Urban Edge Properties Exceeds Expectations in Q2 2026 with Record FFO and Strong Portfolio Performance
Urban Edge Properties, a leading retail-focused REIT, recently released its second-quarter 2026 earnings report, showcasing impressive results that exceeded internal expectations. In a conference call, Chairman and Chief Executive Officer Jeff Olson highlighted the company's success, stating, 'We had a great second quarter with results that exceeded our internal expectations.'
The company reported record FFO as adjusted of $0.40 per share, representing a 10% increase over the same period in 2025 and 7% year-to-date growth. Same-property NOI, including redevelopment, grew by 3.2% for the quarter and 3% year-to-date, demonstrating strong demand for high-quality space across its markets.
One of the key drivers behind this success is the company's focus on upgrading tenancy at select properties. This strategy has paid off, with notable improvements seen at Bergen, Woodbridge, Hudson Mall, and Totowa. Traffic across these centers increased by 3% in the second quarter compared to the previous year, underscoring the strength of their value and necessity-oriented merchandise mix.
The company's SNO (Same-Store NOI) pipeline represents $22 million of future annual gross rent, approximately 7% of current NOI. This pipeline is a significant contributor to future earnings growth, with several tenants set to commence rent payments in 2027. Notably, the addition of BJ's Wholesale Club, Ross, Chick-fil-A, and Chipotle at Bruckner Commons in the Bronx is expected to yield over $8 million in annual rent.
Urban Edge Properties has continued to execute its capital recycling strategy, acquiring the Shops at West Falls Church in Virginia for $40 million and purchasing a ground lease position at Shoppers World in Massachusetts for $10.5 million. These acquisitions are expected to generate an unleveraged IRR of 9% and contribute to the company's long-term growth.
In addition, the company is under contract to sell Briarcliff Commons in New Jersey for $60.5 million, which is expected to close this month. While the market for acquisitions remains highly competitive due to significant capital chasing retail, Urban Edge Properties remains confident in its ability to find deals that meet its return thresholds.
The company's differentiated redevelopment platform is also a key differentiator, with an active pipeline of $155 million expected to yield 12%. This, combined with signed but not open pipelines set to grow NOI by 7%, positions Urban Edge Properties for durable and visible growth. Over the past three years, the company has acquired approximately $700 million of high-quality shopping centers at a 7% cap rate and sold around $500 million of non-core property at a 5.2% cap rate.
As a result of these strong first-half results, Urban Edge Properties raised its full-year FFO as adjusted guidance by $0.02 per share to a new range of $1.50 to $1.54 per share, implying 6% growth over 2025.
