Federal Realty Reports Solid Q4 Growth in Line With Our Expectations

Fourth-quarter results for no-moat Federal Realty Investment Trust were in line with our expectations, leading us to reaffirm our $139 fair value estimate. Same-store occupancy improved 10 basis points sequentially and 40 basis points year over year to 94.3%, in line with our estimate. Federal Realty reported the strongest total re-leasing spreads in over two years with new rents 9.9% higher than prior terms, better than our estimate of a 5.4% spread. Same-store revenue was up 5.8%, and same-store net operating income was up 5.4% in the fourth quarter, in line with our estimate of 5.0% same-store NOI growth. As a result, funds from operations grew 7.2% in the fourth quarter to $1.58 per share, which matched our estimate.