Phillips Edison & Company (PECO) Investor presentation summary

Business overview and strategy

• Operates 324 grocery-anchored neighborhood centers across 31 states, with 95% of ABR from such centers and 83% from #1 or #2 grocers by sales in each market.

• Focuses on right-sized centers in growing markets, with 70% of ABR from necessity-based goods and services.

• Maintains a Locally Smart™ approach, leveraging deep local expertise for merchandising and leasing strategies.

• Strategic presence in Sun Belt states and high-growth U.S. cities, with ~50% of ABR from these regions.

• Portfolio is highly diversified by tenant type, with only 8 tenants representing more than 1% of ABR each.

Operating and financial performance

• Achieved 97% leased portfolio occupancy and ranks #1 among peers in occupancy and necessity-based ABR.

• Delivered Nareit FFO per share growth of 5.5% and Core FFO per share growth of 5.4% at 2026 guidance midpoint.

• Same-center NOI growth targeted at 3–4% long-term, driven by rent spreads, redevelopment, and contractual increases.

• Maintains a low grocer health ratio (2.3%) and strong grocer sales PSF growth (+43% since 2019).

• Inline local neighbors have high retention (80% in Q4 2025) and renewal rent spreads (20.3%).

Growth initiatives and portfolio management

• Invested ~$205M in 10 Everyday Retail centers since 2023, targeting 10%+ unlevered IRRs and high leasing spreads.

• Active development pipeline with ~$69.5M invested in 20 projects under construction, targeting 9–12% yields.

• 2026 acquisition pipeline includes $400–$500M in gross acquisitions, with recent deals in high-income, high-growth markets.

• Strategic portfolio recycling: selling lower-IRR assets and reinvesting in higher-growth properties, improving portfolio demographics.

• Long-term growth targets include mid- to high single-digit Core FFO per share growth and AFFO growth above Core FFO.