Plaza Retail REIT Announces First Quarter 2026 Results

Canada NewsWire

FREDERICTON, NB, May 13, 2026

FREDERICTON, NB, May 13, 2026 /CNW/ - Plaza Retail REIT (TSX: PLZ.UN) ("Plaza" or the "REIT") today announced its financial results for the three months ended March 31, 2026.

"We started 2026 with solid financial and operating performance driven by continued execution across our portfolio," said Jason Parravano, President and Chief Executive Officer. FFO increased by 11.7% year over year to $10.9 million, or $0.098 per unit, reflecting higher NOI from our same asset portfolio, contributions from optimization initiatives, acquisitions, intensifications and developments transferred to income producing properties, and the disciplined redeployment of capital from asset sales. Excluding the impact of the accrued bonuses in the current year and reorganization costs in the prior year, FFO per unit would have increased by 15.6% to $0.102. We have made many structural changes to the way we run the business in the last year which has contributed to some noise in our earnings; however, we are satisfied with the results.

Operating fundamentals remained resilient, with same asset NOI increasing by 1.9%, total NOI increasing by 2.5% in the quarter and committed occupancy holding at 97.5%, supported by rent escalations, renewals, and continued tenant demand across our essential retail portfolio. Excluding enclosed malls, our occupancy remains near perfect at 99%. As a result, leasing spreads remain strong. Our negotiated spreads reached 13.4% based on the average rate over the term. In addition, our new leasing spreads were 76.1% which further highlights demand for our space.

"While AFFO was flat year over year due to higher leasing activity and maintenance capital investments, these expenditures are consistent with our strategy to enhance asset quality, support stronger rental spreads, and unlock long term value," continued Mr. Parravano. As we progress through 2026, we expect the benefit of recently completed and advancing projects to become increasingly evident, reinforcing our ability to drive sustainable cash flow growth and position Plaza for long term value creation."

Summary of Selected IFRS Financial Results
(CAD$000s, except percentages)	Three Months Ended March 31, 2026	Three Months Ended March 31, 2025	$ Change	% Change

Revenues	$32,510	$31,137	$1,373	4.4 %

Net operating income (NOI)⁽¹⁾	$18,795	$18,344	$451	2.5 %

Net change in fair value of investment properties	$2,118	$2,136	($18)	-

Profit and total comprehensive income	$12,820	$9,319	$3,501	-

(1)	This is a non-GAAP financial measure. Refer to the Non-GAAP Financial Measures defined here and in Part I and VII of the Management's Discussion and Analysis ("MD&A") ending March 31, 2026 for more information on each non-GAAP financial measure.

Quarterly Highlights

NOI was $18.8 million, up $451 thousand or 2.5% from the same period in 2025. The increase is due to increased revenue from leasing and rent escalations over the same period in the prior year, partially offset by higher operating expenses.
Profit and total comprehensive income for the current quarter was $12.8 million compared to $9.3 million in the same period in the prior year. Profit and total comprehensive income was impacted by the change in share of profit of associates, which increased by $1.7 million over the same period in the prior year. This was mainly due to the non-cash fair value adjustment to the underlying investment properties, as well as increased income at various properties. Profit and total comprehensive income also increased this quarter as a result of changes in non-cash fair value adjustments relating to derivative assets and liabilities, which accounted for $1.2 million of the increase, as well as the change in fair value of Class B exchangeable LP units.

Summary of Selected Non-IFRS Financial Results
(CAD$000s, except percentages, units repurchased and per unit amounts)	Three Months Ended March 31, 2026	Three Months Ended March 31, 2025	$ Change	% Change

FFO⁽¹⁾	$10,908	$9,763	$1,145	11.7 %
FFO per unit⁽¹⁾	$0.098	$0.088	$0.010	11.4 %
FFO payout ratio⁽¹⁾	71.6 %	80.0 %	n/a	(10.5 %)

AFFO⁽¹⁾	$8,281	$8,289	($8)	(0.1 %)
AFFO per unit⁽¹⁾	$0.074	$0.074	-	-
AFFO payout ratio⁽¹⁾	94.3 %	94.2 %	n/a	0.1 %

Same-asset NOI⁽¹⁾	$19,068	$18,707	$361	1.9 %

Committed occupancy – including non-consolidated investments⁽²⁾	97.5 %	97.6 %	n/a	(0.1 %)
Same-asset committed occupancy⁽³⁾	97.1 %	97.1 %	n/a	-

(1)	This is a non-GAAP financial measure. Refer to the Non-GAAP Financial Measures defined here and in Part I and VII of the MD&A ending March 31, 2026 for more information on each non-GAAP financial measure.
(2)	Excludes properties under development.
(3)	Same-asset committed occupancy excludes properties under development and non-consolidated investments.

Quarterly Highlights

FFO & AFFO: For the three months ended March 31, 2026 FFO increased $1.1 million or 11.7% on a dollar basis and 11.4% on a per unit basis, compared with the same quarter in the prior year. FFO increased due to higher NOI from same-asset, acquisitions, intensifications, developments and properties transferred to income producing. FFO was also impacted by properties sold, from which the capital generated was recently deployed. In addition, FFO was impacted by an increase in administrative costs, partially due to accrued bonuses as well as higher technology costs and professional fees in the current year, partially offset by reorganization costs in the prior year. AFFO of $8.3 million was consistent with the same period in the prior year on a dollar and per unit basis. AFFO was impacted by the changes in FFO noted above, as well as higher leasing costs reflecting initiatives to attract higher-quality tenants, drive optimizations at existing properties to achieve improved rental spreads, and higher maintenance capital expenditures in the current period.
Same-asset NOI increased by $361 thousand or 1.9% due to an increase in revenue from rent escalations and renewals, partially offset by higher operating expenses during the current period.

Non-GAAP Financial Measures

This press release contains certain non-GAAP financial measures including FFO, AFFO and same-asset NOI. These measures are commonly used by entities in the real estate industry as useful metrics for measuring performance. However, they do not have a standardized meaning prescribed by IFRS Accounting Standards and are not necessarily comparable to similar measures presented by other publicly traded entities. These measures should be considered as supplemental in nature and not as a substitute for related financial information prepared in accordance with IFRS Accounting Standards. For further explanation of non-GAAP measures and their usefulness in assessing Plaza's performance, please refer to the section "Basis of Presentation" in Part I and the section "Explanation of Non-GAAP Measures" in Part VII of the REIT's Management's Discussion and Analysis as at March 31, 2026 which can be found on Plaza's website at www.plaza.ca and on SEDAR+ at www.sedarplus.ca.

The following tables reconcile the non-GAAP measures FFO, AFFO, and NOI to the most comparable IFRS measures.

Funds from Operations (FFO) and Adjusted Funds from Operations (AFFO)

Plaza's summary of FFO and AFFO for three months ended March 31, 2026, compared to the three months ended March 31, 2025, is presented below:

(000s – except per unit amounts and percentage data, unaudited)	3 Months Ended March 31, 2026	3 Months Ended March 31, 2025	Change over Prior Period
Profit and total comprehensive income for the period attributable to unitholders	$ 12,727	$ 9,301
Incremental leasing costs included in administrative expenses⁽⁷⁾	749	280
Amortization of debenture issuance costs⁽⁸⁾	(19)	(18)
Distributions on Class B exchangeable LP units included in finance costs – operations	81	81
Deferred income taxes	73	(66)
Right-of-use land lease principal repayments	(208)	(217)
Fair value adjustment to restricted and deferred units	(38)	139
Fair value adjustment to investment properties	(2,118)	(2,136)
Fair value adjustment to investments⁽⁹⁾	(196)	786
Fair value adjustment to Class B exchangeable LP units	(58)	266
Fair value adjustment to convertible debentures	79	169
Fair value adjustment to derivative assets and liabilities	(365)	856
Fair value adjustment to right-of-use land lease assets	208	217
Equity accounting adjustment⁽¹⁰⁾	(42)	139
Non-controlling interest adjustment⁽⁶⁾	35	(34)
FFO⁽¹⁾	$ 10,908	$ 9,763	$ 1,145
*FFO change over prior period - %*			11.7 %

FFO⁽¹⁾	$ 10,908	$ 9,763
Non-cash revenue – straight-line rent⁽⁵⁾	(293)	(94)
Leasing costs – existing properties^{(2) (5) (11)}	(1,732)	(1,266)
Maintenance capital expenditures – existing properties⁽¹²⁾	(608)	(167)
Non-controlling interest adjustment⁽⁶⁾	6	53
AFFO⁽¹⁾	$ 8,281	$ 8,289	($ 8)
*AFFO change over prior period - %*			(0.1 %)

Weighted average trust units outstanding – basic⁽¹⁾⁽³⁾	111,593	111,575
FFO per unit – basic⁽¹⁾	$ 0.098	$ 0.088	11.4 %
AFFO per unit – basic⁽¹⁾	$ 0.074	$ 0.074	-

Gross distribution to unitholders⁽⁴⁾	$ 7,811	$ 7,809
FFO payout ratio – basic⁽¹⁾	71.6 %	80.0 %
AFFO payout ratio – basic⁽¹⁾	94.3 %	94.2 %

FFO⁽¹⁾	$ 10,908	$ 9,763
Interest on dilutive convertible debentures	-	176
FFO – diluted⁽¹⁾	$ 10,908	$ 9,939	$ 969
Diluted weighted average trust units outstanding⁽¹⁾⁽³⁾	111,593	114,105

AFFO⁽¹⁾	$ 8,281	$ 8,289
Interest on dilutive convertible debentures	-	176
AFFO – diluted⁽¹⁾	$ 8,281	$ 8,465	($ 184)
Diluted weighted average trust units outstanding⁽¹⁾⁽³⁾	111,593	114,105

FFO per unit – diluted⁽¹⁾	$ 0.098	$ 0.087	12.6 %
AFFO per unit – diluted⁽¹⁾	$ 0.074	$ 0.074	-

(1)	This is a non-GAAP financial measure. Refer to "Non-GAAP Financial Measures" in Part I and "Explanation of Non-GAAP Financial Measures" in Part VII of the MD&A for more information.
(2)	Based on actuals.
(3)	Includes Class B exchangeable LP units.
(4)	Includes distributions on Class B exchangeable LP units.
(5)	Includes proportionate share of revenue and expenditures at equity-accounted investments.
(6)	The non-controlling interest ("NCI") adjustment includes adjustments required to translate the profit and total comprehensive income attributable to NCI of $93 thousand for the three months ending March 31, 2026 (March 31, 2025 - $18 thousand) to FFO and AFFO for the NCI.
(7)	Incremental leasing costs included in administrative expenses include leasing costs of salaried leasing staff directly attributed to signed leases that would otherwise be capitalized if incurred from external sources. These costs are excluded from FFO in accordance with REALPAC's definition of FFO.
(8)	Amortization of debenture issuance costs is deducted on a straight-line basis over the remaining term of the related convertible debentures, in accordance with REALPAC.
(9)	Fair value adjustment to investments relate to the unrealized change in fair value of equity accounted entities which are excluded from FFO in accordance with REALPAC's definition of FFO.
(10)	Equity accounting adjustment for derivative assets and liabilities includes the change in non-cash fair value adjustments relating to derivative assets and liabilities held by equity accounted entities, which are excluded from FFO in accordance with REALPAC's definition of FFO.
(11)	Leasing costs – existing properties include internal and external leasing costs except to the extent that leasing costs relate to development projects, in accordance with REALPAC's definition of AFFO. See the Gross Capital Additions Including Leasing Fees note on page 25 of the MD&A.
(12)	Maintenance capital expenditures – existing properties include expenditures related to sustaining and maintaining existing space, in accordance with REALPAC's definition of AFFO. See the Gross Capital Additions Including Leasing Fees note on page 25 of the MD&A.

Net Property Operating Income (NOI) and Same-Asset Net Property Operating Income (Same-Asset NOI)

(000s)	3 Months Ended March 31, 2026 (unaudited)	3 Months Ended March 31, 2025 (unaudited)
Same-asset NOI⁽¹⁾	$ 19,068	$ 18,707
Acquisitions, intensifications, developments and redevelopments transferred to IPP in 2025 & 2026 ($3.2 million annual stabilized NOI)	687	202
NOI from properties currently under development and redevelopment ($1.3 million annual stabilized NOI)	-	-
Straight-line rent	293	94
Administrative expenses charged to NOI	(1,320)	(1,096)
Lease termination revenue	19	4
Properties disposed	3	476
Other	45	(43)
Total NOI⁽¹⁾	$ 18,795	$ 18,344
Percentage increase over prior period	2.5 %

(1)	This is a non-GAAP financial measure. Refer to "Non-GAAP Financial Measures" in Part I and "Explanation of Non-GAAP Financial Measures" in Part VII of the MD&A for more information.

Cautionary Statements Regarding Forward-looking Information

This press release contains forward-looking statements relating to Plaza's operations, outlook, financial condition and the environment in which it operates, including expectations regarding current and future operating performance optimization and intensification activities and other projects, and the anticipated impact thereof on future results. Forward-looking statements are not future guarantees of future performance and involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of Plaza to be materially different from any future results, performance or achievements expressed, implied or projected by forward-looking statements contained in this press release, including but not limited to changes in economic, retail, capital market, or debt market conditions, including recessions and changes in, or the extent of changes in, interest rates and the rate of inflation; changes to applicable duties, tariffs and trade laws; supply chain constraints; competitive real estate conditions; and others described in Plaza's Annual Information Form for the year ended December 31, 2025 and Management's Discussion and Analysis for the three months ended March 31, 2026 which can be obtained on the REIT's website at www.plaza.ca or on SEDAR+ at www.sedarplus.ca. Forward-looking statements are based on a number of expectations and assumptions made in light of management's experience and perceptions of historical trends and current conditions, including that progress continues on Plaza's optimizations, intensifications and other projects, that tenant demand for space continues, and that Plaza is able to lease or re-lease space at anticipated rents. Although based upon information currently available to management and what management believes are reasonable expectations and assumptions, there can be no assurances that forward-looking statements will prove to be accurate. Readers, therefore, should not place undue reliance on any forward-looking statements. Plaza undertakes no obligation to publicly update any such statements, except as required by law. These cautionary statements qualify all forward-looking statements contained in this press release.

Further Information

Information appearing in this press release is a select summary of results. A more detailed analysis of the REIT's financial and operating results is included in the REIT's Management's Discussion and Analysis and Consolidated Financial Statements, which can be found on the REIT's website at www.plaza.ca or on SEDAR+ at www.sedarplus.ca.

Conference Call

Jason Parravano, President and CEO and Jim Drake, CFO, will host a conference call for the investment community on May 14, 2026, at 9:00 a.m. EDT. The call-in numbers for participants are 1-416-945-7677 (local Toronto) or 1-888-699-1199 (toll free, within North America).

A replay of the call will be available until May 21, 2026. To access the replay, dial 1-289-819-1450 (local Toronto) or 1-888-660-6345 (Passcode: 42067#). The audio replay will also be available for download on the REIT's website for 90 days following the conference call.

About Plaza

Plaza is an open-ended real estate investment trust and is a leading retail property owner and developer, focused on Ontario, Quebec and Atlantic Canada. Plaza's portfolio at March 31, 2026 includes interests in 190 properties totaling approximately 8.8 million square feet across Canada and additional lands held for development. Plaza's portfolio largely consists of open-air centres and stand-alone small box retail outlets and is predominantly occupied by national tenants with a focus on the essential needs, value and convenience market segments. For more information, please visit www.plaza.ca.

SOURCE Plaza Retail REIT