REITs' Split Screen: Guidance Raised on Industrial Property While ARMOUR Books a $327M Loss
Three property REITs raised their 2026 outlooks on leased-up warehouses. The mortgage REIT across the street took a mark-to-market hit.
- EastGroup Properties reported FFO of $2.45 per diluted share, up 7.9%, declared its 187th consecutive quarterly dividend with a 12.9% increase to $1.75, and raised development and acquisition guidance, the company says. Self-reported m:…8434
- Essential Properties Realty Trust reported AFFO of $0.51 per share, raised 2026 AFFO guidance to $2.02-$2.05, and initiated 2027 guidance of $2.10-$2.18, the company says. Self-reported m:…0307
- First Industrial Realty Trust reported FFO of $0.81 per share, raised 2026 FFO guidance and cash same-store NOI growth guidance to 6.5%, with cash rents on new and renewal leases up 52%, the company says. Self-reported m:…2275
- ARMOUR Residential REIT reported a Q3 GAAP net loss of $327.0 million on market volatility and rising rates, while generating $102.3 million in Distributable Earnings and holding $1.0 billion of liquidity, the company says. Self-reported m:…7747
The warehouse landlords raise
EastGroup Properties reported net income of $1.46 per diluted share and FFO of $2.45 per diluted share, up 7.9% from Q3 2025. The operating portfolio was 97.3% leased and 96.5% occupied as of September 30, 2026. Same-property net operating income rose 5.3% on a straight-line basis and 7.1% on a cash basis. Rental rates on new and renewal leases increased an average of 36.3% on a straight-line basis. CEO Marshall Loeb said the leasing environment has been much more stable than headlines would lead one to expect, and for once a CEO quote in an earnings release is backed by the numbers around it. m:…8434
The capital actions underline the confidence. EastGroup declared its 187th consecutive quarterly cash dividend, increasing it by $0.20, or 12.9%, to $1.75 per share. It entered forward equity sale agreements for approximately $486 million at an initial weighted average forward price of $202.06 per share, raised annual development starts guidance to $390 million, and increased acquisition guidance to $360 million. Raising the dividend and the equity at the same time is the REIT version of stepping on the accelerator. m:…8434
First Industrial Realty Trust reported FFO of $0.81 per share on a diluted basis and diluted net income of $0.44 per share. Cash rental rates on new and renewal leases increased 52% in the quarter, and cash same-store NOI rose 5.6%. The company raised 2026 FFO guidance by $0.01 at the midpoint and increased its cash same-store NOI growth guidance by 75 basis points at the midpoint to 6.5%. It also acquired a fully leased 764,000 square-foot building in Central Pennsylvania for $120 million. Fifty-two percent rent growth on rollovers is not a market in distress, whatever the office headlines say. m:…2275
Essential Properties Realty Trust reported net income per share of $0.27 and AFFO per share of $0.51, then raised 2026 AFFO guidance to $2.02 to $2.05 per share and issued 2027 guidance of $2.10 to $2.18 per share. The company closed $342.2 million of investments in the quarter at a 7.7% weighted average cash cap rate. Issuing full-year 2027 guidance alongside a raise is a signal about visibility into next year's earnings, and triple-net retail apparently has it. m:…0307
The mortgage REIT's $327 million loss
ARMOUR Residential REIT reported a GAAP net loss of $327.0 million for the third quarter. The portfolio totaled $21.3 billion as of September 30, 2026, with a debt-to-equity ratio of 8.24 to 1 on repurchase agreements. When you run leverage above eight times in a rising-rate quarter, the accounting does the rest. m:…7747
The economic picture is less alarming than the GAAP number. Distributable Earnings available to common stockholders were $102.3 million. Liquidity, including cash and unencumbered securities, was $1.0 billion. The company raised $205.7 million of capital through its at-the-market common stock offering program, and repurchased 363,700 shares under its buyback authorization. Issuing equity while buying it back looks contradictory until you remember the two happened at different prices and the ATM is the mortgage REIT's working capital tap. m:…7747
CEO Scott Ulm said mortgage spreads widened late in the third quarter as interest rates rose and markets reacted to a more hawkish Federal Reserve. Nearly half of the company's repurchase agreements were with its affiliate BUCKLER Securities LLC. Reasoning: ARMOUR's quarter is a reminder that the property REITs and the mortgage REITs are not in the same business. One rents space at 52% higher rates; the other borrows short to own paper. The split screen is the story, and both sides are behaving exactly as their structures predict. m:…7747
What is still unresolved
- Whether Federal Reserve rate policy widens mortgage spreads further against ARMOUR's book.
- Whether ARMOUR's dividend levels hold given current economic interest spreads, per the filing's own caveat.
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