EastGroup Properties (NYSE: EGP) reported Q3 2026 revenue of $199.4 million, up 9.5% from $182.1 million a year earlier, while diluted GAAP EPS rose to $1.46 from $1.26. FFO excluding gains on involuntary conversion and business interruption claims increased 7.9% to $2.45 per share. Cash-basis same-property NOI growth of 7.1%, higher rents, and contributions from development and acquisitions supported the quarter ended September 30, 2026.
Core Earnings Data
Property net operating income increased 10.1% to $147.9 million. EastGroup attributed $6.8 million of the increase to same-property operations, $4.2 million to newly developed and value-add properties, and $3.2 million to acquisitions, partly offset by a $634,000 reduction from sold properties.
GAAP net income also benefited from a $4.7 million gain on the sale of non-operating real estate. FFO excludes that gain and therefore provides a clearer view of recurring REIT operating performance.
| Metric | Q3 2026 | Q3 2025 | YoY Change |
|---|---|---|---|
| Revenue | $199.4 million | $182.1 million | Approx. 9.5% |
| Net income attributable to common stockholders | $78.4 million | $66.9 million | Approx. 17.1% |
| Diluted GAAP EPS | $1.46 | $1.26 | Approx. 15.9% |
| FFO attributable to common stockholders | $131.9 million | $121.1 million | Approx. 8.9% |
| FFO per share, excluding specified claims gains | $2.45 | $2.27 | 7.9% |
| Property NOI | $147.9 million | $134.4 million | 10.1% |
| Same-property NOI, cash basis and excluding lease termination income | $133.0 million | $124.2 million | 7.1% |
| EBITDAre | $141.5 million | $128.8 million | Approx. 9.9% |
FFO, property NOI, same-property NOI, and EBITDAre are non-GAAP measures. EastGroup’s FFO calculation excludes real estate depreciation and amortization as well as gains from property sales.
Business and Portfolio Performance
Same-property NOI excluding lease termination income rose 5.3% on a straight-line basis and 7.1% on a cash basis. Average same-property rent reached $9.46 per square foot, compared with $8.99 a year earlier, while average same-property occupancy edged up to 96.9% from 96.7%.
New and renewal leases signed during the quarter produced an average 36.3% increase in rental rates on a straight-line basis. Those leases represented 4.6% of operating portfolio square footage, so the reported spread applies to only the portion of the portfolio that turned over during the quarter. The operating portfolio was 97.3% leased and 96.5% occupied at quarter-end, with average month-end occupancy of 96.1% versus 95.7% a year earlier.
EastGroup started four development projects and one redevelopment project during Q3, totaling 998,000 square feet and projected costs of $162.2 million. Its overall development and value-add pipeline contained 21 projects covering 4.1 million square feet, with projected costs of $636.7 million. The pipeline was 25% leased as of October 20, with $251.5 million still to be invested.
The company also acquired two operating properties and 107 acres of development land for approximately $164 million during the quarter. After quarter-end, it acquired three operating properties and 25 acres of land for approximately $262 million.
Rent Growth Lifted Core Earnings, but Expansion Increased Funding Needs
Higher rents and contributions from development and acquisitions allowed FFO per share to grow despite rising expenses. Depreciation and amortization increased 7.5% to $58.2 million, while interest expense rose approximately 25.1% to $9.6 million. Diluted weighted-average shares also increased by 580,000 from the prior-year quarter.
Debt stood at $1.81 billion at September 30, up from $1.48 billion a year earlier. Annualized debt to EBITDAre increased to 3.2 times from 2.9 times, while interest and fixed-charge coverage declined to 14.7 times from 16.8 times. Debt represented 14.6% of total market capitalization.
EastGroup entered forward equity agreements during Q3 covering approximately 2.4 million shares, with initial proceeds of about $485.5 million if settled. As of October 20, approximately 3.4 million shares remained available for settlement across outstanding agreements, representing anticipated net proceeds of about $685.2 million. The arrangements provide capital for investment but will increase shares outstanding when settled. After quarter-end, EastGroup also repaid a $100 million senior unsecured term loan carrying an effectively fixed 1.98% interest rate.
2026 Operating Guidance
Management raised several operating and capital deployment assumptions for 2026. CEO Marshall Loeb described leasing conditions as more stable than broader headlines suggested, while President Reid Dunbar said leasing momentum supported higher development starts and acquisition plans.
| Metric | Latest 2026 Guidance | Previous Guidance | Change |
|---|---|---|---|
| Same-property NOI growth, cash basis | 7.2%–7.8% | 6.3%–7.3% | Range raised |
| Average operating portfolio occupancy | 95.6%–96.2% | 95.3%–96.1% | Range raised |
| Average same-property occupancy | 96.7%–97.3% | 96.3%–97.1% | Range raised |
| Development starts | 2.5 million sq. ft. | 2.2 million sq. ft. | Increased |
| Development investment | $390 million | $325 million | Increased by $65 million |
| Operating property acquisitions | $360 million | $215 million | Increased by $145 million |
| Operating property dispositions | $44 million | $75 million | Reduced by $31 million |
| Gross capital proceeds | $625 million | $300 million | Increased by $325 million |
The higher development, acquisition, and capital proceeds assumptions point to a more active investment plan. Gross capital proceeds include external debt and equity financing but exclude borrowings under unsecured bank credit facilities.
Recent Insider Transactions
Available insider records show 7,182 purchase or award shares across nine transactions during the latest six-month period, compared with 504 shares sold in one transaction. That produced net additions of 6,678 shares, equal to 1.2% of the reported 543,850 shares held by insiders. The latest 10 records consist of nine stock awards and one sale; stock awards should not be treated as open-market purchases.
| Date | Insider | Role | Transaction | Price per Share | Reported Amount |
|---|---|---|---|---|---|
| Oct. 8, 2026 | Bethany Logan Ropa | Director | Stock award | $0.00 | $0 |
| Oct. 8, 2026 | Robyn R. Werner | Director | Stock award | $0.00 | $0 |
| June 4, 2026 | David Michael Fields | Director | Sale | $195.77 | $98,668 |
| May 29, 2026 | Harold Eric Bolton Jr. | Director | Stock award | $0.00 | $0 |
| May 29, 2026 | D. Pike Aloian | Director | Stock award | $0.00 | $0 |
| May 29, 2026 | Pamela J. Shelley-Kessler | Director | Stock award | $0.00 | $0 |
| May 29, 2026 | David Michael Fields | Director | Stock award | $0.00 | $0 |
| May 29, 2026 | Mary E. McCormick | Director | Stock award | $0.00 | $0 |
| May 29, 2026 | Donald F. Colleran | Director | Stock award | $0.00 | $0 |
| April 27, 2026 | James J. Traynor | Officer | Stock award | $0.00 | $0 |
The June transaction represented approximately 504 shares sold, matching the six-month aggregate sales figure.
Risks Investors Need to Watch
- Rent-spread durability: The 36.3% straight-line increase on new and renewal leases supported property income, but the leases represented only 4.6% of portfolio square footage. Future growth depends on the spreads achieved as additional leases expire.
- Development lease-up: The development and value-add pipeline was only 25% leased, with $251.5 million still to be invested. Slower leasing could delay NOI contributions from these projects.
- Financing and dilution: Interest expense rose faster than revenue, and outstanding forward equity agreements could add approximately 3.4 million shares when settled. The company also raised its gross capital proceeds assumption substantially.
- Execution on increased investment: EastGroup raised its development and acquisition plans at the same time. Returns will depend on construction costs, project timing, occupancy, and the performance of acquired properties.
Summary
EastGroup’s Q3 2026 results reflected higher rents, stable occupancy, and additional income from development and acquisitions, lifting both property NOI and FFO per share. The company responded by expanding its 2026 development and acquisition plans. The main issues to monitor are whether leasing spreads remain elevated, how quickly the development pipeline leases up, and how higher investment is funded without allowing interest costs or dilution to offset property-level growth.
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