Summary of CTO Realty Growth Q2 2026 Earnings Call

1Key Financial Results and Metrics

Core FFO: $18.4 million, up from $14.7 million year-over-year; $0.53 per diluted share vs. $0.45.

AFFO: $19.1 million, an increase from $15.3 million; $0.55 per diluted share vs. $0.47.

Same Property NOI Growth: Increased 10.1% for the quarter and 8.2% year-to-date.

Portfolio Occupancy: 95.4%, up 150 basis points year-over-year.

Total Debt: $660.8 million with a weighted average interest rate of 4.6%.

Liquidity: $131.8 million, including $107 million in undrawn commitments.

2Strategic Updates and Business Highlights

Leasing Activity: Executed 25 leases totaling 213,000 square feet, with a positive cash rent spread of 6%. Year-to-date leasing reached 366,000 square feet, with a 10% cash rent spread.

Acquisitions: Acquired Gallery on the Parkway for $53.3 million, fully occupied and strategically located.

Dispositions: Sold $90.7 million worth of properties at a weighted average exit cap rate of 6.7%, allowing for capital recycling into higher-yield investments.

Structured Investments: Originated $96.4 million in preferred equity investments with initial yields of 12%.

Pipeline: Anticipates a robust pipeline of acquisition opportunities and plans to close at least one more acquisition by year-end.

3Forward Guidance and Outlook

Revised Core FFO Guidance: Increased to $2.09 to $2.13 per diluted share from $2.06 to $2.11.

Revised AFFO Guidance: Increased to $2.21 to $2.25 per diluted share from $2.19 to $2.24.

Investment Volume Guidance: Raised to $300 million to $400 million from $175 million to $250 million.

Same Property NOI Growth: Expected to moderate to 5% to 6% for the remainder of the year.

4Bad News, Challenges, or Points of Concern

Tenant Vacancies: A tenant vacated 98,000 square feet in Albuquerque, impacting year-to-date same property NOI growth. However, this space is expected to be fully leased by the state of New Mexico soon.

Moderation of Growth: Anticipated moderation in same property NOI growth due to tougher comparisons in the latter half of the year, particularly from low bad debt expenses in the previous year.

Interest Rate Environment: While the current environment is seen as an opportunity, it poses risks for refinancing and investment costs.

5Notable Q&A Insights

Signed-Not-Open Pipeline: Expected to contribute approximately $1.3 million to $1.4 million in base rent quarterly starting in 2027.

Market Dynamics: The power center market is becoming more favorable for landlords, providing pricing power and contributing to the increase in same store NOI.

Disposition Strategy: The decision to sell certain properties was influenced by strong buyer interest and the ability to recycle capital into higher-yield opportunities.

Future Investments: The company remains optimistic about deal flow in the structured investment space, viewing the current interest rate environment as beneficial for sourcing new opportunities. Overall, CTO Realty Growth reported strong financial performance in Q2 2026, with strategic growth initiatives and an optimistic outlook, despite some challenges related to tenant vacancies and moderating growth expectations.