Acadia Posts $0.03 Per-Share Loss Despite Growth in Adjusted Funds From Operations
Key Facts
Acadia Realty Trust reported a diluted loss of $0.03 per share in the third quarter of 2026 on Nov. 2, compared with earnings of $0.03 in the year-earlier period. The loss was worse than analysts’ expectations, who had estimated earnings of $0.07 per share before the results. But a key operating metric moved in the opposite direction: adjusted funds from operations rose to $0.31 per share from $0.29 a year earlier. The company reported results before the market opened that day. Management scheduled a call to discuss the results for 11:00 a.m. Eastern time.
The company attributed the decline in net income mainly to a non-cash impairment charge of $11.7 million, or $0.08 per share. The charge was tied to two properties the company said were in the process of being sold. That puts the accounting loss in the context of asset sales, while the adjusted funds from operations metric posted annual growth. The metric totaled $45.2 million in the quarter, compared with $39.7 million in the same period of 2025. The chief executive also said same-store net operating income rose more than 8% in the first nine months, while adjusted funds from operations increased nearly 10% from the same period a year earlier.
Quarterly revenue was $94.983 million, down from $101.006 million in the third quarter of 2025, but above analysts’ estimates of $94.38 million. At same-store properties, net operating income rose 10.2% year over year in the quarter. The company attributed a major part of that growth to its street-retail portfolio, which posted an increase of 15.2%. Growth in this metric was 8.3% in the nine months ended Sept. 30, compared with the same period of 2025. The company expects it to grow between 7.5% and 8.5% for full-year 2026.
Leasing indicators showed large gains on new leases, with GAAP and cash rent spreads of 98% and 62%, respectively. Including renewal leases, spreads were 49% on a GAAP basis and 25% on a cash basis. The company said gains on new leases were driven by street retail. The value of signed leases that have not yet commenced rose 32% to $21.8 million from $16.5 million on June 30. These leases provide an indication of leasing activity that has not yet translated into operating revenue.
By contrast, economic and leased occupancy rates each fell 20 basis points from the end of June, to 94.2% and 95.5%, respectively, on Sept. 30. The company said the decline was entirely related to about 16,600 square feet of vacancy at two street-retail properties acquired during the quarter, at 44 Main Street in Westport and 69-73 Greene Street in SoHo. It added that it expects to lease the space in the near term. It also completed street-retail acquisitions worth about $152 million during the quarter. At the Henderson Avenue project, executed leases or those in advanced negotiations covered about 90% of retail space, with openings targeted during 2027.
In its development business, the company said it signed a lease for the entirety of 129 Fifth Avenue within 30 days, at rent well above the assumptions underlying the transaction. It estimated the yield on cost at more than 9%. In the market, the stock closed at $19.07 on Oct. 29, then at $19.03 on Oct. 30; both prices preceded the results announcement on Nov. 2. The stock had reached $17.98 in mid-October, above its year low of $17.96. Before the results announcement, analysts’ earnings-per-share estimates had fallen 7.69% over two months, while revenue estimates declined 2.5% over the same period.