Alexandria Posts $3.74 Per-Share Loss, Writes Down $637.9 Million in Assets
Key Facts
Alexandria Real Estate reported a diluted net loss of $3.74 per share in the third quarter of 2026, compared with a loss of $1.38 in the same period last year, while revenue fell to $671.182 million from $751.944 million. The company said in a statement published via PR Newswire that the quarterly loss included $637.9 million in real estate impairment charges related to assets classified as held for sale. On an adjusted funds-from-operations basis, diluted FFO was $1.54 per share, versus $2.22 a year earlier. The results show declines in revenue and the adjusted performance measure alongside the recognition of asset impairments. Operating metrics also showed pressure on same-property income, occupancy and rents.
According to the company’s statement, same-property net operating income fell 6.7% in the third quarter. Average occupancy during the period was 88.1%, compared with 91.7% in the corresponding quarter of 2025, while operating-property occupancy stood at 87.1% at the end of September. The rate rises to 90.8% when signed leases for space not yet occupied are included. For renewal and re-leasing leases, rental rates fell 2.4% on a GAAP basis and 3.3% on a cash basis. These metrics indicate that the recorded volume of leasing activity has not yet halted declines in occupancy and operating income or pricing pressure.
By contrast, gross leasing volume totaled 1,236,030 rentable square feet during the quarter, including 450,961 square feet of previously vacant space. The company said leasing of vacant space reached the second-highest quarterly level in its history. Operating-property occupancy was 87.1% at the end of September, or 90.8% including signed leases with future occupancy. Those leases cover 1.3 million square feet, which the company expects to generate about $52 million in annual rental revenue. Occupancy is expected to begin around June 2027, making the revenue impact dependent on when tenants move into the space.
Alexandria narrowed its 2026 adjusted funds from operations guidance to $6.38–$6.42 per share, keeping the midpoint at $6.40, unchanged from its previous guidance. The company said the revision narrowed the range by 6 cents without changing the midpoint. The guidance includes a $30 million to $35 million reduction in funds from operations due to potential tenant contractions. The company had recorded about $30 million of this impact through the first nine months of the year, including about $16 million in the third quarter. The guidance update therefore reflects a narrower range, while the midpoint remains unchanged and the annual estimate absorbs the impact of tenant contractions.
On financing, the company said liquidity stood at $4.56 billion on September 30 and the weighted-average remaining debt term was 11.6 years. In September, it extended its $5.0 billion unsecured senior credit facility, moving its maturity from January 22, 2030, to January 22, 2032. It also reduced the borrowing spread to SOFR plus 0.725%, from SOFR plus 0.835% previously. The company declared a cash dividend of $0.72 per share for the third quarter, in line with the previous quarter. ARE shares closed at $43.02 on October 23, according to EL7 data.
The company is scheduled to present its 2027 guidance and related assumptions, along with sources and uses of capital, at its Investor Day on December 2, 2026. The date follows annual guidance that kept the midpoint unchanged, as the company tracks the impact of signed leases and potential tenant contractions. The company expects occupancy under signed leases covering 1.3 million square feet to begin on a weighted-average basis around June 2027. It estimated the annual rental revenue associated with those leases at about $52 million. That puts next year’s guidance and capital assumptions at the center of the December presentation.