Phillips Edison & Company (PECO) Investor presentation summary

Business overview and strategy

• Operates 326 grocery-anchored neighborhood centers with 36.9M square feet, focusing on markets where top grocers are most profitable.

• 94% of annual base rent (ABR) comes from grocery-anchored centers, with 82% from #1 or #2 grocers by sales in each market.

• 74% of ABR is from necessity-based goods and services, supporting resilience and stable demand.

• Maintains a 97% leased portfolio occupancy and a 3.5% dividend yield.

• Strategy emphasizes local market expertise, diversified tenant mix, and a focus on growing suburban and Sun Belt markets.

Portfolio composition and performance

• Portfolio is highly concentrated in neighborhood centers, leading among retail REIT peers in NOI from this format.

• Strong presence in Sun Belt states and growing U.S. cities, with ~50% of ABR from Sun Belt markets.

• Average 3-mile median household income around centers is $101K, 15% above the U.S. average.

• Tenant mix is led by grocery (28% of ABR), restaurants (21%), and other necessity-based retailers.

• Inline local tenants have an average tenure of 10 years and high retention rates, with Q1 2026 renewal rent spreads at 23.9%.

Growth drivers and financial targets

• Long-term targets include 3–4% same-center NOI growth and mid-to-high single-digit Core FFO per share growth.

• Growth is driven by occupancy gains, strong new and renewal rent spreads, redevelopment, and contractual rent increases.

• External growth through acquisitions, joint ventures, and portfolio recycling, targeting $400M–$500M in annual acquisitions.

• 2026 guidance projects Nareit FFO per share of $2.66–$2.71 and Core FFO per share of $2.72–$2.78, with 3–4% same-center NOI growth.

• Balance sheet remains strong with $810M liquidity, 5.3x net debt to adjusted EBITDAre, and 94% fixed-rate debt.