ALX (Alexander’s, Inc.) Earnings Jump Includes One-Time Tenant Payment
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Alexander’s reported a sharp increase in third-quarter earnings on November 2, 2026, but a payment from a departing tenant makes the improvement less reassuring than the headline suggests.
Funds from operations, or FFO, reached $7.07 per diluted share for the quarter ended September 30, compared with $2.91 a year earlier. This property earnings measure removes real-estate depreciation and certain sale gains, but it does not automatically remove every unusual source of income.
That distinction matters here because Kohl’s ended its Rego Park lease in August and paid the remaining $25.1 million of an approximately $29 million termination payment. The filing attributes $18.8 million of the year-over-year rental revenue increase to higher straight-line revenue from the Kohl’s lease modification. Straight-line accounting spreads rental income across a lease term, so the cash payment and the revenue recognized this quarter are different amounts. Cash received for ending a lease helps today’s resources, while giving up the lease means that cash cannot be assumed to arrive again next quarter.
Alexander’s has signed a 15-year lease with Target for the space, which gives the property a new tenant and a route toward future rental income. We welcome that progress, although the new lease must be judged by the rent it produces after property expenses and financing costs rather than by the payment from the departing tenant.
The quarterly dividend remains $4.50 per share under the October 28 declaration, payable November 20 to holders of record November 9. Reported FFO exceeded that amount this quarter, but comparing the two figures alone would overstate what we know about recurring dividend support.
Our view is that Alexander’s has improved its near-term cash position without yet demonstrating a lasting earnings recovery. The convincing result would be another quarter in which property income supports the payment without a substantial lease-termination receipt. Until then, we would treat the $7.07 headline as an unusually strong reported quarter rather than a new earnings run rate.
Sources
- Alexander’s third-quarter 2026 Form 10-Q
- Alexander’s October 28 dividend declaration and company announcements
This article is general information, not personalized investment advice. Fly High Investing may hold securities discussed in this article.