Piedmont Raises 2026 Core FFO Outlook for Third Straight Quarter

The Tip Desk · November 8, 2026 · 4 min read

Core FFO was $0.39 a share in the third quarter as the office REIT lifted its 2026 range to $1.55–$1.57 a share.

Piedmont Realty Trust (PDM), an owner of Class A office properties in major U.S. Sunbelt markets, raised its 2026 Core FFO outlook for a third consecutive quarter, now six cents ahead of its initial range, after posting $0.39 of Core FFO per diluted share in the three months ended September 30, 2026.

The company now expects Core FFO applicable to common stock of $1.55 to $1.57 a share for the year ending December 31, 2026, versus initial guidance of $1.47 to $1.53. NAREIT FFO is now projected at $1.39 to $1.41 a share. The outlook assumes Same Store NOI growth of 7.5% to 8.5% on a cash basis and 5% to 6% on an accrual basis, net interest expense of about $125 million to $126 million, and weighted average shares of about 126 million to 127 million. No speculative acquisitions, dispositions or refinancing are included.

Core FFO rose from $0.35 a share a year earlier, which the company attributed to rental-rate growth and new leases commencing in the twelve months ended September 30, 2026. NAREIT FFO was $0.23 a share. Piedmont reported a net loss of $21.0 million, or $0.17 a share, versus a $13.5 million loss, or $0.11 a share, a year earlier. The quarter included a $20.2 million loss on early extinguishment of debt and an $8.9 million gain on sale of real estate assets. Core FFO strips those items, along with depreciation and amortization.

Same Store NOI on a cash basis increased 7.5%, versus 9.2% in the year-ago quarter. On an accrual basis it increased 6.9%, versus 3.8% a year earlier. The company said rental rates rose and the commencement or burn-off of abatements on new leases outweighed expiring leases. President and Chief Executive Officer Brent Smith said leasing demand remained strong and that cash and accrual leasing spreads were 26% and 35%, respectively.

Piedmont completed about 406,000 square feet of leasing in the quarter, including 194,000 square feet of new-tenant space across 43 transactions. The average lease was about 9,400 square feet with a weighted average term of about ten years. Cash rent roll-up on leases executed for space vacant one year or less was 26.2%, and accrual roll-up was 34.6%, which the company described as the second-largest quarterly increases in its history. Net effective rent was $29.31.

The in-service portfolio was 87.7% leased as of September 30, 2026, versus 88.9% as of June 30. The company attributed the decline to net expiring square footage outweighing newly leased previously vacant space, as well as the acquisition of 83% leased 4075 Wilson Boulevard. The out-of-service portfolio, two recently redeveloped Minneapolis projects, was 84.7% leased. Executed leases yet to commence covered about 0.7 million square feet and about $29 million of future annual cash rents; executed leases under abatement covered about 1.2 million square feet and about $32 million of future annual cash rents. Leases of more than 700,000 square feet had been executed or were in the legal stage thus far in October.

Capital recycling included the purchase of 4075 Wilson Boulevard, an approximately 186,000-square-foot Class A building in Ballston, Arlington, Virginia, for a net price of about $52.0 million, and the sale of a 10.6-acre Las Colinas land parcel for a gross price of $12.0 million. Piedmont also entered a binding contract to sell Enclave Place in Houston for $81.8 million, expected to close in the fourth quarter, with net proceeds slated to pay down its $600 million line of credit.

The company issued $230 million of 2.875% exchangeable senior notes and used those proceeds, about 4.1 million at-the-market shares at an average $9.72, cash and revolver borrowings to redeem all outstanding 9.25% unsecured senior notes due 2028. About $50 million of note proceeds repurchased about 5.4 million shares at an average $9.20. Weighted average cost of debt fell to 4.78% from 5.58% at year-end 2025. Cash was $3.9 million. Revolver capacity was about $448 million, with no final debt maturities until October 2028.