Modiv Industrial (MDV) Q4 2025 earnings summary

Executive summary

• Rental income for Q4 2025 was $11 million, down from $11.7 million year-over-year due to lease expirations and asset sales.

• Adjusted funds from operations (AFFO) for Q4 2025 was $4 million, slightly down from $4.1 million in the prior year.

• AFFO per share declined to $0.32 from $0.37, mainly due to increased share count from equity issuances.

• Full year 2025 AFFO was $17.2 million, or $1.38 per diluted share, up 15% year-over-year.

• Asset recycling is expected to accelerate in 2026, focusing on selling non-core office and select industrial assets, with a target to transition to a 100% pure-play manufacturing industrial portfolio within 24 months, contingent on market stability and acquisition opportunities.

Financial highlights

• Q4 2025 rental income decreased by $0.7 million year-over-year, primarily from lease expirations and property sales.

• AFFO decreased by $30,000 year-over-year, with lower cash rents partially offset by reduced interest expense and dividends.

• Interest expense rose by $1.1 million compared to Q4 2024, mainly due to amortization of off-market interest rate swaps.

• Cash and cash equivalents at year-end were $14.4 million, with $30 million undrawn on the revolver.

• Consolidated debt was $262.1 million, with a weighted average fixed interest rate of 4.15% and a leverage ratio of 45.1%.

Outlook and guidance

• Asset recycling will focus on divesting non-core office and select industrial assets, with proceeds targeted for accretive industrial acquisitions.

• The company expects more transaction activity in 2026 and 2027, but timing will depend on market conditions and replacement asset availability.

• Management remains committed to maintaining the monthly dividend of $0.10 per share.

• Ongoing patience and discipline in evaluating unsolicited offers and market opportunities.

• The transition to a pure-play manufacturing industrial portfolio is expected within 24 months, but could be faster if market conditions improve.