Alexandria Real Estate Equities (ARE) Investor Day 2025 summary

Strategic priorities and market environment

• Focused on mega campus strategy, reducing exposure to non-core and land assets, and maintaining balance sheet strength and liquidity for 2026 and beyond.

• Seven levers for 2026: strong balance sheet, reduced capital spend, non-core asset dispositions, improved occupancy/NOI, G&A management, mega campus investment, and opportunistic share buybacks.

• Asset recycling since 2021 exceeded $7.5 billion, with a target to have 90%-95% of annual rental revenue from core mega campuses by end of 2026.

• Dividend cut of 45% announced to generate $410 million in additional capital, aligning payout with peers and supporting funding needs.

• Construction spending reduced by nearly 40% from 2024-2026, with pipeline projects cut from 16 to 12, focusing on high-conviction mega campus developments.

Financial guidance and operational outlook

• 2026 FFO per share diluted as adjusted guided to $6.25-$6.55, with a midpoint of $6.40, reflecting asset sales and market headwinds.

• Occupancy expected to decline to 88.5% by end of 2026, outperforming market averages in key regions.

• Same property cash NOI projected to decline 8.5% in 2026, marking the first negative year in over two decades due to known vacates and market softness.

• Rental rates on renewals expected down 8% on a cash basis, up 2% GAAP, with focus on meeting market terms to drive occupancy.

• G&A savings of $72 million targeted for 2025-2026, with recurring savings of $24 million annually versus 2024.

Portfolio repositioning and capital allocation

• Dispositions and partial interest sales of $2.9 billion planned for 2026, with 70% from non-core assets and land, aiming to complete large-scale non-core disposition program.

• Non-core assets expected to represent only 5%-10% of annual rental revenue by end of 2026.

• Proceeds from asset sales to be used for debt reduction (~$1.7 billion), funding development, and maintaining leverage in the 5.6-6.2x net debt/EBITDA range.

• Asset sales buyers include owner-users, private real estate firms, REITs, and investment funds, with opportunistic capital seeking value-add properties.

• Joint ventures remain part of the capital plan, with greater emphasis expected post-2026 as non-core sales wind down.