Realty Income raised its 2026 AFFO-per-share guidance and reported 3.7% year-over-year AFFO growth; the stock was essentially flat, down 0.1% after earnings. The update was mixed in focus: investment activity and portfolio performance were positive, while higher long-term rates are shifting attractive investment opportunities toward Europe, credit and co-investments.
- Third-quarter AFFO was **$1.12 per share**, up **3.7% year over year**. The company raised 2026 guidance to **$4.45–$4.46 per share** and reaffirmed its **$10 billion investment-volume target**.
- Realty Income invested approximately **$2.6 billion** during the quarter, including **$2.2 billion pro rata**, at a **6.8% cash yield** on property acquisitions. Those investments carried a reported leverage-neutral spread of approximately **170 basis points** to short-term weighted-average cost of capital.
- Europe accounted for **$940 million**, or **42% of pro rata investment volume**, at a **7.1% initial cash yield**; more than **85%** of European real estate investment volume was industrial.
- Credit investments totaled approximately **$250 million**, or **over 10% of investment volume**. Management described credit and private-capital co-investments as ways to pursue returns as higher long-term rates pressure balance-sheet acquisition economics.
- Industrial was the largest investment area, at approximately **$1.15 billion** and a **6.5% initial cash yield**. A Dallas logistics acquisition had in-place rents approximately **45% below market**, though leases begin rolling in a few years.
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