Weekly Real Estate News
Brandywine Realty Trust said it completed $681 million in property sales under its 2026 capital-markets plan, more than twice its original $305 million target, as the Philadelphia-based office landlord works to reduce debt and strengthen its balance sheet.
The company disclosed the progress in its October 21 third-quarter earnings release. It reported a net loss available to common shareholders of $22.3 million, or 13 cents per share, compared with a $26.2 million loss, or 15 cents per share, in the year-earlier period. The $681 million figure represents cumulative property sales under its capital-markets program, not quarterly revenue.
Asset sales reshape the balance sheet
Brandywine said its disposition activity included the $136 million sale of Solaris, a residential project in Austin, Texas. During the third quarter, it reduced combined debt by approximately $390 million, including repurchases of $140 million in bonds due in 2028 and 2029. The company reported $176 million in cash and no borrowings outstanding on its $600 million unsecured credit line after subsequent closings described by management.
Net debt to EBITDA fell to 7.6 times from 9.0 times in the previous quarter. The company also repurchased 4.7 million common shares during the quarter.
Occupancy remains a challenge
Brandywine’s core office portfolio was 89.0% occupied and 90.5% leased at September 30. It signed 372,000 square feet of new and renewal leases in wholly owned properties during the quarter. Tenant retention was 50%, while cash-basis same-store net operating income increased 1.7% and accrual-basis same-store NOI declined 0.6%.
The company recorded a $29.1 million impairment charge and a $15.4 million loss on early debt extinguishment during the quarter, partly offset by $55.7 million in net gains on real estate dispositions. Those items affected GAAP results.
Core FFO and outlook
Core funds from operations, a non-GAAP REIT performance measure, totaled $24.5 million, or 14 cents per diluted share, compared with $28.0 million, or 16 cents per share, a year earlier. Brandywine updated its full-year 2026 outlook to a Core FFO range of 54 to 56 cents per diluted share. Core FFO is not interchangeable with net income or operating cash flow.
The report highlights the tradeoff facing office landlords: selling properties can create liquidity and reduce leverage, but a smaller portfolio and persistent leasing challenges may constrain future income. Brandywine said its core focus remains Philadelphia and Austin.
Primary source: Brandywine Realty Trust third-quarter 2026 results, October 21.
