Earnings call transcript: Grand City Properties lifts 2026 outlook in Q3 2026

Grand City Properties has raised its full-year 2026 outlook for FFO I, projecting a range of EUR 185 million to EUR 195 million, up from the previous range of EUR 175 million to EUR 185 million. The residential landlord reported a 4% increase in net rental income to EUR 331 million for the nine months of 2026, driven by a strong like-for-like rental growth of 3.3% and tight housing supply in Germany.

However, adjusted EBITDA and FFO I both rose by 4% to EUR 265 million and EUR 136 million, respectively. The company attributed the weaker FFO I to higher finance costs, as it issued EUR 600 million of perpetual notes with a 5.25% coupon. Despite the higher financing costs, management remains optimistic, stating that the LEG stake should provide meaningful FFO and support growth into 2027.

The stock is currently trading near the lower end of its 52-week range, with a P/E ratio of 3.5 and a price-to-book of 0.26, indicating potential undervaluation.