Key Highlights

  • CTO reported third-quarter Core FFO of $0.53 per diluted share, up from $0.48 a year earlier, and AFFO of $0.55 versus $0.50.
  • Total revenues were $46.9 million, up from $37.8 million.
  • 2026 Core FFO guidance was raised to $2.11 to $2.14 from $2.09 to $2.13, and investment volume to $472 million from $300 million to $400 million.
  • Net debt to pro forma adjusted EBITDA was 5.9 times, with liquidity of $254.6 million.
  • The common dividend was $0.38 per share for the quarter.

CTO Realty Growth Earnings: Did Deal Volume Justify the Higher Core FFO Outlook?

CTO Realty Growth (NYSE:CTO) released third-quarter results on Tuesday, October 27, with Core FFO of $0.53 per diluted share, up from $0.48 a year earlier, and FFO of $0.54 versus $0.48. Management raised 2026 Core FFO guidance to $2.11 to $2.14 from $2.09 to $2.13, and investment volume to $472 million from $300 million to $400 million.

On a GAAP basis the quarter was a loss of $7.05 million to common, or $0.19 per diluted share, against income of $0.03 a year earlier. Investment and other income swung to a $9.4 million loss. The screen's EPS surprise of negative 41% is as screened; FFO is the company's primary measure.

CTO owns shopping centers and mixed-use properties and makes commercial loans.

Revenue and Same-Property NOI: What Drove the Growth?

Total revenues rose to $46.9 million from $37.8 million, about 24.3% as calculated. Interest income from loans and investments more than doubled to $6.9 million,.

Shopping center same-property NOI grew 3.8% in the quarter, and full-year growth guidance of 5.0% to 6.0% was kept. Leasing covered 38 transactions and 467,000 square feet at a 7% cash rent spread on comparable space.

Portfolio leased occupancy was 92.4%, down 180 basis points from a year earlier partly because Zona Rosa was 67% leased at closing. Same-property shopping center occupancy was 95.8%, up 90 basis points.

Zona Rosa, Summit Woods and a 17% Yield: Where Is the Money Going?

Third-quarter investments were $102.3 million at a 9.1% yield, including the $63.3 million Zona Rosa center in Kansas City and an Austin leasehold loan at a 9.75% initial cash yield.

After quarter end, CTO closed the $103.0 million Summit Woods Crossing power center in Kansas City on October 5. On October 15 it funded a $32.0 million preferred equity investment in a ten-property shopping center portfolio at a 17.0% initial yield, including 7.0% paid in kind,. Year-to-date investments including these events reached $472.3 million at a 9.4% yield.

Year-to-date dispositions totaled $90.7 million at a 6.7% cash cap rate. Its stake in Alpine Income Property Trust (NYSE:PINE) contributed $2.2 million of income.

Balance Sheet: How Was the $1.0 Billion Credit Facility Used?

CTO closed an amended $1.0 billion unsecured facility that added $250 million of commitments. Proceeds repaid the $300 million revolver, two $100 million term loans and a $17.8 million mortgage, leaving no secured debt. Weighted average maturity extended to 4.3 years.

Borrowings were $723.0 million at a 4.7% weighted average rate. At-the-market equity issuance raised $125.1 million net year to date. General and administrative guidance moved up to $21.0 million to $21.5 million from $20.0 million to $20.2 million.

What to Watch Next: Can Lease-Up Convert the Pipeline into Earnings?

The October 28 call should add detail on the guidance bridge and the Zona Rosa lease-up. The $5.6 million signed-not-open pipeline and a Carolina Pavilion sale expected late in the fourth quarter are the dated items to follow.