Alexandria's loss deepens on $637.9 million of writedowns as revenue falls 10.7% year over year

Alexandria Real Estate Equities booked a third-quarter net loss of $638.5 million, or $3.74 a share, after $637.9 million of real estate impairment charges, and narrowed its 2026 funds from operations guidance to $6.38 to $6.42 a share from $6.35 to $6.45. Total revenues were $671.18 million, down 10.7% from $751.94 million a year earlier, according to an earnings release and supplemental package filed with the SEC on October 26, 2026 as a current report on Form 8-K under Item 2.02, with the release attached as Exhibit 99.1.

Impairments, not the rent roll, drove the quarterly loss

The loss attributable to common stockholders widened from $234.9 million, or $1.38 a share, in the third quarter of 2025. Nearly all of the red ink is a non-cash charge: impairment of real estate totaled $637.9 million in the quarter, and a footnote to the loss figure ties the charges to assets held for sale. Across nine months the company has lost $2.06 a share, a little less than the $2.09 reported for the same stretch of 2025, which says more about the lumpiness of write-downs than about how the portfolio is trading.

Revenue fell 10.7% as re-letting lagged expirations

Occupancy of operating properties was 87.1% at September 30, versus 86.9% at June 30, and 90.8% once executed leases with future occupancy are included. Rent income still fell, because space handed back by departing tenants had to be re-let before it paid: income from rentals dropped 11.2% to $653.62 million. Same-property net operating income changed (6.7) % in the quarter and (9.2) % over nine months, with cash-basis changes of (2.8) % and (8.4) %; the release prints parentheses for declines. It traces the slide to previously disclosed key lease expirations totaling 282,878 RSF in the quarter and 1.2 million RSF year to date, with downtime expected before replacement rent starts.

Leasing volume and asset sales carried the quarter

Total leasing volume reached 1,236,030 RSF, the highest quarterly figure since the fourth quarter of 2024 and roughly 256,000 RSF above the 1Q25–2Q26 quarterly average of 979,822 RSF. Pricing did not follow volume: renewals and re-leasing signed at rental rates (2.4) % below prior rent on a GAAP basis and (3.3) % below on a cash basis. Capital recycling did more of the work. In October the company sold an approximately 29% noncontrolling interest in Campus Point by Alexandria to a new joint venture partner for $475.0 million, lifting completed 2026 dispositions and partial-interest sales to $716.8 million against a $1.90 billion full-year guidance midpoint. The release casts that program as its funding engine: “We plan to continue funding a significant portion of our capital requirements for the year ending December 31, 2026 through dispositions of land, non-core dispositions, and sales of partial interests.”

Guidance narrowed as fixed-charge coverage slipped

Funds from operations, as adjusted, is now guided to $6.38 to $6.42 a share for 2026, a range narrowed by 6 cents around an unchanged $6.40 midpoint, from $6.35 to $6.45 previously. Third-quarter adjusted FFO was $264.4 million, or $1.54 a share, down 30.6% per share from $2.22. The company also cut its fourth-quarter annualized fixed-charge coverage target to 3.4x to 3.9x from 3.6x to 4.1x, a change it links to the August sale of $1.00 billion of 7.250% junior subordinated notes due 2057, which rating agencies treat as half equity. Net debt and preferred stock equaled 6.9x annualized Adjusted EBITDA at quarter-end, or 6.6x pro forma for the October Campus Point closing, against a 5.6x to 6.2x target for the fourth quarter. Liquidity was $4.56 billion.

Wind-downs and 2027 expirations cap the recovery case

The release is candid about what leasing cannot fix. It assumes a $30 million to $35 million reduction in funds from operations for potential tenant wind-downs in 2026, about $30 million of which was already recognized in the first nine months, then warns: “Based upon current market conditions, we preliminarily estimate at least a similar level of reduction in funds from operations may be necessary in 2027.” It adds that 2027 occupancy may suffer too. Separately, 1.4 million RSF of leases expire in 2027 carrying $100.5 million of annual rental revenue, with expected downtime of 9 to 24 months, which the company says will pull average 2027 occupancy below the 86.2% to 87.8% it projects for December 31, 2026.

December 2 is the next dated catalyst

Management has scheduled an Investor Day for December 2, 2026 to introduce 2027 guidance, and says so plainly: “We expect to introduce 2027 guidance and related key assumptions, and 2027 key sources and uses of capital at our Investor Day on December 2, 2026, consistent with our historical practice.” The earnings call on October 27 at 2:00 p.m. Eastern is the first chance to hear executives discuss the charge, because the release itself carries no quotation from an officer. The dividend was held at $0.72 a quarter, a 47% payout on third-quarter results and a 6.1% yield at quarter-end, and the $500.0 million buyback authorization was untouched as of September 30.