Cedar Realty Trust, Inc. - Q1 2026 Filing Summary
Business Context and Reporting Period
This Form 10-Q covers the quarterly period ended March 31, 2026. Cedar Realty Trust, Inc. (CDR) is a Real Estate Investment Trust (REIT) and a subsidiary of Wheeler Real Estate Investment Trust, Inc. (WHLR). The Company focuses on owning and operating grocery-anchored shopping centers, predominantly in the Northeast. As of the reporting date, the portfolio consisted of 12 properties.
Key Financial Metrics
| Metric | Q1 2026 | Q1 2025 |
|---|---|---|
| Total Revenues | $6.87 million | $7.42 million |
| Net Operating Income (NOI) | $4.28 million | $4.36 million |
| Operating Income | $1.91 million | $4.15 million |
| Net (Loss) Income | $(0.29) million | $1.45 million |
| Net Income Attributable to Common Shareholders | $0.09 million | $9.83 million |
| Funds From Operations (FFO) - Common | $1.87 million | $9.38 million |
| Adjusted FFO (AFFO) - Common | $0.38 million | $(0.37) million |
| Cash and Cash Equivalents | $5.60 million | $7.36 million |
| Restricted Cash | $10.66 million | $8.75 million |
| Total Debt (Loans Payable, net) | $140.17 million | $140.01 million |
| Total Equity | $4.85 million | $6.36 million |
Material Changes vs. Prior Period
- Revenue Decline: Total revenues decreased by 7.3% ($0.54 million) year-over-year. This was primarily driven by the absence of revenue from properties sold in the prior year (Webster Commons and Oregon Avenue), partially offset by a 5.8% increase in Same-Property NOI due to higher base rents and expense recoveries.
- Operating Income Drop: Operating income fell significantly from $4.15 million to $1.91 million. The prior year included a $2.42 million gain on the sale of real estate, which was absent in Q1 2026.
- Net Income Volatility: Net income attributable to common shareholders dropped from $9.83 million to $0.09 million. The prior year figure was heavily influenced by a $10.25 million "deemed contribution" from preferred stock tender offers. In Q1 2026, a smaller $1.60 million deemed contribution was recognized from preferred stock contributions by WHLR.
- Preferred Stock Reduction: The Company continued its strategy of reducing preferred stock obligations. In Q1 2026, WHLR contributed 294,000 shares of Series C Preferred Stock to the Company, which were immediately retired. Since 2024, the Company has retired preferred stock with an aggregate liquidation value of $91.4 million, reducing future annual dividend payments by $6.1 million.
- Debt Profile: Total debt remained relatively stable. The Company has no scheduled debt maturities for the twelve months ending March 31, 2027, excluding minor principal payments on the Timpany Plaza loan.
Outlook, Risks, and Management Commentary
- Capital Strategy: Management intends to continue repurchasing preferred stock while trading at a discount to liquidation value to enhance financial stability and optimize capital allocation. The Company is actively working to improve occupancy by backfilling vacant anchor spaces.
- Liquidity: The Company holds $16.3 million in total cash and restricted cash. Liquidity is supported by operations, asset sales, and a $20.0 million credit facility (August 2025 Credit Facility), though availability is subject to covenants and projected asset sales.
- Leasing Activity: Same-Property occupancy increased to 93.0% from 90.6% in the prior year. Renewal rent spreads were positive at 27.3% for the quarter. New leases were signed at a weighted average rate of $14.85 per square foot.
- Risks and Contingencies:
- Litigation: A putative class action suit (Aquino Action) regarding the 2022 Merger remains pending. A term sheet to resolve the litigation was entered into in May 2026, but the outcome is uncertain. The Company and WHLR have indemnification obligations to former directors.
- Market Risks: Risks include tenant bankruptcies, geographic concentration in the Northeast, interest rate fluctuations, and the impact of e-commerce on retail demand.
- REIT Compliance: The Company must distribute at least 90% of REIT taxable income to maintain tax status. Future dividends are at the Board's discretion based on cash flow.
Investor Verification Checklist
- Verify the status and potential financial impact of the Aquino Action litigation settlement.
- Confirm the occupancy rates and lease renewal terms for the 12 remaining properties, specifically regarding anchor tenants.
- Review the debt covenants associated with the August 2025 Credit Facility and the October 2022 Term Loan to ensure compliance.
- Monitor the preferred stock repurchase program execution and its impact on future dividend obligations.
- Assess the liquidity position given the reduction in total equity to $4.85 million and the reliance on restricted cash for capital expenditures.