Federal Realty Price Target Raised to $125, Q4 FFO Up 6.4%
Ladenburg lifted Federal Realty’s price target to $125 from $115, retaining a Buy rating on improved retail REIT valuations. FRT posted Q4 FFO growth of 6.4% (4.3% full-year), guided 2026 FFO growth of ~6% and completed 2.3M sq ft of leases adding $11M in annual rent.
1. Price Target Raise
Ladenburg raised Federal Realty’s price target to $125 from $115 and maintained a Buy rating, citing a broad re-rating of the retail shopping center sector in 2026 that underpins higher valuation multiples for FRT shares.
2. Q4 Financial Performance and Guidance
Federal Realty reported 6.4% bottom-line FFO growth in Q4 2025 and 4.3% growth for the full year. Management set 2026 FFO guidance at approximately 6% growth at the midpoint, excluding a one-time market tax credit now reflected in its Core FFO metric.
3. Leasing Activity
The portfolio closed the quarter 96.6% leased and 94.5% occupied. During Q4, the trust completed 601,000 sq ft of comparable leasing at 12% rollover spreads, while full-year comparable deals totaled 2.3 million sq ft at 15% spreads, adding about $11 million in annual rent under contract.
4. Investment Transactions and Development Strategy
Federal Realty acquired Annapolis Town Center and Village Pointe—nearly one million sq ft—for about $340 million at initial yields in the low 7% range and projected unlevered IRRs near 9%. The company also sold $169 million of assets in Q4 and $150 million after year-end at low-5% cap rates, and unveiled plans for a 261-unit residential development at Willow Grove Shopping Center to blend retail and housing.