FREDERICTON, NB, March 2, 2026 /CNW/ - Plaza Retail REIT (TSX: PLZ.UN) ("Plaza" or the "REIT") today announced its financial results for the quarter and year ended December 31, 2025.
"2025 marked an important transition year for Plaza with a strong focus on our optimization and intensification strategies, coupled with steady operating fundamentals and a portfolio positioned around non-discretionary retail," said Jason Parravano, President and Chief Executive Officer. "Total FFO increased to $44.0 million or $0.395 per unit compared to $40.5 million or $0.363 per unit in 2024, an 8.8% year-over-year improvement, reflecting contributions from same-asset performance, acquisitions completed over the past year, lower administrative expenses due to $2.7 million in reorganization costs in 2024, and the continued execution of our value-creation pipeline, which included various optimization and intensification initiatives. Excluding $123 thousand of reorganization costs, $425 thousand related to a change in bonus accrual timing and $544 thousand of bad debt related to the insolvency of Toys R Us, and excluding 2024 reorganization costs of $2.7 million, 2025 FFO would have been up 4.5% over 2024."
"From an operations standpoint, the portfolio continued to demonstrate resilience. Demand for our space remained healthy, with committed occupancy of 97.6% and leasing spreads at 13.4% based on the average rate over the term. Same-asset NOI grew by 1.7% for the year despite a handful of tenant disruptions that resulted in bad debt adjustments, most notably from the insolvency of Toys R Us. Our exposure is limited to one location, and we are actively working on a plan to reposition the asset. Excluding the bad debt related to Toys R Us, same asset NOI would have increased by 2.5%. This outcome speaks to both the quality of our locations and the strength of our leasing execution."
"In addition to our strong operating fundamentals, over the course of 2025, our intensification, development, and consolidation initiatives added approximately $3.0 million of incremental NOI, reinforcing our strategy of extracting embedded value from the existing portfolio while maintaining financial discipline. Total NOI for the year was $77.0 million, representing growth of 2.7% compared to 2024."
"We also made meaningful progress advancing projects that will increasingly benefit results in 2026 and beyond. During the year, we handed over multiple spaces to Loblaws and other key tenants for fit-ups and construction across select properties. As these openings stabilize and additional initiatives progress, we expect the impact to become more visible through 2026. At the same time, our optimization work continues to support FFO growth and long-term value creation, even if it can create timing-related noise in AFFO comparisons."
Summary of Selected IFRS Financial Results
(CAD$000s, ThreeMonthsEndedDecember ThreeMonthsEndedDecember $Change %Change Twelve TwelveMonths $ Change % Change
except 31, 2025 31, 2024 MonthsEndedDecember EndedDecember
percentages) 31, 2025 31, 2024
Revenues $31,800 $30,623 $1,177 3.8 % $126,434 $121,280 $5,154 4.3 %
Net operating
income
(NOI)(1) $19,120 $18,926 $194 1.0 % $77,034 $75,019 $2,015 2.7 %
Net change in
fair value of
investment
properties $13,975 $1,847 $12,128 - $14,468 ($10,377) $24,845 -
Profit and
total
comprehensive
income $25,088 $8,473 $16,615 - $55,886 $25,485 $30,401 -
(1) This is a non-GAAP financial measure. Refer to the
Non-GAAP Financial Measures defined here and in Part
I and VII of the Management's Discussion and Analysis
("MD&A") ending December 31, 2025 for more information
on each non-GAAP financial measure.
Quarterly Highlights
-- NOI was $19.1 million, up $194 thousand or 1.0% from the same period in
2024. The increase is due to increased revenue from leasing and rent
escalations over the same period in the prior year, partially offset by
higher operating expenses. NOI was also impacted by bad debt of $337
thousand in the current period.
-- Profit and total comprehensive income for the current quarter was $25.1
million compared to $8.5 million in the same period in the prior year.
Profit and total comprehensive income was primarily impacted by the
change in fair value of investment properties, with a $14.0 million
increase recorded in the current quarter compared to a $1.8 million
increase recorded in the same quarter in the prior year. The fair value
change year over year was mainly due to a decrease in capitalization
rates, increased stabilized NOI as well as new appraisals. Profit and
comprehensive income was also impacted by changes in non-cash fair value
adjustments relating to derivative assets and liabilities, which
accounted for $709 thousand of the increase compared to the same quarter
in the prior year, the non-cash fair value adjustments for Class B
exchangeable LP units, and convertible debentures.
Year-To-Date Highlights
-- NOI was $77.0 million, up $2.0 million or 2.7% from the same period in
2024. The increase is due to increased revenue from leasing and rent
escalations over the same period in the prior year, partially offset by
higher operating expenses, particularly snow removal costs, roof and
asphalt repairs and maintenance in 2025. NOI was also impacted by $770
thousand of bad debt.
-- Profit and total comprehensive income for the current period was $55.9
million compared to $25.5 million in the same period in the prior year.
Profit and total comprehensive income was primarily impacted by the
change in fair value of investment properties, with a $14.5 million
increase recorded in the current period compared to a $10.4 million
decrease recorded in the prior year. The fair value change year over year
was mainly due to decreased capitalization rates, increased stabilized
NOI, new appraisals, as well as the acquisition of the remaining interest
in three Ontario assets. Profit and total comprehensive income was also
impacted by an increase in the share of profit of associates of $1.2
million over the prior year, mainly relating to increased earnings, as
well as an increase in non-cash fair value adjustment of the underlying
properties in the current year. Profit and total comprehensive income
were also impacted by changes in non-cash fair value adjustments relating
to derivative assets and liabilities, the Class B exchangeable LP units,
and convertible debentures.
Summary of Selected Non-IFRS Financial Results
(CAD$000s, except ThreeMonthsEndedDecember ThreeMonthsEndedDecember $ Change % Change Twelve Twelve $ Change % Change
percentages, 31, 2025 31, 2024 MonthsEndedDecember MonthsEndedDecember
units repurchased 31, 2025 31, 2024
and
per unit amounts)
FFO(1) $10,701 $8,514 $2,187 25.7 % $44,032 $40,462 $3,570 8.8 %
FFO per unit(1) $0.096 $0.076 $0.020 26.3 % $0.395 $0.363 $0.032 8.8 %
FFO payout
ratio(1) 73.0 % 91.7 % n/a (20.4 %) 71.0 % 77.2 % n/a (8.0 %)
AFFO(1) $9,107 $5,992 $3,115 52.0 % $33,485 $31,865 $1,620 5.1 %
AFFO per unit(1) $0.082 $0.054 $0.028 51.9 % $0.300 $0.286 $0.014 4.9 %
AFFO payout
ratio(1) 85.8 % 130.3 % n/a (34.2 %) 93.3 % 98.0 % n/a (4.8 %)
Same-asset NOI(1) $18,408 $18,213 $195 1.1 % $73,922 $72,659 $1,263 1.7 %
Normal course - - n/a n/a - 4,920 n/a n/a
issuer bid --
units repurchased
Committed
occupancy --
including
non-consolidated
investments(2) 97.6 % 97.6 % n/a -
Same-asset
committed
occupancy(3) 97.1 % 97.0 % n/a 0.1 %
(1) This is a non-GAAP financial measure. Refer to
the Non-GAAP Financial Measures defined here and in
Part I and VII of the MD&A ending December 31, 2025
for more information on each non-GAAP financial measure.(2) Excludes
properties under development.(3) Same-asset committed occupancy excludes
properties
under development and non-consolidated investments.
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