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Choice Properties Real Estate Investment Trust reported results for the three months ended March 31, 2026, highlighting stable occupancy, growth in cash-based operating metrics and an increase in funds from operations (FFO) per unit. Management said the quarter reflected continued momentum across the portfolio and pointed to a transformational acquisition announced after quarter end.
FFO(1) increased by $5.1 million, or 2.7% per unit diluted, for the three months ended March 31, 2026. The increase was attributed primarily to higher net operating income and lease surrender revenue, partially offset by higher interest expense, lower investment income due to the reduction in Allied’s distribution, higher general and administrative expenses, and lower fee income.
Management said growth in FFO(1) per unit diluted was affected by higher lease surrender revenue of $1.9 million in the current year and a reduction of Allied’s distribution of $3.2 million. Excluding these items, FFO(1) per unit diluted increased by $0.009, or 3.5%.
Choice Properties reported a net loss of $87.2 million for the quarter, compared with a net loss of $96.2 million in the prior year period. The $9.0 million difference was primarily due to changes in certain non-cash fair value adjustments, including:
On April 16, 2026, the Trust announced an agreement with First Capital Real Estate Investment Trust (“FCR”) and KingSett Capital, on behalf of its investors (collectively, “KingSett”). Under the transaction, KingSett and the Trust will acquire FCR in a unit and cash transaction valued at approximately $9.4 billion, including the assumption of certain debt.
Upon closing, the Trust will acquire approximately $5.0 billion of FCR’s high-quality retail assets, and KingSett will acquire approximately $4.4 billion of FCR’s assets and all of FCR’s issued and outstanding units.
Choice Properties said it is focused on capital preservation, delivering stable and growing cash flows and net asset value appreciation. The Trust stated it cannot predict the timing of the closing of the transaction with FCR and KingSett, and its impact on financial results.
For 2026, excluding this impact, the Trust is targeting:
(1) and (2) and (3) refer to notes included in the Trust’s disclosure.
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