Summary:
- Phillips Edison & Company (PECO, Financial) reports 11.2% year-over-year growth in both Nareit FFO and Core FFO for Q1 2025.
- Same-center NOI increased by 3.9% to $115.1 million with a strong occupancy rate of 97.1%.
- PECO acquired six shopping centers for $146.4 million and confirmed 2025 guidance with Core FFO projected at $2.52-$2.59 per share.
Phillips Edison & Company, Inc. (PECO), a prominent owner and operator of grocery-anchored shopping centers, announced strong financial results for the first quarter of 2025, affirming its full-year guidance. The company reported a net income of $26.3 million, equivalent to $0.21 per diluted share.
For Q1 2025, PECO achieved Nareit Funds from Operations (FFO) of $89.0 million, translating to $0.64 per diluted share, and Core FFO of $90.8 million, or $0.65 per diluted share, both showcasing an impressive 11.2% year-over-year growth.
Key performance highlights include a 3.9% increase in same-center net operating income (NOI), amounting to $115.1 million, and maintaining a sturdy leased portfolio occupancy rate of 97.1%. The company also realized rent spreads of 28.1% for new leases and 20.8% for renewals during the quarter.
PECO strategically enhanced its portfolio by acquiring six shopping centers for a total of $146.4 million, while selling one for $24.9 million. The full-year 2025 guidance was reaffirmed, projecting Core FFO in the range of $2.52 to $2.59 per share and same-center NOI growth between 3.00% and 3.50%.
Financially, PECO maintains a robust balance sheet with $760 million in total liquidity and a net debt to adjusted EBITDAre ratio of 5.3x. Despite a slight rise in the leverage ratio compared to the previous quarter, it remains manageable for the retail REIT sector.
The company continues to focus on grocery-anchored centers, highlighting stability and pricing power due to its tenant mix, predominantly composed of necessity-based goods and services.
