FFO and Core FFO Growth
NAREIT FFO per share grew 4.7% in Q1; core FFO per share grew 6.2% year-over-year. Updated 2026 guidance implies NAREIT FFO per share growth of ~5.9% and core FFO per share growth of ~5.8% at the midpoint vs 2025.
Phillips Edison & Company
· PECO
April 23rd, 2026
Summary
- Earnings Call Date:
- 2026-04-23
- Change Since:
- +8.52%
- Next Earnings Date:
- 2026-07-23
Earnings Call Sentiment
PositiveThe call presents a broadly positive operating and financial picture: solid growth in NAREIT and core FFO per share, healthy same-center NOI growth, high occupancy, strong leasing spreads, active accretive acquisitions and development, improved liquidity and a lower-than-expected Q1 bad debt result. Management raised FFO guidance and reaffirmed NOI and acquisitions targets, signaling confidence. The primary negatives are macro and market risks (rate volatility, public vs private valuation spread), modestly elevated leverage metrics to monitor, and execution risk tied to expansion into non-core everyday retail and development. Overall, the positives from operating performance, liquidity and raised guidance outweigh the manageable risks discussed on the call.
Company Guidance
Phillips Edison raised its 2026 outlook: updated guidance implies 2026 NAREIT FFO per share up ~5.9% vs. 2025 at the midpoint and 2026 core FFO per share up ~5.8% at the midpoint, with management targeting mid‑to‑high single‑digit NAREIT/core FFO growth consistent with long‑term targets; the company reiterated 2026 same‑center NOI growth of 3%–4% and $400M–$500M in gross acquisitions (company share). The raise is supported by Q1 results and balance‑sheet strength — Q1 NAREIT FFO $92.9M ($0.67/sh), Q1 core FFO $96.4M ($0.69/sh), same‑center NOI +3.5% in the quarter, Q1 bad debt ~60 bps (2025 full‑year 78 bps; 2026 expected in line), YTD acquisitions $185M with ~$150M under contract, $810M liquidity, net debt/TTM adjusted EBITDAR 5.3x, 94% fixed‑rate debt, weighted average interest 4.4%, weighted average maturity 5.8 years, and a $350M 4.75% senior note issued; collectibility adjustments guidance remains $5M–$8M, and long‑term targets remain 3%–4% same‑center NOI and mid‑to‑high single‑digit core FFO per‑share growth (AFFO upside as renewals increase).
Same-Center NOI and Leasing Execution
Same-center NOI increased 3.5% in the quarter. Leased portfolio occupancy remained very high at 97.1% (anchors 98.4%, inline 95%). Comparable renewal rent spreads were 21.2% and comparable new rent spreads were 36.2%; inline leasing deals showed average annual rent bumps of 2.7%.
Strong Balance Sheet and Liquidity
Ended the quarter with $810 million in liquidity. Completed $350 million public bond offering at 4.75% due 2033; weighted average interest rate on outstanding debt 4.4%; weighted average maturity 5.8 years (incl. extension options); 94% of total debt is fixed-rate (including JV share).
Active Acquisition and Development Activity
Year-to-date acquisition activity of $185 million (five grocery-anchored centers, three everyday retail centers, and land). Pipeline includes ~$150 million awarded or under contract expected to close by end of Q2. 19 projects under active construction (~$74 million total investment) with estimated yields of 9%–12%; six projects stabilized in Q1 adding ~87,000 sqft and ~$1.7 million incremental NOI annually.
Lower-Than-Expected Bad Debt in Q1
Bad debt was ~60 basis points of revenue in Q1, below 2025 full-year level (78 bps), and management expects 2026 bad debt to be in line with 2025.
Pricing Power and Tenant Demand
Management reports strong retailer demand across necessity-based categories, with 74% of rents from necessity-based goods and services; noted market-leading pricing power and high retention pipeline (125 renewals out for signature).
Affirmed and Raised Guidance
Reiterated full-year 2026 same-center NOI guidance of 3%–4% and reaffirmed gross acquisitions target of $400M–$500M (company share); raised FFO guidance ranges after Q1 performance, reflecting confidence in the operating environment and acquisition momentum.
Asset Recycling and Capital Flexibility
Year-to-date dispositions of $29 million (company share) with stated plans to pursue additional dispositions and a diversified toolkit for capital (debt issuance, dispositions, JVs, equity when markets are favorable).
Operator
Good day, and welcome to Phillips Edison & Company, Inc.'s First Quarter 2026 Earnings Call. Please note that this call is being recorded. I will now turn the call over to Kimberly Green, Head of Investor Relations. Kimberly, you may begin.
Kimberly Green
Thank you. I am joined today by our Chairman and CEO, Jeffrey S. Edison, President, Robert F. Myers, and CFO, John P. Caulfield. As a reminder, today's discussion may contain forward-looking statements about the company's view of future business and financial performance, including forward earnings guidance and future market conditions. These are based on management's current beliefs and expectations and are subject to various risks and uncertainties as described in our SEC filings. Our discussion today will reference certain non-GAAP financial measures.
Information regarding our use of these measures and reconciliations of these measures to our GAAP results are available in our earnings press release and supplemental information packet, both of which have been posted on our website. Please note that we have also posted a presentation, and our caution on forward-looking statements also applies to these materials. Following our prepared remarks, we will open the call to Q&A. Given the number of participants on the call today, we respectfully ask that you be limited to one question. Please rejoin the queue if you have follow-up questions. With that, I will turn the call over to Jeffrey S. Edison. Jeff?
Jeffrey S. Edison
Thank you, Kimberly, and thank you everyone for joining us today. We are pleased to report another quarter of strong results, which reflect ...
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