Q3 2025 Federal Realty Investment Trust (New) Earnings Call

October 31, 2025

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Please note this event is being recorded.

I would now like to turn the conference over to Jill Sawyer Senior Vice President of Investor Relations. Please go ahead.

Thank you Meghan good morning, Thank you for joining us today for Federal Realty's third quarter 2025 earnings Conference call.

Before we get started a reminder, that certain matters discussed on this call maybe deemed to be forward looking statements or looking statements include any annualized or projected information as well as statements, referring to expected or anticipated events or results including guidance.

Although federal Realty believes the expectations reflected in such forward looking statements are based on reasonable assumptions federal realty's future operations and its actual performance may differ materially from the information in our forward looking statements and we can give no assurance that these expectations can be attained.

Our earnings release and supplemental reporting package that we issued this morning, our annual report filed on Form 10-K, and our other financial disclosure documents provide a more in depth discussion of risk factors that may affect our financial condition and operational results.

Before we begin our prepared remarks.

Want to know what that Don Wood, our Chief Executive Officer is temporarily away due to our recent loss of an immediate family member our thoughts are with Don and his family. During this very difficult time is that since our chief investment Officer, Jan Sweden them, we'll be reading dawn's prepared remarks.

In addition to you on joining me on the call today are.

Yeah, and Gloria money Chief Financial Officer, when do you see your eastern region, President and Chief operating officer as well as other members of our executive and senior leadership team, including Dawn Becker, Jeff crush it to build and Melissa Solis that are available to take your questions at the conclusion of our prepared remarks.

And with that I will turn the call over to Jan Sweden, John Please begin.

Thanks, Jill and good morning, everybody.

Speaker #1: Good day and welcome to the FEDERAL REALTY INVESTMENT TRUST 3rd QUARTER 2025 EARNINGS CONFERENCE CALL. All participants will be in listen-only mode. Should you need assistance, please signal a conference specialist by pressing the star key followed by zero.

Following her dawn's prepared remarks best.

Best quarter, we've ever had ever and that's saying something given the leasing strength over the past few years 727000 feet of comparable space written at $35 71.

Speaker #1: After today's presentation, there will be an opportunity to ask questions. question, you may press star then one on your telephone keypad. To withdraw your question, please press star then two.

28% more annual cash rent than the previous tenant.

Speaker #1: To ask a

Two thirds of that space was for renewals with de Minimis capital required of the remaining one third related to new tenants over half related to space that is currently occupied but for which a more productive tenant executed a lease a year or two or even three early in order to lock. It up there is no better evidence of the attractiveness of a shopping center REIT.

Speaker #1: Please note this event is being recorded. I would now like to turn the conference over to Jill Sawyer, Senior Vice President of Investor Relations.

Speaker #1: Please go ahead.

Speaker #2: Thank you, Megan. Good morning. Thank you for joining us today for Federal Realty's 3rd Quarter 2025 Earnings Conference Call. Before we get started, a reminder that certain matters discussed on this call may be deemed to be forward-looking statements.

Or something that and it's one of the best ways in our business to assure an increasing stream of cash flows well into the future. When do you will talk about core leasing a bit more in a few minutes straw.

Speaker #2: Forward-looking statements include any annualized or projected information, as well as statements referring to expected or anticipated events or results, including guidance. Although FEDERAL REALTY believes the expectations reflected in such forward-looking statements are based on reasonable assumptions, FEDERAL REALTY's future operations and its actual performance may differ materially from the information in our forward-looking statements, and we can give no assurance of these expectations can be attained.

Jill Sawyer: Forward-looking statements include any annualized or projected information, as well as statements referring to expected or anticipated events or results, including guidance. Although Federal Realty Investment Trust believes the expectations reflected in such forward-looking statements are based on reasonable assumptions, Federal Realty Investment Trust's future operations and its actual performance may differ materially from the information in our forward-looking statements, and we can give no assurance that these expectations can be attained. The earnings release and supplemental reporting package that we issued this morning, our annual report filed on Form 10-K, and our other financial disclosure documents provide a more in-depth discussion of risk factors that may affect our financial condition and operational results. Before we begin our prepared remarks, I want to note that Donald Wood, our Chief Executive Officer, is temporarily away due to a recent loss of an immediate family member.

Strong comparable operating income growth of four 4% in the quarter was equally encouraging and led to <unk> per share of $1 77, Despite the absence of capitalized interest and operating costs at Santana west It negatively impacted <unk> per share by four cents.

That drag will begin to dissipate in this fourth quarter and in 2026 and 2027 as tenants in the 90% leased soon to be 95% leased building continue to occupy and work through free rent periods.

Operationally this was a really strong quarter and based on what we see thus far in October should allow us to close out 2025 strong in.

Speaker #2: disclosure documents provide a more in-depth discussion of risk factors that may affect our financial condition and operational results. Before we begin our prepared remarks, I want to note that Don Wood, our Chief Executive Officer, is temporarily away due to a recent loss of an immediate family member.

In terms of development and redevelopment residential construction in Hoboken, New Jersey, and Balkin with Pennsylvania are moving along nicely on or under budget and on time with leasing to begin in early 2026 at <unk> <unk>.

Speaker #2: Our thoughts are with Don and his family during this very difficult time. In his absence, our Chief Investment Officer, Jan Sweetnam, will be reading Don's prepared remarks.

Jill Sawyer: Our thoughts are with Donald and his family during this very difficult time. In his absence, our Chief Investment Officer, Jan Sweetnam, will be reading Donald's prepared remarks. In addition to Jan, joining me on the call today are Dan Guglielmone, Chief Financial Officer; Wendy Seher, Eastern Region President and Chief Operating Officer; as well as other members of our executive and senior leadership team, including Don Becker, Jeff Kreshik, Stu Biel, and Melissa Solis, that are available to take your questions at the conclusion of our prepared remarks. With that, I will turn the call over to Jan Sweetnam. Jan, please begin. Thanks, Jill, and good morning, everybody. Following are Don's prepared remarks. Best leasing quarter we've ever had, ever. That's saying something given the leasing strength over the past few years: 727,000 feet of comparable space written at $35.71, 28% more annual cash rent than the previous tenant.

During the third quarter, we broke ground on 258, new residential units on the last surface parking lot at Santana row committed capital of roughly $145 million.

Speaker #2: In addition to Jan, joining me on the call today are Dan Guglielmone, Chief Financial Officer; Wendy Seher, Eastern Region President and Chief Operating Officer; as well as other members of our Executive and Senior Leadership Team, including Don Becker, Jeff Kreshik, Stu Beal, and Melissa Solis, that are available to take your questions at the conclusion of our prepared remarks.

Those three projects Hoboken ballot in Santana will require roughly $280 million of capital all in fully monetized and proven environments and should yield six 5% to 7% Unlevered theres more to come in this component of our business in 2026 current conditions suggest market value should be 150 to two.

Speaker #2: And with that, I will turn the call over to Jan Sweetnam. Jan, please begin.

Hundred basis points inside those returns we're committed to realizing that value over time as we've demonstrated with the sale of Oreo Santana row earlier this year Palace at Pike, <unk> Rose, which is currently under contract for sale and should close right around year end and the current marketing Masora at Santana row.

Speaker #3: Thanks, Jill, and good morning, everybody. Following our Don's prepared remarks, best wishing quarter we've ever had, ever, and that's saying something given the leasing strength over the past few years.

Speaker #3: 727,000 feet of comparable space written at $35.71, 28% more annual cash rent than the previous tenant. Two-thirds of that space was for renewals with the minimum capital required.

On the acquisition front I really want to thank those of you that made the trip at Kansas City to join US for our Investor Tour of town Center crossing in Plaza in Leawood earlier. This month, we're off to a great start there from a cash flow and value enhancing perspective, and I just want to reemphasize. The two points that I think it became apparent to investors and analysts on that trip.

Jill Sawyer: Two-thirds of that space was for renewals with de minimis capital required. Of the remaining one-third related to new tenants, over half related to space that is currently occupied but for which a more productive tenant executed a lease a year or two or even three early in order to lock it up. There is no better evidence of the attractiveness of a shopping center to retailers than that. It's one of the best ways in our business to assure an increasing stream of cash flows well into the future. Wendy will talk about core leasing a bit more in a few minutes. Strong comparable property operating income growth of 4.4% in the quarter was equally encouraging and led to FFO per share of $1.77, despite the absence of capitalized interest and operating costs at Santana West that negatively impacted FFO per share by $0.04.

Speaker #3: Of the remaining one-third related to new tenants, over half related to space that is currently occupied but for which a more productive tenant executed a lease a year or two or even three early in order to lock it up.

First that we are not sacrificing quality by expanding our geographical footprint the growth prospects for these investments exceed both the retail and residential assets, we're selling and it is highly likely that the exit cap rates for the shopping centers were pursuing with tightened considerably based upon our re tenanted and redevelopment and.

Speaker #3: There's no better evidence of the attractiveness of a shopping center to retailers than that. And it's one of the best ways in our business to assure an increasing stream of cash flows well into the future.

Speaker #3: Wendy will talk about core leasing a bit more in a few minutes. Strong comparable operating income growth of 4.4% in the quarter was equally encouraging and led to FFO per share of $1.77, despite the absence of capitalized interest and operating costs at Santana West that negatively impacted FFO per share by four cents.

And second that this is not a change in strategy for federal.

Our deep and experienced team is doing what it has always done lease at better both from a merchandising and strength of a lease contract standpoint creative.

Create a more inviting physical space that Lincoln's stay times and increased spend.

Speaker #3: That drag will begin to dissipate in this fourth quarter, and in 2026 and 2027, as tenants in the 90% leased, soon to be 95% leased, building continue to occupy and work through free rent periods.

Jill Sawyer: That drag will begin to dissipate in this fourth quarter, and in 2026 and 2027, as tenants in the 90% leased, soon to be 95% leased, building continue to occupy and work through free rent periods. Operationally, this was a really strong quarter, and based on what we see thus far in October, should allow us to close out 2025 strong. In terms of development and redevelopment, residential construction in Hoboken, New Jersey, and Bala Cynwyd, Pennsylvania, are moving along nicely on or under budget and on time with leasing to begin in early 2026 at Bala Cynwyd. During the third quarter, we broke ground on 258 new residential units on the last surface parking lot at Santana Row, committing capital of roughly $145 million.

And intensify the land with more retail or residential GLA ware and whenever economically feasible.

Our business plan and strategy just on different land with the same characteristics. The affluent consumers underserved the centers are big and dominant in existing relevant tenants have proven that it's the place in the sub market to be.

Speaker #3: Operationally, this was a really strong quarter, and based on what we see thus far in October, should allow us to close out 2025 strong.

Speaker #3: In terms of development and redevelopment, residential construction in Hoboken, New Jersey, and Ballikinwood, Pennsylvania, are moving along nicely on or under budget, and on time with leasing to begin in early 2026 at Ballikinwood.

You might have also seen that we closed on the acquisition of Annapolis Town Center, and a plus location off state route 50, which heads into D C and Interstate 97, which takes you to Baltimore and Annapolis, Maryland.

Speaker #3: During the third quarter, we broke ground on 258 new residential units on the last surface parking lot at Santana Row, committing capital of roughly $145 million.

We bought the property for $187 million at a 7% Unlevered return with an anchor in Shadow anchor Foundation grounded by very successful retailers whole foods lifetime fitness and target, we expect to be able to enhance the surrounding merchandising with better and more productive tenancy, enabling higher rents. We're very excited about this addition in our core market.

Speaker #3: Those three projects, Hoboken, Bala, and Santana, will require roughly $280 million of capital, all in fully amenitized and proven environments and should yield 6.5 to 7% on levered.

Jill Sawyer: Those three projects, Hoboken, Bala, and Santana, will require roughly $280 million of capital, all in fully amenitized and proven environments, and should yield 6.5% to 7% unlevered. There is more to come in this component of our business in 2026. Current conditions suggest market value should be 150 to 200 basis points inside those returns. We're committed to realizing that value over time, as we've demonstrated with the sale of Lavari at Santana Row earlier this year, Palace at Pike & Rose, which is currently under contract for sale and should close right around year-end, and the current marketing of Messora at Santana Row. On the acquisition front, I really want to thank those of you that made the trip to Kansas City to join us for our investor tour of Town Center Crossing and Plaza in Leawood earlier this month.

Next up is another large dominant center in a growing Midwestern submarket that we expect to close this fourth quarter more to come on that one soon.

Speaker #3: There's more to come in this component of our business in 2026. Current conditions suggest market values should be $150 to $200 basis points inside those returns.

So that's about it for my prepared remarks.

Enhanced internal and external growth using all the tools at our disposal is the name of the game quarters like the third of 2025 increased my confidence of doing so let.

Speaker #3: We're committed to realizing that value over time as we've demonstrated with the sale of LaVarie at Santana Row earlier this year, Palace at Pike and Rose, which is currently under contract for sale, and should close right around year-end, and the current marketing of Messora at Santana Row.

Let me now turn it over to Wendy to expand on the leasing environment.

Thank you Jan and good morning, everybody.

Speaker #3: On the acquisition front, I really want to thank those of you that made the trip to Kansas City to join us for our investor tour of Town Center Crossing and Plaza in Leawood earlier this month.

<unk> performance for the quarter highlighted by record leasing volumes that they are significant.

As we conclude the year and look ahead to 2020.

Speaker #3: We're off to a great start there. From a cash flow and value-enhancing perspective, and I just want to reemphasize the two points that I think became apparent to investors and analysts on that trip.

Jill Sawyer: We're off to a great start there from a cash flow and value-enhancing perspective. I just want to re-emphasize the two points that I think became apparent to investors and analysts on that trip. First, that we are not sacrificing quality by expanding our geographical footprint. The growth prospects for these investments exceed both the retail and residential assets we're selling, and it is highly likely that the exit cap rates for the shopping centers we're pursuing will tighten considerably based upon our retenning and redevelopment. Second, this is not a change in strategy for Federal Realty Investment Trust.

As reflected in John's comment, we successfully recorded a record 123 comparable deals and impressive rent spreads of 28% over in place rents are operational metrics are in top form evidenced by strong occupancy healthy margins and reduced controllable.

Speaker #3: First, that we are not sacrificing quality by expanding our geographical footprint. The growth prospects for these investments exceed both the retail and residential assets we're selling, and it is highly likely that the exit cap rates for the shopping centers we're pursuing will tighten considerably based upon our re-tenanting and redevelopment.

Fences.

Underscoring its solid financial performance.

Speaker #3: And second, that this is not a change in strategy for FEDERAL. Our deep and experienced team is doing what it has always done. Lease it better, both from a merchandising and strength of lease contract standpoint.

Outstanding results overall for the quarter.

Jill Sawyer: Our deep and experienced team is doing what it has always done: lease it better, both from a merchandising and strength of lease contract standpoint, create a more inviting physical space that lengthens stay times and increases spend, and intensify the land with more retail or residential GLA where and whenever economically feasible. Same business plan and strategy, just on different land with the same characteristics. The affluent consumer is underserved. The centers are big and dominant, and existing relevant tenants have proven that it's the place in the submarket to be. You might have also seen that we closed on the acquisition of Annapolis Town Center in the A-plus location off State Route 50, which heads into D.C., and Interstate 97, which takes you to Baltimore in Annapolis, Maryland. We bought the property for $187 million at a 7% unlevered return.

Occupancy in the comparable pool continues to show momentum and our occupied rate climbed 40 basis points last quarter, and 20 basis points year over year to 94%.

Speaker #3: Create a more inviting physical space that lengthens stay times and increases spend, and intensify the land with more retail or residential GLA where and whenever economically feasible.

And overall occupancy basis, including all of our shopping centers, we stand at 93, 8% today.

Speaker #3: Same business plan and strategy, just on different land with the same characteristics. The affluent consumer is underserved. The centers are big, and dominant, and existing relevant tenants have proven that it's the place in the submarket to be.

Keep in mind, our two recent acquisitions, leawood, Indianapolis, where roughly 91% and 85% occupied at closing therefore impacting total overall occupancy as we head into the fourth quarter.

Speaker #3: You might have also seen that we closed on the acquisition of Annapolis Town Center in the A-plus location off State Route 50, which heads into DC and Interstate 97, which takes you to Baltimore in Annapolis, Maryland.

We encourage investors to focus on a comparable occupancy metric, which more accurately reflects the continued strength and momentum across our core portfolio.

Speaker #3: We bought the property for $187 million at a 7% unlevered return. With an anchor and shadow anchor foundation grounded by very successful retailers Whole Foods, Lifetime Fitness, and Target, we expect to be able to enhance the surrounding merchandising with better and more productive tenancy enabling higher rents.

Turning to our lease rate, our comparable <unk> strength and at a very healthy 95, 7%.

Jill Sawyer: With an anchor and shadow anchor foundation grounded by very successful retailers Whole Foods, Lifetime Fitness, and Target, we expect to be able to enhance the surrounding merchandising with better and more productive tenancy, enabling higher rents. We're very excited about this addition in our core market. Next up is another large and dominant center in a growing Midwestern submarket that we expect to close in this fourth quarter. More to come on that one soon. That's about it for my prepared remarks. Enhanced internal and external growth using all the tools at our disposal is the name of the game. Quarters like this third of 2025 increase my confidence of doing so. Let me now turn it over to Wendy to expand on the leasing environment. Thank you, Jan, and good morning, everybody.

We expect this figure to grow and show positive momentum into year end, driven by a strong pipeline, including over 175000 square feet of new leases currently in process for vacant space.

Speaker #3: We're very excited about this addition in our core market. Next up is another large and dominant center in a growing Midwestern submarket that we expect to close in this fourth quarter.

This represents roughly 70 basis points of incremental lease rate opportunity.

Speaker #3: More to come on that one soon. So that's about it for my prepared remarks. Enhanced internal and external growth using all the tools at our disposal is the name of the game.

While the third quarter saw record leasing volume a significant portion of this activity was for space, which currently with occupied this is a testament to the durability of the centers and reinforces future stability in our occupancy metrics.

Speaker #3: Quarters like this third of 2025 increase my confidence of doing so. Let me now turn it over to Wendy to expand on the leasing environment.

Speaker #4: Thank you, Jan, and good morning, everybody. Exceptional performance for the quarter highlighted by record leasing volumes that build significant forward momentum as we conclude the year and look ahead to 2026.

Providing embedded growth even if it doesn't immediately lift the red recorded rate.

Jill Sawyer: Exceptional performance for the quarter, highlighted by record leasing volumes that build significant forward momentum as we conclude the year and look ahead to 2026. As reflected in Don's comments, we successfully recorded a record 123 comparable deals at impressive rent spreads of 28% over in-place prior rents. Our operational metrics are in top form, evidenced by strong occupancy, healthy margins, and reduced controllable expenses, all underscoring a solid financial performance. Outstanding results overall for the quarter. Occupancy in the comparable pool continues to show momentum as our occupied rate climbed 40 basis points last quarter and 20 basis points year over year to 94%. On an overall occupancy basis, including all of our shopping centers, we stand at 93.8% today.

I pre leasing space, we effectively reduced downtime, we smooth out quarter to quarter revenue.

Speaker #4: As reflected in Don's comments, we successfully recorded a record $123 million comparable deals at impressive rent spreads of 28% over in-place prior rents. Our operational metrics are in top form, evidenced by strong occupancy, healthy margins, and reduced controllable expenses, all underscoring a solid financial performance.

And strengthen occupancy overtime. This proactive approach is a major focus.

Across our operating team.

We continue to see broad based.

Demand for quality real estate with a variety of best in class names and categories, such as chopped, although Burlington, our house and Ross to name a few.

And we continue to upgrade our retail lineup, including within our more recent acquisition, Virginia Gateway Hamburg in Leawood, These specific which names with names such as coach and Lego worthy Parker and Mercury.

Speaker #4: Outstanding results overall for the quarter. Occupancy in the comparable pool continues to show momentum as our occupied rate climbed 40 basis points last quarter and 20 basis points year over year to 94%.

We were able to drive rents and earn a return on our capital there.

Speaker #4: On an overall occupancy basis, including all of our shopping centers, we stand at 93.8% today. Keep in mind, our two recent acquisitions, Leawood and Annapolis, were roughly 91% and 85% occupied at closing, therefore impacting total overall occupancy as we head into the fourth quarter.

Merchandising and retail sales performance is our focus.

Loves Shaq, Nancy just had their grand opening this past weekend at the Grove in Shrewsbury attracted by the addition of our small format concept.

Jill Sawyer: Keep in mind our two recent acquisitions, Leawood and Annapolis, were roughly 91% and 85% occupied at closing, therefore impacting total overall occupancy as we head into the fourth quarter. We encourage investors to focus on our comparable occupancy metrics, which more accurately reflect the continued strength and momentum across the core portfolio. Turning to our lease rate, our comparable lease rate stands at a very healthy 95.7%. We expect the figure to grow and show positive momentum into year-end, driven by a strong pipeline, including over 175,000 square feet of new leases currently in process for vacant space. This represents roughly 70 basis points of incremental lease rate opportunity. While the third quarter saw record leasing volume, a significant portion of this activity was for space which currently was occupied.

Shaq P&C opened to a line out the door and had their best opening ever of that 25 locations.

Speaker #4: We encourage investors to focus on our comparable occupancy metrics which more accurately reflect the continued strength and momentum across the core portfolio. Turning to our lease rate, our comparable lease rate stands at a very healthy 95.7%.

Merchandising matters and non commodity centers.

Our acquisition of Annapolis Town Center. This quarter is a prime example of our discipline on.

Acquisition strategy.

479000 square foot mixed use retail property.

Firms are focused on acquiring high quality dominant centers in affluent markets.

Speaker #4: We expect the figure to grow and show positive momentum into year-end, driven by a strong pipeline, including over 175,000 square feet of new leases currently in process for vacant space.

With an 85% current occupancy rate. We expect the addition of Annapolis to provide meaningful growth with strong existing anchors like whole foods targeted lifetime.

Speaker #4: This represents roughly 70 basis points of incremental lease rate opportunity. While the third quarter saw record leasing volume, a significant portion of this activity was for space which currently was occupied.

And featuring popular retail brands, such as Sephora, RH pottery barn and Anthropologie.

Perfect addition to Maryland.

Two our Maryland portfolio.

Speaker #4: This is a testament to the durability of the centers and reinforces future stability in our occupancy metrics. Providing embedded growth, even if it doesn't immediately lift the recorded rate.

Jill Sawyer: This is a testament to the durability of the centers and reinforces future stability in our occupancy metrics, providing embedded growth, even if it doesn't immediately lift the recorded rate. By pre-leasing space, we effectively reduce downtime, we smooth out quarter-to-quarter revenue, and strengthen occupancy over time. This proactive approach is a major focus across our operating teams. We continue to see broad-based demand for our quality real estate with a variety of best-in-class names and categories such as Chopped, Alo, Burlington, Our House, and Ross, to name a few. We continue to upgrade our retail lineup, including within our more recent acquisitions, Virginia Gateway, Pembroke, and Leawood, to be specific, with names such as Coach and Lego, Warby Parker, and Blue Mercury. We were able to drive rents and earn a return on our capital there. Merchandising and retail sales performance is our focus.

Expect us to provide a number of tenant announcements for Annapolis on our next call.

With that I'll turn it over to Dan.

Thank you Wendy and Hello, everyone. Our reported <unk> per share for the third quarter of $1 77, both consensus and at the top end of our guidance range of $1 72 to $1 77.

Speaker #4: By pre-leasing space, we effectively reduce downtime, we smooth out quarter-to-quarter revenue, and strengthen occupancy over time. This proactive approach is a major focus across our operating teams.

Comparable POI growth for the quarter was four 4% on a GAAP basis, and three 7% on a cash basis, both metrics outperformed our expectations, primarily due to higher than forecasted revenues in retail residential embarking.

Speaker #4: We continue to see broad-based demand for our quality real estate, with a variety of best-in-class names and categories such as CHOP, Alo, Burlington, Our House, and Ross, to name a few.

And as a result, we will increase guidance for both 2025, that's up over share and comparable POI growth.

More to come on that later in my prepared remarks.

But first an update on the balance sheet.

Continue to have significant liquidity of approximately $1 $3 billion at quarter end comprised of availability on our $1 5 billion unsecured credit facility and over $100 million of cash at quarter end.

Committed active capital allocation program, our balance sheet remains strong.

Third quarter annualized net debt to EBITDA is solid and stands at five six times, reflecting the purchase of believe with assets and our fixed charge coverage stood at three nine times, we continue to look to execute on our capital recycling program.

Jill Sawyer: LoveShackFancy just had their grand opening this past weekend at The Grove in Shrewsbury, attracted by the addition of our small-format Blue Mercury concept. LoveShackFancy opened to a line out the door and had their best opening ever of their 25 locations. Merchandising matters in non-commodity centers. Our acquisition, Annapolis Town Center, this quarter is a prime example of our disciplined acquisition strategy. The 479,000 square foot mixed-use retail property confirms our focus on acquiring high-quality, dominant centers in affluent markets. With an 85% current occupancy rate, we expect the addition of Annapolis to provide meaningful growth with strong existing anchors like Whole Foods, Target, and Life Time, and featuring popular retail brands such as Sephora, RH, Pottery Barn, and Anthropologie, a perfect addition to our Maryland portfolio. Expect us to provide a number of tenant announcements for Annapolis on our next call. I'll turn it over to Dan.

With $400 million of assets at various stages in the asset sale process with roughly $200 billion expected to close by year end or shortly thereafter, and another 200 plus million forecasted to close in the first half of 2026 behind that we have a pool of over $1 billion of noncore assets under <unk>.

Incineration to be brought to market in 2026 and beyond.

Of that total roughly $1 $5 billion pool about a third as peripherally located residential with the other two thirds being noncore retail.

With estimated blended yields targeted in the mid to upper 5% cap rate range and blended unlevered IRR inside of seven.

Very attractively priced capital.

While leverage may fluctuate modestly from quarter to quarter, given the inherent timing differences between acquisition and sale transactions, we expect to maintain a long term net debt to EBITDA ratio in the low to mid five times range.

Jill Sawyer: Thank you, Wendy. Hello, everyone. Our reported FFO per share for the third quarter of $1.77 is above consensus and at the top end of our guidance range of $1.72 to $1.77. Comparable POI growth for the quarter was 4.4% on a GAAP basis and 3.7% on a cash basis. Both metrics outperformed our expectations, primarily due to higher-than-forecasted revenues in retail, residential, and parking. As a result, we will increase guidance for both 2025 FFO per share and comparable POI growth. More to come on that later in my prepared remarks. First, an update on the balance sheet. We continue to have significant liquidity of approximately $1.3 billion at quarter-end, comprised of availability on our $1.25 billion unsecured credit facility and over $100 million of cash at quarter-end. Amid an active capital allocation program, our balance sheet remains strong.

From a flexibility perspective with leverage metrics, where they are at over $1 5 billion of asset sales in process and under consideration. We are very well positioned to continue to be on offense with respect to capital deployment.

Now onto guidance as mentioned earlier with a third consecutive beaten raised.

We are raising our forecasted range.

<unk> per share excluding the new market tax credit work into a recurring <unk> to $7 five to $7 11.

This represents about four 6% growth.

This recurring basis at the midpoint over 2024, and roughly 4% to 5% at the low and high end of our range respectively.

Including the onetime new market tax credits and these figures our NAREIT defined <unk> range increases to $7 20 to $7 26, which represents six 8% growth at the midpoint over 2024.

Jill Sawyer: Third-quarter annualized net debt to EBITDA is solid and stands at 5.6 times, reflecting the purchase of the Leawood assets, and our fixed charge coverage stood at 3.9 times. We continue to look to execute on our capital recycling program, with $400 million of assets at various stages in the asset sale process, with roughly $200 million expected to close by year-end or shortly thereafter, and another $200-plus million forecasted to close in the first half of 2026. Behind that, we have a pool of over $1 billion of non-core assets under consideration to be brought to market in 2026 and beyond. Of that total, roughly $1.5 billion pool, about a third is peripherally located residential, with the other two-thirds being non-core retail. With estimated blended yields targeted in the mid to upper 5% cap rate range and blended unlevered IRRs inside of 7%. Very attractively priced capital.

This increase is driven by one center net operating outperformance during the quarter and roughly <unk> <unk> accretion from the Annapolis acquisition for the quarter, which translates to three to four on an annualized basis.

Third, quarter annualized, net debt to a solid and stands at 5.6 times reflecting the purchase of the Leewood assets and our fixed charge coverage. Stood at 3.9 times, we continue to look to execute.

On our Capitol.

Given another strong result for <unk>, we are increasing our forecast for 2025 comparable Oi growth Q3, and a half to 4% or 375% at the midpoint.

And that's 4% when excluding prior period rent and term fees.

We expect comparable occupied levels to be in the low 90 fours by year end given the deal signed to date.

Of that total roughly $1 $5 billion pool about a third as peripherally located residential where the other two thirds being noncore retail.

Re process with roughly 200 million expected to close by year, end or shortly thereafter. And another 200 plus million forecasted to close in the first half of 2026 behind that. We have a pool of over 1 billion dollars of non-core assets, under consideration to be brought to Market in 2026 and Beyond.

Continued robust pipeline of leasing activity, which continues to have momentum even after a record third quarter volumes.

Retail tenant demand for our portfolio showing no signs of abating to date.

With estimated blended yields targeted in the mid to upper 5% cap rate range and blended Unlevered IRR is inside of seven.

We do have one other acquisition that we have under contract that should close before year end.

Very attractively priced capital.

Roughly $150 million, although given the expected closing late in the quarter, we do not expect it to materially add to 2025.

Jill Sawyer: While leverage may fluctuate modestly from quarter to quarter, given inherent timing differences between acquisition and sale transactions, we expect to maintain a long-term net debt to EBITDA ratio in the low to mid-5 times range. From a flexibility perspective, with leverage metrics where they are and over $1.5 billion of asset sales in process and under consideration, we are very well positioned to continue to be on offense with respect to capital deployment. Now, onto guidance. As mentioned earlier, with a third consecutive beat and raise, we are raising our forecasted range for FFO per share, excluding the new market tax credit, more akin to a recurring FFO, to $7.05 to $7.11. This represents about 4.6% growth on this recurring basis at the midpoint over 2024 and roughly 4% to 5% at the low and high end of the range, respectively.

One thing to keep in mind the acquisitions, we've completed so far this year.

<unk> the one currently under contract.

From a flexibility perspective with leverage metrics, where they are at over $1 $5 billion of asset sales in process and under consideration. We are very well positioned to continue to be on offense with respect to capital deployment.

Will total over $750 million.

Blended initial cash yield of roughly 7% GAAP yield north of 7% and initial blended occupied rate just 88%.

Now onto guidance as mentioned earlier with a third consecutive beaten raised.

These are high quality assets with clear leasing upside, which will enhance enhanced growth in 2026 27 and beyond.

We are raising our forecasted range.

<unk> per share excluding the new market tax credit more akin to a recurring <unk> to $7 five to $7.11. This represents about four 6% growth on this recurring basis at the midpoint over 2024, and roughly 4% to 5% at the low and high.

The implied <unk> guidance for fourth quarter, $2025 182 to 188 and represents 7% growth year over year at the midpoint.

While we won't be providing formal 2026 guidance until our fourth quarter call in February we do expect a strong year operationally.

We're executing from a position of strength.

And the range respectively.

Jill Sawyer: Including the one-time new market tax credits in these figures, our newly defined FFO range increases to $7.20 to $7.26, which represents 6.8% growth at the midpoint over 2024. This increase is driven by 1% of net operating outperformance during the quarter and roughly 1% accretion from the Annapolis acquisition for the quarter, which translates to 3 to 4 cents on an annualized basis. Given another strong result for Q3, we are increasing our forecast for 2025 comparable POI growth to 3.5% to 4%, or 3.75% at the midpoint. That is 4% when excluding prior period rent and term fees. We expect comparable occupied levels to be in the low 94s by year-end, given the deal signed to date and the continued robust pipeline of leasing activity, which continues to have momentum even after the record third-quarter volumes.

Including the one time new market tax credits and these figures are near redefined our range increases to $7 20 to $7.26, which represents six 8% growth at the midpoint over 2024.

Investing in strategically maintaining balance sheet discipline and setting ourselves up for another year of meaningful growth ahead.

But before I hand, the call back to the operator, given the number of participants on the call. We kindly ask that you limit yourself to one question. During this segment of the call.

This increase is driven by one center net operating outperformance during the quarter and roughly one cent accretion from the Annapolis acquisition for the quarter, which translates to a three to four on an annualized basis.

Please know multi part questions.

You have additional questions. Please re queue.

And given the really tough news that Jill shared earlier.

Given another strong result for three Q, we are increasing our forecast for 2025 comparable Oi growth, two 3.5% to 4% or 375% at the midpoint.

Completely understand that many of you may want to send a message of support that Don and his family.

We respectfully ask that you refrain from expressing condolences on this call.

And that's 4% when excluding prior period rent and term fees.

So we can focus on the discussion on federal Realty in its third quarter results and keep the Q&A segment of the call as efficient as possible.

We expect comparable occupied levels to be in the low 90 fours by year end given the deals signed to date.

Thank you.

Continued robust pipeline of leasing activity, which continues to have momentum even after a record third quarter volumes.

And with that operator, please open the line for questions.

We will now begin the question and answer session to ask a question you May Press Star then one on your telephone keypad.

Jill Sawyer: Retail tenant demand for our portfolio is showing no signs of abating to date. We do have one other acquisition that we have under contract that should close before year-end of roughly $150 million. Although, given the expected closing late in the quarter, we do not expect it to materially add to 2025 FFO. One thing to keep in mind, the acquisitions we've completed so far this year, including the one currently under contract, will total over $750 million, have a blended initial cash yield of roughly 7%, a cap yield north of 7%, and an initial blended occupied rate of just 88%. These are high-quality assets with clear leasing upside, which will enhance growth in 2026, 2027, and beyond. Implied FFO guidance for fourth quarter 2025 is 182 to 188 and represents 7% growth year-over-year at the midpoint.

Retail tenant demand for our portfolio showing no signs of abating to date.

It really isn't a speakerphone please pick up your handset before pressing the keys.

We do have one other acquisition that we have under contract that should close before year end.

At any time. Your question has been addressed and you would like to withdraw your question. Please press Star then two.

Roughly $150 million, although given the expected closing late in the quarter, we do not expect it to materially add to 2025.

Please rejoin the queue for any follow up questions.

At this time, we will pause momentarily to assemble our roster.

One thing to keep in mind the acquisitions, we've completed so far this year.

<unk> the one currently under contract.

Well total over $750 million.

The first question comes from one Santa <unk> with BMO capital markets. Please go ahead.

Blended initial cash yield of roughly 7% GAAP yield north of 7% and initial blended occupied rate just 88%.

Hi, great. Thank you for the time.

Yeah.

For the team I guess.

These are high quality assets with clear leasing upside, which will enhance enhanced growth in 2026 27 and beyond.

Dan you talked about the dispositions and processing is kind of a blended cap rate, but just curious if you can give any color.

On how the two main buckets retail versus Rajiv compare.

The implied <unk> guidance for fourth quarter 2025 is 182 to 188 and represents 7% growth year over year at the midpoint.

Given kind of our early feedback on on what may be kind of out there in the marketplace to test pricing.

Jill Sawyer: While we won't be providing formal 2026 guidance until our fourth quarter call in February, we do expect a strong year operationally. We're executing from a position of strength. We're investing in strategically, maintaining balance sheet discipline, and setting ourselves up for another year of meaningful growth ahead. Now, before I hand the call back to the operator, given the number of participants on the call, we kindly ask that you limit yourself to one question during this segment of the call. Please, no multi-part questions. If you have additional questions, please reach you. Given the really tough news that Jill shared earlier, we completely understand that many of you may want to send a message of support to Don and his family.

We won't be providing formal 2026 guidance until our fourth quarter call in February we do expect a strong year operationally.

Sure sure Yeah look we've got as we mentioned $400 million in the market now, that's probably a little bit more skewed towards.

We're executing from a position of strength, where you're investing and strategically maintaining balance sheet discipline and setting ourselves up for another year of meaningful growth ahead.

Residential.

Overall, the $1 five.

Third of the peripheral residential two thirds.

Non core retail pricing is going to be kind of in and around five sub five for what were selling on the residential and it'll be in and around six six low sixes six sometimes high fives are on unimplemented basis on the retail.

But before I hand, the call back to the operator, given the number of participants on the call. We kindly ask that you limit yourself to one question. During this segment of the call.

Please know multi part questions.

You have additional questions. Please re queue.

And given the really tough news that Jill shared earlier.

And so blended we should be in the mid to upper fives overall, so I think a nice positive spread to where we're deploying the capital.

Completely understand that many of you may want to send a message of support that Don and his family.

Jill Sawyer: However, we respectfully ask that you refrain from expressing condolences on this call so we can focus on the discussion of Federal Realty Investment Trust and its third-quarter results and keep the Q&A segment of the call as efficient as possible. Thank you. With that, operator, please open the line for questions. We will now begin the question-and-answer session. To ask a question, you may press star then one on your telephone keypad. If you are using a speakerphone, please pick up your handset before pressing the keys. If at any time your question has been addressed and you would like to withdraw your question, please press star then two. Please rejoin the queue for any follow-up questions. At this time, we will pause momentarily to assemble our roster. The first question comes from Juan Sanabria with BMO Capital Markets. Please go ahead. Hi. Great. Thank you for the time.

In and around the high sixes low sevens on a cash basis.

We respectfully ask that you refrain from expressing condolences on this call.

GAAP yields above that.

So we can focus on the discussion of federal Realty in its third quarter results and keep the Q&A segment of the call as efficient as possible.

Thank you.

The next question comes from Michael Goldsmith with UBS. Please go ahead.

Thank you.

And with that operator, please open the line for questions.

Good morning, Thanks, a lot for taking my question.

We will now begin the question and answer session to ask a question you May Press Star then one on your telephone keypad.

You mentioned, you're not going to issue formal 2026 guidance, but you did talk about some of the factors right like Annapolis.

That's gonna Speakerphone, please pick up your handset before pressing the keys.

Is that Youll see next year.

If at any time. Your question has been addressed and you would like to withdraw your question. Please press Star then two please.

Well it is the capitalized interest on our regulatory interface. So can you outline any kind of any sort of onetime or other topics that you've already talked about for 2026, just so we can get a sense of.

Please rejoin the queue for any follow up questions. At this time, we will pause them entirely to assemble our roster.

Where the puck is going and what's the trajectory of the company.

Earnings growth next year could look like based on what you've already said.

The first question comes from one Santa Maria with BMO capital markets. Please go ahead.

Yes. Good question. Thank you Michael.

We.

With respect to two.

Hi, great. Thank you for the time.

One timers, obviously the big one time of really is what's occurred in 2025 with the new market tax credits.

Jill Sawyer: For the team, I guess. Dan, you talked about the dispositions and processing gave kind of a blended cap rate, but just curious if you can give any color on how the two main buckets, retail versus Red Sea, compare. Given kind of early feedback on what may be kind of out there in the marketplace to test pricing. Sure. Sure. Look, we've got, as we mentioned, $400 million in the market now. That's probably a little bit more skewed towards residential. Overall, the $1.5 billion is a third of the peripheral residential, two-thirds non-core retail. Pricing is going to be kind of in and around five, sub-five for what we're selling on the residential, and it'll be in and around six, low sixes, six, sometimes high fives on a blended basis on the retail. Blended, we should be in the mid to upper fives overall.

But the team I guess.

Dan you talked about the dispositions and processing gave kind of a blended cap rate, but just curious if you can give any color.

We would encourage folks if you want to understand kind of the true operational growth underlying the business is to exclude that one timer in 2025 and focus on the $7 and <unk> of kind of more of a recurring number.

On how the two main buckets retail versus Red Sea.

There.

And given kind of early feedback on on what may be kind of out there in the marketplace to test pricing.

And in terms of looking forward, we don't have anything or expect to have any one timers one.

Sure sure Yeah look Oh, we've got as we mentioned $400 million in the market now, that's probably a little bit more skewed towards residential.

Timers, we consider are recurring numbers term fees.

We think that's recurring so part of the business it's on Forecastable.

But we do not expect any kind of material differences from our current guidance, which we increased a little bit this quarter.

Overall, the 1 billion five there's a third of the peripheral residential two thirds are noncore retail pricing is gonna be kind of in and around five sub five.

The five $5 million to $6 million range.

So it should be consistent with that with regards to capitalized interest.

We're selling on the residential and it'll be in and around six six low sixes six sometimes high fives are on.

You brought up.

We had about $13 $5 million, we're expecting in the $13 million to $14 million range. This year we're.

On a blended basis on the retail.

We're not done we don't have a precise number but I think as a place holder using kind of a $10 million to $11 million kind of level for capitalized interest is something you can use for now, but we will provide more precision on that in February.

And so blended we should be in the mid to upper fives.

Jill Sawyer: I think a nice positive spread to where we're deploying the capital, in and around the high sixes, low sevens on a cash basis, and GAAP yields above that. Thank you. The next question comes from Michael Goldsmith with UBS. Please go ahead. Good morning. Thanks a lot for taking my question. Dan, you mentioned you're not going to issue formal 2026 guidance, but you did talk about some of the factors, right, like Annapolis and the benefit that you'll see next year, as well as the capitalized interest in San Antonio, where you're starting to fade. Can you outline kind of any sort of one-time or other topics that you've already talked about for 2026, just so we can get a sense of where the focus is going, what's the trajectory of the company, and what earnings growth next year could look like based on what you've already said?

Overall, so I think a nice positive spread to where we're deploying the capital in and around you know the high sixes low sevens on a cash basis and GAAP yields above that.

With regards to.

Growth in we don't have a precise number but right now our current guidance in 2025. The recurring number is in the mid fours four 6% I would expect that that feels like it should be somewhat consistent with where.

Thank you.

The next question comes from Michael Goldsmith with UBS. Please go ahead.

Good morning, Thanks, a lot for taking my question.

Where we'd expect things to be next year as well on a recurring basis keep in mind, that's with about 150 to 200 basis points of headwind from the refinancing of our bonds in February.

You mentioned, you're not going to issue formal 2026 guidance, but you did talk about some of the factors right.

Yes.

And.

What you'll see next year as well as the capitalized interest and Samsung.

That we're expecting and so that's call it five 5% to 7% underlying growth.

The peso can you outline kind of any sort of one time or other topics that you've already talked about for 2026, just so we can get a sense of where the puck is going and what's the trajectory of the company.

In the core business, which I think is we feel really really good about.

And so that's kind of I think the big numbers.

Earnings growth next year could look like based on what you've already said.

I would point you to we do expect we only had $3 million to $5 million of incremental development POI contribution this year.

Jill Sawyer: Thanks. Yeah. Good question. Thank you, Michael. With respect to one-timers, obviously, the big one-timer really is what's occurred in 2025 with the new market tax credit. We would encourage folks, if you want to understand kind of the true operational growth underlying the business, to exclude that one-timer in 2025 and focus on the $7.08 of kind of more of a recurring number. In terms of looking forward, we don't have anything or expect to have any one-timers. One-timers, we consider a recurring number as term fees. We think that's recurring. It's a part of the business. It's unforecastable. We do not expect any kind of material differences from our current guidance, which we increased a little bit this quarter in the $5 million, $5 to $6 million range. It should be consistent with that.

Yeah. Good question. Thank you, Michael we with respect to two one.

That will be up higher next year into the into the double digits, but will have a more precise number for you in 2000 and in terms of the 2026 incremental contribution on our call in February.

One timers, obviously the big one time of really is what's occurred in 2025 with the new market tax credit we would encourage folks if you want to understand kind of the true operational growth underlying businesses to exclude that one time or in 2025 and focus on the $7 and each sense of kind of more of a recurring number.

Our next question comes from Samir Khanal with Bank of America. Please go ahead.

Yeah.

Good morning, everybody.

And in terms of looking forward, we don't have anything or expect to have any one timers. One timers, we consider are recurring numbers term fees.

Sian or when the the spreads in the quarter were impressive 28% cash spreads.

I guess, if you take a step back how much of that is.

Sort of true market rent growth that youre seeing in your portfolio.

We think that's recurring so part of the business it's unfortunate the bowl.

Yes.

Versus maybe just sort of.

But we do not expect any kind of material differences from our current guidance, which we increased a little bit this quarter and are in the five $5 million to $6 million range. So it should be consistent with that with regards to capitalized interest you brought up we had about 13 and a half million dollars, we're expecting in the 13 to 14.

Our tenant upgrade is trying to understand that these spreads are sustainable.

And if there is a sort of this inflection of market rents that are taking place for your type of assets.

Jill Sawyer: With regards to capitalized interest, you brought up, we had about $13.5 million or expecting in the $13 to $14 million range this year. We're not done. We don't have a precise number, but I think as a placeholder, using kind of a $10 to $11 million kind of level for capitalized interest is something you can use for now. We'll provide more precision on that in February. With regards to growth, we don't have a precise number, but right now, at current guidance in 2025, the recurring number is in the mid-4s, 4.6%. I would expect that that feels like it should be somewhat consistent with where we'd expect things to be next year as well on a recurring basis. Keep in mind, that's with about 150 to 200 basis points of headwind from the refinancing of our bonds in February that we're expecting.

Sure. There is no question that the 28% is a is a strong number from us as you as you kind of the way I kind of look at it is more over a 12 month period, which is more we're seeing kind of in the mid teen.

Range this year.

We're not done we don't have a precise number but I think as a placeholder using kind of a $10 million to $11 million kind of level for capitalized interest is is something you can use for now, but we'll provide more precision on that in February.

And continue to be aggressive and it makes sense right because our R. R.

Our leased and occupied rate continue to increase that we're able to drive rents at that rate.

With regards to you know.

I think that it can be lumpy. So not every quarter will be 28%, but I think that we are definitely seeing some.

Growth are in.

Yeah, we don't have a precise number but right now our current guidance in 2025 now the recurring number is in the mid fours four 6% I would expect that that's feels like it should be somewhat consistent with where we'd expect things to be.

Our ability to drive rents and like I said that trailing 12 months should be should provide us in that mid teens.

And as the results will play out in the fourth quarter and into the first quarter.

Next year as well on a recurring basis keep in mind, that's worth about 150 to 200 basis points.

Our next question comes from Alexander Goldfarb with Piper Sandler. Please go ahead.

Of headwind from the refinancing of our bonds in February.

Hey, good morning down there.

Dan.

We're expecting them and so that's call it five 5% to 7% underlying growth.

Jill Sawyer: That's, call it, 5.5% to 7% underlying growth in the core business, which I think we feel really, really good about. That's kind of, I think, the big numbers I would point you to. We do expect we only had $3 million to $5 million of incremental development POI contribution this year. That will be up higher next year into the double digits. We'll have a more precise number for you in terms of the 2026 incremental contribution in the fall and February. Our next question comes from Samir Canal with Bank of America. Please go ahead. Good morning, everybody. I guess, Sean or Wendy, the spreads in the quarter were impressive, right? 28% cash spreads. I guess if you take a step back, how much of that is sort of true market rent growth that you're seeing in your portfolio versus maybe just sort of mix or tenant upgrades?

An outage Santana west.

You have that office tenant that you know.

In the core business, which I think is we feel really really good about.

Whenever it didn't take the space this year, whatever the that take space, making it ready that.

And so that's kind of I think the big numbers I would I would point you to we do expect you know, we only had $3 million to $5 million of incremental development P. O Y contribution this year that will be up higher next year into the well into the double digits well have a more precise number for you in 'twenty in terms of the 2012.

<unk> got delayed is that is that tenant looking to be on track for 26 meeting like should we expect.

Early in 2006 that that revenue would start flowing.

Or is that could that be further delayed from a revenue recognition standpoint.

Yes.

Our expectation is in line with our revised guidance earlier in the year that this fourth quarter, we will begin recognizing straight line rent and so there'll be.

Six incremental contribution on the call in February.

Our next question comes from Samir Khanal with Bank of America. Please go ahead.

We'll be recognizing on Pwc, which is roughly the 40% anchor tenant in the building.

Yeah.

Good morning, everybody, I guess Jan or Wendy the the spreads in the quarter were impressive right, 28% cash spreads.

We will be recognizing straight line rent and that's why that's one of the drivers of kind of the incremental <unk> that we will see from our development pipeline our development portfolio in 2026 so.

I guess, if you take a step back how much of that is.

Sort of true market rent growth that youre seeing in your portfolio.

Hum.

On.

Maybe just sort of makes our tenant upgrade is trying to understand that these spreads are sustainable.

In line with our expectations and will be a driver of growth next year.

Jill Sawyer: Trying to understand if these spreads are sustainable and if there's sort of this inflection of market rents that are taking place for your type of assets. Thanks. There's no question that the 28% is a strong number from us. The way I kind of look at it is more over a 12-month period, which is more we're seeing kind of in the mid-teens. We can continue to be aggressive, and it makes sense, right, because our leased and occupied rate continue to increase, so we're able to drive rents at that rate. I think that it can be lumpy, so not every quarter will be 28%, but I think that we are definitely seeing some ability to drive rents. Like I said, that trailing 12 months should provide us in that mid-teens as the results will play out in the fourth quarter and into the first quarter.

And if there's a sort of this inflection of market rents that are taking place for your type of assets.

Our next question comes from Michael Griffin with Evercore ISI. Please go ahead.

Well, there's no question that the 28% is that it's a strong number from us as you as you kind of the way I kind of look at it is more over a 12 month period, which is more we're seeing kind of in the mid teen.

Great. Thanks, maybe one for Jan just as it relates to sort of the investment pipeline and outlook I know in Kansas City, you talked about you know the.

Upside opportunity in some of these larger open air centers similar to town center versus maybe the premium the market is putting on more grocery anchor. So can you just talk about your thoughts on maybe the disconnect between those two types of properties I mean is it expectations for higher foot traffic at grocery anchor Center Thats may.

So look and continue to be aggressive and it makes sense right because R. R.

Our leased and occupied rate continue to increase so we're able to drive rents at that rate.

I think that it can be lumpy. So not every quarter will be 28%, but I think that we are definitely seeing some some ability to drive rents and like I said that trailing 12 months it should provide us in that mid teens.

Driving down that cap rate or is there just a broader disconnect versus the types of assets like a town center or Indianapolis that you all are targeting thank you.

Yeah. Thanks, Thanks, Michael Good good question.

Hum.

And as a result, well will play out in the fourth quarter and into the first quarter.

An interesting time in the in the market. There has historically been for at least the last 10 years strong demand for grocery anchored centers and cap rates have gotten bid down to relatively low levels. It sort of feels like they if they flattened out.

Jill Sawyer: Our next question comes from Alexander Goldsarb with Piper Sandler. Please go ahead. Hey. Good morning down there. Dan, on out at Santana West, you had that office tenant that, whatever, didn't take the space this year, whatever the take space, making it ready, that got delayed. Is that tenant looking to be on track for 2026, meaning should we expect sort of early in 2026 that that revenue would start flowing, or could that be further delayed from a revenue recognition standpoint? Yeah. Our expectation is in line with our revised guidance earlier in the year that this fourth quarter, we will begin recognizing straight-line rent. We'll be recognizing on PWC, which is roughly the 40% anchor tenant in the building. We'll be recognizing straight-line rent, and that's one of the drivers of the incremental POI that we'll see from our development pipeline or development portfolio in 2026.

Our next question comes from Alexander Goldfarb with Piper Sandler. Please go ahead.

Hey, good morning down there.

Dan Hi.

On out at Santana West you have that office tenant that you know.

Little bit.

And there just has not been as much capital in the market. In fact really recently has been very little capital in the market for larger transactions and so the few transactions that came to the market.

Whenever it didn't take the space this year, whatever the that take space Youre, making it ready that.

Got delayed is that is that tenant looking to be on track for 26 meeting like should we expect sort of early in 2006 that that revenue would start flowing or is that could that be further delayed from a revenue recognition standpoint.

There was good bidding for it but the yields were higher because they're just there wasn't that much competition for it and so this last in the second half of this year I think what we've seen is there's a lot of there's a lot of large large centers that have come to the market. There's a lot of theres more capital in the <unk>.

Yes.

In the market chasing those it still feels like there's a good supply demand equilibrium there.

Our expectation is in line with our revised guidance earlier in the year.

But it's just that we still see that spread happening here simply because the larger centers or they can be more complicated to execute there is a lot more leasing that needs to be done there.

This fourth quarter, we will begin recognizing straight line rent and so there'll be we'll be recognizing on pwc, which is roughly the 40% anchor tenant in the building.

And I, just think where we are one of the reasons, we're really interested in it as we think we get a great risk adjusted yield and buying these assets that are a little bit more complicated they're larger they're harder to operate because we've just got a great leasing team, we've got such great relationships with it with our merchants and we get so much Intel on these things before we actually start.

We'll be recognizing straight line rent and that's why that's a that's one of the drivers of kind of the incremental P. O Y that we will see from our development pipeline our development portfolio in 2026 and so on.

Jill Sawyer: In line with our expectations, and we'll be a driver of growth next year. Our next question comes from Michael Griffin with Evercore ISI. Please go ahead. Great. Thanks. Maybe one for Jan, just as it relates to sort of the investment pipeline and outlook. I know in Kansas City, you talked about the upside opportunity in some of these larger open-air centers similar to Town Center versus maybe the premium the market is putting on more grocery anchors. Can you just talk about your thoughts on maybe the disconnect between those two types of properties? I mean, is it expectations for higher foot traffic at grocery anchor centers that's maybe driving down that cap rate, or is there just a broader disconnect versus the types of assets like a Town Center or an Annapolis that you all are targeting? Thank you. Yeah. Thanks, Michael. Good question.

Yeah.

In line with our expectations and will be a driver of growth next year.

Bidding on them no, let's put them under contract and so we still think that spread is going to be there.

Our next question comes from Michael Griffin with Evercore ISI. Please go ahead.

It has not disappeared.

Great. Thanks, maybe one for you on just as it relates to sort of the investment pipeline and outlook I know in Kansas City, you talked about you know the upside opportunity in some of these larger open air centers similar to town center versus maybe the premium the market is putting on more grocery anchor. So can you just talk about.

Our next question comes from Sydney ROM with Barclays. Please go ahead.

Alright, thanks very much for taking my question I was wondering if you could elaborate a bit on the debt maturity schedule, and particularly with $200 million attached around mortgage I'm trying in December I saw there's two when your extension options. There. So I was just wondering with Oklahoma.

Your thoughts on maybe the disconnect between those two types of properties I mean is it expectations for higher foot traffic grocery anchor center, that's maybe driving down that cap rate or is there just a broader disconnect versus the types of assets like a town center or Indianapolis that you all are targeting thank you.

With regard specifically to the Tesoro and I'll talk a little bit more broadly about our maturity schedule going forward, but those ROE, we will be extending that for another year exercising the first of those two options would take us to the end of 2026, we have the flexibility to push it out to the end of 2027.

Yeah. Thanks, Thanks, Michael Good good question, an interesting time in the are in the market. There. There has historically been for at least the last 10 years strong demand for grocery anchored centers and cap rates have gotten bid down to relatively low levels. It sort of feels like they've they flattened out.

Jill Sawyer: Interesting time in the market. There has historically been, for at least the last 10 years, strong demand for grocery anchored centers, and cap rates have gotten bid down to relatively low levels, and it sort of feels like they've flattened out a little bit. There just has not been as much capital on the market. In fact, really recently, there's been very little capital on the market for larger transactions. The few transactions that came to the market, there was good bidding for it, but the yields were higher because there wasn't that much competition for it. In the second half of this year, I think what we've seen is there's a lot of large centers that have come to the market. There's more capital in the market chasing those. It still feels like there's a good supply-demand equilibrium there.

Low leverage surely is imminently financeable.

Financeable at the end as well so really no concerns there we did refinance our azalea alone, which has a maturity of tomorrow.

And so that's been refinanced at very attractive rates and the kind of Oh on the swap to fixed basis, it'll be end up in kind of the below floors.

A little bit.

And there just has not been as much capital in the market in fact really recently, there's been very little capital in the market for larger transactions and so the few transactions that came to the market there.

And then with regards to the maturity we have in February of our $400 million of bonds with a 1.25% we've got.

There was good bidding for it but the yields were higher because there's just there wasn't that much competition for it and so this last in the second half of this year I think what we've seen is there's a lot of there's a lot of large large centers that have come to the market. There's a lot of theres more capital in the are in the market chasing those it still feels like there's a good supply demand equilibrium.

We've got options and it's good to have options, whether it be in the bond market, whether it be in the bank term loan market, whether it be in the convertible market to have those options is really kind of.

You know being federal and having our high investment grade rating kind of allows us to do to be able to be opportunistic and nimble with regards to how we plan to refinance that and we'll look to optimize it and so more to come on that obviously in February.

I'm there.

Jill Sawyer: We still see that spread happening here simply because the larger centers can be more complicated to execute. There's a lot more leasing that needs to be done there. I just think one of the reasons we're really interested in it is we think we get a great risk-adjusted yield in buying these assets that are a little bit more complicated. They're larger. They're harder to operate because we've just got a great leasing team. We've got such great relationships with the merchants, and we get so much intel on these things before we actually start bidding on them, know let's put them under contract. We still think that spread's going to be there. It has not disappeared. Our next question comes from Simi Rome with Barclays. Please go ahead. Hi. Thanks very much for taking the question.

But it's just that we still see that spread happening here simply because the larger centers are they can be more complicated to execute if there's a lot more leasing that needs to be done there and I just think where we are one of the reasons. We're really interested in it as we think we get a great risk adjusted yield in buying these assets at all.

There'll be more color on exactly how we were.

Executed.

Our next question comes from Floris Van <unk> with Ladenburg. Please go ahead.

Little bit more complicated they're larger they're harder to operate because we've just got a great leasing team, we've got such great relationships with it with our merchants and we get so much Intel on these things before we actually start bidding on them no, let's put them under contract and so we still think that spread is going to be there. It has not disappeared.

Hey, thanks.

Question on your physical occupancy I know youre still about 160 basis points I believe below peak levels.

And maybe when do you if you can give some sort of update.

Our next question comes from Sydney ROM with Barclays. Please go ahead.

Updating on.

How quickly you see that trending and is there a chance that we could surpass that level over the next 18 months or so.

Alright, thanks very much for taking my question I was wondering if you could elaborate a bit on the debt maturity schedule and particularly in the $200 million attached around mortgage I'm trying in December I saw there is two one year extension options. There. So I was just wondering what the problem was.

Jill Sawyer: I was wondering if you could elaborate a bit on the debt maturity schedule and particularly the $200 million Bethesda Row mortgage maturing in December. I saw there's two one-year extension options there, so I was just wondering what the plan is. Thanks. Yeah. With regards specifically to Bethesda Row, and I'll talk a little bit more broadly about our maturity schedule going forward, but Bethesda Row, we will be extending that for another year, exercising the first of those two options which would take us to the end of 2026. We have the flexibility to push it out to the end of 2027. It's a low leverage. It surely is imminently financeable at the end as well. Really no concerns there. We did refinance our Azalea loan, which has a maturity of tomorrow. That's been refinanced at very attractive rates.

Sure. Thanks Floris.

I think what we're seeing is.

In terms of our ability to drive that occupancy rate up I'm feeling good about the anchor side of it I think is where we have more room to push that number and I think here that and see that as I mentioned in my comments was that 175000 square feet of space that we have really finalizing and signing leases.

Yeah with regard specifically to the best of ROE and I'll talk a little bit more broadly about our maturity schedule going forward, but it does draw we will be extending that for another year exercising the first of those two options will take us to the end of 2026, we have the flexibility to push it out to the end of 2027 is the low <unk>.

In the next quarter for spaces that are currently vacancy you're going to see that push up towards the end of the quarter and I think on the small shop side you know we're over 93% leased right now so I think we're going to use that as an opportunity to continue to drive rents. It could go up a little bit, but we're going to we will be like a little bit.

Average surely is imminently financeable at the end as well so really no concerns there we did refinance our azalea alone, which has a maturity of tomorrow and so that's been refinanced at very attractive rates and the kind of Oh, I'm, a swap to fixed basis it'll be end up in.

That frictional vacancy as I call. It that we can drive rents, but I think you're going to see more increase on the anchor side, which will overall increase our occupancy.

Jill Sawyer: On a swap-to-fix basis, it'll end up in kind of the below fours. With regards to the maturity we have in February of our $400 million of bonds with a 1.25%, we've got options. It's good to have options, whether it be in the bond market, whether it be in the bank term loan market, whether it be in the convertible market. To have those options is really kind of what being Federal and having our high investment-grade rating kind of allows us to do, to be able to be opportunistic and nimble with regard to how we plan to refinance that, and we'll look to optimize it. More to come on that. Obviously, in February, there'll be more color on exactly how we execute it. Our next question comes from Floris Van Dijkum with Ladenburg. Please go ahead. Hey. Thanks. Question on your physical occupancy.

Kind of the low fours.

And then with regards to the maturity we have in February of our $400 million of bonds with a 1.25%. We've got you now.

The next question comes from Cooper Clark with Wells Fargo. Please go ahead.

We've got options and it's good to have options are whether it be in the bond market, whether it be in the bank term loan market, whether it be in the convertible market to have those options is really kind of what.

Great. Thanks for taking the question curious how Annapolis is funded and how that ties into the <unk> accretion for <unk> in three to four for the full year I'm wondering if that <unk> accretion is combined with the 200 million of sales to find or just trying to figure out how that one is.

You know being federal and then having our high investment grade rating kind of allows us to do to be able to be opportunistic and nimble with regards to how we plan to refinance that and we'll look to optimize it and so more to come on that obviously in February you know there'll be more color on exactly how we would be.

Inclusive of sales to close by year end or not.

Yes.

What fungible and look we like.

You have a big balance sheet that allows us the flexibility to fund ultimately we've got capacity on our credit facilities are term loans temporarily we funded on that basis cash on hand, ultimately a long term basis. It will be on a permanent basis be funded with the asset sales.

We executed.

Our next question comes from Floris Van <unk> with Ladenburg. Please go ahead.

Hey, thanks.

Question on your physical occupancy I know, you're still about 160 basis points I believe below peak levels and maybe when do you. If you can give some sort of update on what you know how quickly you see that trending and is there a chance that we could.

Jill Sawyer: I note you're still about 160 basis points, I believe, below peak levels. Maybe, Wendy, if you can give some sort of update on. How quickly you see that trending, and is there a chance that we could surpass that level over the next 18 months or so? Sure. Thanks, Floris. I think what we're seeing is, in terms of our ability to drive that occupancy rate up, I'm feeling good about the anchor side of it. I think it's where we have more room to push that number. I think you're going to see that, as I mentioned in my comments, with that 175,000 square feet of space that we have really finalizing and signing leases in the next quarter for spaces that are currently vacant. You're going to see that push up towards the end of the quarter.

So the one set of accretion is really the spread between kind of a long term.

No basically yield or the initial yield they won and next 12 months realm.

Relative to where we're selling stuff in the.

Surpass that level over the next 18 months or so.

The initial yields in the mid to high fives and we're in the on a GAAP basis in the Sevens.

Sure. Thanks, Floris I think what we're what we're seeing is a in terms of our ability to drive that occupancy rate up I'm feeling good about the anchor side of it I think is where we have more room to push that number and I think here that and see that as I mentioned in my call.

That's how you get to the one the.

<unk> accretion on a quarterly basis for the fourth quarter and three to four.

On an annualized basis for the full year.

Hopefully that answers your question is good one.

But.

Hopefully that answers it.

Comments with that 175000 square feet of space that we have really finalizing and signing leases in the next quarter for spaces that are currently vacancy you're going to see that push up towards the end of the quarter.

Our next question comes from Greg Mcginniss with Scotiabank. Please go ahead.

The sneaker baidu on as Greg Mcginniss.

You are now in active it's down gross model could you share some details on competition for the assets you target and how it is impacting cap rates overall.

Jill Sawyer: I think on the small shop side, we're over 93% leased right now. I think we're going to use that as an opportunity to continue to drive rents. It could go up a little bit, but we like a little bit of that frictional vacancy, as I call it, that we can drive rents. I think you're going to see it more increase on the anchor side, which will overall increase our occupancy. Our next question comes from Cooper Clark with Wells Fargo. Please go ahead. Great. Thanks for taking the question. Curious how Annapolis is funded and how that ties into the $0.01 accretion for Q4 and $0.03 to $0.04 for the full year. Wondering if that $0.01 accretion is combined with the $200 million of sales to fund or just trying to figure out how that $0.01 is inclusive of sales to close by year-end or not. Yeah.

And I think on the small shop side, you know we're over 93% leased right now so I think we're going to use that as an opportunity to continue to drive rents. It could go up a little bit, but we're going to we will be like a little bit of that frictional vacancy as I call. It that we can drive rents, but I think you're going to see more increase on.

Trying to understand whether the pool of assets that checks all the boxes for federal RFP is shrinking or not.

Jan do you want to take.

Take that one yeah.

I'm not sure I totally heard the.

The anchor side, which will overall increase on occupancy.

<unk> question is a question in terms of what does the pool of future potential acquisitions look like is that was that the question.

The next question comes from Cooper Clark with Wells Fargo. Please go ahead.

Yeah, Yeah, as a result of fewer intense dynamic active and competition for the assets yeah, yeah, Okay, and the size of the cool yeah.

Great. Thanks for taking the question curious how Annapolis is funded and how that ties into the <unk> accretion for <unk> in three to four for the full year wondering if that one's done accretion is combined with the 200 million of sales to find or just trying to figure out how that one is.

Yeah, Yeah got it got it.

<unk>.

I sort of it sort of feels like we're we're in kantar.

<unk> equilibrium and by what I, what I mean by that is.

Go back 12 months or nine months ago, there weren't a lot of large transactions that were interested in that we are on the market and there weren't a lot of people chasing those type of those type of assets and so it felt so I could sort of was it was an equilibrium of today. There was a lot of large transactions that came on the <unk>.

Inclusive of sales to close by year end or not.

Yes, it's somewhat fungible and look we.

Jill Sawyer: Look, it's somewhat fungible. We have a big balance sheet that allows us the flexibility to fund. Ultimately, we've got capacity on our credit facilities and our term loans. Temporarily, we fund it on that basis, cash on hand. Ultimately, on a long-term basis, it will be, on a permanent basis, be funded with the asset sales. The $0.01 accretion is really the spread between kind of the long-term yield or the initial yield day one and next 12 months relative to, we're selling stuff in the initial yields in the mid to high 5%, and we're on a GAAP basis in the 7%. That's how you get to the $0.01 accretion on a quarterly basis for the fourth quarter and $0.03 to $0.04 on an annualized basis for the full year. Hopefully, that answers your question. It's a good one, Cooper, but hopefully, that answers it.

Do you have a big balance sheet that allows us the flexibility to fund ultimately we've got capacity on our credit facilities are term loans temporarily we fund it on that basis cash on hand, ultimately a long term basis. It will be on a permanent basis be funded with the asset sales.

Market in April May June.

We're also matched by more capital coming in looking at those are those acquisitions and those possibilities and so it feels like we're sort of while theres more competition out there I think it's more work for the sellers trying to understand who's real on the bid sheet.

So the one set of accretion is really the spread between kind of a long term.

It's likely.

Yields are or the initial yield they won and in next 12 months.

And of the ones that are a real who are the ones that really stand out as being able to work through issues and be at the closing at the end and as we think through we think we compete very well on that on that basis. So just from a competitive standpoint. It feels like we're sort of in the same position from an equilibrium standpoint, we'll have to see what happens in 'twenty six and.

Relative to where we're selling stuff in the.

The initial yields in the mid to high fives and we're in the on a GAAP basis in the Sevens.

That's how you get to the one the one set of accretion on a quarterly basis for the fourth quarter and three to four.

Beyond that but we would expect it to continue to see more large transactions coming to the market later this year or beginning of next year and we think we're in a pretty good competitive position to make a play for them.

On an annualized basis for the full year.

Hopefully that answers your questions good one Cooper, but I'm.

Hopefully that answers it.

Yes.

Jill Sawyer: Our next question comes from Greg McGinniss with Scotiabank. Please go ahead. Hello. This is Victor Fedeola with Greg McGinniss. As you are now in an active external growth mode, could you share some details on current conditions for the assets you target and how it is impacting debt rates overall? Just trying to understand whether the pool of assets that check all the boxes for Federal is shrinking or not. Jan, do you want to take that one? Yeah. I'm not sure I totally heard the full question. Is the question in terms of what does the pool of future potential acquisitions look like? Was that the question? Yeah. As a result of current kind of dynamic and competition for the assets. Yeah. Just trying to understand the size of the pool. Yeah. Got it. It sort of feels like we're in continued equilibrium.

Our next question comes from Greg Mcginniss with Scotiabank. Please go ahead.

That another thing that is not kind of I think fully appreciate it yes.

Oh, there's a sneaker baidu along with Greg Mcginniss.

Is the skill set that we have this federal realty, whether it be in our leasing.

You are now in an active extent on gross margin could you share some details on Q.

Capability of our relationships with tenants, our ability to add place, making and and other things that enhance.

For Dan asked Whats your target and how it is impacting cap rates overall, just trying to understand whether the pool of assets that checks all the boxes for federal.

The operations and productivity of the assets that we buy a lot of these assets are under managed and Theyre not.

RF is shrinking or not.

Jan do you want to.

It's not easy it's not low hanging fruit and you need a really really good operator to drive those kind of results and I think thats a competitive advantage we have over much of the capital that we're competing with and we can do things that others can't in terms of driving our upside and NOI upside.

I'll take that one yeah I'm not sure I totally heard the full question is a question in terms of what does the pool of future potential acquisitions look like is that was that the question.

Yeah, Yeah, as a result of fewer intense dynamic and competition for the assets yeah, yeah. Okay in the size of the cool yeah yeah.

These potential acquisitions.

Yeah, Yeah got you got it all right so the.

I sort of it sort of feels like we're we're in continued equilibrium and by what I. What I mean by that is you know go back 12 months or nine months ago. There weren't a lot of large transactions that were interested in that were on the market and there weren't a lot of people chasing those type of those type of <unk>.

Our next question comes from Craig Mailman with Citi. Please go ahead.

Jill Sawyer: By what I mean by that is, go back 12 months or 9 months ago, there weren't a lot of large transactions that we're interested in that were on the market, and there weren't a lot of people chasing those type of assets. It felt like it was in equilibrium. Today, there were a lot of large transactions that came on the market in April, May, June that were also matched by more capital coming in looking at those acquisitions and those possibilities. It feels like while there's more competition out there, I think it's more work for the sellers trying to understand who's real on the bid sheet. Of the ones that are real, who are the ones that really stand out as being able to work through issues and be at the closing at the end.

You may be right Greg.

Greg We don't hear you.

And so it felt so I could sort of wasn't it was an equilibrium of today. There was a lot of large transactions that came on the market in April May June.

Yeah, you're on mute.

Okay. We'll go to the next question.

Uh huh.

They were also matched by more capital coming in looking at those are those acquisitions in and those possibilities and so it feels like we're sort of while theres more competition out there I think it's more work for the sellers trying to understand you know who's real on the bid sheet and of the ones that are a real who are the ones that really.

Operator. The next question is from Ravi Baby out with Mizuho. Please go ahead.

Hi, there good morning can.

Can we discuss the snow pipeline how much do we have in total rent that's embedded in that pipeline and what the projected timeline for this to come online.

Do you think it will compress from here on how and where is the room for this to expand further as occupancy grows. Thanks.

Standout as being able to work through issues and be at the closing at the end and as we think through we think we compete very well on that on that basis. So just from a competitive standpoint. It feels like we're sort of in the same position from an equilibrium standpoint, well have to see what happens in 'twenty six and beyond that but we would expect.

Jill Sawyer: As we think through, we think we compete very well on that basis. Just from a competitive standpoint, it feels like we're in the same position from an equilibrium standpoint. We'll have to see what happens in 2026 and beyond that. We would expect to continue to see more large transactions coming to the market later this year, beginning of next year. We think we're in a pretty good competitive position to make a play for them. I think that another thing that is not fully appreciated is the skill set that we have as Federal Realty, whether it be in our leasing capability, our relationships with tenants, our ability to add placemaking and other things that enhance the operations and productivity of the assets that we buy. A lot of these assets are undermanaged, and it's not easy. It's not low-hanging fruit.

Great question, Ravi and Craig re queue, we'll get to your question or whatever the technical difficulty we didn't hear you, but please re queue. So we can we are we want to hear from you Ravi great question.

So is.

To continue to see more large transactions coming to the market later this year or beginning of next year and we think we're in a pretty good Quebec competitive position to to make a play for them.

Is gonna be.

About $20 million in the comparable portfolio and another $18 million and kind of the to be delivered portfolio.

Yeah, and look I think that another thing that is not kind of I think fully appreciate it and yes. It is the skill set that we have instead of realty, whether it be in our leasing our capability to our relationships with tenants our ability to go and place, making and and other things that.

So $38 million in total in.

In terms of.

About a quarter of that will come online or on an annualized basis begin and commence.

In the fourth quarter about call it 60% should be in 2026, and the remaining 15% should occur.

Hence.

Bullet Ah in 2027, the most part.

The operations and productivity of the assets that we buy a lot of these assets are under managed and Theyre not.

Yeah the.

Probably of the 60% next year.

It's not easy it's not low hanging fruit and you need a really really good operator to drive those kind of results and I think that's a competitive advantage we have over much of the capital that we're competing with and we can do things that others can't in terms of driving Oh, why outside and NOI upside at.

Jill Sawyer: You need a really, really good operator to drive those kind of results. I think that's a competitive advantage we have over much of the capital that we're competing with. We can do things that others can't in terms of driving POI upside and NOI upside at these potential acquisitions. Our next question comes from Greg Mailman with Citi. Please go ahead. You may be muted. Greg? Greg, we don't hear you. You're on mute. We'll go to the next question. Operator, the next question is from Ravi Vaidya with Mizuho. Please go ahead. Hi there. Good morning. Can we discuss the S&O pipeline? How much do we have in total rent that's embedded in that pipeline, and what's the projected timeline for this to come online? Do you think it will compress from here on out, or is there room for this to expand further as occupancy grows? Thanks.

<unk>, probably three quarters of it is going to be call. It $70, 70% to 75% should be in the first half of the year.

Obviously <unk> has become a is helpful. For you guys from a modeling perspective, it only tells half the story.

When you look at <unk> you have to look at the other side of that is filling the top of the bucket SNL what is the leaks in the bottom of the bucket what is your credit.

These potential acquisitions.

Our next question comes from Craig Mailman with Citi. Please go ahead.

Reserve with the credit profile of your tenancy.

I think that that needs to be looked at in tandem. So we'd encourage you guys to the extent that snow is important to you.

That you look at both sides of that with regards to our snow given what when he had indicated we expect our leased rate to grow into the fourth quarter and into the beginning of 2026.

You may be right right.

Greg We don't hear you.

Yeah, you're on mute.

That should grow our spread between our leased rate occupied rate both of them should trend upwards, which is what you want I think that's more important the direction of your occupancy metrics than necessarily what the spread is between the two we will look to it may increase up to.

Okay. We'll go to the next question.

Uh huh.

Operator. The next question is from Ravi Baby out with Mizuho. Please go ahead.

Hi, there good morning can we discuss the snow pipeline how much do we have in total rent that's embedded in that pipeline and what the projected timeline for this to come online.

200 basis points, but our objective is to tighten that as much as we can and get in check out of historical levels in the low <unk>.

Do you think it will compress from here on out and or is there room for this to expand further as occupancy grows. Thanks.

100, 100 to 150 basis points, that's obviously kind of where we'd like to be because that shows efficiency and getting tenants open and it. All is also an indication of the credit quality.

Jill Sawyer: Great question, Ravi. Greg, re-queue. We'll get to your question for whatever the technical difficulty. We didn't hear you, but please re-queue so we can. We want to hear from you. Ravi, great question. S&O is going to be about $20 million in a comparable portfolio and another $18 million in kind of the to-be-delivered portfolio, so $38 million in total. About a quarter of that will come online or, on an annualized basis, begin and commence in the fourth quarter. About 60% should be in 2026, and the remaining 15% should occur in 2027, for the most part. Probably of the 60% next year, roughly probably three-quarters of it is going to be, 70% to 75% should be in the first half of the year. Obviously, S&O has become helpful for you guys from a modeling perspective. It only tells half the story.

Great question, Ravi and Craig you'll reach you will get to your question or whatever the technical difficulty we didn't hear you, but please re queue. So we can oh, we are we want to hear from you Ravi Great question Snow is.

Of your tenancy.

We can maintain a very very tight SNL.

Everyone likes to say.

Is gonna be.

About $20 million in the comparable portfolio and another $18 million.

Our next question comes from Craig Mailman with Citi. Please go ahead.

The to be delivered portfolio.

So $38 million in total.

Hey, guys. This is sidney on for Craig I think he's having some technical difficulties. So Wendy you mentioned that tenants are vying for currently occupied space.

In terms of.

About a quarter of that will come online or on an annualized basis begin and commence.

In the fourth quarter about call it 60% should be in 2026, and the remaining 15% should occur.

Two to three quarters and years ahead of exploration now is this is a significant trend that youre seeing or is this more anecdotal and how much of this activity actually drive the cash spreads on new leases during the quarter.

All at a in 2027, the most part.

Yeah the.

Probably of the 60% next year.

Yes. Thank you for the question Sidney.

Awfully, probably three quarters of it is going to be called $70, 70% to 75% should be in the first half of the year.

You know when I look at what we've been doing over the last.

Several quarters, you can see that our rate of new deals that are are being basically signed up for space. That's already occupied and continue to pick up so maybe its more oil in that if you. If you look kind of coming out of Covid, we were leasing where we had more vacancy we are amazed.

Obviously <unk> has become a is helpful. For you guys from a modeling perspective. It only tells half the story I mean, when you look at <unk> you have to look at the other side of that is filling the top of the bucket. So now what is the leaks in the bottom of the bucket what is your credit.

Jill Sawyer: When you look at S&O, you have to look at the other side of that—filling the top of the bucket, S&O. What is the leaks in the bottom of the bucket? What is your credit reserve? What's the credit profile of your tenancy? I think that needs to be looked at in tandem. We encourage you guys, to the extent that S&O is important to you, that you look at both sides of that. With regards to our S&O, given what Wendy had indicated, we expect our lease rate to grow into the fourth quarter and into the beginning of 2026. That should grow our spread between our lease rate and occupied rate. Both of them should trend upwards, which is what you want. I think that's more important, the direction of your occupancy metrics than necessarily what the spread is between the two.

Reserve was the credit profile of your tenancy I think that that needs to be looked at in tandem. So I would encourage you guys to the extent that snow is important to you.

In space that was occupied in the 30% 40% range now were up to 50 60 in this quarter was 70%.

But we're.

That you look at both sides of that with regards to our snow given what when he had indicated we expect our leased rate to grow into the fourth quarter and into the beginning of 2026.

Leasing is arnie for occupied space. So I think that will continue as our occupancy and lease rates go up and I think it's showing a healthy.

Our ability to reduce downtime and to level out our revenues quarter to quarter and that's really what we're focused on.

Our next question comes from Hong Leon <unk> with J P. Morgan. Please go ahead.

Jill Sawyer: We will look to it may increase up towards 200 basis points, but our objective is to tighten that as much as we can and get into kind of historical levels in the low hundreds, 100 to 150 basis points. That's obviously kind of where we'd like to be because that shows efficiency in getting tenants open. It is also an indication of the credit quality of your tenancy if you kind of can maintain a very, very tight S&O, as everyone likes to say. Our next question comes from Craig Mailman with Citi. Please go ahead. Hey, guys. This is Sydney on for Craig. I think he was having some technical difficulties. Wendy, you mentioned that tenants are vying for currently occupied space two to three quarters and years ahead of expirations now. Is this a significant trend that you're seeing, or is this more anecdotal?

Yeah, Hey, Hey, Dan I guess, a quick question for clarification, I think you talked about <unk> growth being kind of in the mid fours on a recurring basis going forward is that just for the current portfolio or does that also layer on potential future acquisition and disposition activity too.

200 basis points, but our objective is to tighten that as much as we can and get in check out of historical levels in the low <unk>.

Hundreds gel 100 to 150 basis points, that's that's obviously kind of where we'd like to be because that shows efficiency and getting tenants open and it. All is also an indication of the credit quality.

Yeah, No that's just kind of with what's in place.

Of your tenancy.

For the most part it reflects kind of expectations with Annapolis.

Kind of can maintain a very very tight S. N L. A as everyone likes to say.

But it does not.

Assume any incremental acquisitions.

Our next question comes from Craig Mailman with Citi. Please go ahead.

And in 20 years speculative acquisitions in 2026 that would be additive, yes, given our our objective of doing acquisitions that are accretive from day. One obviously that is the poor or the mid fours is kind of the baseline and acquisitions will enhance.

Hey, guys. This is sidney on for Greg I think he was having some technical difficulties. So Wendy you mentioned that tenants are vying for currently occupied space Yeah.

Two to three quarters and years ahead of explorations now is this is a significant trend that youre seeing or is this now more anecdotal and how much of this activity actually drive the cash spreads on new leases during the quarter.

You know that figure kind of going forward.

No embedded assumptions on speculative acquisitions or dispositions in that number.

Jill Sawyer: How much does this activity actually drive the cash spreads on new leases during the quarter? Yes. Thank you for the question, Sydney. When I look at what we've been doing over the last several quarters, you can see that our rate of new deals that are being basically signed up for space that's already occupied has continued to tick up. Maybe it's more in the, if you look kind of coming out of COVID, we had more vacancy. We were leasing space that was occupied in the 30, 40% range. Now we're up to 50, 60%, and this quarter was 70% of what we're leasing is already for occupied space. I think that'll continue as our occupancy and lease rates go up. I think it's showing a healthy ability to reduce downtime and to level out our revenues quarter to quarter. That's really what we're focused on.

Our next question comes from Tayo Okusanya with Deutsche Bank. Please. Please go ahead.

Yes. Thank you for the question Sidney.

When I look at what we've been doing over the last.

Hi, good morning.

Several quarters, you can see that our rate of new deals that are being basically signed up for space. That's already occupied and continue to pick up so maybe its more all in that if you. If you look kind of coming out of Covid. We were leasing we had more vacancy leasing.

Can you talk a little bit about the $150 million.

Acquisition that can make it happen.

By year end, if you can just kind of a general sense of kind of what it is where it is.

Yeah, I know John you can add on I'll, just get it look we'll announce that when we close on it.

Space that was occupied in the 30% to 40% range now were up to 50 60 in this quarter was 70%.

We are expecting or under contract, it's roughly $150 million.

As Don alluded to it's got them in a it's a.

But we're leasing is arnie for occupied space. So I think that will continue as our occupancy and lease rates go up and I think it's showing a healthy.

What will be a similar market to a L leawood, Kansas type of location.

We'll announce that when it closes as is our policy and kind of what we do on a normal basis, yeah, you're on I dunno way with regards to the returns.

Our ability to reduce downtime and to level out our revenues quarter to quarter and that's really what we're focused on.

It's going to be consistent with the returns that we've been achieving on the assets to date, John I don't know if theres any other color, but I think that's what we're probably prepared to.

Jill Sawyer: Our next question comes from Honglian Sun with JPMorgan. Please go ahead. Yeah. Hey, Dan. I guess a quick question or clarification. I think you talked about FFO growth being kind of in the mid fours on a recurring basis going forward. Is that just for the current portfolio, or does that also layer on potential future acquisition and disposition activity too? Yeah. No, that's just kind of with what's in place. For the most part, it reflects kind of expectations with Annapolis. It does not assume any incremental acquisitions in 2025 or speculative acquisitions in 2026. That would be additive. Given our objective of doing acquisitions that are created from day one, obviously, the mid fours is kind of the baseline. Acquisitions will enhance that figure kind of going forward. There's no embedded assumptions on speculative acquisitions or dispositions in that number.

Our next question comes from Hong Leon <unk> with J P. Morgan. Please go ahead.

Yeah.

To give you today a sale.

Yeah, Hey, Hey, Dan I guess, a quick question for clarification, I think you talked about <unk>.

Yes, no I think you nailed it Dan I think the only thing I would just add or reemphasize is it'll it'll it's going to be it's a great city its rate MSA. It fits it unbelievably well in the affluent submarket in the affluent customer there is underserved and there is pent up demand in the marketplace and I think that we'll be able to demonstrate that to talk about it.

<unk> growth being kind of in the mid fours on a recurring basis going forward is that just for the current portfolio or does that also layer on potential future acquisition and disposition activity too.

Yeah, No that's just kind of with what's in place.

Once we once we close it so that's what I would add to it.

For the most part it reflects kind of.

And I'd add another thing that this is an off market transaction.

<unk> with Annapolis.

But it does not.

Something that was sourced off market.

Assume any incremental acquisitions.

And it fits perfectly within kind of the new federal playbook in terms of op metros.

And in 20 years speculative acquisitions in 2026 that would be additive.

Given our you know our objective of doing acquisitions that are accretive from day. One obviously that is the poor or the mid fours is kind of the baseline and acquisitions will enhance.

The dynamic.

Employment.

Dominant assets with a meaningful size and significant trade area affluence unmet retail demand and proven hits and checks all of those boxes. So we're excited about it and.

You know that figure Ah kind of going forward. It's a there's no embedded assumptions on speculative acquisitions or dispositions in that number.

Stay tuned.

Our next question comes from Linda Tsai with Jefferies. Please go ahead.

Jill Sawyer: Our next question comes from Omatayo Okasania with Deutsche Bank. Please go ahead. Hi. Good morning. Could you talk a little bit about the $150 million acquisition that's going to happen by year end? If you just kind of give a general sense of kind of what it is, where it is. Yeah. Jan, you can add on. I'm just going to look. We'll announce that when we close on it. We are expecting, we're under contract. It's roughly $150 million. As Don alluded to, it will be a similar market to a Leawood, Kansas type of location. We'll announce that when it closes, as is our policy and kind of what we do on a normal basis. Jan, I don't know. With regards to returns, it's going to be consistent with the returns that we've been achieving on the assets to date.

Our next question comes from Tayo Okusanya with Deutsche Bank. Please. Please go ahead.

Hi, Thanks for taking my question it sounds like including what you have under contract to sell 200 closing by year end and another 200 closing in 2026, you can be selling up to the one 5 billion. You've identified is it feasible to replenish with another $1 5 billion and recycled that as well just wondering about the length of runaway for unlocking of value creation.

Hi.

Morning.

Could you talk a little bit about the $115 million.

Acquisition that can make that happen.

By year end, if you can just kind of a general sense of kind of what it is where it is.

<unk>.

Yeah, well I look I, it's a great question, Linda and thanks, I think that the that gives us runway probably into 'twenty, seven and the existing $1 billion.

Yeah.

John you can add on and I'll just go to the well, we'll announce that when we close on it we are expecting or under contract, it's roughly $150 million.

As Don alluded to it's got them in a it's a.

It gives us a runway. These are identified we think that they will attract interest from the market and so forth do we have more behind that is there. Yes, I mean, we could kind of delve in I think this is the near term next 18, 24 36 month pool that we're considering.

Well it will be a similar market to a yes.

We would Kansas type of location.

We will announce that when it closes as is our policy and kind of what we do on a normal basis, you're on I Dunno way with regards to the returns you know what's going to be consistent with the returns that we've been achieving on the assets to date, John I don't know if there's any other color, but I think that's what we're probably prepared to.

And is there more behind it.

Yes.

No.

We need to be thoughtful a lot of what we are.

Jill Sawyer: Jan, I don't know if there's any other color, but I think that's what we're probably prepared to give you today. Yeah. No, I think you nailed it, Dan. I think the only thing I would just add re-emphasizes,

We own and are in our portfolio and significant gains because we've created significant amounts of value in these assets and so we need to be thoughtful with regards to managing that ideally we'd like to do that through 10 31 exchanges.

Yeah ill give you today Oh.

Yeah, No I think.

You nailed it Dan I think the only thing I would just add or reemphasize is it'll it'll it's going to be it's a great city its rate MSA it fits unbelievably well in the affluent submarket in the affluent customer there is underserved and there's pent up demand in the marketplace and I think that we'll be able to demonstrate that and talk about it once we once we.

Operator: It's going to be, it's a great city, it's a great MSA, it fits unbelievably well in the affluent submarket, and the affluent customer there is underserved, and there's pent-up demand in the marketplace. I think that we'll be able to demonstrate that and talk about it once we close it. That's what I would add.

So that also has got a governor but to the extent, we need to accelerate because we see more opportunities in the market.

To deploy capital on the acquisition front or <unk>.

And redevelopments are and so forth.

Close it so that's what I would add.

Dan Guglielmone: I'd add another thing that this is an off-market transaction, something that was sourced off-market, and it fits perfectly within kind of the new Federal playbook in terms of top metros, with a dynamic employment, dominant assets with, you know, a meaningful size and significant trade area, affluence, unmet retail demand, and proven hits and checks all of those boxes. We're excited about it, and, you know, stay tuned.

Have that ability to ask.

Yeah, and I'd add another thing that this is an off market transaction.

Accelerate.

And move up some of the pool to the forefront of activity in our inner asset sale process.

Something that was sourced off market.

And it fits perfectly within the new federal playbook in terms of top metros.

The next question comes from Kenneth Billingsley with Compass point. Please go ahead.

The dynamic employment dominant assets with a meaningful size and significant trade area affluence unmet retail demand and proven hits and checks all those boxes. So we're excited about it and stay.

Hi, good morning, Thanks for taking my question.

And a follow up thank you.

Made some comment on.

Believe me, but looking at renewal rates are up 29%.

<unk> was the highest in the last 12 months.

Can you maybe just discuss.

One of our key item there could you just need discuss what formulated.

Stay tuned.

Jill Sawyer: Our next question comes from Linda Tsai with Jefferies. Please go ahead.

Our next question comes from Linda Tsai with Jefferies. Please go ahead.

Hi increase on a renewal basis.

[Analyst]: Hi, thanks for taking my question. It sounds like including what you have under contract to sell, $200 million closing by year-end, and another $200 million closing in 2026, you could be selling up to the $1.5 billion you've identified. Is it feasible to replenish with another $1.5 billion and recycle that as well? Just wondering about the length of runway for unlocking of value creation.

Yeah look we were able to push rents on the renewals yeah look timing of renewals. It ebbs and flows we happen to have a significant amount of opportunity this quarter and those deals got done there were some see some really strong renewal rates that we were able to achieve.

Hi, Thanks for taking my question it sounds like including what you have under contract to sell 200 closing by year end and another 200 closing in 2026, you can be selling up to the one 5 billion. You've identified is it feasible to have replenished with another $1 5 billion and recycled that as well just wondering about the length of runaway for unlocking of value creation.

And you know in terms of the volume of renewals that happens that'll ebb and flow over time I think there were a number of deals that we're able to get renewables at rates that were kind of above average I would not expect us to maintain continue to be driving renewal rates.

<unk>.

Dan Guglielmone: Yeah, it's a great question, Linda, and thanks. I think that gives us runway probably into 2027, and the existing $1 billion gives us runway. These are identified. We think that they'll attract interest from the market and so forth. Do we have more behind that? Yes. I mean, we could delve in. I think this is the near-term, the next 18, 24, 36-month pool that we're considering. Is there more behind it? Yes. We need to be thoughtful. A lot of what we own in our portfolio has significant gains because we've created significant amounts of value in these assets. We need to be thoughtful with regards to managing that. Ideally, we'd like to do that through 1031 exchanges, so that also is a governor.

Yeah, well I look I, it's a great question, Linda and thanks, I think that the that gives us runway probably into 'twenty seven and the existing $1 billion. It gives us a runway. These are identified we think that they will attract interest from the market and so forth do we have more behind that is there.

Yeah, I would look also on a trailing 12 month basis, maybe a little bit lower just because renewals tend to be a little bit lower but I would look at kind of a more normalized number is looking at the trailing 12, which as you know in our in our supplement on the leasing page there.

Yes, I mean, we could kind of Delta and I think this is the near term next 18, 24 36 months well that we're considering.

And is there more behind it.

Yes.

No.

We need to be thoughtful a lot of what we are you know we own in our in our portfolio and significant gains because we've created significant amounts of value in these assets and so we need to be thoughtful with regards to managing that ideally we'd like to do that through 10 31 <unk>.

Our next question comes from Paulina, Roger Smith with Green Street. Please go ahead.

Good morning.

This is some more big T shirt question and you have highlighted that the recently acquired centers have very clear significant operational upside.

Changes.

So that also was kind of a governor but to the extent, we need to accelerate because we see more opportunities in the market.

Dan Guglielmone: To the extent we need to accelerate because we see more opportunities in the market to deploy capital on the acquisition front or in redevelopments and so forth, we have that ability to accelerate and move up some of the pool to the forefront of activity in our asset sale process.

Do you see this application alone.

With the broader market socket.

To deploy capital on the acquisition front or and Redevelopments are and so forth, we have that ability to accelerate.

Our our turning point for the company in terms of expected close.

Or are you are more maintaining a growth trajectory session, replacing.

Right.

And move up some of the pool to the forefront of activity in our inner asset sale process.

More mature centers for where others will drive the next phase approach.

Jill Sawyer: Our next question comes from Kenneth Billingsley with Compass Point. Please go ahead.

Our next question comes from Kenneth Billingsley with Compass point. Please go ahead.

Yeah.

Yeah, I I hope.

My question is.

[Analyst]: Hi, good morning. Thanks for taking my question. I just want to follow up, I think you made some comments on the leasing side, but looking at renewal rates of up 29%, the GLA was the highest in the last 12 months. Can you maybe just discuss, there weren't a lot of TIs in there. Could you just maybe discuss what formulated such a high increase on a renewal basis?

Hi, good morning, Thanks for taking my question.

Yeah, I think I understand and yes. It's a good question look we are seeing kind of the opportunity to buy assets that are more raw material to kind of put into.

And a follow up I think you made some comments on.

Believe me I've been looking at renewal rates are up 29%.

<unk> was the highest in the last 12 months.

Our you know kind of the.

Can you maybe just discuss.

One a lot of key item there could you just need discuss what formulated.

The federal Bill.

Business model, where we can really drive merchandising leasing rents.

A high increase on a renewal basis.

Dan Guglielmone: Yeah, look, we were able to push rents on the renewal. Timing of renewals ebbs and flows. We happen to have a significant kind of opportunity this quarter, and those deals got done. There were some really strong renewal rates that we were able to achieve. In terms of the volume of renewals, that happens. That'll ebb and flow over time. I think there were a number of deals that were able to get renewals at rates that were kind of above average. I would not expect us to maintain, continue to be driving renewal rates. I would look also on a trailing 12-month basis, maybe a little bit lower, just 'cause renewals tend to be a little bit lower. I would look at kind of a more normalized number, looking at the trailing 12, which is in our supplement, on the leasing page there.

Invest capital on a disciplined basis to really drive and enhance returns for those assets.

I think that that is something that is additive.

No different look we are able to do that on our existing portfolio as well, but I think.

We see the opportunity to sell some of the.

And you know in terms of the volume of renewals that happens at 11 flow over time I think there were a number of deals that we're able to get renewables at rates that were kind of above average I would not expect us to maintain continue to be driving renewal rates I would look at.

Some of the assets that may be.

You know we've done a really really good job of harvesting the our opportunity in the near term.

And see that as an attractive source of capital to redeploy into assets that can enhance our growth rate, but I don't see it as a turning point I think it's more a continuation of what we do well I think we're seeing opportunity to harvest gains in our portfolio.

Also on a trailing 12 month basis, maybe a little bit lower just because renewals tend to be a little bit lower but I would look at kind of a more normalized number is looking at the trailing 12, which as you know.

In our and our supplement on the leasing page there.

Redeploy them into and really to enhance our growth rate, but it's really just a continuation and an expansion of what federal has always done.

Jill Sawyer: Our next question comes from Paulina Rojas with Green Street. Please go ahead.

Our next question comes from Paulina, Roger Smith with Green Street. Please go ahead.

Again, if you have a question. Please press Star then one.

[Analyst]: Good morning. This is a more big-picture question. You have highlighted that the recently acquired centers have a very clear, significant operational upside. Do you think these acquisitions, along with the broader market focus, are turning points for the company in terms of expected growth, or are you more maintaining a growth trajectory, essentially replacing more mature centers for others that will drive the next phase of growth? I hope my question is clear.

Good morning.

This is some more big T shirt question and you have highlighted that the recently acquired centers have very clear significant operational upside.

We have a follow up question from Alexander Goldfarb with Piper Sandler. Please go ahead.

Hey, Thank you for taking the follow up.

As you guys look at some of the expansion markets.

Do you see this reputation.

That you're obviously leawood and then whatever the next city is.

With the broader market socket.

R. R. A turning point for the company in terms of expected close.

Do you see that perhaps you know retailers or rents haven't been pushed as much as they have in those markets I'm just trying to understand like obviously, everyone knows like the infill markets like Philly.

Or are you are more maintaining a growth trajectory session, replacing and more mature centers four or.

Philly area, or New York Metro our D C Metro and.

Either it will drive the next phase.

Our retailers know that hey, you have to pay big rents Theres big incomes.

Yes.

And.

Yeah, I I hope my question.

But just wondering as you go to some of these next you know some of the Midwest markets and meet.

Dan Guglielmone: Yeah, I think I understand. You know, it's a good question, Paulina. Look, we are seeing kind of the opportunity to buy assets that are more raw material to kind of put into our, you know, kind of the Federal Realty business model where we can really drive merchandising, leasing, rents, invest capital on a disciplined basis to really drive and enhance returns for those assets. I think that that is something that is additive. It's no different. Look, we are able to do that on our existing portfolio as well. I think we see the opportunity to sell some of the assets that maybe we have done a really, really good job of harvesting, the opportunity in the near term and see that as an attractive source of capital to redeploy into assets that can enhance our growth rate. I don't see it as a turning point.

Yeah.

Yeah, I think I understand and yeah. It's a good question look we are seeing kind of the opportunity to buy assets that are more raw material to kind of put into.

Just different legacy of ownership do you find that the rents have been pushed in the same way or is there is that part of the opportunity I'm just trying to understand if it's more just hey, new area for growth versus actually the way. The markets have worked they may be havent been as efficient because.

Our you know kind of the.

The federal.

Business model, where we can really drive merchandising leasing rents.

Just different types of ownership that may have existed there versus in the coastal markets.

Invest capital on a disciplined basis to really drive and enhance returns for those assets.

Yeah, I'm going to I'm going to let stew Beale answer that one that you guys are well matched to our on our re would trip Stu.

I think that that is something that is additive.

No different look we're able to do that on our existing portfolio as well, but I think.

Really at the forefront of that sure yeah, Alex Thanks for the question.

We see the opportunity to sell some of the you know the some of the assets that maybe are we are you know we've done a really really good job of harvesting the opportunity in the near term and and see that as an attractive source of capital to redeploy into.

The short answer is there is a lot of runway on the rents here.

They they have not been pushed as hard.

The properties haven't been invested in the right way to push them as hard.

At the end of the day. This is all a fraction of the vault.

The volume of tenants believe they can do it here.

Assets that can enhance our growth rate, but I don't see it as a turning point I think it's more a continuation of what we do well.

We showed you guys. When we went live with the volumes that were coming out of that property before they had been kind of running the way that we would run them.

Dan Guglielmone: I think it's more a continuation of what we do well. I think we're seeing an opportunity to harvest gains in our portfolio and redeploy them to really enhance our growth rate. It's really just a continuation and an expansion of what Federal Realty has always done.

So I do think that's a big part of this push is there is a lot of runway.

We're seeing an opportunity to harvest gains in our portfolio and redeploy them into and really to enhance our growth rate, but it's really just a continuation and an expansion of what federal has always done.

To continue to upgrade the merchandise.

Merchandising push the sales invest in the properties and push those rents to get closer to what they're used to paying other places in the country.

Jill Sawyer: Again, if you have a question, please press star, then one. We have a follow-up question from Alexander Goldfarb with Piper Sandler. Please go ahead.

Again, if you have a question. Please press Star then one.

This concludes our question and answer session.

We have a follow up question from Alexander Goldfarb with Piper Sandler. Please go ahead.

I'd like to turn the conference back over to Jill Sawyer for any closing remarks.

Operator: Hey, thank you for taking the follow-up. As you guys look at some of the expansion markets that you're, you know, obviously Leah Wood and then whatever the next city is, do you see that perhaps, you know, retailers or rents haven't been pushed as much as they have in those markets? I'm just trying to understand, like, obviously everyone knows, like, the infill markets, like, you know, Philly area or New York Metro or DC Metro. You know, retailers know that, hey, you have to pay big rents. There's big incomes. Just wondering, as you go to some of these next, you know, some of the Midwest markets and maybe, you know, just different legacy of ownership, do you find that the rents have been pushed in the same way, or is that part of the opportunity?

Hey, Thank you for taking the follow up as you guys look at some of the expansion markets.

Thanks for joining us today have a nice weekend everyone.

The conference has now concluded. Thank you for attending today's presentation you may now disconnect.

That you're obviously leawood and then whatever the next city is.

Okay.

Philly area, or New York Metro or D C Metro and retailers know that hey, you have to pay big rents Theres big incomes.

But just wondering as you go to some of these next yes.

The Midwest markets and meet.

Operator: I'm just trying to understand if it's more just, hey, new area for growth versus actually the way the markets have worked, they maybe haven't been as efficient because of, you know, just different types of ownership that may have existed there versus in the coastal markets.

Just different types of ownership that may have existed there versus in the coastal markets.

Dan Guglielmone: Yeah, I'm going to let Stu Beale answer that one. You guys all met Stu on our Leah Wood trip. Stu, you're probably at the forefront of that, sir.

Yeah, well I'm going to I'm going to let stew Beale answer that one that you guys are well matched to our on our leawood trip Stu.

Do you you probably at the forefront of that sure yes, Alex Thanks for the question.

Operator: Yeah. Hey, Alex, thanks for the question. I think the short answer is that there is a lot of runway on the rents here. They have not been pushed as hard. The properties haven't been invested in the right way to push them as hard. At the end of the day, this is all a fraction of the function of the volume the tenants believe they can do here. I think we showed you guys when we were in Leawood, the volumes that were coming out of that property before they had been kind of run in the way that we would run them. I do think that's a big part of this.

I think the short answer is there is a lot of runway on the rents here. They they have not been pushed as hard they the the properties haven't been invested in the right way to push them as hard AR.

At the end of the day. This is all a fraction of the volunteer a function of the volume of tenants believe they can do here.

I think we showed you guys. When we went live with the volumes that were coming out of that property before they had been kind of running the way that we would run them.

And so I do think that's a big part of this push is there is a lot of runway.

Operator: The push is there is a lot of runway to continue to upgrade the merchandise, merchandising, push the sales, invest in the properties, and push those rents to get closer to what they're used to paying other places in the country.

To continue to upgrade the merchandise.

<unk> pushed the sales investment properties and push those rents to get closer to what they're used to paying other places in the country.

Jill Sawyer: This concludes our question and answer session. I would like to turn the conference back over to Jill Sawyer for any closing remarks.

This concludes our question and answer session I would like to turn the conference back over to Jill Sawyer for any closing remarks.

Jill Sawyer: Thanks for joining us today. Have a nice weekend, everyone.

Thanks for joining us today have a nice weekend everyone.

Jill Sawyer: The conference has now concluded. Thank you for attending today's presentation. You may now disconnect.

The conference has now concluded. Thank you for attending today's presentation you may now disconnect.

Yeah.

[music].

Uh huh.

Q3 2025 Federal Realty Investment Trust (New) Earnings Call

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