Open the filing on EDGARAmerican Assets Trust, Inc. Reports First Quarter 2026 Financial Results
SAN DIEGO, California - 4/28/2026 - American Assets Trust, Inc. (NYSE: AAT) (the “company”) today reported financial results for its first quarter ended March 31, 2026.
First Quarter Highlights
- Net income available to common stockholders of $5.1 million for the first quarter, or $0.08 per diluted share.
- FFO of $0.51 per diluted share for the first quarter, compared to $0.52 per diluted share for the same period in 2025.
- Same-store cash Net Operating Income (“NOI”) remained flat for the first quarter, compared to the same period in 2025.
- Leased 237,000 of office square feet, of which approximately 108,000 is comparable at an average straight-line basis and cash-basis contractual rent increase of 10.6% and 4.8%, respectively, during the first quarter.
- Leased 39,000 of retail square feet, of which approximately 38,000 is comparable at an average straight-line basis increase of 1.3% and cash-basis contractual rent decrease of 2.0%, respectively, during the first quarter.
Amended and Restated Credit Facility
- On April 1, 2026, the credit facility was amended and restated to, among other things, increase the borrowing capacity to $600 million, consisting of a $500 million revolving line of credit and a $100 million term loan, and extend the maturity date to April 1, 2030.
Financial Results
| (Unaudited, amounts in thousands, except per share data) | Three Months Ended March 31, |
| | 2026 | | 2025 |
| Net income | $6,739 | | $54,107 | |
| Basic and diluted income attributable to common stockholders per share | $0.08 | | $0.70 | |
| FFO attributable to common stock and common units | $38,834 | | $39,945 | |
| FFO per diluted share and unit | $0.51 | | $0.52 | |
Net income attributable to common stockholders decreased $47.4 million for the three months ended March 31, 2026 compared to the same period in 2025, primarily driven by the gain on sale of Del Monte Center recognized in 2025, higher interest expense as we stopped capitalizing interest related to La Jolla Commons III being placed into service, decrease in occupancy at First & Main and overall increase in rental expenses across all segments.
FFO decreased $1.1 million for the three months ended March 31, 2026 compared to the same period in 2025, primarily due to the items described above. Gain on sale of Del Monte Center is excluded from FFO computations.
FFO is a non-GAAP supplemental earnings measure which the company considers meaningful in measuring its operating performance. A reconciliation of net income to FFO is attached to this press release.
Leasing
The portfolio leased status as of the end of the indicated quarter was as follows:
| March 31, 2026 | December 31, 2025 | March 31, 2025 |
|---|
| Total Portfolio | | | |
| Office | 84.5% | 83.1% | 85.5% |
| Retail | 97.7% | 97.7% | 97.4% |
| Multifamily (1) (2) | 94.7% | 93.7% | 91.4% |
| Mixed-Use: | | | |
| Retail | 96.2% | 96.2% | 89.3% |
| Hotel | 91.9% | 82.3% | 84.6% |
| Same-Store Portfolio | | |
| Office | 86.3% | 85.6% | 85.5% |
| Retail | 97.7% | 97.7% | 97.4% |
| Multifamily (1) (2) | 94.3% | 93.4% | 91.3% |
| Mixed-Use: | | | |
| Retail | 96.2% | 96.2% | 89.3% |
| Hotel | 91.9% | 82.3% | 84.6% |
(1) Percentage leased for our multifamily properties includes total units rented and occupied as of each of the applicable dates.
(2) Santa Fe Park RV Resort is excluded from the multifamily presentation above to reflect traditional multifamily performance. Including Santa Fe Park RV Resort, multifamily occupancy would be 92.1%, 91.1% and 90.0% as of March 31, 2026, December 31, 2025 and March 31, 2025, respectively. Including Santa Fe Park RV Resort, multifamily same-store occupancy would be 91.5%, 90.6% and 89.7% as of March 31, 2026, December 31, 2025 and March 31, 2025, respectively.
(3) Same-store portfolio excludes: (i) Del Monte Center (retail), which was sold on February 25, 2025, (ii) Genesee Park (multifamily), which was acquired on February 28, 2025, (iii) La Jolla Commons III (office), which was placed into service on April 1, 2025 and (iv) land held for development.
During the first quarter of 2026, the company signed 43 leases for approximately 275,300 square feet of office and retail space, as well as 337 multifamily apartment leases. Renewals accounted for 73% of the comparable office leases, 92% of the comparable retail leases, and 52% of the residential leases.
Office and Retail
The annualized base rent per leased square foot as of the end of the indicated quarter was as follows:
| | 2nd Quarter 2025 | 3rd Quarter 2025 | 4th Quarter 2025 | 1st Quarter 2026 |
|---|
| Office | Weighted Average Portfolio | $56.36 | $56.59 | $56.69 | $56.64 |
| Retail | Weighted Average Portfolio | $29.57 | $29.57 | $29.72 | $30.04 |
On a comparable basis (i.e., leases for which there was a former tenant in the past six-months) our office and retail leasing spreads as of the end of the indicated quarter are shown below:
| | 2nd Quarter 2025 | 3rd Quarter 2025 | 4th Quarter 2025 | 1st Quarter 2026 |
|---|
| Office | Cash Basis % Change Over Prior Rent | (2.0)% | 9.3% | 6.6% | 4.8% |
| Straight-Line Basis % Change Over Prior Rent | 9.6% | 18.6% | 11.5% | 10.6% | |
| Retail | Cash Basis % Change Over Prior Rent | 7.4% | 4.4% | 0.3% | (2.0)% |
| Straight-Line Basis % Change Over Prior Rent | 21.9% | 21.0% | 24.3% | 1.3% | |
On a comparable basis (i.e., leases for which there was a former tenant in the past six-months) during the first quarter of 2026, our office and retail leasing spreads are shown below:
| | Number of Leases Signed | Comparable Leased Sq. Ft. | Average Cash Basis % Change Over Prior Rent | Average Cash Contractual Rent Per Sq. Ft. | Straight-Line Basis % Change Over Prior Rent |
|---|
| Office | Q1 2026 | 15 | 108,000 | 4.8% | $58.66 | 10.6% |
| Retail | Q1 2026 | 13 | 38,000 | (2.0)% | $45.70 | 1.3% |
Multifamily
The average monthly base rent per occupied unit as of the end of the indicated quarter was as follows:
| 2nd Quarter 2025 | 3rd Quarter 2025 | 4th Quarter 2025 | 1st Quarter 2026 |
|---|
| Average Monthly Base Rent per Occupied Unit | $2,732 | $2,730 | $2,684 | $2,756 |
Same-Store Cash Net Operating Income
For the three months ended March 31, 2026, same-store cash NOI remained flat, compared to the three months ended March 31, 2025. The same-store cash NOI by segment was as follows (in thousands):
| Three Months Ended | |
|---|
| March 31, | |
|---|
| 2026 | 2025 | Change |
|---|
| Cash Basis: | | | |
| Office | $35,035 | | $35,074 | | (0.1)% |
| Retail | 16,269 | | 16,383 | | (0.7) |
| Multifamily | 9,848 | | 9,562 | | 3.0 |
| Mixed-Use | 5,219 | | 5,363 | | (2.7) |
| Same-store Cash NOI | $66,371 | | $66,382 | | - % |
(1) Same-store portfolio excludes: (i) Del Monte Center (retail), which was sold on February 25, 2025, (ii) Genesee Park (multifamily), which was acquired on February 28, 2025, (iii) La Jolla Commons III (office), which was placed into service on April 1, 2025 and (iv) land held for development.
(2) Lease termination fees and tenant improvement reimbursements are excluded from same-store cash NOI to provide a more accurate measure of operating performance.
Same-store cash NOI is a non-GAAP supplemental earnings measure which the company considers meaningful in measuring its operating performance. A reconciliation of same-store cash NOI to net income is attached to this press release.
Credit Facility
On April 1, 2026, our credit facility was amended and restated to, among other things, increase the revolving line of credit from $400 million to $500 million, extend the maturity date of the restated $500 million revolving line of credit to April 1, 2030 (with two, six-month extension options), and extend the maturity of the $100 million term loan included within the credit facility to April 1, 2030 (with one, twelve-month extension option).
Balance Sheet and Liquidity
At March 31, 2026, the company had gross real estate assets of $3.8 billion and liquidity of $518.3 million, comprised of cash and cash equivalents of $118.3 million and $400.0 million of availability on its line of credit. At March 31, 2026, the company had only 1 out of 31 assets encumbered by a mortgage.
Dividends
The company declared dividends on its shares of common stock of $0.340 per share for the first quarter of 2026. The dividends were paid on March 19, 2026.
In addition, the company has declared a dividend on its common stock of $0.340 per share for the second quarter of 2026. The dividend will be paid in cash on June 18, 2026 to stockholders of record as of June 4, 2026.
Guidance
The company affirms its guidance range for full year 2026 FFO per diluted share of $1.96 to $2.10 per share, with a midpoint of $2.03.
The company's guidance excludes any impact from future acquisitions, dispositions, equity issuances or repurchases, debt financing or repayments. The foregoing estimates are forward-looking and reflect management's view of current and future market conditions, including certain assumptions with respect to leasing activity, rental rates, occupancy levels, interest rates, credit spreads and the amount and timing of acquisition and development activities. The company's actual results may differ materially from these estimates.
Conference Call
The company will hold a conference call to discuss the results for the first quarter of 2026 on Wednesday, April 29, 2026 at 8:00 a.m. Pacific Time (“PT”). To participate in the event by telephone, please dial 1-833-816-1162 and ask to join the American Assets Trust, Inc. conference call. A live on-demand audio webcast of the conference call will be available on the company's website at www.americanassetstrust.com. A replay of the call will also be available on the company's website.
Supplemental Information
Supplemental financial information regarding the company's first quarter 2026 results may be found on the "Financial Reporting" tab of the “Investors” page of the company's website at www.americanassetstrust.com. This supplemental information provides additional detail on items such as property occupancy, financial performance by property and debt maturity schedules.
Financial Information
American Assets Trust, Inc.
Consolidated Balance Sheets
(In Thousands, Except Share Data)
| March 31, 2026 | December 31, 2025 |
|---|
| Assets | (unaudited) | |
| Real estate, at cost | | |
| Operating real estate | $3,703,308 | $3,694,203 |
| Construction in progress | 75,226 | 68,937 |
| Held for development | 487 | 487 |
| 3,779,021 | 3,763,627 |
| Accumulated depreciation | (1,167,625) | (1,144,259) |
| Net real estate | 2,611,396 | 2,619,368 |
| Cash and cash equivalents | 118,340 | 129,362 |
| Accounts receivable, net | 6,728 | 7,407 |
| Deferred rent receivables, net | 84,333 | 84,642 |
| Other assets, net | 79,770 | 80,497 |
| Total assets | $2,900,567 | $2,921,276 |
| Liabilities and equity | | |
| Liabilities: | | |
| Secured notes payable, net | $74,872 | $74,849 |
| Unsecured notes payable, net | 1,613,295 | 1,612,761 |
| Accounts payable and accrued expenses | 68,901 | 71,094 |
| Security deposits payable | 10,503 | 10,063 |
| Other liabilities and deferred credits, net | 60,279 | 61,304 |
| Total liabilities | 1,827,850 | 1,830,071 |
| Commitments and contingencies | | |
| Equity: | | |
| American Assets Trust, Inc. stockholders' equity | | |
| Common stock, $0.01 par value, 490,000,000 shares authorized, 61,390,936 and 61,390,936 shares issued and outstanding at March 31, 2026 and December 31, 2025, respectively | 614 | 614 |
| Additional paid-in capital | 1,481,552 | 1,479,870 |
| Accumulated dividends in excess of net income | (346,589) | (331,086) |
| Accumulated other comprehensive income | 998 | 1,419 |
| Total American Assets Trust, Inc. stockholders' equity | 1,136,575 | 1,150,817 |
| Noncontrolling interests | (63,858) | (59,612) |
| Total equity | 1,072,717 | 1,091,205 |
| Total liabilities and equity | $2,900,567 | $2,921,276 |
American Assets Trust, Inc.
Unaudited Consolidated Statements of Operations
(In Thousands, Except Shares and Per Share Data)
| Three Months Ended March 31, |
|---|
| 2026 | 2025 |
|---|
| Revenue: | | |
| Rental income | $104,422 | | $102,951 | |
| Other property income | 6,170 | | 5,656 | |
| Total revenue | 110,592 | | 108,607 | |
| Expenses: | | |
| Rental expenses | 31,720 | | 30,300 | |
| Real estate taxes | 11,946 | | 11,005 | |
| General and administrative | 8,783 | | 9,312 | |
| Depreciation and amortization | 32,311 | | 30,494 | |
| Total operating expenses | 84,760 | | 81,111 | |
| Gain on sale of real estate | - | | 44,476 | |
| Operating income | 25,832 | | 71,972 | |
| Interest expense, net | (19,707) | | (18,780) | |
| Other income, net | 614 | | 915 | |
| Net income | 6,739 | | 54,107 | |
| Net income attributable to restricted shares | (236) | | (203) | |
| Net income attributable to unitholders in the Operating Partnership | (1,369) | | (11,369) | |
| Net income attributable to American Assets Trust, Inc. stockholders | $5,134 | | $42,535 | |
| Net income per share | | |
| Basic income attributable to common stockholders per share | $0.08 | | $0.70 | |
| Weighted average shares of common stock outstanding - basic | 60,697,679 | | 60,537,300 | |
| Diluted income attributable to common stockholders per share | $0.08 | | $0.70 | |
| Weighted average shares of common stock outstanding - diluted | 76,879,216 | | 76,718,837 | |
| Dividends declared per common share | $0.340 | | $0.340 | |
Reconciliation of Net Income to Funds From Operations
The company's FFO attributable to common stockholders and operating partnership unitholders and reconciliation to net income is as follows (in thousands except shares and per share data, unaudited):
| Three Months Ended |
|---|
| March 31, 2026 |
|---|
| Funds From Operations (FFO) | |
| Net income | $6,739 |
| Depreciation and amortization of real estate assets | 32,311 |
| FFO, as defined by NAREIT | $39,050 |
| Less: Nonforfeitable dividends on restricted stock awards | (216) |
| FFO attributable to common stock and units | $38,834 |
| FFO per diluted share/unit | $0.51 |
| Weighted average number of common shares and units, diluted | 76,893,750 |
Reconciliation of Same-Store Cash NOI to Net Income
The company's reconciliation of Same-Store Cash NOI to Net Income is as follows (in thousands, unaudited):
| Three Months Ended |
|---|
| March 31, |
|---|
| 2026 | 2025 |
|---|
| Same-store cash NOI | $66,371 | | $66,382 | |
| Non-same-store cash NOI | (285) | | 580 | |
| Cash NOI | $66,086 | | $66,962 | |
| Lease termination fees and tenant improvement reimbursements | 244 | | 174 | |
| Non-cash revenue and other operating expenses | 596 | | 166 | |
| General and administrative | (8,783) | | (9,312) | |
| Depreciation and amortization | (32,311) | | (30,494) | |
| Interest expense, net | (19,707) | | (18,780) | |
| Gain on sale of real estate | - | | 44,476 | |
| Other income, net | 614 | | 915 | |
| Net income | $6,739 | | $54,107 | |
| Number of properties included in same-store analysis | | 30 | | 29 |
(1) Same-store portfolio excludes: (i) Del Monte Center (retail), which was sold on February 25, 2025; (ii) Genesee Park (multifamily), which was acquired on February 28, 2025, (iii) La Jolla Commons III (office), which was placed into service on April 1, 2025 and (iv) land held for development.
(2) Lease termination fees and tenant improvement reimbursements are excluded from same-store cash NOI to provide a more accurate measure of operating performance.
(3) Represents adjustments related to the straight-line rent income recognized during the period offset by cash received during the period and the provision for bad debts recorded for deferred rent receivable balances, the amortization of above (below) market rents, the amortization of lease incentives paid to tenants, the amortization of other lease intangibles, and straight-line rent expense for our lease of the Annex at The Landmark at One Market.
Reported results are preliminary and not final until the filing of the company's Form 10-Q with the Securities and Exchange Commission and, therefore, remain subject to adjustment.
Use of Non-GAAP Information
Funds from Operations
The company calculates FFO in accordance with the standards established by the National Association of Real Estate Investment Trusts ("NAREIT"). FFO represents net income (computed in accordance with GAAP), excluding gains (or losses) from sales of depreciable operating property, impairment losses, real estate related depreciation and amortization (excluding amortization of deferred financing costs) and after adjustments for unconsolidated partnerships and joint ventures.
FFO is a supplemental non-GAAP financial measure. Management uses FFO as a supplemental performance measure because it believes that FFO is beneficial to investors as a starting point in measuring the company's operational performance. Specifically, in excluding real estate related depreciation and amortization and gains and losses from property dispositions, which do not relate to or are not indicative of operating performance, FFO provides a performance measure that, when compared year-over-year, captures trends in occupancy rates, rental rates and operating costs. The company also believes that, as a widely recognized measure of the performance of REITs, FFO will be used by investors as a basis to compare the company's operating performance with that of other REITs. However, because FFO excludes depreciation and amortization and captures neither the changes in the value of the company's properties that result from use or market conditions nor the level of capital expenditures and leasing commissions necessary to maintain the operating performance of the company's properties, all of which have real economic effects and could materially impact the company's results from operations, the utility of FFO as a measure of the company's performance is limited. In addition, other equity REITs may not calculate FFO in accordance with the NAREIT definition as the company does, and, accordingly, the company's FFO may not be comparable to such other REITs' FFO. Accordingly, FFO should be considered only as a supplement to net income as a measure of the company's performance. FFO should not be used as a measure of the company's liquidity, nor is it indicative of funds available to fund the company's cash needs, including the company's ability to pay dividends or service indebtedness. FFO also should not be used as a supplement to or substitute for cash flow from operating activities computed in accordance with GAAP.
Cash Net Operating Income
The company uses NOI internally to evaluate and compare the operating performance of the company's properties. The company believes cash NOI provides useful information to investors regarding the company's financial condition and results of operations because it reflects only those income and expense items that are incurred at the property level, and when compared across periods, can be used to determine trends in earnings of the company's properties as this measure is not affected by (1) the non-cash revenue and expense recognition items, (2) the cost of funds of the property owner, (3) the impact of depreciation and amortization expenses as well as gains or losses from the sale of operating real estate assets that are included in net income computed in accordance with GAAP or (4) general and administrative expenses and other gains and losses that are specific to the property owner. The company believes the exclusion of these items from net income is useful because the resulting measure captures the actual revenue generated and actual expenses incurred in operating the company's properties as well as trends in occupancy rates, rental rates and operating costs. Cash NOI is a measure of the operating performance of the company's properties but does not measure the company's performance as a whole. Cash NOI is therefore not a substitute for net income as computed in accordance with GAAP.
Cash NOI is a non-GAAP financial measure of performance. The company defines cash NOI as operating revenues (rental income, tenant reimbursements (other than tenant improvement reimbursements), ground lease rental income and other property income) less property and related expenses (property expenses, ground lease expense, property marketing costs, real estate taxes and insurance), adjusted for non-cash revenue and operating expense items such as straight-line rent, amortization of lease intangibles, amortization of lease incentives and other adjustments. Cash NOI also excludes lease termination fees, tenant improvement reimbursements, general and administrative expenses, depreciation and amortization, interest expense, other nonproperty income and losses, acquisition-related expense, gains and losses from property dispositions, extraordinary items, tenant improvements, and leasing commissions. Other REITs may use different methodologies for calculating cash NOI, and accordingly, the company's cash NOI may not be comparable to the cash NOIs of other REITs.
About American Assets Trust, Inc.
American Assets Trust, Inc. is a full service, vertically integrated and self-administered real estate investment trust ("REIT"), headquartered in San Diego, California. The company has over 55 years of experience in acquiring, improving, developing and managing premier office, retail, and residential properties throughout the United States in some of the nation’s most dynamic, high-barrier-to-entry markets primarily in Southern California, Northern California, Washington, Oregon, Texas and Hawaii. The company's office portfolio comprises approximately 4.3 million rentable square feet, and its retail portfolio comprises approximately 2.4 million rentable square feet. In addition, the company owns one mixed-use property (including approximately 94,000 rentable square feet of retail space and a 369-room all-suite hotel) and 2,302 multifamily units. In 2011, the company was formed to succeed to the real estate business of American Assets, Inc., a privately held corporation founded in 1967 and, as such, has significant experience, long-standing relationships and extensive knowledge of its core markets, submarkets and asset classes. For additional information, please visit www.americanassetstrust.com.
Forward Looking Statements
Forward-looking statements notice
This press release may contain forward-looking statements within the meaning of the federal securities laws, which are based on current expectations, forecasts and assumptions that involve risks and uncertainties that could cause actual outcomes and results to differ materially. Forward-looking statements relate to expectations, beliefs, projections, future plans and strategies, anticipated events or trends and similar expressions concerning matters that are not historical facts. In some cases, you can identify forward-looking statements by the use of forward-looking terminology such as “may,” “will,” “should,” “expects,” “intends,” “plans,” “anticipates,” “believes,” “estimates,” “predicts,” or “potential” or the negative of these words and phrases or similar words or phrases which are predictions of or indicate future events or trends and which do not relate solely to historical matters. The following factors, among others, could cause actual results and future events to differ materially from those set forth or contemplated in the forward-looking statements: adverse economic or real estate developments in our markets; defaults on, early terminations of or non-renewal of leases by tenants, including significant tenants; decreased rental rates or increased vacancy rates; our failure to generate sufficient cash flows to service our outstanding indebtedness; fluctuations in interest rates and increased operating costs; our failure to obtain necessary outside financing; our inability to develop or redevelop our properties due to market conditions; investment returns from our developed properties may be less than anticipated; general economic conditions, including the impact of tariffs and other trade restrictions; the potential impact of a prolonged government shutdown; financial market fluctuations; risks that affect the general office, retail, multifamily and mixed-use environment; the competitive environment in which we operate; system failures or security incidents through cyberattacks; the impact of epidemics, pandemics, or other outbreaks of illness, disease or virus and the actions taken by government authorities and others related thereto, including the ability of our company, our properties and our tenants to operate; difficulties in identifying properties to acquire and completing acquisitions; our failure to successfully operate acquired properties and operations; risks related to joint venture arrangements; potential litigation; difficulties in completing dispositions; conflicts of interests with our officers or directors; lack or insufficient amounts of insurance; environmental uncertainties and risks related to adverse weather conditions and natural disasters; other factors affecting the real estate industry generally; limitations imposed on our business and our ability to satisfy complex rules in order for American Assets Trust, Inc. to continue to qualify as a REIT, for U.S. federal income tax purposes; and changes in governmental regulations or interpretations thereof, such as real estate and zoning laws and increases in real property tax rates and taxation of REITs. While forward-looking statements reflect the company's good faith beliefs, assumptions and expectations, they are not guarantees of future performance. For a further discussion of these and other factors that could cause the company's future results to differ materially from any forward-looking statements, see the section entitled “Risk Factors” in the company's most recent annual report on Form 10-K, and other risks described in documents subsequently filed by the company from time to time with the Securities and Exchange Commission. The company disclaims any obligation to publicly update or revise any forward-looking statement to reflect changes in underlying assumptions or factors, of new information, data or methods, future events or other changes.
Source: American Assets Trust, Inc.
Investor and Media Contact:
American Assets Trust
Robert F. Barton
Executive Vice President and Chief Financial Officer
858-350-2607