Brixmor Q3 2026 NOI Rises 6.6% as Occupancy Hits Record

Brixmor Property Group (NYSE: BRX) reported record leased occupancy and in-place rents for the third quarter of 2026, while same-property net operating income rose 6.6%. The open-air shopping center landlord also outlined a large acquisition and joint-venture transaction that it expects to expand its grocery-anchored portfolio and contribute immediately to Nareit funds from operations per share.

Total leased occupancy reached a record 95.6% as of September 30, up 150 basis points from a year earlier. Small-shop leased occupancy increased 140 basis points to a record 92.8%, while anchor occupancy stood at 97.0%. The gap between leased and billed occupancy was 420 basis points, representing space that has been leased but is not yet generating billed rent.

In-place annual rent per square foot rose 5% year over year to a record $19.47. Same-property NOI growth of 6.6% included a 480-basis-point contribution from base rent. Nareit FFO was $0.60 per diluted share, compared with $0.58 in each of the first two quarters of 2026.

Leasing and reinvestment support embedded growth

Brixmor executed 1.6 million square feet of new and renewal leases during the quarter. Combined spreads were 25%, including a 42.6% spread on new leases and a 19% spread on renewals. New-lease spreads have remained above 30% for 13 consecutive quarters, according to the presentation. The trailing-12-month tenant retention rate increased 300 basis points year over year to 88% by gross leasable area.

Signed but not yet commenced leases represented $69 million of annual rent, up 14% from a year earlier. Brixmor said 89% of that rent is scheduled to commence by the end of 2027, providing contractually secured revenue as tenants begin paying rent and leases reach their full annual run rate. The pipeline represents about 500 basis points of total portfolio gross leasable area, although 80 basis points relates to space expected to be vacated by existing tenants in the near term.

The company had 46 reinvestment projects in process with estimated net costs of $332 million and an average projected incremental NOI yield of 10%. That total included 15 redevelopment projects, 16 outparcel developments and 15 anchor-space repositioning projects. Brixmor stabilized $55 million of projects during the third quarter at a 10% NOI yield.

Acquisitions completed during the quarter totaled $50 million, including the purchase of the Stater Bros.-anchored Village West Shopping Center in California’s Inland Empire. Dispositions totaled $43 million.

Slate transaction would expand grocery-anchored portfolio

Brixmor plans to acquire 23 grocery-anchored shopping centers totaling about 3 million square feet for $636 million. The properties are all within its existing operating footprint and are concentrated primarily in Florida, Georgia and the Carolinas. The company said it does not plan dispositions from this portfolio and has identified about $100 million of redevelopment and outparcel opportunities within it.

Separately, Brixmor and Everview Partners intend to acquire another 92 centers totaling about 12 million square feet for $1.71 billion through a joint venture owned 20% by Brixmor and 80% by Everview. Brixmor will act as asset manager, property manager and leasing representative, and will invest about $174 million of preferred equity carrying a 9% dividend. Management also views the joint-venture assets as a potential pipeline for future acquisitions.

The transaction is expected to close in the first quarter of 2027, subject to Slate unitholder approval and customary closing conditions. Brixmor expects it to be immediately accretive to Nareit FFO per share and projects that 2027 leverage will remain consistent with recent levels.

Expected funding includes about $300 million of available cash, including $115 million of unsettled forward at-the-market proceeds, and approximately $500 million of debt funding. The remaining amount is expected to come from normal capital recycling. Brixmor said the final funding mix will depend on pricing and market conditions and does not rely on issuing equity at current trading levels.

Balance sheet and outlook

Brixmor ended the quarter with $1.5 billion of liquidity. Net principal debt was 5.2 times annualized adjusted EBITDA, fixed-charge coverage was 4.1 times and all debt was fixed-rate. The weighted average stated interest rate was 4.4%, with a weighted average maturity of 4.7 years.

The presentation maintained a long-term same-property NOI growth target of at least 4%, excluding occupancy growth. Brixmor identified contractual rent increases, mark-to-market leasing and value-accretive reinvestment as the principal components of that target. The company also announced a 7% increase in its annual dividend for 2027 to $1.32.

Key uncertainties include economic conditions, inflation and interest rates, consumer spending, tenant financial health, competition from other properties and e-commerce, higher operating and redevelopment costs, and natural disasters. The pending Slate transaction also carries closing, financing, integration and joint-venture management risks, including the possibility that anticipated benefits may not be realized or that unexpected liabilities and expenses may arise.