February 25, 2026 — Leads & Copy — Granite Real Estate Investment Trust (TSX: GRT.UN) announced its consolidated combined results for the three-month period and year ended December 31, 2025, and the appointment of Amber Choudhry and Jonathan Kelly to its Board of Trustees.
Net operating income (NOI) reached $133.3 million in the fourth quarter of 2025, compared to $121.2 million in the prior year, driven by contractual rent adjustments, consumer price index-based increases, new and renewal leasing, and acquisitions of eight income-producing properties in the U.S. and U.K. starting in the second quarter of 2025.
Constant currency same-property NOI increased by 7.9% in the fourth quarter of 2025. The four-quarter average constant currency same-property NOI for 2025 was up 5.6%.
Funds from operations (FFO) totaled $96.6 million ($1.59 per unit) in the fourth quarter of 2025, compared to $92.7 million ($1.47 per unit) in the fourth quarter of 2024. For the year ended December 31, 2025, FFO was $363.0 million ($5.91 per unit), compared to $343.9 million ($5.44 per unit) for the previous year.
Adjusted funds from operations (AFFO) amounted to $79.3 million ($1.30 per unit) in the fourth quarter of 2025, compared to $78.8 million ($1.25 per unit) in the fourth quarter of 2024. For the year ended December 31, 2025, AFFO was $319.8 million ($5.21 per unit), compared to $307.1 million ($4.86 per unit) for the prior year.
The Canadian dollar weakened against the Euro but strengthened slightly against the U.S. dollar during the three months ended December 31, 2025. For the year, the Canadian dollar weakened against both currencies. Foreign exchange had a favorable impact on FFO of $0.03 per unit for both the quarter and the year and on AFFO of $0.03 per unit for the quarter and $0.17 per unit for the year.
The AFFO payout ratio was 66% for the fourth quarter of 2025, consistent with the fourth quarter of 2024.
Granite recognized $60.5 million in net fair value gains on investment properties in the fourth quarter of 2025, mainly from increased fair market rents in the U.S. and discount and terminal capitalization rate compression. The company recognized $5.6 million in net fair value losses on investment properties for the year. Unrealized foreign exchange losses decreased the value of investment properties by $115.5 million in the fourth quarter and $64.1 million for the year.
Net income attributable to unitholders in the fourth quarter of 2025 was $135.4 million, compared to $83.7 million in the prior year. This increase was primarily due to changes in fair value adjustments on investment properties, foreign exchange gains, and increased net operating income, partially offset by increased income tax expense and changes in fair value gains on financial instruments and general and administrative expenses.
During the fourth quarter, Granite completed the acquisition of six income-producing properties in the U.S. and U.K., totaling approximately 1.4 million square feet, for about $292.3 million. On December 19, 2025, Granite completed the disposition of three income-producing properties in the U.S., totaling approximately 1.7 million square feet, for $189.5 million.
Subsequent to the fourth quarter, on January 30, 2026, Granite disposed of a 0.2 million square foot income-producing property in the Netherlands for $37.6 million (€23.4 million).
In-place occupancy as of December 31, 2025, was 98.0%, up from 94.9% the prior year. Committed occupancy as of February 25, 2026, is 98.6%.
Granite achieved average rental rate spreads of 24% over expiring rents during the fourth quarter, representing approximately 1.2 million square feet of lease renewals. For the year, average rental rate spreads were 45% over expiring rents, representing approximately 4.8 million square feet of lease renewals.
During the fourth quarter, Granite executed approximately 769,000 square feet of new leases for previously vacant space. Subsequent to December 31, 2025, Granite executed a lease commencing in the second quarter of 2026 for approximately 253,000 square feet of previously vacant space in Columbus, Ohio.
As of December 31, 2025, two income-producing properties in the U.S. and Netherlands were classified as assets held for sale, with a fair value of $81.0 million.
Granite also released its Green Bond use of proceeds report, allocating $1.2 billion of Green Bond proceeds towards Eligible Green Projects.
Granite REIT voluntarily delisted its units from the NYSE on December 31, 2025, and terminated its registration with the SEC on January 5, 2026. On January 22, 2026, the Trust amended its unsecured revolving credit facility, extending the maturity date to January 22, 2031. On February 13, 2026, Granite LP prepaid the remaining €50.0 million principal of a senior unsecured non-revolving term facility.
For 2026, Granite forecasts FFO per unit between $6.25 and $6.40 and AFFO per unit between $5.40 and $5.55. Constant currency same property NOI – cash basis is expected to be within a range of 5.5% to 6.5%.
Ms. Choudhry has more than 30 years of experience in the Canadian capital markets. Most recently, she served as Managing Director, Debt Capital Markets at CIBC Capital Markets in Toronto. Mr. Kelly is a seasoned investor and board director with over two decades of global leadership experience in asset management and investing. Prior to retiring in October 2025, he was a Senior Managing Director in the Infrastructure Group and was the European Head of Infrastructure for Blackstone, based in London, UK.
Mr. Peter Aghar and Ms. Sheila A. Murray will not stand for re-election at Granite’s next Annual General Meeting in June 2026.
Granite will hold a conference call on February 26, 2026, at 11:00 a.m. (ET) to discuss these results.
Granite is a Canadian-based REIT focused on logistics, warehouse, and industrial properties in North America and Europe. It owns 147 investment properties with approximately 62.6 million square feet of leasable area.
Source: Granite Real Estate Investment Trust
