Kimco's Q2 FFO Beats Estimates, Revenues Lag, Occupancy Dips Y/Y

Kimco Realty Corp. KIM reported second-quarter 2025 funds from operations (FFO) per share of 44 cents, beating the Zacks Consensus Estimate of 43 cents. The metric grew 7.3% from the year-ago quarter.

Results reflect higher same-property net operating income (NOI) due to a rise in minimum rents. However, lower occupancy owing to tenant bankruptcies and higher interest expenses acted as dampeners.

This retail REIT clocked in revenues of $525.2 million, which lagged the consensus mark of $526.9 million. However, the figure improved 5% year over year.

According to Conor Flynn, CEO of Kimco, "The modest dip in overall occupancy due to the bankruptcies of JOANN and Party City was significantly less than anticipated, further evidencing the strong tenant demand for our well-located centers and the resilient consumer demand for necessity-based essential goods and services.”

KIM’s Q2 in Detail

Pro-rata leased occupancy at the end of the second quarter was 95.4%, highlighting a decline of 80 basis points (bps) year over year. This reflected the impact of the expected vacates of the remaining JOANN and Party City leases, partially offset by strong leasing activity. Our estimate for the same stood at 95.8%.

Pro-rata anchor occupancy at the end of the quarter was 96.7%, reflecting a decline of 140 bps year over year.

Pro-rata small shop occupancy at the end of the quarter was 92.2%, representing a 50 bps increase year over year, reaching a new all-time company record.

Kimco executed 506 leases, aggregating 2.7 million square feet in the quarter. Blended pro-rata cash rent spreads on comparable spaces were 15.2%, with new leases increasing 33.8%, and renewals and options growing 9.6%.

Same-property NOI jumped 3.1% year over year, backed by a rise in the minimum rent of 2.7%.

Interest expenses were up 10.7% year over year to $81.2 million in the reported quarter. We estimated the same to grow by 7.5%.

KIM’s Portfolio Activity

During the second quarter, Kimco sold a freestanding, Home Depot-anchored property for $49.5 million in Santa Ana, CA, with a gain of $38.4 million.

Balance Sheet Position of KIM

This retail REIT exited the second quarter of 2025 with more than $2.2 billion of immediate liquidity. This included full availability on its $2.0 billion unsecured revolving credit facility and $227.8 million of cash, cash equivalents and restricted cash.

Its net-debt-to-EBITDA was 5.6X on a look-through basis as of June 30, 2025, the same as in the prior-year quarter.

In the second quarter, KIM repurchased 3 million common shares at an average price of $19.61 per share.

KIM’s Dividend Update

Concurrent with the second-quarter earnings release, Kimco’s board of directors has declared a quarterly cash dividend of 25 cents per share. This dividend will be paid out on Sept. 19 to its shareholders of record as of Sept. 5, 2025.

2025 Guidance by KIM

For 2025, Kimco now expects its FFO per share range to be $1.73-$1.75, up from the prior guidance range of $1.71-$1.74. The Zacks Consensus Estimate of $1.73 lies at the lower end of the range.

Kimco’s full-year outlook is based on the same-property NOI growth of more than 3.0% compared to previous guidance of more than 2.5%. Total acquisitions (including structured investments), net of dispositions, remain unchanged at $100 million to $125 million.

KIM’s Zacks Rank

The company currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Kimco Realty Corporation Price, Consensus and EPS Surprise

Kimco Realty Corporation price-consensus-eps-surprise-chart | Kimco Realty Corporation Quote

Upcoming Earnings Releases

We now look forward to the earnings releases of other retail REITs, such as Simon Property Group SPG and Federal Realty Investment Trust FRT, which are slated to report on Aug. 4 and Aug. 6, respectively.

The Zacks Consensus Estimate for Simon’s second-quarter 2025 FFO per share stands at $3.04, indicating a 4.8% increase year over year. SPG currently has a Zacks Rank #3.

The Zacks Consensus Estimate for Federal Realty Investment Trust’s second-quarter 2025 FFO per share is pegged at $1.73, implying a 2.4% year-over-year increase. FRT currently carries a Zacks Rank #3.

Note: Anything related to earnings presented in this write-up represents funds from operations (FFO), a widely used metric to gauge the performance of REITs.

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This article originally published on Zacks Investment Research (zacks.com).

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