SmartCentres Real Estate Investment Trust (SRU.UN) Q4 2025 earnings summary

Executive summary

• Delivered strong financial and operational performance in Q4 and full-year 2025, with robust Same Property NOI growth, high occupancy, and increased FFO, supported by resilient leasing and a conservative balance sheet.

• All property sectors—retail, industrial, residential, storage, and office—showed healthy growth and high tenant retention, with continued expansion in self-storage and residential segments and significant development pipeline progress.

• Maintained stable cash distributions and robust balance sheet, outperforming industry benchmarks.

• Industry-leading 98.6% in-place and committed occupancy rate at year-end, supported by leasing of 430,000 sq. ft. of vacant space and 125,000 sq. ft. of new-build retail.

• Opened a new Walmart store at South Oakville shopping centre and increased the unencumbered asset pool to over $10 billion.

Financial highlights

• Same Property NOI grew 2.9% in Q4 (5.1% excluding anchors); full-year growth was 3.7% (5.6% excluding anchors).

• FFO per Unit for Q4 2025 was $0.54, up from $0.53 in Q4 2024; AFFO per Unit for Q4 2025 was $0.48, with payout ratio to AFFO at 94.8%.

• Distributions maintained at CAD 1.85 per unit; payout ratio to AFFO improved to 89.2% for 2025.

• Adjusted Debt to Adjusted EBITDA was 9.7x in Q4 2025; interest coverage ratio at 2.6x; weighted average debt term to maturity improved to 3.4 years.

• Over CAD 1 billion in liquidity and unencumbered asset pool reached CAD 10 billion for the first time.

Outlook and guidance

• Portfolio expected to maintain momentum into 2026, with continued rent growth, strong cash flow, and ongoing development of mixed-use, residential, and self-storage projects.

• Same Property NOI for 2026 projected to be in a similar range as 2025, with Toys "R" Us vacancies causing a temporary dip early in the year but expected to recover as backfills are completed.

• Two new self-storage facilities opening in QC in Q2 2026, and two more in BC in 2027.

• Focus on intensification and value creation on underutilized land, leveraging strong tenant demand.

• Anticipates robust growth in new retail developments, including grocery and large-format retailers, over the next five years.