Alexander's Inc. Reports Q1 2026 Financial Results with Decreased Net Income and Rental Revenues

Alexander's Inc. reported its financial results for the first quarter of 2026, revealing a net income of $4.66 million, or $0.91 per diluted share, a significant decrease from the $12.31 million, or $2.40 per diluted share, recorded in the same period last year. The company's rental revenues also fell to $53.41 million, down from $54.92 million in the prior year, primarily due to the expiration of Home Depot's lease and lower revenues from other retail tenants. The decrease in rental income was partially offset by increased operating expense recoveries and new leases at Rego Park II.

Total expenses for the quarter increased to $39.47 million from $35.75 million, driven by higher operating expenses, which rose by $3.42 million. This increase was attributed to higher costs related to common area maintenance and real estate taxes, as well as lower capitalized expenses. Depreciation and amortization expenses also saw a slight increase, totaling $8.77 million compared to $8.60 million in the previous year. Interest and other income decreased significantly to $1.45 million from $3.95 million, reflecting lower average investment balances and interest rates.

In terms of operational metrics, Alexander's portfolio consists of five properties totaling 2.45 million square feet, with a commercial occupancy rate of 94.4% and a residential occupancy rate of 97.4% as of March 31, 2026. Notably, Bloomberg L.P. remains a key tenant, leasing approximately 947,000 square feet and accounting for 61% of the company's rental revenues. The company has extended Bloomberg's lease until February 2040, which includes a significant tenant fund that is amortized over the lease term.

Strategically, Alexander's has entered into an agreement to sell its Rego Park I shopping center for $235.5 million, with expected net proceeds of approximately $202 million after costs. This sale is anticipated to close in the third quarter of 2026 and is expected to generate a financial statement gain of about $147 million. The company ended the quarter with $152.05 million in cash and cash equivalents, a decrease from $192.23 million at the end of 2025, primarily due to cash used in investing and financing activities.

Looking ahead, Alexander's management expressed confidence that cash flow from operations, along with existing cash balances, will be sufficient to meet the company's operational needs, including dividends and debt service. However, they acknowledged potential challenges posed by interest rate fluctuations and inflation, which could impact future cash flows. The company remains focused on maintaining its property portfolio and managing its financial obligations effectively.