What Alpine Income Property Trust (PINE) Said on Its Q3 Earnings Call

Key Points

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• Strong Q3 performance: Alpine reported FFO and AFFO of $0.55 per diluted share, each up about 20% year over year. The company invested roughly $41 million during the quarter and surpassed $300 million in closed and under-contract investments for 2026.

• Major industrial acquisition planned: Alpine agreed to acquire a fully leased, 13-property industrial portfolio for $117.3 million, featuring a 10.2-year weighted average lease term and no expirations before late 2031. Management described the deal as a one-off opportunity rather than a shift in its strategic focus.

• Higher outlook but increased leverage: Alpine raised its 2026 AFFO guidance to $2.20–$2.22 per share, implying roughly 17% growth at the midpoint. New financing will provide $175 million of additional liquidity, though leverage is expected to rise to approximately 7.3 times debt to EBITDA after funding the industrial acquisition.

Alpine Income Property Trust (NYSE:PINE) reported third-quarter funds from operations and adjusted funds from operations of $0.55 per diluted share, each up about 20% from the prior-year period, as the net-lease REIT increased investment activity and raised its full-year outlook.

President and Chief Executive Officer John Albright said AFFO per diluted share rose 19.6% year over year during the quarter. The company invested about $41 million at a weighted average initial yield of 8.5% and said closed and under-contract investments for the year had exceeded $300 million, surpassing its prior full-year record of $277 million in 2025.

Third-Quarter Results and Portfolio Activity

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Total third-quarter revenue was $20.5 million, including $12.8 million of lease income and $7.6 million of interest income from commercial loan investments, Chief Financial Officer Philip Mays said. For the first nine months of 2026, total revenue was $58.9 million, with lease income of $38.1 million and commercial loan interest income of $20.7 million.

FFO and AFFO for the nine-month period were $1.65 and $1.66 per diluted share, respectively, both approximately 23% above the comparable period last year. Mays noted that the second quarter included about $0.02 per diluted share of non-recurring termination-fee income, while the third quarter did not include one-time or non-recurring income.

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During the quarter, Alpine closed $39.2 million of property acquisitions at a weighted average initial cash capitalization rate of 8.5%. The acquired properties included locations leased to Best Buy in McAllen, Texas; Lowe’s in Fairfax, Virginia; and Dick’s Sporting Goods in Asheville, North Carolina. Albright said those tenants are investment-grade rated and rank among Alpine’s five largest tenants by annual base rent.

Year to date, the company has completed $85.8 million of acquisitions at a weighted average initial capitalization rate of 8%. Subsequent to quarter-end, Alpine acquired a Burlington property in Chandler, Arizona, for $7.9 million.

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At the end of the quarter, Alpine’s property portfolio included 130 properties totaling 4.8 million square feet across 31 states. Occupancy was 99.6%, the weighted average remaining lease term was 8.7 years, and annualized straight-line base rent totaled $53.9 million. About 68% of annual base rent came from credit-rated tenants, including 56% from investment-grade-rated tenants.

Industrial Portfolio Agreement

Earlier this month, Alpine announced an agreement to acquire a 13-property industrial portfolio for $117.3 million, or about $63 per square foot. The portfolio totals approximately 1.9 million square feet across 11 states and is fully leased to nine tenants under absolute triple-net leases.

The portfolio has annual rent escalations, a weighted average remaining lease term of 10.2 years and no lease expirations before late 2031, according to Albright. He said the tenant base is diversified, tenants have operated at their sites for an average of 40 years and have invested significant capital in their facilities. He also said Alpine believes the portfolio’s in-place rents are below market.

“While industrial is not a strategic focus, this portfolio stood out” because of its initial yield, tenant diversification, lease duration and potential rent growth, Albright said. In response to analyst questions, he characterized the transaction as “basically a one-off” for now, though he said the company remains open to opportunities in other property sectors when the risk-adjusted return is attractive.

Alpine expects to close the industrial acquisition in the middle of the fourth quarter, subject to customary closing conditions. Albright said the portfolio’s pricing reflected the higher-interest-rate environment and that management was comfortable with the capitalization rate relative to the 10-year Treasury yield.

Financing, Leverage and Loan Portfolio

Alpine raised $8.2 million of net proceeds through its common and preferred at-the-market programs during the third quarter. Year to date, it has raised approximately $70 million through those programs.

Net debt to pro forma adjusted EBITDA was 6.5 times at quarter-end, unchanged from the prior quarter but down from 7.7 times a year earlier. The company had $398.5 million of debt outstanding at a weighted average interest rate of 4.48%, with no debt maturities until 2029.

After quarter-end, Alpine received bank commitments for a new $100 million four-year term loan and a $75 million increase to its revolving credit facility. Mays said the financing was expected to close in late October, adding $175 million of potential liquidity. The term loan proceeds are expected to reduce outstanding revolver borrowings.

Mays said the new term loan would be fixed at roughly 4.75% at closing. He also said Alpine expects leverage to rise to the low-7-times range, or approximately 7.3 times debt to EBITDA, after funding the industrial acquisition before potential asset sales and other actions reduce leverage.

On the commercial loan portfolio, Alpine received early repayment in full on two loans totaling $17.9 million at a weighted average yield of 10.2%. At quarter-end, the loan portfolio consisted of 11 loans with $160.1 million of outstanding face amount and a weighted average coupon, including paid-in-kind interest, of 13.4%.

Albright said the loan book was near its target of about 20% of total undepreciated asset value but was not required to remain at that level. He said repayments could be redeployed into new lending opportunities or property investments depending on market conditions.

Raised 2026 Outlook

Alpine raised its full-year 2026 FFO guidance to $2.19 to $2.21 per diluted share, from a previous range of $2.10 to $2.13. It increased AFFO guidance to $2.20 to $2.22 per diluted share, from $2.12 to $2.15.

At the midpoint, the new AFFO outlook represents approximately 17% growth per share over 2025, Mays said. The revised forecast assumes $310 million to $350 million of investment volume and incorporates expected investment, disposition and financing timing, along with early loan repayments and the scheduled fourth-quarter maturity of a $7.4 million loan yielding 10.25%.

About Alpine Income Property Trust (NYSE:PINE)

Alpine Income Property Trust, Inc is a real estate investment trust (REIT) that owns and manages a portfolio of income-producing commercial properties in the United States. The company primarily invests in single-tenant net lease properties, under which tenants generally assume responsibility for property expenses such as taxes, insurance and maintenance.

Its portfolio has included retail, office and industrial properties leased to tenants across a range of industries. Alpine seeks to generate rental income through long-term leases and may pursue acquisitions, dispositions and other real estate investments intended to support the growth and diversification of its property portfolio.

Alpine Income Property Trust was formed by CTO Realty Growth, Inc and became a publicly traded company in 2019 following its separation from CTO Realty Growth.

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