Regency Centers NASDAQ: REG opened 2026 with what management repeatedly characterized as a strong first quarter, citing solid same-property net operating income growth, high occupancy, and continued momentum across its development and investments platform.
On the company’s first-quarter 2026 earnings call, President and CEO Lisa Palmer said the quarter “delivered strong Same-Property NOI and earnings growth, driven by robust operating fundamentals and accretive capital allocation.” She attributed performance to “the resiliency and spending power of consumers in our strong suburban trade areas,” along with Regency’s focus on “essential retail anchored by top-performing grocers.”
Operating trends: occupancy near 97% and a $42 million leasing pipeline
East Region President and COO Alan Roth said tenant demand remained “robust across nearly all categories and regions,” naming grocers, restaurants, health and wellness concepts, and off-price retailers as among the most active. Roth also pointed to tightening space availability: “The availability of high-quality space is increasingly scarce, both at our centers and in our trade areas, and that dynamic is working in our favor.”
Roth said same property percent leased was “approaching 97%,” up 10 basis points from the fourth quarter. He called the sequential increase “seasonally unusual,” and said leased occupancy was close to the prior peak with “further upside” possible, especially in anchor leasing.
He also highlighted progress in converting leased space to commenced occupancy, noting the same property commenced rate rose 20 basis points during the quarter as Regency worked through its signed-not-open (SNO) pipeline. Roth said the pipeline represents “approximately $42 million of incremental base rent,” which he called “a significant tailwind to future NOI growth.”
On leasing economics, Roth said Regency posted “robust cash re-leasing spreads” and that GAAP spreads were “near a record high,” reflecting both mark-to-market increases and “meaningful contractual rent steps” embedded into leases.
Same-property NOI grew 4.4% as guidance held steady
EVP and CFO Mike Mas reported same-property NOI growth of 4.4% in the first quarter, including 3.5% base rent growth. He reiterated commentary from the prior quarter that first-quarter results would be above the full-year range, while the second quarter is expected to fall below it due to the “uneven nature of other income” and a difficult year-over-year comparison tied to “last year’s favorable expense reconciliation performance.”
Mas said Regency maintained its full-year same-property NOI growth guidance of 3.25% to 3.75%. He also reiterated full-year guidance for growth in both Core Operating Earnings and Nareit FFO per share of 4.5% at the midpoint. Mas added that the company continues to expect “total NOI growth north of 6%,” driven by deliveries from ground-up development and contributions from acquisitions completed in 2025.
Mas noted “minor assumption changes” within the outlook, including modest increases to development and redevelopment spend due to higher expected starts, and an increase in acquisitions guidance “to now include known transactions.”
Development and investments: $600M+ in-process pipeline and a quick Bay Area delivery
West Region President and CIO Nick Wibbenmeyer said Regency’s investments platform remained active and “accretive” during the quarter. He said the company completed $42 million of projects in the first quarter, including Oakley Shops at Laurel Fields, a Safeway-anchored neighborhood center developed ground-up in the Bay Area. Wibbenmeyer said the project was delivered in less than 18 months, calling it “one of the quickest ground-up deliveries that I can recall.”
Regency also began $73 million of new projects in the quarter, including Crystal Brook Corner, a Long Island redevelopment that will be transformed into a Whole Foods-anchored neighborhood center. Wibbenmeyer said the deal reflects Regency’s approach to acquisitions that can be enhanced through its development capabilities and relationships to create “near-term value creation.”
Wibbenmeyer said the in-process pipeline now exceeds $600 million with “exceptional leasing momentum” and “blended returns above 9%.” He emphasized the company’s focus on de-risking projects before breaking ground, describing that approach as enabling on-time and on-budget execution.
He also cited several ground-up examples, including Ellis Village in Northern California, which he said is already 100% leased with an anticipated anchor opening later in 2026, and the SunVet and StoneBridge projects in the Northeast, which both had Whole Foods openings during the first quarter.
Looking ahead, Wibbenmeyer said Regency has “visibility to a potential of more than $1 billion of project starts over the next three years.” In response to questions about timing, he said starts can be “lumpy” and likely “back-end weighted” during 2026, with Regency prioritizing entitlements, anchor pre-leasing, drawings, and bids before moving forward. On underwriting, Wibbenmeyer said the company’s “development yields are firmly in that 7%+ range,” and management’s expectations have not changed.
Tenant health and anchor negotiations amid macro questions
Analysts asked about tenant health, particularly for small shops, given macro uncertainty and higher gas prices. Palmer said Regency’s centers are positioned to perform through cycles due to their focus on “necessity, value, convenience,” adding that in tougher times there can be a “trade-down effect” that can increase traffic at Regency’s properties. She also said the company’s trade areas tend to have more resilient consumers.
Roth pointed to multiple indicators he said remained favorable, including sales, collections, and foot traffic. He said foot traffic was up 2.3% in the first quarter, and added that April traffic was up 3% compared with first-quarter levels “during this time period of increased fuel prices.”
On lease structure, Roth said rent steps were common in shop leasing: “90% of our new shop leasing did in fact have 3% or greater embedded rent steps,” and “about a quarter” had 4% or greater. For anchors, he said Regency was not seeing a “dramatic shift” in embedded steps but still had “pricing power,” citing levers such as work letters, tenant improvements, and rent structure. Roth said the anchor pipeline included transactions signed in the first quarter for a Publix redevelopment, a PGA Superstore, and “our first Teso Life to a Virginia project,” alongside retailers such as Ross, TJX, Burlington, and Ulta.
Palmer added that pricing power for anchors is influenced by supply and demand, arguing that as space becomes even more constrained, Regency should gain incremental leverage in negotiations. She also suggested retailer efficiency gains—citing technology and artificial intelligence—could eventually support higher rents.
Balance sheet, financing, and non-cash revenue questions
Mas highlighted Regency’s access to capital and low leverage. He said that in February the company issued $450 million of seven-year unsecured notes at a 4.5% coupon, which he described as the lowest credit spread in Regency’s history and “one of the most favorable costs of debt capital in the REIT sector,” attributing the execution to its A ratings from Moody’s and S&P. Mas said leverage remained near the low end of the company’s 5x to 5.5x target range and that Regency had nearly full availability on its credit facility.
Mas also said Regency’s free cash flow enables it to fund its development pipeline with “no current need to raise equity or sell properties.” Still, Palmer told analysts the company remains opportunistic on equity issuance if an accretive funding opportunity arises, calling it “a tool in our toolbox” that Regency will use “when the opportunity presents itself.”
On non-cash revenue, Mas explained that results can be “uneven by its nature.” He said first-quarter non-cash revenue was impacted primarily by an adjustment related to “a single tenant, one lease,” which was moved to cash basis, resulting in “a reserve on straight line rent” recorded in the quarter. He said the company remained comfortable with its full-year non-cash revenue guidance and reiterated that Regency uses Core Operating Earnings to focus on cash earnings by eliminating non-cash and non-recurring items.
Mas declined to name the tenant involved in the cash-basis change, describing it as “one lease in well over 9,000 leases” and an accounting judgment about the tenant’s ability to meet future lease obligations, while noting the tenant remained current on rent and that Core Operating Earnings was not impacted.
In closing remarks, Palmer reiterated confidence in Regency’s long-term positioning, pointing to what she called the company’s “strategic advantages”—portfolio quality, the development platform, the balance sheet, and its team—as drivers of durable cash flows and growth over time.
About Regency Centers NASDAQ: REG
Regency Centers Corporation is a publicly traded real estate investment trust (REIT) specializing in the ownership, operation and development of grocery-anchored shopping centers. Focused on everyday needs retail, the company's portfolio is strategically concentrated in high-growth, densely populated markets across the United States. By aligning its properties with essential retailers, Regency Centers delivers stable income streams and drives sustained value for shareholders.
Founded in 1963 and headquartered in Jacksonville, Florida, Regency Centers began as a single shopping center developer before evolving into one of the largest owners of grocery-center real estate.
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