Cousins Properties (CUZ) Stock: Dividend vs FFO, FAD, Debt

A $0.32 dividend and two different payout ratios

Cousins reports FFO (Nareit funds from operations) and FAD, its own measure: FFO adjusted to exclude non-cash items and transaction costs and to deduct second-generation capital expenditures. The company describes FAD as information that “assists in the comparability of the Company's dividend policy with other real estate companies.” It does not report a Core FFO or an AFFO, so FFO and FAD are the two yardsticks that matter. The dividend is the constant.

Net income does not cover the dividend, and FFO adds back depreciation by design. Net income available to common stockholders was $26.2 million ($0.16 a share) in Q2 2026, helped by a $9.2 million gain on the sale of Research Park V, and $1.3 million ($0.01) for the six months, which includes the $36.6 million impairment on One Eleven Congress. Common dividends paid in cash were $108.0 million in the half. Depreciation and amortization was $213.3 million in the same six months, which is the main reason FFO is so much higher than earnings.

Why FAD is lower. In 2025 second-generation capital expenditures (leasing costs plus building improvements for re-leased space) were $139.4 million, against $116.1 million in 2024, and straight-line rental revenue, which FAD removes because it is not cash, was $39.3 million. Those two items alone are about $1.06 a share on 168.7 million diluted shares (our arithmetic). In Q4 2025 the capital spending was $47.5 million, which is why FAD fell to $0.35 and the dividend took 90.1% of it. FAD per share recovered to $0.48 in Q1 2026 and $0.44 in Q2 2026, with second-generation capital spending of $26.6 million and $35.9 million.

Cash flow tells the same story from another angle. Net cash from operating activities was $402.3 million in 2025 against $215.8 million of common dividends paid, which is comfortable. In the first half of 2026 it was $197.0 million; dividends paid were $108.0 million and all capital expenditures in the cash flow statement were $133.6 million, so operating cash flow less dividends less capital spending was minus $44.6 million (our arithmetic), before $317.3 million of property acquisitions and $90.0 million of share repurchases, which were paid for with sales ($77.1 million in the half) and borrowing.

At the June 30, 2026 stock price of $29.98 that the supplemental uses for market capitalization, $1.28 a year is a 4.3% yield (our arithmetic). The price is the only market figure on this page; every other number comes from filings and company releases.

Guidance: five raises since February 2025

Guidance for 2026 net income is $0.08 to $0.14 a share, up from $0.02 to $0.10. It assumes the 2.9 million forward shares settle in the third quarter and that the 303 Tremont land parcel in Charlotte sells in the fourth, and “does not include any speculative property acquisitions, dispositions, or development starts.” First-half FFO was $1.49, which leaves $1.43 to $1.49 for the second half (our arithmetic), or $0.72 to $0.75 a quarter, about the Q2 rate. Two things in the history are worth knowing. First, 2025 FFO per share rose less than FFO in dollars because the company issued 15.5 million shares in the fourth quarter of 2024 (the 10-K cites that issuance as the reason common dividends paid rose to $215.8 million). Second, the Q1 2026 raise was credited to the share repurchase and to debt execution, not to rent.

What changed in the second quarter of 2026

The CEO said the company “leased more than 920,000 square feet of office space during the second quarter, increasing our portfolio to 92.8% leased - the highest level since the first quarter of 2020.” The release gives several qualifiers that a headline does not:

• Leased is not occupied. Weighted average occupancy for total office was 89.4%, 3.4 points below the leased figure (our arithmetic); leases signed but not started do not pay rent yet. The same-property pool had weighted average occupancy of 88.8% in Q2 2026 against 90.1% a year earlier.
• Cash NOI +5.9%, GAAP NOI +2.0%. Same-property NOI on the GAAP basis was $155.5 million against $152.5 million. Rental revenues rose 5.2% and operating expenses 12.3%. The cash-basis measure excludes straight-line rents, lease-inducement amortization and above- and below-market rent amortization (supplemental footnote 3), so the two measures differ by definition, not by error.
• New leases cost more. On the Q2 leases, total leasing costs were $13.30 per square foot per year across all types and $17.06 on new leases, of which tenant improvements were $10.67; net effective rent was $28.05 for all leases and $24.16 for new leases, against net annualized rent of $41.35 and $41.22 (supplemental). Straight-line rent on re-leased space rose 26.8% against 9.2% on a cash basis.

Where the rent is: markets and cities

Atlanta is the largest market by space and, with 91.6% leased and 85.7% occupied, the one with the widest gap between the two measures among the big three; Charlotte is the weakest at 81.9% leased after the February purchase of 300 South Tryon. Austin is the most leased of the large markets, and it is where the company has just sold. The 10-K adds that “in Austin, technology companies represent 53.1% of our annualized rent,” 19.2% of Charlotte's rent is banking and financial companies and 25.0% of Tampa's is biotechnology and health science (December 31, 2025). A weakness in one industry would show up in a single city.

The company calls its buildings “lifestyle office,” and says its portfolio is “well positioned to benefit from” a flight to quality. The 10-Q is careful about the term: “We do not consider the expression ‘lifestyle office’ a classification of our properties in accordance with any standard listing criteria in the real estate industry.” Treat it as marketing language, not a data category.

Tenants: Amazon, Alphabet and NCR Voyix

Amazon is the shortest-dated of the three large tenants, with a weighted average of 5.5 years remaining against 11.6 for Alphabet. Alphabet's rent is lower on this table than at year-end ($54.9 million, 6.1%, in the 10-K) because, in the supplemental's words, “Effective June 1, 2026, Alphabet began to self manage the property, including directly paying some operating expenses.” That is a change in how rent is counted, not necessarily in what Alphabet pays in total. Ovintiv, in the table at 0.8 years, had agreed an early termination in the third quarter of 2025; the footnote says “Approximately 88% of Ovintiv's premises were previously subleased,” and those subtenants became direct tenants after June 30, 2026.

The schedule is at June 30, 2026 and the company's share. Leases expiring in 2026 through 2030 are 31.0% of annual contractual rent and 35.4% of leased space (our arithmetic). Expiring rent of $45 to $52 a foot in 2026 to 2030, against $57.17 across the whole schedule, means the older leases are priced below the new ones, which is the basis for positive rent spreads, but also means each re-leasing needs the $13 to $17 a foot of leasing costs above.

Debt: 5.57x, a 2026 maturity wall of two mortgages, and a bigger facility

The leverage ratio that is not driven by the share price, net debt to EBITDAre, has risen across the two years; the market-capitalization ratio swings with the stock (51.3% in March, when the price was $22.57, and 44.0% in June). At June 30 the company's share of debt principal was $3.923 billion at a weighted average rate of 4.89% and a weighted average maturity of 4.2 years assuming all extension options (the 10-Q says 4.1 years excluding unexercised extensions). 85% was fixed at 4.90%; 15% ($594.0 million) was floating at 4.87%.

The two mortgages carry 3.450% and 3.370%; the company's public notes carry 4.875% to 5.875%, so refinancing them at those rates would raise the interest cost (our reading, not a company statement). The release for the fourth quarter of 2025 said guidance “includes an assumed refinancing” of the $250.0 million term loan (August 17, 2026), the Colorado Tower loan and the 201 North Tryon loan. The June 30 balance sheet shows the two mortgages still outstanding and $1.0 billion available on the $1.2 billion credit facility, which was recast on April 1, 2026 to mature April 1, 2031 with a lower spread (SOFR plus 0.725%); $167.0 million was drawn. As of October 19, 2026 no 8-K reports how the September and October maturities were handled, and the last filing is the September 15 investor-presentation 8-K, so the answer will come in the Q3 10-Q. The covenants in the facility allow overall leverage up to 60%, secured leverage up to 50%, and require fixed-charge coverage of at least 1.5x, against 3.39x reported.

Buying Charlotte, selling Austin, buying back stock

Net acquisitions in the cash flow statement for the first half of 2026 were $317.3 million of property purchases against $77.1 million of dispositions. The company says its repurchase program “does not obligate the Company to repurchase any dollar amount or number of shares, and may be suspended or discontinued at any time,” and it bought none in Q2, after the stock rose to $29.98. The ATM program has $305.6 million of capacity left; the 2.9 million shares sold forward in 2025 at an average of about $30.44 carry $88.5 million of expected net proceeds and are assumed settled in Q3 2026. Shares outstanding fell from 167,981,990 at December 31, 2025 to 164,602,058 at June 30, 2026 (-2.0%, our arithmetic). The company has no projects under active development and 38.4 acres of land at a cost basis of $234.3 million.

What comes next: the Q3 report on October 29

Cousins announced on October 1, 2026 that it will release third-quarter results after the market closes on Thursday, October 29, 2026, with a call on Friday, October 30 at 10:00 a.m. Eastern. Both press releases are company announcements, not SEC filings. In the last two quarters the 10-Q was filed on the same day as the earnings 8-K (October 30, 2025 and July 30, 2026), so the 10-Q for the quarter ended September 30, 2026 should appear on or about October 29. As of October 19, 2026 it is not filed.

What a holder or reader can do with this

This page is analysis of public documents, not investment, legal or tax advice. Things the filings let you check yourself:

• Pick the denominator and say which. The dividend is 42.3% of Q2 FFO and 71.8% of Q2 FAD. A quote page showing only the first looks very safe; the second is closer to cash after leasing costs.
• Watch the gap, not the headline. FFO exceeded FAD by $1.20 a share in 2025 and by $0.56 in the first half of 2026 (our arithmetic). If leasing costs rise with occupancy, the gap can widen even as FFO grows.
• Separate leased from occupied. 92.8% leased and 89.4% occupied are both company numbers for the same quarter.
• Check the two named tenants. Amazon and Alphabet are 14.4% of annualized rent together (our arithmetic), with 5.5 and 11.6 years left.
• Compare with other office REITs on the same basis. Our ten-company office REIT table of dividends, occupancy and debt puts Cousins next to SL Green, BXP, Kilroy, Douglas Emmett, Highwoods and others, and our pages on BXP, Vornado, SL Green and Douglas Emmett read their filings the same way.
• Listed versus non-traded. If you are weighing a listed REIT such as this one against a non-traded REIT for income, see our comparison of non-traded and publicly traded REITs. The listed one prices daily and discloses quarterly in the same 10-Q format; the numbers above are what a daily price is reacting to.

FAQ

All figures are from Cousins Properties (SEC CIK 25232) filings read on EDGAR on October 19, 2026: Form 10-K for 2025 (accession 0000025232-26-000014); Form 10-Q for the quarter ended June 30, 2026 (0000025232-26-000063); earnings releases and supplemental information attached to Forms 8-K for Q4 2024 (0000025232-25-000011), Q1 2025 (0000025232-25-000027), Q2 2025 (0000025232-25-000044), Q3 2025 (0000025232-25-000060), Q4 2025 (0000025232-26-000010), Q1 2026 (0000025232-26-000043) and Q2 2026 (0000025232-26-000061); Forms 8-K of February 17, 2026 (0000025232-26-000017), February 20, 2026 (0001628280-26-010188), April 1, 2026 (0000025232-26-000036) and September 15, 2026 (0000025232-26-000068); and the EDGAR filing index. The September 17, 2026 third-quarter dividend declaration and the October 1, 2026 earnings-date announcement come from company press releases distributed by PR Newswire, which are not SEC filings; the $29.98 share price is the June 30, 2026 figure in the supplemental. Percentages marked as ours, the FFO-to-FAD gaps, cash-flow shortfall, guidance midpoint and second-half range, expiration sums, debt-change ratios and market shares of NOI are our arithmetic from those rows; FFO, FAD, EBITDAre, same-property NOI and net debt are the company's own non-GAAP measures and definitions. This is analysis of public documents, not investment, legal or tax advice.