Slate Grocery REIT Reports Second Quarter 2026 Results

TORONTO--(BUSINESS WIRE)--Slate Grocery REIT (TSX: SGR.U) (TSX: SGR.UN) (the "REIT"), an owner and operator of U.S. grocery-anchored real estate, today announced its financial results and highlights for the three and six months ended June 30, 2026.

"We continue to have strong conviction in the outlook for our portfolio of high-quality grocery-anchored real estate," said Blair Welch, Chief Executive Officer of Slate Grocery REIT. "In the second quarter, our team completed over 569,000 square feet of leasing at consistently high rental spreads. With our in-place portfolio rents still meaningfully below market, we believe the REIT is well positioned for continued long-term growth."

For the CEO's letter to unitholders for the quarter, please follow the link here.

Highlights¹

• The REIT completed over 569,000 square feet of total leasing throughout the quarter at consistently high rental spreads that continue to drive strong performance
  • Renewals were completed at 16.7% above expiring rents, and new deals were completed at 41.0% above comparable average in-place rent
  • Adjusting for completed redevelopments, same-property Net Operating Income (“NOI”) increased by $3.8 million or 2.3% in the second quarter on a trailing twelve-month basis
  • As at June 30, 2026, portfolio occupancy was 93.6%
  • The REIT's average in-place rent of $13.10 per square foot remains well below the market average of $24.79², providing meaningful runway for continued rent increases

• The REIT has a weighted average interest rate of 5.0%, with 90.2% of its debt having a fixed interest rate, providing a stable outlook for the REIT's near-term financing costs
  • The REIT's weighted average capitalization rate remains well above its weighted average interest rate for outstanding debt, allowing the REIT to maintain positive leverage; this attractive valuation, combined with continued NOI growth, is expected to increase portfolio valuation over time

^1Includes the REIT's share of joint venture investments. Refer to “Non-IFRS Measures” section below.

^2CBRE Econometric Advisors, Q2 2026.

Summary of Q2 2026 Results

	Three months ended June 30,
(thousands of U.S. dollars, except per unit amounts)		2026		2025	Change %
Rental revenue	$	57,932	$	52,385	10.6%
NOI^1 2	$	42,477	$	41,660	2.0%
Net income ^2	$	14,334	$	13,081	9.6%
Same-property NOI (3 month period, 113 properties) ^1 2	$	41,885	$	41,118	1.9%
Same-property NOI (12 month period, 113 properties) ^1 2	$	167,569	$	164,161	2.1%
New leasing (square feet) ^2		134,738		33,516	302.0%
New leasing spread ^2		41.0%		28.8%	42.4%
Total leasing (square feet) ^2		569,458		423,894	34.3%
Total leasing spread ^2		16.0%		11.6%	37.9%
New leasing – anchor / junior anchor ^2		95,984		—	100.0%
Weighted average number of units outstanding ("WA units")		60,465		60,403	0.1%
FFO^1 2	$	14,802	$	15,883	(6.8)%
FFO per WA units^1 2	$	0.24	$	0.26	(7.7)%
FFO payout ratio^1 2		87.6%		81.6%	7.4%
AFFO ^1 2	$	11,460	$	12,624	(9.2)%
AFFO per WA units^1 2	$	0.19	$	0.21	(9.5)%
AFFO payout ratio^1 2		113.1%		102.7%	10.1%
Fixed charge coverage ratio^1	1.9x		1.9x		—%
(thousands of U.S. dollars, except per unit amounts)	June 30, 2026		December 31, 2025		Change %
Total assets	$	2,374,390	$	2,357,080	0.7%
Total assets, proportionate interest ^1 2	$	2,468,321	$	2,449,256	0.8%
Debt	$	1,302,714	$	1,303,456	(0.1)%
Debt, proportionate interest ^1 2	$	1,393,098	$	1,392,100	0.1%
Net asset value per unit	$	13.82	$	13.65	1.2%
Number of properties ^2		115		115	—%
Portfolio occupancy^2		93.6%		94.4%	(0.8)%
Debt / GBV ratio		54.9%		55.3%	(0.7)%
^1 Refer to “Non-IFRS Measures” section below.
^2 Includes the REIT's share of joint venture investments.

Conference Call and Webcast

Senior management will host a live conference call at 9:00 am ET on August 7, 2026 to discuss the results and ongoing business initiatives of the REIT.

The conference call can be accessed by dialing [phone] or 1 [phone]. Additionally, the conference call will be available via simultaneous audio found at https://onlinexperiences.com/scripts/Server.nxp?LASCmd=AI:4;F:QS!10100&ShowUUID=C3B07928-00E0-49E7-9E5C-38EFD7A8E4D6&LangLocaleID=1033. A replay will be accessible until August 21, 2026, via the REIT’s website or by dialing [phone] or 1 [phone] (access code 84668#) approximately two hours after the live event.

About Slate Grocery REIT (TSX: SGR.U / SGR.UN)

Slate Grocery REIT is an owner and operator of U.S. grocery-anchored real estate. The REIT owns and operates critical real estate infrastructure across major U.S. metro markets that communities rely upon for their everyday needs. The REIT’s resilient grocery-anchored portfolio and strong credit tenants are expected to provide unitholders with durable cash flows and the potential for capital appreciation over the longer term. Visit slategroceryreit.com to learn more about the REIT.

About Slate Asset Management

Slate Asset Management is a global alternative investor and manager focused on essential real estate and infrastructure assets. We focus on fundamentals with the objective of creating long-term value for our investors and partners across the real estate space. We are supported by exceptional people and flexible capital, which enable us to originate and execute on a wide range of compelling investment opportunities. Visit slateam.com to learn more, and follow Slate Asset Management on LinkedIn, X (Twitter), and Instagram.

Supplemental Information

All interested parties can access Slate Grocery’s Supplemental Information online at slategroceryreit.com in the Investors section. These materials are also available on SEDAR+ or upon request to the REIT at [e-mail] or [phone].

Forward Looking Statements

Certain information herein constitutes “forward-looking information” as defined under Canadian securities laws which reflect management’s expectations regarding objectives, plans, goals, strategies, future growth, results of operations, performance, business prospects and opportunities of the REIT. The words “plans”, “expects”, “does not expect”, "forecasts", “scheduled”, “estimates”, “intends”, “anticipates”, “does not anticipate”, “projects”, “believes”, or variations of such words and phrases or statements to the effect that certain actions, events or results “may”, “will”, “could”, “would”, “might”, “occur”, “be achieved”, or “continue” and similar expressions identify forward-looking statements. Management believes that the expectations reflected in its forward-looking statements are based upon reasonable assumptions, however, management can give no assurance that actual results, performance or achievements will be consistent with these forward-looking statements. Such forward-looking statements are qualified in their entirety by the inherent risks and uncertainties surrounding future expectations.

Forward-looking statements are necessarily based on a number of estimates and assumptions that, while considered reasonable by management as of the date hereof, are inherently subject to significant business, economic and competitive uncertainties and contingencies. When relying on forward-looking statements to make decisions, the REIT cautions readers not to place undue reliance on these statements, as forward-looking statements involve significant risks and uncertainties, and should not be read as guarantees of future performance or results, and will not necessarily be accurate indications of whether or not the times at or by which such performance or results will be achieved. A number of factors could cause actual results to differ, possibly materially, from the results discussed in the forward-looking statements. Additional information about risks and uncertainties is contained in the filings of the REIT with securities regulators.

Non-IFRS Measures

This news release and accompanying financial statements are based on IFRS® Accounting Standards (“IFRS Accounting Standards”), as issued by the International Accounting Standards Board (“IASB”).

We disclose a number of financial measures in this news release that are not measures used under IFRS Accounting Standards, including NOI, same-property NOI, FFO, FFO payout ratio, AFFO, AFFO payout ratio, adjusted EBITDA, fixed charges and the fixed charge coverage ratio, in addition to certain measures on a per unit basis.

• NOI is defined as rental revenue less operating expenses, prior to straight-line rent, International Financial Reporting Interpretations Committee ("IFRIC") 21, Levies ("IFRIC 21") property tax adjustments and adjustments for equity investments. Same-property NOI includes those properties owned by the REIT for each of the current period and the relevant comparative period, excluding those properties under development.
• FFO is defined as net income adjusted for certain items including transaction/disposition costs, change in fair value of properties, change in fair value of financial instruments, deferred income taxes, unit income (expense), adjustments for equity investments, IFRIC 21 property tax adjustments and other expenses.
• AFFO is defined as FFO adjusted for straight-line rental revenue and revenue sustaining capital, leasing costs and tenant improvements.
• FFO payout ratio and AFFO payout ratio are defined as distributions declared divided by FFO and AFFO, respectively.
• FFO per WA unit and AFFO per WA unit are defined as FFO and AFFO divided by the weighted average class U equivalent units outstanding, respectively.
• Adjusted EBITDA is defined as NOI less general and administrative expenses at the REIT's proportionate interest.
• Fixed charges include principal payments and cash interest paid, net at the REIT's proportionate interest.
• Fixed charge coverage ratio is defined as adjusted EBITDA divided by fixed charges at the REIT's proportionate interest.
• Net asset value is defined as the aggregate of the carrying value of the REIT's equity, deferred income taxes and exchangeable units of subsidiaries.
• Proportionate interest represents financial information adjusted to reflect the REIT's equity accounted joint ventures and financial real estate assets and its share of net income (losses) from equity accounted joint ventures and financial real estate assets on a proportionately consolidated basis at the REIT's ownership percentage of the related investment.

We utilize these measures for a variety of reasons, including measuring performance, managing the business, capital allocation and the assessment of risk. Descriptions of why these non-IFRS measures are useful to investors and how management uses each measure are included in Management’s Discussion and Analysis. We believe that providing these performance measures on a supplemental basis to our IFRS Accounting Standards results is helpful to investors in assessing the overall performance of our businesses in a manner similar to management. These financial measures should not be considered as a substitute for similar financial measures calculated in accordance with IFRS Accounting Standards. We caution readers that these non-IFRS financial measures may differ from the calculations disclosed by other businesses, and as a result, may not be comparable to similar measures presented by others.

SGR-FR

Calculation and Reconciliation of Non-IFRS Measures

The table below summarizes a calculation of non-IFRS measures based on financial information in accordance with IFRS Accounting Standards.

	Three months ended June 30,
(in thousands of U.S. dollars, except per unit amounts)		2026		2025
Rental revenue	$	57,932	$	52,385
Straight-line rent revenue		(28)		(111)
Property operating expenses		(10,470)		(9,071)
IFRIC 21 property tax adjustment		(7,492)		(6,983)
Contribution from joint venture investments		2,535		5,440
NOI^1 2	$	42,477	$	41,660
Cash flow from operations	$	20,912	$	21,187
Changes in non-cash working capital items		(8,907)		(3,761)
Other expenses		6,328		—
Finance charge and mark-to-market adjustments		(1,336)		(1,120)
Interest income and TIF note adjustments		103		141
Adjustments for joint venture investments		1,071		2,748
Non-controlling interest		(2,871)		(3,276)
Capital expenditures		(1,567)		(1,798)
Leasing costs		(1,076)		(803)
Tenant improvements		(1,197)		(694)
AFFO^1 2	$	11,460	$	12,624
Net income^2	$	14,334	$	13,081
Change in fair value of financial instruments		(436)		608
Other expenses		6,328		—
Change in fair value of properties		4,436		8,454
Deferred income tax expense		1,198		2,174
Unit expense		1,769		1,122
Adjustments for joint venture investments		(1,692)		1,432
Non-controlling interest		(3,643)		(4,005)
IFRIC 21 property tax adjustment		(7,492)		(6,983)
FFO^1 2	$	14,802	$	15,883
Straight-line rental revenue		(28)		(111)
Capital expenditures		(1,567)		(1,798)
Leasing costs		(1,076)		(803)
Tenant improvements		(1,197)		(694)
Adjustments for joint venture investments		(246)		(582)
Non-controlling interest		772		729
AFFO^1 2	$	11,460	$	12,624
^1 Refer to “Non-IFRS Measures” section above. ^2 Includes the REIT's share of joint venture investments.
	Three months ended June 30,
(in thousands of U.S. dollars, except per unit amounts)		2026		2025
NOI^1 2	$	42,477	$	41,660
General and administrative expenses		(4,283)		(3,996)
Cash interest, net		(16,816)		(14,419)
Finance charge and mark-to-market adjustments		(1,336)		(1,120)
Current income tax expense		(407)		(238)
Adjustments for joint venture investments		(1,464)		(2,692)
Non-controlling interest		(2,871)		(3,276)
Capital expenditures		(1,567)		(1,798)
Leasing costs		(1,076)		(803)
Tenant improvements		(1,197)		(694)
AFFO^1 2	$	11,460	$	12,624
^1 Refer to “Non-IFRS Measures” section above.
^2 Includes the REIT's share of joint venture investments.

	Three months ended June 30,
(in thousands of U.S. dollars, except per unit amounts)		2026		2025
Net income ^1	$	14,334	$	13,081
Interest and finance costs		18,152		15,539
Change in fair value of financial instruments		(436)		608
Other expenses		6,328		—
Change in fair value of properties		4,436		8,454
Deferred income tax expense		1,198		2,174
Current income tax expense		407		238
Unit expense		1,769		1,122
Adjustments for joint venture investments		(541)		3,331
Straight-line rent revenue		(28)		(111)
IFRIC 21 property tax adjustment		(7,492)		(6,983)
Adjusted EBITDA^1 2	$	38,127	$	37,453
NOI^1 2		42,477		41,660
General and administrative expenses ^1 2		(4,350)		(4,207)
Adjusted EBITDA^1 2	$	38,127	$	37,453
Cash interest paid		(17,900)		(16,656)
Principal payments		(2,327)		(2,913)
Total fixed charges^1	$	(20,227)	$	(19,569)
Fixed charge coverage ratio^1 2	1.9x		1.9x
^1 Includes the REIT's share of joint venture investments. ^2 Refer to “Non-IFRS Measures” section above.

	June 30, 2026						December 31, 2025
(in thousands of U.S. dollars, except per unit amounts)	Statement of Financial Position		Joint Venture Investments		Proportionate Share (Non-IFRS)		Statement of Financial Position		Joint Venture Investments		Proportionate Share (Non-IFRS)
ASSETS
Non-current assets
Properties	$	2,233,133	$	149,500	$	2,382,633	$	2,231,184	$	147,000	$	2,378,184
Joint venture investments		62,274		(62,274)		—		63,138		(63,138)		—
Interest rate swaps		5,238		275		5,513		—		—		—
Other assets		3,206		—		3,206		3,379		—		3,379
	$	2,303,851	$	87,501	$	2,391,352	$	2,297,701	$	83,862	$	2,381,563
Current assets
Cash		24,821		2,496		27,317		21,819		2,798		24,617
Accounts receivable		22,189		1,296		23,485		24,774		1,117		25,891
Property held for sale		16,600		—		16,600		—		—		—
Other assets		4,309		2,259		6,568		6,980		3,904		10,884
Prepaids		2,469		379		2,848		5,806		495		6,301
Interest rate swaps		151		—		151		—		—		—
	$	70,539	$	6,430	$	76,969	$	59,379	$	8,314	$	67,693
Total assets	$	2,374,390	$	93,931	$	2,468,321	$	2,357,080	$	92,176	$	2,449,256
LIABILITIES
Non-current liabilities
Debt	$	1,277,962	$	54,249	$	1,332,211	$	1,225,490	$	37,042	$	1,262,532
Interest rate swaps		—		—		—		2,655		—		2,655
Deferred income taxes		164,835		—		164,835		157,211		—		157,211
Other liabilities		4,891		493		5,384		4,793		488		5,281
	$	1,447,688	$	54,742	$	1,502,430	$	1,390,149	$	37,530	$	1,427,679
Current liabilities
Debt		24,752		36,135		60,887		77,966		51,602		129,568
Accounts payable and accrued liabilities		47,337		3,054		50,391		39,880		3,044		42,924
Exchangeable units of subsidiaries		9,216		—		9,216		8,612		—		8,612
Distributions payable		4,321		—		4,321		4,323		—		4,323
	$	85,626	$	39,189	$	124,815	$	130,781	$	54,646	$	185,427
Total liabilities	$	1,533,314	$	93,931	$	1,627,245	$	1,520,930	$	92,176	$	1,613,106
EQUITY
Unitholders' equity	$	661,317	$	—	$	661,317	$	659,124	$	—	$	659,124
Non-controlling interest		179,759		—		179,759		177,026		—		177,026
Total equity	$	841,076	$	—	$	841,076	$	836,150	$	—	$	836,150
Total liabilities and equity	$	2,374,390	$	93,931	$	2,468,321	$	2,357,080	$	92,176	$	2,449,256

	Three months ended June 30, 2026						Three months ended June 30, 2025
	Statement of Income		Joint Venture Investments		Proportionate Share (Non-IFRS)		Statement of Income		Joint Venture Investments		Proportionate Share (Non-IFRS)
Rental revenue	$	57,932	$	4,114	$	62,046	$	52,385	$	8,320	$	60,705
Property operating expenses		(10,470)		(751)		(11,221)		(9,071)		(1,484)		(10,555)
General and administrative expenses		(4,283)		(67)		(4,350)		(3,996)		(211)		(4,207)
Interest and finance costs		(18,152)		(1,161)		(19,313)		(15,539)		(1,899)		(17,438)
Share of income in joint venture investments		3,009		(3,009)		—		1,898		(1,898)		—
Other expenses		(6,328)		—		(6,328)		—		—		—
Change in fair value of financial instruments		436		245		681		(608)		(78)		(686)
Change in fair value of properties		(4,436)		629		(3,807)		(8,454)		(2,750)		(11,204)
Net income before income taxes and unit expense	$	17,708	$	—	$	17,708	$	16,615	$	—	$	16,615
Deferred income tax expense		(1,198)		—		(1,198)		(2,174)		—		(2,174)
Current income tax expense		(407)		—		(407)		(238)		—		(238)
Unit expense		(1,769)		—		(1,769)		(1,122)		—		(1,122)
Net income	$	14,334	$	—	$	14,334	$	13,081	$	—	$	13,081
Net income attributable to
Unitholders	$	9,764	$	—	$	9,764	$	9,763	$	—	$	9,763
Non-controlling interest		4,570		—		4,570		3,318		—		3,318
Net Income	$	14,334	$	—	$	14,334	$	13,081	$	—	$	13,081