CTO — CTO Realty Growth, Inc.

CTO Realty Growth, Inc. Q4 2025 Earnings Call Summary

1. Key Financial Results and Metrics:

• Core FFO: Q4 Core FFO was $15.8 million ($0.49 per diluted share), up from $14.2 million ($0.46 per diluted share) year-over-year. Full-year Core FFO totaled $60.5 million ($1.87 per diluted share), an increase from $47.9 million ($1.88 per diluted share) in the previous year.
• Same Property NOI: Total same property NOI increased by 1.1% in Q4, with shopping centers specifically growing by 4.3%. The growth was impacted by a significant vacancy in a non-core office property.
• Debt Metrics: Net debt to EBITDA improved to 6.4x from 6.7x in Q3 2025. The company ended the year with $167 million in liquidity.

2. Strategic Updates and Business Highlights:

• Occupancy and Leasing: Record lease occupancy reached 95.9%. The company signed leases for 189,000 square feet in Q4, with a cash rent increase of 31%. For the full year, 671,000 square feet were leased, reflecting a 24% cash rent increase.
• Acquisitions: CTO acquired Pompano City Center for $65.2 million, which is 92% occupied and has potential for further leasing. The company also has a planned acquisition of a 384,000 square foot shopping center in Texas for $83 million.
• Dispositions: The company sold The Shops at Legacy North for $78 million, capitalizing on leasing efforts that took longer than expected.

3. Forward Guidance and Outlook:

• 2026 Guidance: Core FFO is projected to be between $1.98 and $2.03 per diluted share, with AFFO between $2.11 and $2.16. Key assumptions include $100 million to $200 million in investment volume at a yield of 8% to 8.5%, and same property NOI growth for shopping centers of 3.5% to 4.5%.
• Pipeline: The signed not open pipeline stands at $6.1 million, with nearly half expected to contribute to earnings in 2026 and full recognition in 2027.

4. Bad News, Challenges, or Points of Concern:

• Non-Core Property Issues: The office property in Albuquerque, New Mexico, faced challenges with a significant vacancy impacting NOI. While a new lease has been signed, the property’s performance remains a concern.
• Market Conditions: The company noted a potential repayment of a loan from Waters, which could impact liquidity. Additionally, there is a competitive landscape for acquisitions, with limited available properties in the market.

5. Notable Q&A Insights:

• Leasing Strategy: The company is optimistic about backfilling the remaining anchor spaces, with multiple tenants interested. Expected contributions from signed leases will ramp up in 2026.
• Pompano City Center: There are significant mark-to-market opportunities, particularly with JCPenney, which currently pays minimal rent.
• Market Focus: CTO is shifting its focus away from Atlanta due to high exposure and is looking to invest more in other Southeast and Southwest markets.
• CapEx Trends: The elevated CapEx in Q4 was attributed to specific leasing activities and is not expected to be the norm moving forward.

Overall, CTO Realty Growth, Inc. reported strong performance in Q4 2025, with positive leasing activity and strategic acquisitions, while also navigating challenges related to non-core properties and market conditions. The outlook for 2026 appears promising, supported by a robust pipeline and anticipated NOI growth.