Earnings call transcript: Brixmor Property beats Q3 2025 EPS estimates

Brixmor Property Group reported its third-quarter 2025 earnings, exceeding analyst expectations with an EPS of $0.31 compared to the forecasted $0.23, marking a surprise of 34.78%. The company's revenue also surpassed estimates, reaching $340.84 million against a forecast of $338.47 million. According to InvestingPro data, two analysts have recently revised their earnings upward for the upcoming period, suggesting continued optimism. Despite these positive results, Brixmor's stock declined 3.13% to $27.63 in premarket trading, reflecting investor concerns over broader market conditions or other factors not directly related to earnings. Current analysis from InvestingPro indicates the stock is trading slightly above its Fair Value.

Key Takeaways

• Brixmor's EPS exceeded expectations by 34.78%.
• Revenue slightly surpassed forecasts, reaching $340.84 million.
• Despite positive earnings, stock fell by 3.13% in premarket trading.
• Strong leasing activity with 1.5 million square feet of new and renewal leases.
• Annual dividend increased by 7% to $1.23.

Company Performance

Brixmor Property Group demonstrated solid performance in Q3 2025, driven by strong leasing activities and strategic project stabilizations. The company executed 1.5 million square feet of new and renewal leases, achieving a record blended cash spread of 18%. The increase in annual dividend by 7% to $1.23 also highlights the company's commitment to returning value to shareholders. However, the stock's decline suggests that broader market conditions or other external factors might have influenced investor sentiment.

Financial Highlights

• Revenue: $340.84 million, slightly above forecast.
• Earnings per share: $0.31, exceeding the forecast by 34.78%.
• NAREIT FFO: $0.56 per share in Q3.
• Same-property NOI growth: 4%.
• Average incremental project yield: 11%.

Earnings vs. Forecast

Brixmor's Q3 2025 earnings per share of $0.31 exceeded the forecasted $0.23 by 34.78%, a significant beat that underscores the company's operational efficiency and strategic leasing initiatives. Revenue also outpaced expectations, albeit by a smaller margin of 0.7%. These results mark a positive deviation from previous quarters, where earnings surprises were less pronounced.

Market Reaction

Despite the earnings beat, Brixmor's stock price fell by 3.13% to $27.63 in premarket trading. This movement contrasts with the positive earnings results and suggests that investors may be reacting to broader market trends or other external factors. The stock remains within its 52-week range of $22.29 to $30.67, indicating room for recovery as market conditions stabilize.

Outlook & Guidance

Brixmor updated its FFO guidance to a range of $2.23 to $2.25, reflecting confidence in its ongoing projects and leasing activities. The company expects base rent growth to accelerate in 2026, supported by a strong pipeline of signed but not commenced rent, projected to commence by the end of 2026. Continued focus on redevelopment and value-add acquisitions is expected to drive future growth.

Executive Commentary

Interim CEO Brian Finnegan emphasized the company's resilience, stating, "We continue to keep a close eye to see if there are any cracks in that, but to date, we're really not seeing it." Chief Investment Officer Mark Horgan added, "Our job is to grow earnings at Brixmor, and that's what we're going to be focused on over time." These comments highlight management's confidence in sustaining growth and navigating market challenges.

Risks and Challenges

• Broader economic conditions could impact retail demand and tenant expansion.
• Potential supply chain disruptions may affect project timelines and costs.
• Market saturation in certain regions could limit growth opportunities.
• Rising interest rates may increase financing costs for new developments.
• Increased competition from other retail property operators.

Q&A

During the earnings call, analysts focused on the sustainability of Brixmor's leasing momentum and the impact of macroeconomic factors on future growth. Management expressed optimism about tenant expansion and downplayed concerns about tariffs and macro uncertainties, indicating a robust outlook for the coming quarters.

Full transcript - Brixmor Property (BRX) Q3 2025:

Speaker 4: Evenings. Welcome to Brixmor Property Group Incorporated's third quarter 2025 earnings conference call. At this time, all participants are in a listen-only mode. A question and answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. Please note this conference is being recorded. I will now turn the conference over to Stacy Slater, Senior Vice President, Investor Relations at Capital Markets. Thank you. You may begin.

Stacy Slater, Senior Vice President, Investor Relations, Brixmor Property Group: Thank you, operator, and thank you all for joining Brixmor's third quarter conference call. With me on the call today are Brian Finnegan, Interim CEO and the company's President and Chief Operating Officer, and Steve Gallagher, Chief Financial Officer. Mark Horgan, Executive Vice President and Chief Investment Officer, will also be available for Q and A. Before we begin, let me remind everyone that some of our comments today may contain forward-looking statements that are based on certain assumptions and are subject to inherent risks and uncertainties. As described in our SEC filings, an actual future result may differ materially. We assume no obligation to update any forward-looking statements. Also, we will refer today to certain non-GAAP financial measures.

Further information regarding our use of these measures and reconciliations of these measures to our GAAP results are available in the earnings release and supplemental disclosure on the Investor Relations portion of our website. Before turning the call to Brian, please note that out of respect for Jim's privacy, we will not be addressing any questions regarding his medical leave, and we refer you to the company's October 16th press release. We do ask that you join our Brixmor family in wishing Jim good health. Given the number of participants on the call, we kindly ask that you limit your questions to one per person. If you have additional questions, please re-queue. At this time, it's my pleasure to introduce Brian Finnegan.

Brian Finnegan, Interim CEO, President and Chief Operating Officer, Brixmor Property Group: Thanks, Stacy, and good morning, everyone. I first want to say on behalf of the entire Brixmor team that our thoughts go out to Jim and his family. We care about him deeply and are grateful for the well-wishes and support for him that we have received from across the industry. In the meantime, the team he built remains focused on executing our business plan, which, as demonstrated in the third quarter, continues to deliver outstanding results. As usual, those results begin with leasing. This quarter, we executed 1.5 million square feet of new and renewal leases at a blended cash spread of 18%.

New leases during the quarter were signed at a record rate of $2,585 per square foot, as our team continues to capitalize on healthy demand to be in our well-located shopping centers. We are seeing strong activity in both anchors and small shops, with small shop occupancy hitting another record at 91.4%, with room to run as we deliver our reinvestment program. On the anchor front, the team is making progress on backfilling the spaces recaptured over the past year, with new leases executed during the quarter on those spaces, with the likes of Marshalls, Total Wine & More, Bob’s Discount Furniture, and Cavender’s Boot City. Thanks to the continued strength in leasing, the signed but not yet commenced pipeline remains above $60 million, despite commencing a record $22 million of ABR during the quarter, which Steve will comment on further.

New tenant openings are among the most exciting aspects of our business, and the third quarter included Sprouts Farmers Market in Knoxville, Tennessee, Trader Joe’s in suburban Denver, and several openings at two of our most impactful redevelopments: the Davis Collection in Davis, California, and Block 59 in suburban Chicago. Staying with reinvestment, during the quarter, we stabilized eight value-enhancing projects with a total cost of approximately $46 million at an average incremental yield of 11%. This included College Plaza in Long Island, New York, where we added a new Chick-fil-A out parcel and reconfigured existing inline space for Burlington, Five Below, and Ulta, to complement a strong-performing ShopRite supermarket. We also stabilized the first phase of Barn Plaza in suburban Philadelphia, where earlier this year we opened Bucks County’s first new Whole Foods market.

Thanks to the successful execution of the initial phase of that project by our North Region team, we're adding a second phase into our active pipeline this quarter, which includes first the portfolio new leases with Pottery Barn, Williams-Sonoma, Sephora, and Lovesac. This is one of the many examples across the portfolio where our reinvestment program is enabling us to attract a much higher caliber of tenant than we have historically. Finally, on reinvestment, our partnership with Publix continues to grow, as we announced our second new project of the year in Hilton Head, South Carolina, with several more to follow in the future pipeline. Our percentage of ABR from grocery anchor tenants now sits at 82%, and as we've seen a 35% increase in year-over-year traffic when we add a grocer, we're thrilled with the opportunities to add more grocers to the portfolio as we execute our reinvestment program.

Switching to transactions, as we discussed at length on our second quarter call, we closed on the $223 million acquisition of LaCenterra at Cinco Ranch in suburban Houston and are pleased with our team's progress out of the gate, with seven new leases either signed or in process, all well ahead of our initial underwriting. Mark and team continue to raise attractive capital as we exited eight assets where we had maximized value since our last earnings call, bringing our total disposition volume year to date to $148 million. We continue to evaluate opportunities to put our platform to work and still expect to be net acquirers at year-end. To that end, we have approximately $190 million of value-add acquisitions under control and look forward to sharing more about these exciting acquisitions soon.

To summarize, our team continues to execute on all fronts, attracting great tenants in a supply-constrained environment at the highest rents we've ever achieved. Our redevelopment platform continues to deliver low-risk, compelling returns with several years of runway for future growth. On the transaction front, we're well-positioned to continue to recycle capital out of low-growth assets into those where we see the opportunity to create value through our operating platform. Thank you to the Brixmor team for your continued focus and effort as we continue to create value for our stakeholders. With that, I'll hand the call over to Steve for a more detailed review of our financial results. Steve?

Steve Gallagher, Chief Financial Officer, Brixmor Property Group: Thanks, Brian. I'm pleased to report on another strong quarter of execution by the Brixmor team, as we continue to stack rent commencements from the signed but not yet commenced rent pipeline that will accelerate growth over the next several quarters. NAREIT FFO was $0.56 per share in the third quarter, driven by same-property NOI growth of 4%. As expected, base rent growth decreased to a 270 basis point contribution due to a 150 basis point drop in billed occupancy compared to the third quarter of last year. We expect base rent growth to accelerate into 2026 as billed occupancy rebounds, and we continue to commence rent from the signed but not yet commenced rent pipeline at higher rents.

Additionally, revenue streamed on collectible contributed 80 basis points to growth in the quarter, as we trend to the lower end of our historical run rate of 75 to 110 basis points of total revenue, given the improvement in our underlying tenant credit. As Brian noted, we commenced a record high $22 million of new ABR in the quarter, and capitalizing on the strong leasing environment, we executed $16 million of new leases at a record high $25.85 per square foot and ended the third quarter with a 390 basis point spread between leased and billed occupancy. Our signed but not yet commenced rent pipeline totaled $60 million, which includes $53 million of net new rent.

In addition, the blended annualized rent per square foot on the signed but not yet commenced pool is $22.30 per square foot, approximately 21% above our portfolio average, reflecting the below-market rent basis in our centers. We expect 80% of the signed but not yet commenced rent pipeline to commence by the end of 2026, with 2026 commencements slightly weighted to the first half of that period. From a balance sheet perspective, at September 30, we had $1.6 billion of available liquidity, including approximately $400 million from our September 2025 4.85% issuance, which pre-funded our June 2026 maturity of $600 million at 4.125%. One note on the capital markets front, our SEC shelf registration statement is due to expire next month, so we'll be filing a replacement shelf registration statement this week. As part of that process, we'll also be reviewing our existing ATM program and DRIP.

We will also be extending our buyback program for another three years, which together will continue to provide Brixmor with maximum flexibility to capitalize on a wide range of potential capital market environments and support the long-term execution of our business plan. We are pleased to announce a 7% increase in our annual dividend to a rate of $1.23. The revised dividend, which approximates taxable income, allows the company to retain as much free cash flow as possible while meeting our REIT dividend requirements. In terms of our forward outlook, we have updated our FFO guidance to $2.23 to $2.25 and affirmed our same-property NOI range of 3.9% to 4.3%. Our increased FFO expectations are driven by higher-than-expected lease settlement income in the fourth quarter, as we continue to capitalize on opportunities to proactively recapture and accretively backfill space.

As such, we expect lease settlement income to be a headwind to 2026 FFO growth. We are excited about how we are positioned heading into next year, with significant tailwinds from 2025 rent commencements, a strong signed but not yet commenced rent pipeline, and reduced exposure to at-risk tenancy, coupled with the strong demand from tenants to locate in our centers. I'll turn the call over to the operator for Q and A.

Speaker 4: Thank you. If you would like to ask a question, please press star one on your telephone keypad. A confirmation tone will indicate your line is in the question queue. You may press star two if you would like to remove your question from the queue. For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys. One moment while we pull for questions. Our first question is from Michael Goldsmith with UBS Investment Bank. Please proceed.

Michael Goldsmith, Analyst, UBS Investment Bank: Good morning. Thanks a lot for taking my question. Steve, question for you on the implied acceleration of the same-store NOI growth in the fourth quarter. Can you walk through kind of the contributing factors there? Is that a function of the SNOC pipeline being activated, what you've already done, what is due in the fourth quarter? Also, can you just talk about the role of the comparisons in the accelerations and just the sustainability of that? Thanks.

Brian Finnegan, Interim CEO, President and Chief Operating Officer, Brixmor Property Group: Sure. Yeah, I mean, as we talked about, we commenced $22 million of rent in the quarter, right? We've talked a lot over the last several quarters about just the stacking of rent and how that provides growth heading into future quarters. You obviously get a partial benefit of that rent that commenced in the quarter, and then you get another partial benefit in Q4 as it's fully in for the entire quarter. You also have approximately $19 million of rent that we expect to commence between the end of the third quarter and fourth quarter that will provide growth into that quarter as well. I think the only other thing I would just remind you is when you look to the prior year quarter ending 9/30, the entirety of the tenant disruption that we've experienced over the last year was in billing as of that period.

That rent starts to fall off the fourth quarter and then through 2025, just as you're thinking about the year-over-year comparisons. What we're really looking forward to is that tailwind that the commencements of the snow pipeline is providing.

Michael Goldsmith, Analyst, UBS Investment Bank: Yeah, Michael, I would just add what we're really excited about there on the commencement front, too, is some of these larger redevelopments starting to come online, like Block 59 in Chicago, which I mentioned. We're also seeing the first of the boxes that we backfilled last year that we took back at the end of the year starting to come online as well, two Ross boxes that we opened last week. Everything that Steve said, again, gives us good visibility to the end of the year, but some anecdotes there in terms of the nature of that as well.

Brian Finnegan, Interim CEO, President and Chief Operating Officer, Brixmor Property Group: Thank you very much. Good luck in the fourth quarter.

Michael Goldsmith, Analyst, UBS Investment Bank: Thanks, Michael.

Speaker 4: Our next question is from Samir Khanal with BofA Securities. Please proceed.

Samir Khanal, Analyst, BofA Securities: Thank you. I guess, Brian, in your opening remarks, you talked about shop occupancy hitting another record, and you also stated there's more room to run. Maybe expand on those comments as we think about occupancy into next year. Thanks.

Brian Finnegan, Interim CEO, President and Chief Operating Officer, Brixmor Property Group: Yeah, we've been pleased with the progress on the shop front, as I mentioned. If you look at that future reinvestment pipeline, we're several hundred basis points below where occupancy sits today. When we've seen historically, as we bring those projects on, you're seeing a lift in shop occupancy. We do feel like we have several hundred basis points more to run. You think about the nature of those projects in that future reinvestment pipeline, a great future pipeline that we have with Publix, thinking about Plano, Texas, other projects that we have in Florida, suburban Atlanta, metro New York, which gives us real good visibility in our ability to drive that forward. That's really that piece in terms of what's left and our ability to get it even higher than it is today, which again, we're pretty pleased about.

Samir Khanal, Analyst, BofA Securities: Thank you.

Brian Finnegan, Interim CEO, President and Chief Operating Officer, Brixmor Property Group: You got it.

Speaker 4: Our next question is from Craig Mailman with Citigroup. Please proceed.

Hey, good morning, guys. Brian, you had mentioned some additional acquisitions that are in the pipeline. Could you just go through what the opportunity set looks like and, you know, where cap rates are trending? Are these going to be more like LaCenterra at Cinco Ranch that are longer-term opportunities that maybe aren't initially accretive, or are there some stabilized in there that can kind of boost FFO in the near term as well?

Brian Finnegan, Interim CEO, President and Chief Operating Officer, Brixmor Property Group: Okay, Craig, I'll hand this to Mark, but I would just say we're really pleased with what we're seeing on the transaction front, also pleased with not just what we're doing out of the gate in LaCenterra, but what we're doing out of the gate with the $300 million of acquisitions that we closed last year. Maybe I'll hand it to Mark to give an overview on what he's seeing in the market.

Mark Horgan, Executive Vice President and Chief Investment Officer, Brixmor Property Group: Sure. You know, the market remains really competitive. As we've discussed on past calls, we're seeing new entrants in capital, actually on the sidelines, really seeking exposure to open-air retail. A lot of that capital is actually seeking smaller, simple grocery anchor deals. What's interesting is that that's really allowing us the opportunity to be efficient when we capital recycle. We're selling some assets where we see low hold IRRs from our perspective, well below IRRs than we'd like to generate. We've got the ability to recycle that capital into assets like LaCenterra, where we see really strong growth and the ability to drive strong IRRs and really drive our return on invested capital from here. With respect to the deals that we're buying, we really try to focus on, from an acquisition perspective, value-add opportunities.

The ones that are in the pipeline today, which we think will continue to grow over time, that pipeline will continue to grow. They look pretty similar to LaCenterra in that they have very strong growth opportunities where we're going to leverage our platform to drive strong cash flows through occupancy gain, through rent mark-to-market, and some redevelopment. I would say the ones that we're looking at today are not lifestyle centers. They're more traditional open-air retail centers that fit right into our platform. A good example on one of those assets, we're using our platform to drive an immediate increase in an anchor rent that's giving us better growth through the term of that anchor rent and increasing the going-in cap rate by about 50 basis points, which you'd feel is very compelling from an acquisition perspective.

I think it speaks to the strength of the platform as we think about future acquisitions from here.

Brian Finnegan, Interim CEO, President and Chief Operating Officer, Brixmor Property Group: Thanks, Craig.

Speaker 4: Our next question is from Michael Griffin with Evercore ISI. Please proceed.

Michael Griffin, Analyst, Evercore ISI: Great, thanks. First of all, my thoughts to Jim and his family, wishing him a speedy recovery. Brian, maybe you could talk a little bit about how the leasing pipeline looks as we head into next year. I mean, are retailers still looking to expand and grow their business? You guys have done some pretty strong new leasing year to date, but just give us a sense of what those conversations are like, kind of caveating that, you know, while it seems like we've gotten some trade deals done, there is still this macro uncertainty as it relates to tariffs and the potential impact to retailers. Thank you.

Brian Finnegan, Interim CEO, President and Chief Operating Officer, Brixmor Property Group: We appreciate the kind words about you, Michael. We remain very optimistic and encouraged by what we're seeing in the leasing environment. The pipeline today is higher than it was a year ago, despite the fact that we've signed 10% more in GLA this year. The retailers who we're growing with are not only looking to add store count in both infill locations and where they have additional white space with specialty grocers, off-price apparel, health and wellness operators. The tenants are performing. If you listen to those second quarter calls, you saw you heard some very strong results from a lot of the retailers that we continue to grow with. From a tariff perspective, they've been able to navigate this with suppliers.

As we think about our core tenant mix, as well as the new operators who are expanding with us in the portfolio, they continue to have strong open to buys as they head into 2026. Interestingly, we have a full slate for New York ICSE coming up in a few weeks. Those discussions will be primarily around 2027, right? There's still deals that we're signing towards the end of the year that we're going to get open in late 2026. Part of that focus, too, is 2027 pipeline. We remain very encouraged. We continue to keep a close eye to see if there are any cracks in that, but to date, we're really not seeing it.

Michael Griffin, Analyst, Evercore ISI: Great, thanks so much.

Brian Finnegan, Interim CEO, President and Chief Operating Officer, Brixmor Property Group: Bye.

Speaker 4: Our next question is from Todd Thomas with KeyBanc Capital Markets. Please proceed.

Hi, thanks. I wanted to go back to the same-store growth and ask a bit about the building blocks for 2026, if I could. You talked about the headwinds from bankruptcies and tenant disruptions for the year. I think you noted it was about 230 basis points last quarter. Any early thoughts about how we should think about that drag today as we look into 2026, whether you expect that to alleviate or do you see a similar level of drag?

Brian Finnegan, Interim CEO, President and Chief Operating Officer, Brixmor Property Group: Yeah, I mean, as we sit here today, I think the one thing we've talked about a lot over the last couple of quarters is just to reduce exposure we have to at-risk tenancy, right? When you look at our watchlist today versus even versus our peer, but especially compared to five, ten years ago, you just see a lot less exposure to some of those names that you all were worried about, as were we, Big Lots, Party City, Joann's. You're seeing more exposure to things like Whole Foods, Sprouts, Publix, right? I think as you look into 2026, obviously, one of the headwinds is going to be we did recognize rent for that bankruptcy space in 2025. That's not going to recur in 2026, right? I think sitting here today, there doesn't look to be a lot of significant tenant disruption out there moving forward.

Obviously, we'll see how the next couple of quarters play out. We really feel comfortable sitting here today with the tailwind from that snow pipeline commencing in 2025 and then also into 2026. Obviously, just reminding that there is some BK headwinds for the rent we recognize in 2025.

Okay, thank you.

Thanks, Todd.

Speaker 4: Our next question is from Greg McGinniss with Scotiabank. Please proceed.

Hey, good morning. Brian, I just wanted to touch back on the tenant health commentary. You know, looking at the bad debt expense, guidance was maintained, and despite previously trending towards the low end, Q3 was up versus Q2. Could you just provide some insight on that increase? Then generally, more generally, how you're feeling about the range in the year end?

Brian Finnegan, Interim CEO, President and Chief Operating Officer, Brixmor Property Group: I'll let Steve hit the guidance piece, but just to expand on what he just said, our office supply exposure has been cut in half. We have a very low drugstore exposure. If you look, we have 17% of our ABR comes from local tenants. The underlying credit quality of the tenants who backfilled the space we took back over the last year is very strong. We feel very confident in terms of where that watchlist exposure sits today. There are always categories that we're keeping a close eye on, but as Steve noted, that has dropped meaningfully from where this portfolio was historically. Steve, maybe you could touch on the guidance piece. Yeah, I mean, obviously, we are trending to the lower end of the range. I'm still within the range.

I'd just remind you about things we've talked about over the last couple of years, the first half of the year, due to some of the out-of-period cash collections on real estate taxes, generally has a lower, when you're just looking at it as a percentage of total revenue. The back end is typically a little bit higher. I think we feel comfortable where we're headed within the range, but I'd just remind you that third and fourth quarter, when you're looking at it as a percentage, is a little bit higher. I think when you're comparing to the prior year, obviously, it's a favorable trend.

Okay, thank you.

Thanks, Craig.

Speaker 4: Our next question is from Alexander Goldfarb with Piper Sandler. Please proceed.

Hey, good morning. Just echoing the speedy recovery thoughts for Jim. Mark, you know, the cap rates in the acquisition world have definitely come in, even Power Center. I know you guys really aren't looking at that, but even that's getting a strengthening bid. As you look at your opportunity set, do you sort of have a minimum threshold where you're like, we can't buy below X yield because the deals need to be accretive from day one? Just trying to understand, you know, with more focus on REITs delivering earnings growth, true, you know, true earnings cash flow growth. Do you find that you have a floor that you won't go below, or how do you balance that given the increased competition for assets?

Mark Horgan, Executive Vice President and Chief Investment Officer, Brixmor Property Group: Look, I think everyone in the room understands that our job is to grow earnings at Brixmor, and that's what we're going to be focused on over time. Our acquisitions program historically and today remains focused on driving high unlevered IRRs. When we look at the deals we've been delivering, that tends to be in that 9.5% to 10.5% range. When we find compelling opportunities, we're going to go after them to acquire. Last year, we acquired Britain Plaza, pardon me, down in Tampa, which was a lower going-in yield where we see very, very significant value-add opportunities in that asset. We're not going to pass up the ability to buy something like a Britain Plaza in the future. With that said, the assets we're working on today, we think have attractive going-in yields and growth. We're really focused on both parts of that plan from an acquisitions perspective.

Brian Finnegan, Interim CEO, President and Chief Operating Officer, Brixmor Property Group: Since we're funding that through capital recycling, we're funding that with assets that we don't see that long-term growth potential into assets, just to Mark's point, where we do. With everything Mark said, we feel that there are a lot of compelling opportunities out there for us today, despite the fact that it is a competitive market.

Mark Horgan, Executive Vice President and Chief Investment Officer, Brixmor Property Group: I think the other thing I would add, and we've talked about this in the past, is we continue to mine out things like land parcels in this portfolio, which, you know, are not yielding any cash flow today or yielding negative cash flow given the carry cost. We did that earlier this year. We have some in our pipeline today that, again, will provide us some really well-priced capital to put the work in the acquisitions market.

Thank you.

Thanks, Alex.

Speaker 4: Our next question is from Cooper Clark with Wells Fargo Securities. Please proceed.

Samir Khanal, Analyst, BofA Securities0: Great, thanks for taking the question. It looks like G&A came down in the quarter around $2 to $3 million. Curious what drove this and if $26 million is a good run rate moving forward or if it was driven by a more one-time item.

Brian Finnegan, Interim CEO, President and Chief Operating Officer, Brixmor Property Group: Yeah, I mean, we're obviously not going to provide guidance on G&A right now. If you just look at the comparison to the prior quarter, we did do a restructuring in the prior year, which did have a charge in that quarter and importantly gave us a better run rate going forward of a reduced G&A, which you're seeing in that line year to date. It's really about the comparison and what happened in the prior quarter. We feel pretty comfortable where G&A is today.

Samir Khanal, Analyst, BofA Securities0: Great, thank you.

Mark Horgan, Executive Vice President and Chief Investment Officer, Brixmor Property Group: Thank you.

Speaker 4: Our next question is from Juan Sanabria with BMO Capital Markets. Please proceed.

Hi, good morning and good thoughts with Jim and his family. I just wanted to ask about the Publix relationship you kind of noted at the top in your prepared remarks, and what we could see going forward, any opportunities for some greenfield developments?

Brian Finnegan, Interim CEO, President and Chief Operating Officer, Brixmor Property Group: Yeah, first touching on the Publix relationship, Juan, our South Region team has had a longstanding relationship with them. We've done into the double-digit projects in terms of in-place redevelopments. We've got two new projects that we've done this quarter in Southeast Florida and Hilton Head, South Carolina, which we recently announced. We just announced yesterday another redevelopment in St. Pete with them. We've got a long pipeline with them and a great partnership in terms of they've been reinvesting, like a lot of our grocery partners, in their stores in both Florida and some other Southeast markets. The team in the South Region's done a fantastic job with them, and we look forward to continuing to see that grow. You can see many of those projects in the future pipeline. As it relates to new development, our focus is on redevelopment.

We've got several years of runway of future growth in that future reinvestment pipeline. As Mark touched on, he's adding additional opportunities to that as well. Never say never because we do have great relationships with the likes of Publix, Kroger, HEB. I could go down the list that we have a lot of, we've had a lot of good rapport, not just rapport with, but we've been able to execute with historically. We'll continue to look at things, but generally, that focus is going to be on redevelopment.

Speaker 4: Our next question is from Haendel St. Juste with Mizuho Securities. Please proceed.

Hey there. Thanks for taking my question. Best wishes to Jim. I wanted to build on the last question. Looks like the average yield for redevelopment projects ticked down a bit sequentially to 9% versus 10% last quarter. Is that a mix issue? Are you starting to see the impact of tariffs or higher costs? Maybe this is a new level we should expect near term. Some thoughts broadly, I guess, on minimum yield or hurdles in light of the lower debt costs. I'm curious if you're changing that at all in light of lower debt costs. Thanks.

Brian Finnegan, Interim CEO, President and Chief Operating Officer, Brixmor Property Group: Juan, I'm sorry, Haendel. If you look at where we've said historically and where we've been delivering, it's been high single-digit, low double-digit returns. It's just effectively the mix that we had of what was stabilizing during the quarter. As we look out in that future reinvestment pipeline, we still see, as I said, several years of runway for similar returns. There have been instances where there have been some cost increases, but we're getting it back in terms of our rents, and we continue to be able to invest accretively. These are incremental returns. We're also not including in those returns the follow-on leasing that we continue to see in these projects several years after. We remain very encouraged by what we're seeing in terms of the projects going forward and the nature of what those returns look like. We're not changing our thresholds.

If anything, as we've done some of these larger projects, we want a higher pre-lease threshold from where we've been historically to limit our risk. These projects are still fully bought out, and we have a great line of sight on where costs are going to go. Generally, we're very pleased with what we've been seeing both in the existing and future pipeline as it relates to those returns.

Thank you.

Thanks, Handel.

Speaker 4: Our next question is from Caitlin Burrows with Goldman Sachs. Please proceed.

Hi, good morning, everyone. A big part of the Brixmor story is your ability to quarter after quarter achieve large leasing spreads as you bring rents up to market rates. I guess with Jim having become CEO almost 10 years ago, it would seem like a lot of this opportunity has been realized by now, but maybe that's not true. Could you give some detail on how you think about what portion of that upside, the outside leasing spreads has been realized, how much is left, and how long leasing spreads can continue in the mid-teens rate?

Brian Finnegan, Interim CEO, President and Chief Operating Officer, Brixmor Property Group: Caitlin, I would just say we're very pleased with the rent growth trends in the portfolio, both with what we've been able to execute as well as what we see coming down the pike. If you think about the quarter, we signed the highest rents we ever have in overall small shop and anchors. Over the last year, we've signed the highest rents that we ever have in all those categories as well. If you look at that future leasing pipeline, it sits at about 40% higher than our in-place rents today. As we continue to reinvest in the portfolio, we expect to continue to drive rents higher. We still have a low rent basis in terms of the spaces that we are taking back, and we're backfilling these boxes accretively. We still see a long runway for future rent growth.

You could see some fluctuation in a given quarter, but really pleased with what we're seeing from the team.

Thanks.

Thank you.

Speaker 4: As a reminder, just star one if you would like to ask a question or a follow-up question. Our next question is from Floris Van Dijkum with Ladenburg Thalmann. Please proceed.

Hey guys, thanks for taking my question. Jim, I hope you're enjoying the Cavaliers in your time off because the football season is a little bit special. We haven't had that in a couple of years. I wanted to ask about the recycling of capital. One of the unique elements that you guys had is selling stabilized, low-growth assets at attractive cap rates and reinvesting into your significant redevelopment activity. As I noticed, you haven't sold that much year to date. I think it's $190 million-ish or thereabouts, less than what you've acquired. Could you talk about the pipeline of dispositions and what the impact of that is going to be? You do have a significant redevelopment pipeline as well that is in the works and you're adding onto it.

Brian Finnegan, Interim CEO, President and Chief Operating Officer, Brixmor Property Group: For Floris, I'll start and then maybe I'll hand it to Mark. There's always going to be, and Jim has said this historically, a portion of the portfolio where we've maximized value. We're going to take that capital and recycle it into places where we see more compelling growth opportunities that align with the growth profile of the company. With that, maybe I'll hand it to Mark in terms of some more detail on the pipeline.

Mark Horgan, Executive Vice President and Chief Investment Officer, Brixmor Property Group: Yeah, I'm sure that the other account I'd make with respect to our funding of the business plan, don't forget we do generate significant free cash flows here post-dividend, post-our normal leasing spend. That's really what's funding the vast majority of our redevelopment program. There's probably some limited amount of disposition going into keeping us leveraged and neutral there. Ultimately, I wouldn't forget that as you think about how we're funding the business. On the pipeline for dispositions, as I mentioned, what's most interesting to us in the market today is this new capital coming in that, again, is seeking exposure to the space.

We think we've got an ability here to be opportunistic and sell assets that Brian highlighted that have less growth in our overall portfolio and put it back to work in assets where we are compelled to see higher growth rates and really drive that ROIC for us over time.

Just to make sure, the cap rates on the dispositions are broadly in line with what you're acquiring, except maybe the lifestyle center. You know that it should be on a sort of a cap rate neutral basis, or is there a little bit of dilution involved there?

Our year-to-date cap rate, like it's been for many years, is in and around a seven. The acquisitions are going to be slightly lower than that when you blend them all together this year. Last year, we think it was about neutral. It depends on the mix of what we're selling. Importantly, we're really focused on that long-term hold IRR, and we think that growth of what we're buying is significantly better than what we're selling. We're seeing that through looking back at the assets we bought, so we remained convicted in the acquisition program to add value to the company over time.

Thanks, guys.

Thanks, Floris.

Speaker 4: Our next question is from Linda Tsai with Jefferies. Please proceed.

Hi, thanks for taking my question. Can you comment on the yield for LaCenterra? In terms of traditional open-air centers being in your acquisition pipeline, just wondering why you highlighted that they are not lifestyle centers.

Brian Finnegan, Interim CEO, President and Chief Operating Officer, Brixmor Property Group: I'll take the second part first, Linda, sorry about that. We did touch on LaCenterra at Cinco Ranch a bit last quarter, but Mark can spend a little bit more time on that. I think what Mark was saying is we're looking for assets that have compelling growth profiles. If you look at that in terms of what we bought historically, it's been a mix. When Mark was comparing it to LaCenterra at Cinco Ranch, these assets are very similar in that they're grocery anchored, and we feel like we can put our platform to work to have compelling growth out of those properties. Maybe Mark, I don't know if there's a little bit more to add on for LaCenterra at Cinco Ranch.

Mark Horgan, Executive Vice President and Chief Investment Officer, Brixmor Property Group: Yeah, I would really point to the comments we made last quarter. We went through it in detail. What I would highlight is that since last quarter, we've outperformed what our expectations were in the initial ownership period. We remain convicted in the growth that we're generating. We remain convicted that the yields we're going to roll will be a little bit higher in year one. Moreover, the growth that we see coming from that asset, we think is a really compelling opportunity for Brixmor. Just to highlight, what I was trying to highlight was the assets that we're buying, we have high conviction in growth, just like we did with LaCenterra. The ones in the pipeline today that we have under control just look more like traditional shopping centers. We're always going to focus on growth.

Thank you.

Brian Finnegan, Interim CEO, President and Chief Operating Officer, Brixmor Property Group: Thanks, Linda.

Speaker 4: As a reminder, to ask a question or follow-up question, it is star one on your telephone keypad. Our next question is from Hong Zhang with JPMorgan Chase. Please proceed.

Yeah, hey, I guess your lease to occupied spread has gone down throughout this year, but still remains above historic levels. Just given the strong rent commencements you expect in Q4 and Q2 in 2026, do you expect to be back to more historic levels by the end of 2026, going to 2027?

Brian Finnegan, Interim CEO, President and Chief Operating Officer, Brixmor Property Group: I'll take that. I would expect that to still remain wide. Obviously, you'd expect it to tighten since we commenced a record amount of ABR during the quarter, but we're also leasing a lot of space. We've got a large legal pipeline that we continue to fill. Deals in the leasing committee, in terms of the flow in the leasing committee on a weekly basis, remains strong. The pipeline remains elevated. We like what we're seeing from a demand perspective. You should expect that to remain somewhat elevated, but it is exciting in terms of the commencements that we've had here that we had in the third quarter and that we look forward to seeing in the fourth.

Thank you.

You got it. Thanks.

Speaker 4: There are no further questions at this time. I would like to turn the floor back over to Stacy for closing remarks.

Stacy Slater, Senior Vice President, Investor Relations, Brixmor Property Group: Thank you, guys, for all joining today.

Speaker 4: Thank you. This will conclude today's conference. You may disconnect your lines at this time, and thank you for your participation.

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