Healthcare Realty Trust Executes $125M in Real Estate Transactions, Reports Q1 2026 Results and Raises Full-Year Guidance

Healthcare Realty Trust Incorporated (NYSE: HR), the largest public pure-play owner, operator, and developer of medical outpatient buildings in the United States, reported first-quarter 2026 financial results on April 30, disclosing approximately $125 million in total real estate transaction activity, a 6.9% increase in same-store cash net operating income, and an upward revision to its full-year 2026 guidance.

The Nashville, Tennessee-based real estate investment trust posted GAAP net loss of $(0.00) per share, NAREIT FFO of $0.35 per share, and Normalized FFO of $0.41 per share for the quarter ended March 31, 2026. Normalized FFO improved from $0.39 per share in the first quarter of 2025. Funds available for distribution totaled $112.9 million, reflecting a payout ratio of 75%.

Real Estate Acquisition and Disposition Activity

Healthcare Realty Trust completed approximately $125 million in total transaction activity during the first quarter, including its first new real estate acquisition within the KKR joint venture since the partnership's formation.

The company acquired a medical office building attached to a market-leading hospital in Birmingham, Alabama for $89 million, representing an $18 million investment at the company's pro rata share through the joint venture. The acquisition brings Healthcare Realty's presence at that hospital campus to two properties and approximately 650,000 square feet in the Birmingham market.

On the disposition side, the company sold two assets in Oklahoma City, Oklahoma for $12 million in a direct sale to an affiliated health system. Total dispositions for the quarter reached approximately $33 million.

Real Estate Development and Redevelopment Pipeline

Healthcare Realty Trust advanced its real estate development and redevelopment pipeline during the quarter, adding two new redevelopment projects totaling $31 million in projected investment, completing one redevelopment project, and commencing a new redevelopment in Boston.

In Charlotte, North Carolina, the company completed a $35 million redevelopment of two medical office buildings adjacent to Novant Health Huntersville Medical Center. The project is 98% leased to a mix of hospital and physician practices spanning cardiology, oncology, women's health, dermatology, and imaging.

In Boston, Massachusetts, Healthcare Realty commenced a 155,000-square-foot redevelopment connected to Tufts Medical Center in downtown Boston. The $25 million project is fully leased and will modernize the property to support Tufts Medicine's healthcare delivery operations.

In Albany, New York, the company executed two new leases with St. Peter's Health for clinic space and an ambulatory surgery center totaling 63,500 square feet within a redevelopment project.

Leasing Activity and Tenant Retention

During the first quarter, Healthcare Realty Trust executed 291 new and renewal leases totaling 2.0 million square feet across same-store properties and redevelopment projects, including 286,000 square feet of new lease executions. The weighted average lease term was 7.7 years with average annual escalators of 3.1%. Cash leasing spreads came in at positive 4.2%, and tenant retention reached 93.5%.

Key leasing transactions included:

• Atlanta, Georgia: 176,000 square feet of new and renewal leases with Wellstar Health System, maintaining greater than 90% occupancy across six on-campus medical office buildings.
• Charlotte, North Carolina: Renewal of 153,600 square feet with Advocate Health across five buildings that are 93% occupied.
• Charleston, South Carolina: Renewal of 54,600 square feet with MUSC Health across two buildings that are 100% occupied.
• Various markets: Renewal of approximately 736,000 square feet at eight single-tenant properties with a weighted average remaining lease term of less than three years; on average, the company extended those leases by nearly 10 years at strong cash leasing spreads.

Balance Sheet and Financing Activity

Healthcare Realty Trust reported net debt to adjusted EBITDA of 5.5x as of March 31, 2026, adjusted for an expected mortgage note receivable repayment in the second quarter. The company had approximately $1.2 billion of liquidity on its revolving facility and cash on hand.

During the first quarter, the company repurchased 5.7 million shares of common stock at an average price of $17.38 per share for a total of $100 million.

On February 12, 2026, Healthcare Realty established an inaugural commercial paper program with a total capacity of up to $600 million. At the end of the first quarter, $251 million was outstanding at a weighted average interest rate of 4.2%, representing more than 30 basis points in savings compared to the company's drawn revolving facility rate.

The company also extended $400 million in interest rate swaps to January 2029 at a fixed SOFR rate of 3.3%, and received $400 million in commitments from its existing bank group for a new unsecured delayed draw term loan expected to close in May 2026. The company will have the ability to draw proceeds at any time over the 12-month period following closing.

NAREIT FFO Guidance and Dividend

Healthcare Realty Trust raised its full-year 2026 guidance across key metrics. The company's increased 2026 Normalized FFO guidance range is $1.59 to $1.65 per share (diluted), a $0.01 increase at the midpoint. NAREIT FFO guidance was revised to $1.45 to $1.51 per share, up from the prior range of $1.44 to $1.50. Same-store cash NOI growth guidance was raised to a range of 3.75% to 4.75%, a 25-basis-point increase at the midpoint.

The company's board of directors unanimously approved a common stock dividend in the amount of $0.24 per share, payable May 22, 2026, to Class A common stockholders of record on May 11, 2026. Eligible holders of operating partnership units will receive a distribution of $0.24 per unit, equivalent to the Class A common stock dividend.

Board Refreshment

As part of the company's ongoing board refreshment initiatives, longtime independent director Jay Leupp announced he will retire following the company's Annual Meeting of Shareholders scheduled for May 19, 2026.

"On behalf of the entire company and our shareholders, I would like to thank Jay for his tireless commitment and leadership for our organization since 2020," said Peter Scott, CEO of Healthcare Realty Trust.

Leupp added: "As the longest tenured independent director at Healthcare Realty and a firm believer in continuing Board refreshment, I decided to retire from the Board of Directors at the conclusion of my seventh term. I would like to thank Healthcare Realty shareholders for giving me the opportunity to serve as an independent director, and I plan to remain a fellow shareholder in the years ahead. I wish the very best to our talented CEO, management team and best-in-class Board of Directors in their continued drive to grow shareholder value."

Earnings Call

Healthcare Realty Trust scheduled a conference call for May 1, 2026, at 9:00 a.m. Eastern Time to discuss earnings results, quarterly activities, general operations, and industry trends. A simultaneous webcast will be available through the company's investor relations website.

Sources: Healthcare Realty Trust Q1 2026 Earnings Press Release