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Brandywine Realty Trust (BDN)
NYSE:BDN
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Brandywine Realty
(NYSE:BDN)
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Rating:51Neutral
Price Target:
$3.00
▼(-4.76% Downside)
The score is held back primarily by weak financial performance (losses, pressured profitability, and leverage risk) and bearish technicals (below major moving averages with negative MACD). These are partly offset by supportive earnings-call signals (FFO growth guidance and leasing momentum) and a very high dividend yield, though the payout appears tied to an execution-heavy deleveraging plan.
Positive Factors
Leasing and Occupancy Momentum
Sustained leasing velocity and high occupancy create durable rental cash flows and reduce vacancy-driven earnings volatility. Forward leasing growth and large executed deal volume support near-term NOI stability, higher renewal probability, and improved fixed-charge coverage if trends persist through the next leasing cycles.
Local Pricing Power in Philadelphia
Consistent rent gains and outsized market share in core Philly submarkets indicate structural competitive advantages. Strong renewal economics and pricing power support sustainable same-store revenue, underwriting strength for development projects, and resilience versus broader office-market weakness over the medium term.
Improving Cash Flow Metrics
Material FCF improvement and operating cash flow that covers accounting losses enhance near-term liquidity and operational resilience. This strengthens the company's ability to fund capital needs, service debt, and execute deleveraging plans without immediate external equity, reducing refinancing urgency if maintained.
Negative Factors
Elevated Leverage and Weak Coverage
High leverage and thin interest coverage create structural financial fragility: limited cushion for higher rates or rent stress, greater refinancing sensitivity, and constrained strategic flexibility. Sustained ~8x leverage raises default and covenant risk, making execution of deleveraging critical to credit stability over months.
Negative Profitability and Revenue Trend
Persistent negative margins and declining revenue signal structural profitability issues, not transitory noise. Ongoing losses reduce retained capital, pressure cash buffers, and make reliance on asset sales or external financing more likely if operating income does not stabilize or improve materially within the medium term.
Dependence on Asset Sales and Refinancing
A business plan contingent on large, near-term asset dispositions and successful refinancings concentrates execution risk. If timing, pricing, or buyer demand falters, deleveraging targets and interest-cost reductions may not materialize, leaving the company exposed to higher funding costs and constrained liquidity through the next 2–6 months.
Brandywine Realty (BDN) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$548.78M
Dividend Yield17.55%
Average Volume (3M)4.30M
Price to Earnings (P/E)―
Beta (1Y)0.86
Revenue Growth-5.52%
EPS Growth40.27%
CountryUS
Employees285
SectorReal Estate
Sector Strength53
IndustryREIT - Office
Share Statistics
EPS (TTM)-0.21
Shares Outstanding173,699,040
10 Day Avg. Volume2,799,392
30 Day Avg. Volume4,301,057
Financial Highlights & Ratios
PEG Ratio0.29
Price to Book (P/B)0.64
Price to Sales (P/S)1.05
P/FCF Ratio0.00
Enterprise Value/Market Cap5.70
Enterprise Value/Revenue6.46
Enterprise Value/Gross Profit25.47
Enterprise Value/Ebitda12.16
Forecast
1Y Price Target
$4.00Price Target Upside26.98% Upside
Rating ConsensusModerate Sell
Number of Analyst Covering5
EPS Forecast (FY)-0.66
Revenue Forecast (FY)$478.21M
Brandywine Realty Business Overview & Revenue Model
Company DescriptionBrandywine Realty Trust (NYSE: BDN) is one of the largest, publicly traded, full-service, integrated real estate companies in the United States with a core focus in the Philadelphia, Austin and Washington, D.C. markets. Organized as a real estate investment trust (REIT), we own, develop, lease and manage an urban, town center and transit-oriented portfolio comprising 175 properties and 24.7 million square feet as of December 31, 2020 which excludes assets held for sale. Our purpose is to shape, connect and inspire the world around us through our expertise, the relationships we foster, the communities in which we live and work, and the history we build together.
How the Company Makes MoneyBrandywine Realty Trust generates revenue primarily through rental income from its portfolio of office and mixed-use properties. The company leases space to a diverse range of tenants, including major corporations and government entities, which provides a stable cash flow. In addition to base rental income, Brandywine benefits from ancillary revenue sources such as leasing commissions, property management fees, and service charges. The company's focus on high-quality, strategically located properties in growing metropolitan areas further supports its revenue model. Significant partnerships with local governments and organizations also contribute to its earnings by enabling development projects and enhancing community engagement.
Brandywine Realty Earnings Call Summary
Earnings Call Date:Feb 03, 2026
(Q4-2025)
| % Change Since: |
Next Earnings Date:Apr 22, 2026
Earnings Call Sentiment Neutral
The call presented a mix of encouraging operational momentum—strong leasing activity, market-share gains in Philadelphia, rent growth, improved tour and conversion metrics, and 2026 FFO guidance showing mid-single-digit growth—paired with material near-term financial and execution challenges. Key concerns are elevated leverage and fixed-charge pressure (net debt/EBITDA ~8x), rising interest expense, reliance on $280M–$300M of asset sales and successful refinancing of near-term loans, and an underperforming Austin submarket. Management articulated clear plans (asset sales, recapitalizations, refinancing, and cost controls) that should address many weaknesses if executed, but outcomes are execution-dependent.Q4-2025 Updates
Positive Updates
Strong Occupancy and Leasing Activity
Wholly-owned core portfolio 88.3% occupied and 90.4% leased; annual leasing ~1.6M sq ft; Q4 executed 415k sq ft (157k wholly-owned, 257k JV); forward leasing up 26% to 229k sq ft with most occupancy in next two quarters.
Robust Tour and Conversion Metrics
Q4 tour volume +13% vs Q3 and +87% vs Q4 2024; 2025 annual tours +20% year-over-year; 56% of tours converted to proposals and 38% of proposals converted to executed leases.
Rent Growth and Market Share in Philadelphia
Since 2021 net effective rents in Market West and University City up ~20% (≈5.4% annualized); Brandywine captured 54% of new leasing in these submarkets in 2025 (30% share over last 5 years vs 15% market baseline).
Notable Asset Stabilization and Consolidation
Redeemed JV partner interests at Schuylkill Yards; 3025 JFK added to core portfolio at 92% leased; pro forma consolidation improves net debt/EBITDA by 0.4x and fixed charge coverage by 0.2x.
High Renewal Economics at Solaris
Solaris now 98% occupied and 99% leased; renewals since Nov 1 have produced average 12.7% effective rent growth.
2026 Guidance Shows Earnings Growth
2026 FFO guidance $0.51–$0.59 (midpoint $0.55), representing ~5.8% growth versus 2025 at the midpoint; year-end occupancy expected to improve +120 bps.
Controlled Liquidity and Debt Opportunities
No outstanding balance on $600M unsecured line of credit and $32M cash on hand; >50% of outstanding bonds carry coupons >8%, presenting refinancing opportunities that management says could reduce interest cost ~ $0.10 per share if refinanced to market rates.
Spec Revenue and Leasing Mark-to-Market Strength
Generated nearly $27.3M of spec revenue in 2025 (in line with plan); new leasing mark-to-market strong at +13% GAAP (4% cash); spec revenue from new lease transactions projected +39% vs 2025 at mid-year capture.
Planned $280–$300M Asset Sales to Deleverage
Business plan targets $280M–$300M of sales in 2026 (midpoint cap rate assumption ~8%) with ~$100M already with buyers selected, intended primarily to reduce debt and improve credit metrics.
Pipeline and Development Progress
Operating leasing pipeline ~1.5M sq ft (including ~140k sq ft in advanced negotiations); One Uptown leasing improved to 55% (up from 40%), and Solaris/3151 pipeline showing active proposals (3151 ~60% office / 40% life science).
Negative Updates
Q4 Net Loss and One-Time Charges
Q4 net loss $36.9M (-$0.21 per share); Q4 FFO $14.6M ($0.08) in line with consensus but impacted by a one-time early CMBS extinguishment charge of $12.2M (~$0.07 per share).
Elevated Leverage and Coverage Metrics
Third-quarter annualized combined and core net debt/EBITDA were 8.8x and 8.4x, respectively (above business plan ranges); fourth-quarter debt service and interest coverage ratios were 1.8 (below prior quarter). Management projects year-end core net debt/EBITDA ~8.0–8.4x and fixed charge ratio 1.8–2.0.
Rising Interest Expense
Total interest expense expected to approximate $170M in 2026 (including deferred financing costs and capitalized interest), a ~ $30M increase vs 2025; capitalized interest up ~$10M and consolidation/refinancing actions adding incremental interest.
Operating Cost Pressures
Property-level NOI in Q4 was $70M, $1M below forecast primarily due to increased operating costs across the portfolio.
Austin Market Underperformance
Austin occupancy at 74% produced a 400 basis point drag on overall company leasing levels; market recovery described as slow despite tour volume >100% year-over-year.
Dependence on Asset Sales and Execution Risk
Business plan relies on $280M–$300M of sales (majority in H1) to reduce leverage; proceeds timing and execution are critical—sales assumed at ~8% cap rates and used to repay debt, but guidance excludes benefits from ATX JV recaps and land gains.
High CAD Payout and Elevated Capital Plan
2026 CAD payout ratio targeted at 70%–90% with a $475M capital plan (includes refinancing, buybacks, development spend), implying constrained near-term balance sheet flexibility until sales and recapitalizations occur.
Development Drag on Near-Term Earnings
Consolidation of development projects (e.g., 3151) increases short-term interest and operating losses; 3151 drove operating losses in 2025 and capitalization period ended, increasing interest expense in 2026.
Stock Valuation Discount and Market Perception
Management highlighted the stock is significantly undervalued relative to estimated NAV (management commentary cited a large discount), creating potential shareholder pressure and complicating buyback timing.
Short-Term Liquidity Considerations
Cash on hand $32M and unsecured line maturing June 2026 (management expects extension); 3025 JFK construction loan $178M matures July 2026 requiring refinancing or other action.
Company Guidance
The company guided 2026 FFO of $0.51–$0.59 per share (midpoint $0.55, +5.8% vs. 2025) on roughly $292 million of property-level GAAP NOI (a $30 million YoY increase, including ~$17M from consolidated 3025 JFK and a $7M decrease from 2025 asset sales/move-outs), with spec revenue targeted at $17–$18 million (about $13M or ~75% secured toward the midpoint). Operating assumptions include year-end occupancy up ~120 bps, positive net absorption, GAAP mark-to-market of 5–7% (CBD/PA suburbs 8–10%), cash mark-to-market of -2% to 0%, leasing capital of 12–13%, same-store GAAP growth -1% to +1% (cash 0%–2%), and G&A of $36–37M. Financial and capital targets call for ~ $280–$300M of dispositions (~$290M midpoint) at ~8% average cap rates (majority closing H1), a $475M 2026 capital plan, CAD payout ~70%–90% (improving H2), year-end core net debt/EBITDA ~8.0–8.4x (projected combined net debt/EBITDA and fixed charge coverage ~1.8–2.0x), total interest expense ≈$170M, ~180M shares outstanding, $32M cash on hand today and roughly $52M expected EOY, and plans to refinance the $178M 3025 construction loan (targeting ~200 bps savings) while prioritizing debt reduction before opportunistic share repurchases.Brandywine Realty Financial Statement Overview
Summary
Weak profitability and revenue trend (TTM net margin -38.55% and revenue down) drive a low income statement score, partly offset by improved cash flow dynamics (strong TTM free cash flow growth and operating cash flow covering net losses). Leverage and negative ROE remain meaningful risks despite some improvement in reported leverage metrics.Income Statement
Brandywine Realty's income statement shows a concerning trend with declining revenue and profitability. The TTM data reveals a negative net profit margin of -38.55%, indicating significant losses. Revenue has decreased by 2.09% compared to the previous period, and the EBIT margin is low at 8.48%. These factors highlight challenges in maintaining profitability and revenue growth.45
Neutral
Balance Sheet
The balance sheet reflects a high level of debt with a debt-to-equity ratio of 2.15 in the most recent annual report, although it has improved to 0.036 in the TTM period. The return on equity is negative, indicating that the company is not generating positive returns for shareholders. The equity ratio is relatively stable, but the high leverage poses a risk to financial stability.55
Neutral
Cash Flow
Cash flow analysis shows some positive aspects, with a significant increase in free cash flow growth of 143.47% in the TTM period. The operating cash flow to net income ratio is above 1, indicating that operating cash flow is covering net losses. However, the free cash flow to net income ratio is low, suggesting limited cash flow relative to net losses.60
Neutral
| Breakdown | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 484.45M | 505.52M | 514.65M | 506.10M | 486.82M |
| Gross Profit | 122.83M | 318.19M | 324.70M | 311.70M | 298.51M |
| EBITDA | 257.23M | 103.00M | 91.29M | 303.89M | 255.97M |
| Net Income | -179.48M | -195.91M | -196.79M | 53.82M | 12.29M |
Balance Sheet | |||||
| Total Assets | 3.59B | 3.49B | 3.73B | 3.87B | 3.85B |
| Cash, Cash Equivalents and Short-Term Investments | 62.30M | 90.23M | 58.32M | 17.55M | 27.46M |
| Total Debt | 2.63B | 2.24B | 2.16B | 2.08B | 1.88B |
| Total Liabilities | 2.79B | 2.45B | 2.41B | 2.24B | 2.14B |
| Stockholders Equity | 792.73M | 1.04B | 1.32B | 1.63B | 1.69B |
Cash Flow | |||||
| Free Cash Flow | 0.00 | 51.37M | 20.81M | -53.71M | 55.75M |
| Operating Cash Flow | 0.00 | 181.13M | 177.27M | 209.31M | 190.87M |
| Investing Cash Flow | 0.00 | -120.19M | -174.91M | -190.59M | -100.31M |
| Financing Cash Flow | 0.00 | -32.30M | 46.79M | -28.63M | -109.34M |
Brandywine Realty Technical Analysis
Positive
3.15
Price Trends
2.99
Positive
3.34
Negative
3.63
Negative
Market Momentum
-0.02
Negative
61.00
Neutral
41.74
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For BDN, the sentiment is Positive. The current price of 3.15 is above the 20-day moving average (MA) of 2.96, above the 50-day MA of 2.99, and below the 200-day MA of 3.63, indicating a neutral trend. The MACD of -0.02 indicates Negative momentum. The RSI at 61.00 is Neutral, neither overbought nor oversold. The STOCH value of 41.74 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for BDN.
Brandywine Realty Risk Analysis
Brandywine Realty disclosed 47 risk factors in its most recent earnings report. Brandywine Realty reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Brandywine Realty Peers Comparison
UnderperformOutperform
Sector (65)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
65 Neutral | $2.17B | 12.19 | 3.79% | 4.94% | 3.15% | 1.96% | |
58 Neutral | $1.10B | 76.90 | 1.00% | 9.58% | 11.02% | -30.91% | |
55 Neutral | $1.07B | -15.24 | -4.45% | 6.09% | -1.23% | 9.10% | |
51 Neutral | $548.78M | -3.04 | -19.60% | 17.55% | -5.52% | 40.27% | |
47 Neutral | $483.33M | -0.48 | -14.02% | ― | -7.89% | -15.88% | |
40 Neutral | $82.95M | -1.80 | -7.21% | 4.71% | -14.68% | -13.53% |
* Real Estate Sector Average
BDN
Brandywine Realty
3.15
-1.23
-28.16%
FSP
Franklin Street Properties
0.80
-0.96
-54.65%
HPP
Hudson Pacific Properties
8.17
-14.09
-63.30%
PDM
Piedmont Office
8.63
0.27
3.23%
DEA
Easterly Government Properties
23.77
-1.26
-5.03%
Brandywine Realty Corporate Events
Business Operations and StrategyExecutive/Board Changes
Brandywine Realty Announces EVP Retirement Plans
Neutral
Dec 12, 2025
On December 11, 2025, Brandywine Realty Trust announced the upcoming retirement of George D. Johnstone, Executive Vice President – Operations, by the end of the first quarter of 2026. The company acknowledged his 27 years of service and plans to engage him in transition activities in 2026, indicating a strategic approach to leadership changes.
The most recent analyst rating on (BDN) stock is a Hold with a $6.00 price target. To see the full list of analyst forecasts on Brandywine Realty stock, see the BDN Stock Forecast page.
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.