Covered — but leveraged, and flat. A quarterly payer at $0.17 a share, $0.68 annualized, held flat since late 2022. Coverage is real on the line Macerich itself reports: funds from operations, as adjusted, was $0.35 a share in the second quarter of 2026 and $0.70 for the first half, so the $0.17 quarterly dividend took about 49% of it in both windows. The portfolio is healing — leased occupancy reached 94.0% at June 30, 2026, up from 92.0% a year earlier, go-forward centers were 95.5% leased, and go-forward net operating income rose 3.8% year over year. What keeps this a warning is the balance sheet and the flat payout: net debt to adjusted EBITDA was 7.30× at June 30, 2026 (6.83× pro forma for unsettled forward equity), and a dividend that has not risen since late 2022 does not compound. For a REIT, the House reads the cash line — never the EPS payout, which depreciation makes meaningless — and Macerich reports FFO as adjusted, not AFFO, so the payout here is computed on that line.
Key risk: Leverage first, malls second — at 7.30× net debt to adjusted EBITDA, refinancing or a leasing setback hits the cash that covers the dividend before it hits the payout ratio, and the dividend has no recent raise cushion to absorb it.
Changes if: Net debt to adjusted EBITDA rises past 7.30×, leased occupancy slips back below 94%, or FFO as adjusted falls toward the $0.17 quarterly dividend. Any of those turns a covered payout into a cut question.
- ✓FFO coverage check: About 49% of FFO as adjusted paid out — $0.17 against $0.35 in the second quarter and $0.34 against $0.70 for the first half of 2026 — leaves a real cushion. Macerich reports FFO as adjusted, not AFFO; the payout is computed on that reported cash line.
- !Leverage check: 7.30× net debt to adjusted EBITDA at June 30, 2026 is heavy — 6.83× pro forma for unsettled forward equity still leaves little room if rates stay high or leasing stalls, and the company's own Path Forward plan names deleveraging as a multi-year goal.
- !Growth check: No compounding here: the dividend has sat at $0.17 since late 2022, after a cut from $0.75 to $0.15 during 2020, while FFO as adjusted grew only from $0.34 to $0.35 year over year in the second quarter. Occupancy is improving, but the payout itself is not growing.
What this grade doesn't say: It screens the dividend only — covered, real, compounding. It says nothing about valuation or price: a well-covered payer can still be overpriced, and its price can still fall.