful retail properties to enhance GLA and productivity[67]. Capital Expenditures and Investments - A new redevelopment project at Willow Grove, PA, was announced with a projected cost of $110 - $120 million and an expected ROI of 7%[18]. - Non-maintenance capital expenditures for the year totaled $273.801 million, up from $227.893 million in 2024, indicating a focus on development and expansion[36]. - Total capital expenditures for the year were $303.163 million, compared to $252.445 million in 2024, reflecting increased investment in property[36]. - The company anticipates development/redevelopment capital expenditures of $175 million to $225 million for 2026, down from $194 million in 2025[96]. Debt and Liquidity - The company ended Q4 2025 with approximately $1.3 billion in total liquidity, supporting future growth initiatives[8]. - Total net debt as of December 31, 2025, was $4,835,685,000, an increase from $4,350,223,000 in 2024[47]. - The company's leverage ratio, measured as total net debt to market capitalization, increased to 35% in 2025 from 31% in 2024[47]. - The weighted average effective interest rate on total debt was 4.00% as of December 31, 2025[50]. - The total debt maturities amount to $4.96 billion, with 24.3% maturing in 2030 at a weighted average rate of 4.3%[57]. Future Guidance - For 2026, the company provided guidance of $3.90 to $4.00 for earnings per diluted share and $7.42 to $7.52 for Nareit and Core FFO per diluted share, indicating growth of 5.1% to 6.5% year-over-year[21]. - Estimated net income available for common shareholders per diluted share for full year 2026 is projected to be between $3.90 and $4.00[24]. - Nareit FFO per diluted share for 2026 is estimated to be between $7.42 and $7.52, reflecting a growth of 2.8% to 4.2% over 2025[97]. - Core FFO for 2026 is also estimated to be between $7.42 and $7.52, indicating a growth of 5.1% to 6.5% compared to 2025[97].

Core Viewpoint - Federal Realty Investment Trust reported its financial results for the fourth quarter and full year ended December 31, 2025, indicating performance metrics that are crucial for investors to assess the company's growth and stability [1]. Financial Performance - The company disclosed its earnings for the fourth quarter, which are essential for understanding its quarterly performance trends [1]. - Full year results were also provided, offering insights into the overall financial health and operational efficiency of the company for the entire year [1].

Company Overview - Federal Realty Investment Trust (NYSE: FRT) is a leading real estate investment trust (REIT) focusing on high-quality retail properties in major coastal markets, known for sustainable growth and community investment [1] - The company has a remarkable record of increasing quarterly dividends for 54 consecutive years, indicating strong financial stability and commitment to shareholders [6] Market Position and Competitors - Federal Realty competes with other retail REITs such as Simon Property Group, Regency Centers, and Kimco Realty [1] - The retail REIT sector is experiencing solid fundamentals, characterized by tight vacancy rates and resilient holiday sales, which supports a positive outlook for Federal Realty [4] Analyst Insights - The consensus price target for FRT has shown a modest increase from $109.27 last year to $110 last month, reflecting a stable or slightly positive outlook from analysts [2] - Analyst Collin Mings from Raymond James has set a price target of $140 for FRT, indicating strong confidence in the company's future performance, which exceeds recent consensus price targets [3][5][6] Upcoming Earnings Report - Federal Realty is expected to announce its Q4 2025 earnings on February 12th, with anticipated earnings of $1.85 per share and revenue of approximately $327.7 million [3][6] - Investors are advised to monitor quarterly earnings reports and news regarding new property developments or acquisitions, as these factors could influence future price targets [5]

Core Insights - Federal Realty Investment Trust (FRT) is scheduled to report its fourth-quarter and full-year 2025 results on February 12, with analysts keen to evaluate its performance in the current economic environment [1][10]. Company Performance - In the last reported quarter, FRT's funds from operations (FFO) per share was $1.77, exceeding the Zacks Consensus Estimate of $1.76, driven by increased comparable property operating income and strong leasing activity [2]. - Over the past four quarters, FRT has surpassed estimates three times, with an average beat of 2.89% [2]. - The Zacks Consensus Estimate for FRT's fourth-quarter revenues is $328.96 million, indicating a 5.63% increase year-over-year, while rental revenues are projected at $323.79 million, up from $303.88 million [8][12]. Market Environment - The U.S. retail real estate market showed signs of stabilization in Q4 2025, supported by steady consumer demand and limited new supply, leading to improved occupancy rates [3][4]. - National retail vacancy was reported at 5.7%, reflecting tighter conditions compared to historical norms, with approximately 3.4 million square feet of net absorption in Q4, marking the strongest quarterly improvement since Q4 2023 [4][5]. Factors Influencing FRT - FRT is expected to benefit from high demand for its quality retail properties in affluent markets, aided by a well-diversified tenant mix and limited new supply in its operating regions [6]. - The company's leased occupancy rate is estimated at 96.3%, with a projected year-over-year rent per square foot increase of 1.1% [7][10]. - FRT's interest expenses are anticipated to rise by 11.1% year-over-year, which may impact performance, although FFO estimates have been revised up to $1.86 per share [9][11]. Full-Year Projections - For the full year, the Zacks Consensus Estimate for FRT's FFO per share is $7.24, reflecting a 6.94% year-over-year increase, with revenues projected to rise by 5.85% [12].

Core Viewpoint - Federal Realty Investment Trust has announced the sale of Misora Apartments for $148.5 million, marking its first significant asset disposition of 2026, contributing to a total of $475 million in recent capital recycling activities at attractive yields [1][2][3]. Group 1: Recent Transactions - The sale of Misora Apartments, a 212-unit Class A residential community, is part of Federal Realty's strategy to prune and reinvest in higher-return opportunities [1][2]. - In addition to Misora, the company sold Courthouse Center, a 33,000-square-foot shopping center in Rockville, Maryland, for $10 million [2]. - These transactions follow a series of asset sales in 2025, including Levare Apartments and Pallas at Pike & Rose, generating nearly $475 million in proceeds at a blended cap rate in the low 5% range [3]. Group 2: Company Strategy and Performance - The company emphasizes a disciplined approach to asset management, focusing on reinvesting in high-value opportunities while maintaining financial flexibility [4]. - Federal Realty is recognized for its long-term sustainable growth strategy, primarily investing in retail-based properties in major coastal markets and underserved regions [4]. - As of September 30, 2025, Federal Realty's portfolio includes 103 properties with approximately 3,600 tenants across 27.9 million commercial square feet and around 3,000 residential units [4]. Group 3: Dividend and Market Position - Federal Realty has a notable track record of increasing quarterly dividends for 58 consecutive years, the longest in the REIT industry [5]. - The company is a member of the S&P 500 index and trades on the NYSE under the symbol FRT [5].

Core Viewpoint - Federal Realty Investment Trust (FRT) is recognized as a "Dividend King" with a current yield of 4.4% and anticipates total growth of 6.8% for the fiscal year, primarily driven by strong leasing activity [1] Company Summary - FRT has a current dividend yield of 4.4% [1] - The company expects a total growth rate of 6.8% for the fiscal year [1] - Strong leasing activity is cited as the main factor contributing to this growth [1]