What changed in this filing

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Item 2. Management’s Discussion and Analysis

2026-07-31 compared with 2026-05-01 · 243 added, 100 removed, 331 unchanged (51% of the section changed)

44 unchanged sentences

We are a full service, vertically integrated and self-administered REIT that owns, operates, acquires and develops high quality retail, office, multifamily and mixed-use properties in attractive, high-barrier-to-entry markets in Southern California, Northern California, Washington, Oregon, Texas and Hawaii.

As of March 31, 2026, our portfolio was comprised of twelve office properties;

As of June 30, 2026, our portfolio was comprised of twelve office properties;

eleven retail shopping centers;

1 unchanged sentence

and seven multifamily properties.

Additionally, as of March 31, 2026, we owned land at two of our properties that we classified as held for development and/or construction in progress.

Additionally, as of June 30, 2026, we owned land at two of our properties that we classified as held for development and/or construction in progress.

Our core markets include San Diego, California;

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Rady or his affiliates, including the Ernest Rady Trust U/D/T March 13, 1983, or the Rady Trust, and did not have any operating activity until the consummation of our initial public offering on January 19, 2011.

Our Company, as the sole general partner of our Operating Partnership, has control of our Operating Partnership and owned 78.95% of our Operating Partnership as of March 31, 2026.

Our Company, as the sole general partner of our Operating Partnership, has control of our Operating Partnership and owned 78.96% of our Operating Partnership as of June 30, 2026.

Accordingly, we consolidate the assets, liabilities and results of operations of our Operating Partnership.

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Acquired properties are classified into same-store properties once we have owned such properties for the entirety of comparable period(s) and the properties are not under significant development or expansion.

Below is a summary of our same-store and redevelopment same-store composition for the three months ended March 31, 2026 and 2025.

One Beach Street is classified as a same-store property when compared to the designation for the three months ended March 31, 2025, as this property was placed into service on August 1, 2024.

Genesee Park is classified as a non-same-store property because it was acquired on February 28, 2025, and thus has not been owned for the comparable period.

La Jolla Commons III is classified as a non-same store property when compared to the designations for the three months ended March 31, 2025, as it was placed into service on April 1, 2025.

Below is a summary of our same-store and redevelopment same-store composition for the three and six months ended June 30, 2026 and 2025.

One Beach Street is classified as a same-store property when compared to the designation for the three and six months ended June 30, 2025, as this property was placed into service on August 1, 2024.

Genesee Park is classified as a same-store property when compared to the designation for the three months ended June 30, 2025 and a non-same-store property when compared to the designation for the six months ended June 30, 2025 as it was acquired on February 28, 2025.

La Jolla Commons III is classified as a same-store property when compared to the designation for the three months ended June 30, 2025 and a non-same-store property when compared to the designation for the six months ended June 30, 2025, as it was placed into service on April 1, 2025.

La Jolla Commons III is a part of the La Jolla Commons office project, and not a stand-alone property.

Retail same-store operating income increased approximately 0.1% for the three months ended March 31, 2026 compared to the same period in 2025.

Office same-store operating income remained flat for the three months ended March 31, 2026 compared to the same period in 2025.

Three Months Ended March 31,

Three Months Ended June 30, Six Months Ended June 30,

2026 2025 2026 2025

Same-Store 31 29 30 29

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Furthermore, we believe the locations of our properties and diversified portfolio will mitigate some of the potentially negative impact of the current economic environment.

During the three months ended March 31, 2026, we signed 29 office leases for a total of 236,670 square feet of office space including 108,456 square feet of comparable space leases (leases for which there was a prior tenant), at an average rental rate increase on a cash and GAAP basis of 4.8% and 10.6%, respectively.

During the three months ended June 30, 2026, we signed 14 office leases for a total of 109,715 square feet of office space including 75,416 square feet of comparable space leases (leases for which there was a prior tenant), at an average rental rate increase on a cash and GAAP basis of 9.1% and 10.2%, respectively.

New office leases for comparable spaces were signed for 29,529 square feet at an average rental rate increase on a cash and GAAP basis of 14.3% and 12.8%, respectively.

Renewals for comparable office spaces were signed for 45,887 square feet at an average rental rate increase on a cash and GAAP basis of 5.9% and 8.6%, respectively.

Tenant improvements and incentives were $24.68 per square foot of office space for comparable new leases for the three months ended March 31, 2026, mainly due to new tenants at Timber Ridge and Coastal Collection at Torrey Reserve.

During the three months ended March 31, 2026, we signed 14 retail leases for a total of 38,581 square feet of retail space including 37,593 square feet of comparable space leases (leases for which there was a prior tenant), at an average rental rate decrease on a cash basis of 2.0% and increase on a GAAP basis of 1.3%, respectively.

New retail leases for comparable spaces were signed for 10,000 square feet at an average rental rate decrease on a cash and GAAP basis of 17.8% and 22.0%, respectively.

Renewals for comparable retail spaces were signed for 27,593 square feet at an average rental rate increase on a cash and GAAP basis of 3.8% and 13.0%, respectively.

Tenant improvements and incentives were $22.50 per square foot of retail space for comparable new leases for the three months ended March 31, 2026, mainly due to a new tenant at Solana Beach Towne Center.

Tenant improvements and incentives were $24.35 per square foot of office space for comparable new leases for the three months ended June 30, 2026, mainly due to new tenants at City Center Bellevue and Coastal Collection at Torrey Reserve.

During the three months ended June 30, 2026, we signed 20 retail leases for a total of 138,993 square feet of retail space including 133,828 square feet of comparable space leases (leases for which there was a prior tenant), at an average rental rate increase on a cash and GAAP basis of 3.0% and 20.2%, respectively.

There were no comparable new leases, tenant improvements, or incentives on retail space during the three months ended June 30, 2026.

The rental increases associated with comparable spaces generally include all leases signed in arms-length transactions reflecting market leverage between landlords and tenants during the period.

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We cease capitalization on the portion substantially completed and occupied or held available for occupancy, and capitalize only those costs associated with any remaining portion under construction.

We capitalized external and internal costs related to new development, redevelopment, expansion and repositioning activities combined of $7.7 million and $2.0 million for the three months ended March 31, 2026 and 2025, respectively.

We capitalized external and internal costs related to other property improvements combined of $14.3 million and $12.3 million for the three months ended March 31, 2026 and 2025, respectively.

We capitalized external and internal costs related to new development, redevelopment, expansion and repositioning activities combined of $15.5 million and $8.6 million for the three months ended June 30, 2026 and 2025, respectively, and $23.2 million and $10.6 million for the six months ended June 30, 2026 and 2025, respectively.

We capitalized external and internal costs related to other property improvements combined of $14.3 million and $12.8 million for the three months ended June 30, 2026 and 2025, respectively, and $28.7 million and $25.2 million for the six months ended June 30, 2026 and 2025, respectively.

Interest costs on developments and major redevelopments are capitalized as part of developments and redevelopments not yet placed into service.

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Because the development of La Jolla Commons III is now complete and the building, inclusive of the land, was placed into service as of April 1, 2025, there were no capitalized interest costs related to development activities after the three months ended March 31, 2025.

We capitalized interest costs related to development activities of $1.4 million for the three months ended March 31, 2025.

We capitalized interest costs related to development activities of $1.4 million for the six months ended June 30, 2025.

Results of Operations

For our discussion of results of operations, we have provided information on a total portfolio and same-store basis.

Comparison of the three months ended March 31, 2026 to the three months ended March 31, 2025

The following summarizes our consolidated results of operations for the three months ended March 31, 2026 compared to our consolidated results of operations for the three months ended March 31, 2025.

As of March 31, 2026, our operating portfolio was comprised of 31 office, retail, multifamily and mixed-use properties with an aggregate of approximately 6.8 million rentable square feet of office and retail space, including the retail portion of our mixed-use property, 2,302 residential units (including 120 RV spaces) and a 369-room hotel.

Additionally, as of March 31, 2026, we owned land at two of our properties that we classified as held for development and/or construction in progress.

As of March 31, 2025, our operating portfolio was comprised of 31 office, retail, multifamily and mixed-use properties with an aggregate of approximately 6.6 million rentable square feet of office and retail space, including the retail portion of our mixed-use property, 2,302 residential units (including 120 RV spaces) and a 369-room hotel.

Additionally, as of March 31, 2025, we owned land at three of our properties that we classified as held for development and/or construction in progress.

The following table sets forth selected data from our unaudited consolidated statements of comprehensive income for the three months ended March 31, 2026 and 2025 (dollars in thousands):

Three Months Ended March 31, Change %

Comparison of the three months ended June 30, 2026 to the three months ended June 30, 2025

The following summarizes our consolidated results of operations for the three months ended June 30, 2026 compared to our consolidated results of operations for the three months ended June 30, 2025.

As of June 30, 2026 and June 30, 2025 our operating portfolio was comprised of 31 office, retail, multifamily and mixed-use properties with an aggregate of approximately 6.8 million rentable square feet of office and retail space, including the retail portion of our mixed-use property, 2,302 residential units (including 120 RV spaces) and a 369-room hotel.

Additionally, as of June 30, 2026 and June 30, 2025, we owned land at two of our properties that we classified as held for development and/or construction in progress.

The following table sets forth selected data from our unaudited consolidated statements of comprehensive income for the three months ended June 30, 2026 and 2025 (dollars in thousands):

Three Months Ended June 30, Change %

Rental income $ 103,115 $ 101,070 $ 2,045 2 %

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Interest expense, net (19,931) (19,784) (147) 1

Other income, net 422 927 (505) (54)

Net income 6,790 7,121 (331) (5)

Net income attributable to restricted shares (235) (206) (29) 14

Net income attributable to unitholders in the Operating Partnership

(1,380) (1,459) 79 (5)

Net income attributable to American Assets Trust, Inc.

$ 5,175 $ 5,456 $ (281) (5) %

Total property revenues .

Total property revenue consists of rental revenue and other property income.

Total property revenue increased $1.6 million, or 1%, to $109.5 million for the three months ended June 30, 2026 compared to $107.9 million for the three months ended June 30, 2025.

The percentage leased was as follows for each segment as of June 30, 2026 and 2025:

Percentage Leased (1)

Office 84.4 % 82.0 %

Retail 97.9 % 97.7 %

Multifamily 87.7 % 88.1 %

Mixed-Use (2)

92.2 % 95.0 %

(1) The percentage leased for our retail and office segments and the retail portion of our mixed-use segment includes the square footage under lease, including leases which may not have commenced as of June 30, 2026 or 2025, as applicable.

Percentage leased for our multifamily properties includes total units leased and occupied as of the applicable date.

(2) Includes the retail portion of the mixed-use property only.

The increase in total property revenue was attributable primarily to the factors discussed below.

Rental revenues .

Rental revenue includes minimum base rent, cost reimbursements, percentage rents and other rents.

Rental revenue increased $2.0 million, or 2%, to $103.1 million for the three months ended June 30, 2026 compared to $101.1 million for the three months ended June 30, 2025.

Rental revenue by segment was as follows (dollars in thousands):

Total Portfolio Same-Store Portfolio (1)

Three Months Ended June 30, Change % Three Months Ended June 30, Change %

2026 2025 2026 2025

Office $ 48,989 $ 48,448 $ 541 1 $ 48,989 $ 48,447 $ 542 1

Retail 23,255 22,569 686 3 23,255 22,603 652 3

Multifamily 16,667 16,443 224 1 16,667 16,443 224 1

Mixed-Use 14,204 13,610 594 4 14,204 13,610 594 4

$ 103,115 $ 101,070 $ 2,045 2 % $ 103,115 $ 101,103 $ 2,012 2 %

(1) For this table and tables following, the same-store portfolio excludes land held for development (office).

Office rental revenue increased $0.5 million for the three months ended June 30, 2026 compared to the three months ended June 30, 2025 primarily due to new tenant leases at La Jolla Commons III, City Center Bellevue, Timber Ridge and One Beach Street.

These increases were offset by lower occupancy at 14Acres and a one-time reserve for certain receivables related to an office tenant at Coastal Collection at Torrey Reserve.

The company continues to pursue recovery of the outstanding amounts.

Retail rental revenue increased $0.7 million for the three months ended June 30, 2026 compared to the three months ended June 30, 2025 primarily due to a $0.4 million increase related to new tenant leases at Alamo Quarry Market, Lomas Santa Fe Plaza, Carmel Country Plaza and Waikele Center.

Additionally, there was an increase in cost recoveries of $0.3 million.

Multifamily rental revenue increased $0.2 million for the three months ended June 30, 2026 compared to the three months ended June 30, 2025 primarily due to an overall increase in average monthly base rent and a slight decrease in overall occupancy.

Average monthly base rent and occupancy was $2,796 and 89.3%, for the three months ended June 30, 2026, respectively, compared to $2,725 and 89.5%, for the three months ended June 30, 2025, respectively.

Total mixed-use rental revenue increased $0.6 million for the three months ended June 30, 2026 compared to the three months ended June 30, 2025 primarily due to an increase of $0.5 million in rental revenue at our retail portion of our mixed-use property resulting from the collection of amounts previously reserved as bad debt.

Additionally there was an increase at the hotel portion of our mixed-use property due to an increase in average occupancy and revenue per available room to 90.5% and $308 for the three months ended June 30, 2026, respectively, compared to 86.0% and $305 for the three months ended June 30, 2025, respectively.

Other property income .

Other property income decreased $0.5 million, or 7%, to $6.4 million for the three months ended June 30, 2026 compared to $6.9 million for the three months ended June 30, 2025.

Other property income by segment was as follows (dollars in thousands):

Total Portfolio Same-Store Portfolio

Three Months Ended June 30, Change % Three Months Ended June 30, Change %

2026 2025 2026 2025

Office $ 1,736 $ 2,370 $ (634) (27) $ 1,724 $ 2,358 $ (634) (27)

Retail 269 439 (170) (39) 269 439 (170) (39)

Multifamily 1,054 985 69 7 1,054 985 69 7

Mixed-Use 3,309 3,069 240 8 3,309 3,069 240 8

$ 6,368 $ 6,863 $ (495) (7) % $ 6,356 $ 6,851 $ (495) (7) %

Office other property income decreased $0.6 million for the three months ended June 30, 2026 compared to the three months ended June 30, 2025 primarily due to lease termination fees received at Timber Ridge during 2025.

Retail other property income decreased $0.2 million for the three months ended June 30, 2026 compared to the three months ended June 30, 2025 primarily due to lease termination fees received at Alamo Quarry Market during 2025.

Multifamily other property income increased $0.1 million for the three months ended June 30, 2026 compared to the three months ended June 30, 2025 primarily due to an increase in parking income at Hassalo on Eighth - Multifamily.

Mixed-use other property income increased $0.2 million for the three months ended June 30, 2026 compared to the three months ended June 30, 2025 primarily due to an increase in room-related other income driven by higher occupancy at the hotel portion of our mixed-use property and parking income at the retail portion of our mixed-use property.

Property Expenses

Total Property Expenses.

Total property expenses consist of rental expenses and real estate taxes.

Total property expenses increased $1.2 million, or 3%, to $41.6 million for the three months ended June 30, 2026 compared to $40.3 million for the three months ended June 30, 2025.

Rental Expenses.

Rental expenses increased $2.1 million, or 7%, to $31.8 million for the three months ended June 30, 2026 compared to $29.7 million for the three months ended June 30, 2025.

Rental expense by segment was as follows (dollars in thousands):

Total Portfolio Same-Store Portfolio

Three Months Ended June 30, Change % Three Months Ended June 30, Change %

2026 2025 2026 2025

Office $ 11,687 $ 10,404 $ 1,283 12 $ 11,621 $ 10,333 $ 1,288 12

Retail 3,382 3,356 26 1 3,382 3,361 21 1

Multifamily 5,956 5,902 54 1 5,956 5,902 54 1

Mixed-Use 10,744 10,016 728 7 10,744 10,016 728 7

$ 31,769 $ 29,678 $ 2,091 7 % $ 31,703 $ 29,612 $ 2,091 7 %

Office rental expense increased $1.3 million for the three months ended June 30, 2026 compared to the three months ended June 30, 2025 primarily due to an increase in facilities services expense, utilities expense and repairs and maintenance expense.

Multifamily rental expense increased $0.1 million for the three months ended June 30, 2026 compared to the three months ended June 30, 2025 primarily due to an increase in repairs and maintenance expense and security expense at Pacific Ridge Apartments, Genesee Park and Hassalo on Eighth - Multifamily.

These increases were partially offset by a decrease in contract labor service expense at Pacific Ridge Apartments and Genesee Park.

Mixed-use rental expense increased $0.7 million for the three months ended June 30, 2026 compared to the three months ended June 30, 2025 primarily due to an increase in room-related expenses and excise tax at the hotel portion of our mixed-use property and an increase in personnel expense at the retail portion of our mixed-use property.

Real Estate Taxes.

Real estate taxes decreased $0.9 million, or 8%, to $9.8 million for the three months ended June 30, 2026 compared to $10.6 million for the three months ended June 30, 2025.

Real estate tax expense by segment was as follows (dollars in thousands):

Total Portfolio Same-Store Portfolio

Three Months Ended June 30, Change % Three Months Ended June 30, Change %

2026 2025 2026 2025

Office $ 3,579 $ 5,209 $ (1,630) (31) $ 3,608 $ 5,162 $ (1,554) (30)

Retail 2,992 2,568 424 17 2,992 2,568 424 17

Multifamily 2,153 1,825 328 18 2,153 1,825 328 18

Mixed-Use 1,067 1,043 24 2 1,067 1,043 24 2

$ 9,791 $ 10,645 $ (854) (8) % $ 9,820 $ 10,598 $ (778) (7) %

Office real estate taxes decreased $1.6 million for the three months ended June 30, 2026 compared to the three months ended June 30, 2025 primarily due to real estate tax refunds received at La Jolla Commons and Lloyd Portfolio, partially offset by an increase in tax consultant fees.

Retail real estate taxes increased $0.4 million for the three months ended June 30, 2026 compared to the three months ended June 30, 2025 primarily due to an increase in property tax assessments during 2026 and real estate tax refunds received during 2025 at Alamo Quarry Market.

Multifamily real estate taxes increased $0.3 million for the three months ended June 30, 2026 compared to the three months ended June 30, 2025 primarily due to supplemental real estate taxes at Genesee Park and an increase at Pacific Ridge Apartments due to a real estate tax refund received during 2025.

Property Operating Income

Property operating income increased $0.3 million to $67.9 million for the three months ended June 30, 2026, compared to $67.6 million for the three months ended June 30, 2025.

Property operating income by segment was as follows (dollars in thousands):

Total Portfolio Same-Store Portfolio

Three Months Ended June 30, Change % Three Months Ended June 30, Change %

2026 2025 2026 2025

Office $ 35,459 $ 35,205 $ 254 1 $ 35,484 $ 35,310 $ 174 —

Retail 17,150 17,084 66 — 17,150 17,113 37 —

Multifamily 9,612 9,701 (89) (1) 9,612 9,701 (89) (1)

Mixed-Use 5,702 5,620 82 1 5,702 5,620 82 1

$ 67,923 $ 67,610 $ 313 — % $ 67,948 $ 67,744 $ 204 — %

Office operating income increased $0.3 million for the three months ended June 30, 2026 compared to the three months ended June 30, 2025, primarily due to new tenant leases at La Jolla Commons III, City Center Bellevue, Timber Ridge and One Beach Street, partially offset by lower occupancy at 14Acres and a one-time reserve for certain receivables related to an office tenant at Coastal Collection at Torrey Reserve.

The company continues to pursue recovery of the outstanding amounts.

The increase was also due to real estate tax refunds received at La Jolla Commons and Lloyd Portfolio.

These increases were offset by a decrease in other property income due to lease termination fees received at Timber Ridge during 2025, and an increase in rental expenses primarily from higher facilities services, utilities and repairs and maintenance expense.

Retail operating income increased $0.1 million for the three months ended June 30, 2026 compared to the three months ended June 30, 2025 primarily due to new tenant leases at Alamo Quarry Market, Lomas Santa Fe Plaza, Carmel Country Plaza and Waikele Center, and higher cost recoveries.

These increases were offset by a decrease in other property income due to lease termination fees received at Alamo Quarry Market during 2025 and higher real estate taxes at Alamo Quarry Market due to increased property tax assessments during 2026 and real estate tax refunds received during 2025.

Multifamily operating income decreased $0.1 million for the three months ended June 30, 2026 compared to the three months ended June 30, 2025 primarily due to higher rental expenses at Pacific Ridge Apartments, Genesee Park and Hassalo on Eighth - Multifamily, higher real estate taxes at Genesee Park and a real estate tax refund received at Pacific Ridge Apartments during 2025.

These increases in expenses were partially offset by an increase in rental revenue due to higher average monthly base rent and a slight decrease in occupancy of $2,796 and 89.3%, respectively, for the three months ended June 30, 2026 compared to $2,725 and 89.5%, respectively, for the three months ended June 30, 2025.

Total mixed-use operating income increased $0.1 million for the three months ended June 30, 2026 compared to the three months ended June 30, 2025 primarily due to higher rental revenue at the retail portion of our mixed-use property from the collection of amounts previously reserved as bad debt, and higher revenue at the hotel portion driven by increased occupancy.

Hotel average occupancy and revenue per available room were 90.5% and $308, respectively, for the three months ended June 30, 2026 compared to 86.0% and $305, respectively, for the three months ended June 30, 2025.

These increases were offset by higher rental expenses from increased room-related expenses and excise tax at the hotel portion and higher personnel expense at the retail portion.

General and Administrative.

General and administrative expenses increased $0.1 million, or 1%, for the three months ended June 30, 2026, compared to the three months ended June 30, 2025.

This increase was primarily due to higher corporate legal expenses and consulting fees.

Depreciation and Amortization.

Depreciation and amortization expense decreased $0.1 million for the three months ended June 30, 2026, compared to the three months ended June 30, 2025.

This decrease was primarily due to $0.9 million related to leases-in-place at Genesee Park, which fully amortized within a year of acquisition.

This decrease was offset by an increase in new tenant improvements and building improvements assets placed into service.

Interest Expense, net.

Interest expense increased $0.1 million, or 1%, for the three months ended June 30, 2026, compared to the three months ended June 30, 2025.

This increase was primarily due to the amortization of the new loan fees associated with the Fourth Amended and Restated Credit Facility entered into on April 1, 2026.

Other Income, net.

Other income, net decreased $0.5 million, or 54%, for the three months ended June 30, 2026, compared to the three months ended June 30, 2025.

This decrease was primarily due to lower interest and investment income attributed to a decrease in yield on our average cash balance during the period.

Comparison of the Six Months Ended June 30, 2026 to the Six Months Ended June 30, 2025

The following summarizes our consolidated results of operations for the six months ended June 30, 2026 compared to our consolidated results of operations for the six months ended June 30, 2025.

The following table sets forth selected data from our unaudited consolidated statements of income for the six months ended June 30, 2026 and 2025 (dollars in thousands):

Six Months Ended June 30, Change %

Rental income $ 207,537 $ 204,021 $ 3,516 2 %

Other property income 12,538 12,519 19 —

Total property revenues 220,075 216,540 3,535 2

Rental expenses 63,489 59,978 3,511 6

Real estate taxes 21,737 21,650 87 —

Total property expenses 85,226 81,628 3,598 4

Total property operating income 134,849 134,912 (63) —

General and administrative (17,695) (18,162) 467 (3)

Depreciation and amortization (65,023) (63,276) (1,747) 3

Interest expense, net (39,638) (38,564) (1,074) 3

Gain on sale of real estate — 44,476 (44,476) 100

8 unchanged sentences

Total property revenue consists of rental revenue and other property income.

Total property revenue increased $2.0 million to $110.6 million for the three months ended March 31, 2026 compared to $108.6 million for the three months ended March 31, 2025.

The percentage leased was as follows for each segment as of March 31, 2026 and 2025:

Total property revenue increased $3.5 million, or 2%, to $220.1 million for the six months ended June 30, 2026 compared to $216.5 million for the six months ended June 30, 2025.

The percentage leased was as follows for each segment as of June 30, 2026 and 2025:

Percentage Leased (1)

4 unchanged sentences

92.2 % 95.0 %

(1) The percentage leased includes the square footage under lease, including leases which may not have commenced as of March 31, 2026 or 2025, as applicable.

Leased units for our multifamily properties include total units leased and occupied as of the applicable date.

Percentage leased for our multifamily properties includes total units leased and occupied as of the applicable date.

(2) Includes the retail portion of the mixed-use property only.

2 unchanged sentences

Rental revenue includes minimum base rent, cost reimbursements, percentage rents and other rents.

Rental revenue increased $1.5 million, or 1%, to $104.4 million for the three months ended March 31, 2026 compared to $103.0 million for the three months ended March 31, 2025.

Rental revenue increased $3.5 million, or 2%, to $207.5 million for the six months ended June 30, 2026 compared to $204.0 million for the six months ended June 30, 2025.

Rental revenue by segment was as follows (dollars in thousands):

Total Portfolio Same-Store Portfolio (1)

Three Months Ended March 31, Change % Three Months Ended March 31, Change %

Six Months Ended June 30, Change % Six Months Ended June 30, Change %

2026 2025 2026 2025

4 unchanged sentences

$ 207,537 $ 204,021 $ 3,516 2 % $ 201,570 $ 200,702 $ 868 — %

(1) For this table and tables following, the same-store portfolio excludes:

(1) For this table and the tables following, the same-store portfolio excludes:

(i) Del Monte Center (retail), which was sold on February 25, 2025;

(ii) Genesee Park (multifamily), which was acquired on February 28, 2025, (iii) La Jolla Commons III (office), which was placed into service on April 1, 2025 and (iv) land held for development (office).

Office rental revenue increased $1.5 million for the three months ended March 31, 2026 compared to the three months ended March 31, 2025 primarily due to new tenant leases at La Jolla Commons III.

Same-store office rental revenue increased $0.7 million primarily due to an increase in occupancy and base rent at City Center Bellevue, Timber Ridge and Lloyd Portfolio.

These increases were offset by lower occupancy at First & Main.

Retail rental revenue decreased $1.3 million for the three months ended March 31, 2026 compared to the three months ended March 31, 2025 primarily due to the sale of Del Monte Center on February 25, 2025.

Same-store retail revenue increased $0.3 million primarily due to new tenant leases and scheduled rent increases at Alamo Quarry Market.

Multifamily rental revenue increased $1.1 million for the three months ended March 31, 2026 compared to the three months ended March 31, 2025 primarily due to the acquisition of Genesee Park.

Same-store multifamily rental revenue increased $0.2 million primarily due to an overall increase in average monthly base rent and overall occupancy.

Same-store average monthly base rent and occupancy was $2,820 and 91.2%, for the three months ended March 31, 2026, respectively, compared to $2,777 and 90.5%, for the three months ended March 31, 2025, respectively.

Total mixed-use rental revenue increased $0.3 million for the three months ended March 31, 2026 compared to the three months ended March 31, 2025 primarily due to an increase in average occupancy and revenue per available room to 91.9% and $305 for the three months ended March 31, 2026, respectively, compared to 84.6% and $298 for the three months ended March 31, 2025, respectively.

Office rental revenue increased $2.0 million for the six months ended June 30, 2026 compared to the six months ended June 30, 2025 primarily due to new tenant leases commencing at La Jolla Commons III.

Same-store rental revenue decreased $1.2 million primarily due to a tenant relocating from La Jolla Commons I to La Jolla Commons III and the reassessment of the respective straight-line rent.

Additionally, the decrease was due to lower occupancy and annualized base rents at Coastal Collection at Torrey Reserve, 14Acres and First & Main and a one-time reserve for certain receivables related to an office tenant at Coastal Collection at Torrey Reserve.

The company continues to pursue recovery of the outstanding amounts.

These decreases were partially offset by new leases at City Center Bellevue, Timber Ridge and One Beach Street.

Retail rental revenue decreased $0.7 million for the six months ended June 30, 2026 compared to the six months ended June 30, 2025 primarily due to the sale of Del Monte Center on February 25, 2025.

Same-store retail rental revenue increased $1.0 million primarily due to new tenant leases and scheduled rent increases at Alamo Quarry Market, Lomas Santa Fe Plaza and Carmel Country Plaza.

Additionally, there was an increase in cost recoveries of $0.2 million.

Multifamily revenue increased $1.3 million for the six months ended June 30, 2026 compared to the six months ended June 30, 2025 primarily due to the acquisition of Genesee Park.

Same-store multifamily revenue increased $0.2 million due to an increase in average monthly base rent and occupancy, which was $2,833 and 89.8% for the six months ended June 30, 2026 compared to $2,784 and 89.7% for the six months ended June 30, 2025.

Mixed-use rental revenue increased $0.9 million for the six months ended June 30, 2026 compared to the six months ended June 30, 2025 primarily due to an increase of $0.5 million in rental revenue at our retail portion of our mixed-use property due to collections of previously reserved bad debt.

Additionally there was an increase at the hotel portion of our mixed-use property due to an increase in average occupancy and revenue per available room to 91.2% and $306 for the six months ended June 30, 2026, respectively, compared to 85.3% and $302 for the six months ended June 30, 2025, respectively.

Other property income .

Other property income increased $0.5 million, or 9%, to $6.2 million for the three months ended March 31, 2026 compared to $5.7 million for the three months ended March 31, 2025.

Other property income remained flat at $12.5 million for the six months ended June 30, 2026 and the six months ended June 30, 2025.

Other property income by segment was as follows (dollars in thousands):

Total Portfolio Same-Store Portfolio

Three Months Ended March 31, Change % Three Months Ended March 31, Change %

Six Months Ended June 30, Change % Six Months Ended June 30, Change %

2026 2025 2026 2025

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$ 12,538 $ 12,519 $ 19 — % $ 12,431 $ 12,481 $ (50) — %

Multifamily other property income increased $0.3 million for the three months ended March 31, 2026 compared to the three months ended March 31, 2025 primarily due to an increase in parking income and other operating income at Hassalo on Eighth - Multifamily.

Mixed-use other property income increased $0.2 million for the three months ended March 31, 2026 compared to the three months ended March 31, 2025 primarily due to an increase in resort fee income driven by higher occupancy at the hotel portion of our mixed-use property and parking income at the retail portion of our mixed-use property.

Office other property income decreased $0.6 million for the six months ended June 30, 2026 compared to the six months ended June 30, 2025 primarily due to lease termination fees received at Timber Ridge and lease settlement income received at City Center Bellevue during 2025, which were partially offset by an increase in parking garage income at La Jolla Commons and Lloyd Portfolio.

Retail other property income decreased $0.1 million for the six months ended June 30, 2026 compared to the six months ended June 30, 2025 primarily due to lease termination fees received at Alamo Quarry Market during 2025.

Multifamily other property income increased $0.3 million for the six months ended June 30, 2026 compared to the six months ended June 30, 2025 primarily due to an increase in parking income and other operating income at Hassalo on Eighth - Multifamily.

Total mixed-use other property income increased $0.4 million for the six months ended June 30, 2026 compared to the six months ended June 30, 2025 primarily due to an increase in room-related other income driven by higher occupancy at the hotel portion of our mixed-use property and higher parking income at the retail portion of our mixed-use property.

Property Expenses

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Total property expenses consist of rental expenses and real estate taxes.

Total property expenses increased $2.4 million, or 6%, to $43.7 million for the three months ended March 31, 2026 compared to $41.3 million for the three months ended March 31, 2025.

Total property expenses increased by $3.6 million to $85.2 million for the six months ended June 30, 2026, compared to $81.6 million for the six months ended June 30, 2025.

This increase in total property expenses was attributable primarily to the factors discussed below .

Rental Expenses.

Rental expenses increased $1.4 million, or 5%, to $31.7 million for the three months ended March 31, 2026 compared to $30.3 million for the three months ended March 31, 2025.

Rental expenses increased $3.5 million, or 6%, to $63.5 million for the six months ended June 30, 2026, compared to $60.0 million for the six months ended June 30, 2025.

Rental expense by segment was as follows (dollars in thousands):

Total Portfolio Same-Store Portfolio

Three Months Ended March 31, Change % Three Months Ended March 31, Change %

Six Months Ended June 30, Change % Six Months Ended June 30, Change %

2026 2025 2026 2025

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$ 63,489 $ 59,978 $ 3,511 6 % $ 61,140 $ 57,367 $ 3,773 7 %

Office rental expense increased $0.9 million for the three months ended March 31, 2026 compared to the three months ended March 31, 2025 primarily due to an increase at La Jolla Commons Tower III related to new operations and amenities.

Same-store office rental expense increased $0.7 million due to an increase in facilities services expense, utilities expense and repairs and maintenance expense.

Retail rental expense decreased $0.6 million for the three months ended March 31, 2026 compared to the three months ended March 31, 2025 primarily due to the sale of Del Monte Center in the first quarter of 2025.

Same-store retail rental expense increased $0.2 million due to an increase in repairs and maintenance expense and marketing expense.

Multifamily rental expense increased $0.6 million for the three months ended March 31, 2026 compared to the three months ended March 31, 2025 primarily due to the acquisition of Genesee Park.

Same-store multifamily rental expense increased $0.2 million due to an overall increase in facilities services expense and repairs and maintenance expense across our other multifamily properties.

Mixed-use rental expense increased $0.5 million for the three months ended March 31, 2026 compared to the three months ended March 31, 2025 primarily due to an increase in room-related expenses and excise tax at the hotel portion of our mixed-use property and an increase in personnel expense at the retail portion of our mixed-use property.

Office rental expenses increased $2.2 million for the six months ended June 30, 2026 compared to the six months ended June 30, 2025 primarily due to a $1.9 million increase in same-store office rental expenses due to higher utilities, facilities services, and repairs and maintenance expenses, as well as increased expenses at La Jolla Commons Tower III related to new operations and amenities.

Retail rental expenses decreased $0.5 million for the six months ended June 30, 2026 compared to the six months ended June 30, 2025 primarily due to the sale of Del Monte Center in the first quarter of 2025.

Same-store retail rental expenses increased $0.3 million due to an increase in repairs and maintenance expense, facilities service expense and marketing expense.

Multifamily rental expenses increased $0.7 million for the six months ended June 30, 2026 compared to the six months ended June 30, 2025 primarily due to an increase in repairs and maintenance expense and security expense at Pacific Ridge Apartments, Genesee Park and Hassalo on Eighth - Multifamily.

These increases were partially offset by a decrease in contract labor expenses at Pacific Ridge Apartments and Genesee Park.

Total mixed-use rental expenses increased $1.3 million for the six months ended June 30, 2026 compared to the six months ended June 30, 2025 primarily due to an increase in room-related expenses and excise tax at the hotel portion of our mixed-use property and an increase in personnel expense at the retail portion of our mixed-use property.

Real Estate Taxes.

Real estate taxes increased $0.9 million, or 9%, to $11.9 million for the three months ended March 31, 2026 compared to $11.0 million for the three months ended March 31, 2025.

Real estate tax expense stayed flat at $21.7 million for the six months ended June 30, 2026, compared to the six months ended June 30, 2025.

Real estate tax expense by segment was as follows (dollars in thousands):

Total Portfolio Same-Store Portfolio

Three Months Ended March 31, Change % Three Months Ended March 31, Change %

Six Months Ended June 30, Change % Six Months Ended June 30, Change %

2026 2025 2026 2025

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$ 21,737 $ 21,650 $ 87 — % $ 20,329 $ 21,033 $ (704) (3) %

Office real estate taxes increased $0.4 million for the three months ended March 31, 2026 compared to the three months ended March 31, 2025 primarily due to an increase in real estate taxes at La Jolla Commons III due to the fact that we stopped capitalizing real estate taxes when the building was placed into service on April 1, 2025.

Retail real estate taxes increased $0.2 million for the three months ended March 31, 2026 compared to the three months ended March 31, 2025 primarily due to real estate tax refunds received at Del Monte Center in 2025.

Same-store retail real estate taxes increased $0.1 million primarily due to tax consultant fees at Waikele Center.

Multifamily real estate taxes increased $0.3 million for the three months ended March 31, 2026 compared to the three months ended March 31, 2025 primarily due to the acquisition of Genesee Park.

Same-store multifamily real estate taxes increased $0.1 million primarily due to higher tax assessments at Pacific Ridge Apartments and Loma Palisades.

Office real estate taxes decreased $1.2 million for the six months ended June 30, 2026 compared to the six months ended June 30, 2025 primarily due to real estate tax refunds received at La Jolla Commons and Lloyd Portfolio, partially offset by an increase in tax consultant fees and an increase in real estate taxes at La Jolla Commons III due to the fact that we ceased capitalization of real estate taxes when the building was placed into service on April 1, 2025.

Retail real estate taxes increased $0.6 million for the six months ended June 30, 2026 compared to the six months ended June 30, 2025 primarily due to an increase in property tax assessments at Alamo Quarry Market, Lomas Santa Fe Plaza and Southbay Marketplace.

Additionally, there was an increase at Alamo Quarry Market due to real estate tax refunds received during 2025.

Multifamily real estate taxes increased $0.6 million for the six months ended June 30, 2026 compared to the six months ended June 30, 2025 primarily due to the acquisition of Genesee Park and an increase in property tax assessments and real estate tax refunds received during 2025 at Pacific Ridge Apartments.

Property Operating Income

Property operating income decreased $0.4 million, or 1%, to $66.9 million for the three months ended March 31, 2026, compared to $67.3 million for the three months ended March 31, 2025.

Property operating income decreased $0.1 million to $134.8 million for the six months ended June 30, 2026, compared to $134.9 million for the six months ended June 30, 2025.

Property operating income by segment was as follows (dollars in thousands):

Total Portfolio Same-Store Portfolio

Three Months Ended March 31, Change % Three Months Ended March 31, Change %

Six Months Ended June 30, Change % Six Months Ended June 30, Change %

2026 2025 2026 2025

4 unchanged sentences

$ 134,849 $ 134,912 $ (63) — % $ 132,532 $ 134,783 $ (2,251) (2) %

Office operating income increased $0.2 million for the three months ended March 31, 2026 compared to the three months ended March 31, 2025, primarily due to new tenant leases at La Jolla Commons III, which was offset by an increase in rental expenses due to new operations and amenities and higher real estate taxes at La Jolla Commons III.

Same-store office operating income remained flat as the increase in occupancy and base rents at City Center Bellevue, Timber Ridge and Lloyd Portfolio were offset by lower occupancy at First & Main and higher rental expenses.

Retail operating income decreased $0.9 million for the three months ended March 31, 2026 compared to the three months ended March 31, 2025 primarily due to the sale of Del Monte Center.

Same-store retail operating income remained flat as the increase in new tenant leases and scheduled rent increases at Alamo Quarry Market were offset by higher rental expenses.

Multifamily operating income increased $0.5 million for the three months ended March 31, 2026 compared to the three months ended March 31, 2025 primarily due to the acquisition of Genesee Park and an increase in occupancy and average monthly base rent.

Same-store average monthly base rent and occupancy was $2,820 and 91.2%, respectively, for the three months ended March 31, 2026, compared to $2,777 and 90.5%, respectively, for the three months ended March 31, 2025.

These increases were partially offset by higher rental expenses and real estate taxes.

Total mixed-use operating income decreased $0.1 million for the three months ended March 31, 2026 compared to the three months ended March 31, 2025 primarily due to higher room-related expenses at the hotel portion of our mixed-use property, and an increase in personnel expenses at the retail portion of our mixed-use property.

These decreases were partially offset by an increase in average occupancy and revenue per available room to 91.9% and $305, respectively, for the three months ended March 31, 2026, compared to 84.6% and $298, respectively, for the three months ended March 31, 2025.

Office operating income increased $0.4 million for the six months ended June 30, 2026 compared to the six months ended June 30, 2025, primarily due to new tenant leases at La Jolla Commons III, City Center Bellevue, Timber Ridge and One Beach Street, and real estate tax refunds received at La Jolla Commons and Lloyd Portfolio.

These increases were partially offset by higher rental expenses from new operations and amenities at La Jolla Commons III, and higher utilities expense, facilities services expense and repairs and maintenance expense.

Additionally, the increases were also offset by lower occupancy and annualized base rents at Coastal Collection at Torrey Reserve, 14Acres and First & Main, and a one-time reserve for certain receivables related to an office tenant at Coastal Collection at Torrey Reserve.

The Company continues to pursue recovery of the outstanding amounts.

Retail operating income decreased $0.8 million during the six months ended June 30, 2026 compared to the six months ended June 30, 2025 primarily due to the sale of Del Monte Center on February 25, 2025 and higher real estate taxes from increased property tax assessments at Alamo Quarry Market, Lomas Santa Fe Plaza and Southbay Marketplace, as well as real estate tax refunds received at Alamo Quarry Market during 2025.

These decreases were partially offset by higher same-store rental revenue from new tenant leases and scheduled rent increases at Alamo Quarry Market, Lomas Santa Fe Plaza and Carmel Country Plaza and higher cost recoveries.

Multifamily operating income increased $0.4 million during the six months ended June 30, 2026 compared to the six months ended June 30, 2025 primarily due to higher revenue from the acquisition of Genesee Park and higher same-store revenue from an increase in average monthly base rent and occupancy.

Average monthly base rent and occupancy were $2,833 and 89.8%, respectively, for the six months ended June 30, 2026 compared to $2,784 and 89.7%, respectively, for the six months ended June 30, 2025.

These increases were offset by an increase in rental expenses due to higher repairs and maintenance expense and security expense and an increase in real estate taxes due to increased property tax assessments and real estate tax refunds received during 2025 at Pacific Ridge Apartments.

General and Administrative.

General and administrative expenses decreased $0.5 million, or 6%, for the three months ended March 31, 2026, compared to the three months ended March 31, 2025.

This decrease was primarily due to lower employee-related costs, including, without limitation, with respect to base pay, bonus and benefits for certain salaried and hourly workers.

General and administrative expenses decreased $0.5 million, or 3%, to $17.7 million for the six months ended June 30, 2026, compared to $18.2 million for the six months ended June 30, 2025.

This decrease was primarily due to lower employee-related costs, including, without limitation, with respect to base pay and benefits for certain salaried and hourly workers.

Depreciation and Amortization.

Depreciation and amortization expense increased $1.8 million, or 6%, for the three months ended March 31, 2026, compared to the three months ended March 31, 2025.

This increase was primarily due to $1.1 million related to La Jolla Commons III, which was placed into service on April 1, 2025, $0.2 million related to the acquisition of Genesee Park on February 28, 2025 and new tenant improvements, building improvements and leasing commission assets placed into service.

Depreciation and amortization expense increased $1.7 million, or 3%, to $65.0 million for the six months ended June 30, 2026, compared to $63.3 million for the six months ended June 30, 2025.

This increase was primarily due to $0.8 million related to La Jolla Commons III assets which were placed into service on April 1, 2025.

This increase was also related to new tenant improvements and building improvement assets placed into service.

Interest Expense, net.

Interest expense increased $0.9 million, or 5%, for the three months ended March 31, 2026, compared to the three months ended March 31, 2025.

This increase was primarily due to a decrease in capitalized interest related to La Jolla Commons III being placed into service on April 1, 2025.

Interest expense increased $1.1 million, or 3%, to $39.6 million for the six months ended June 30, 2026 compared to $38.6 million for the six months ended June 30, 2025.

This increase was primarily due to the amortization of the new loan fees associated with the Fourth Amended and Restated Credit Facility entered into on April 1, 2026 and a decrease in capitalized interest related to La Jolla Commons III being placed into service on April 1, 2025.

This increase was partially offset by a decrease in interest expense related to the maturity and repayment of our Series C Notes on February 3, 2025.

Gain on sale of real estate.

The gain on sale of real estate of $44.5 million for the three months ended March 31, 2025, was due to the sale of Del Monte Center on February 25, 2025.

Gain on sale of real estate of $44.5 million during the period relates to our sale of Del Monte Center on February 25, 2025.

Other Income, net.

Other income, net decreased $0.3 million, or 33%, for the three months ended March 31, 2026, compared to the three months ended March 31, 2025.

Other income, net decreased $0.8 million, or 44%, for the six months ended June 30, 2026, compared to the six months ended June 30, 2025.

This decrease was primarily due to lower interest and investment income attributed to a decrease in yield on our average cash balance during the period, partially offset by lower income tax expense.

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The company’s principal source of funding for its dividend payments is distributions it receives from the Operating Partnership.

As of March 31, 2026, the company owned an approximate 78.95% partnership interest in the Operating Partnership.

As of June 30, 2026, the company owned an approximate 78.96% partnership interest in the Operating Partnership.

The remaining approximately 21.04% are owned by non-affiliated investors and certain of the company's directors and executive officers.

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We believe the Operating Partnership’s sources of working capital, specifically its cash flow from operations, and borrowings available under its unsecured line of credit, are adequate for it to make its distribution payments to the company and, in turn, for the company to make its dividend payments to its stockholders.

As of March 31, 2026, the company has determined that it has adequate working capital to meet its dividend funding obligations for the next 12 months.

As of June 30, 2026, the company has determined that it has adequate working capital to meet its dividend funding obligations for the next 12 months.

However, we cannot assure you that the Operating Partnership’s sources of capital will continue to be available at all or in amounts sufficient to meet its needs, including its ability to make distribution payments to the company.

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Actual future sales will depend on a variety of factors including, but not limited to, market conditions, the trading price of our common stock and our capital needs.

For the three months ended March 31, 2026, no shares of common stock were sold through the ATM equity program.

For the six months ended June 30, 2026, no shares of common stock were sold through the ATM equity program.

We have no obligation to sell the remaining shares available for sale under the ATM equity program.

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must generally make annual distributions to its stockholders of at least 90% of its net taxable income.

As of March 31, 2026, we held $118.3 million in cash and cash equivalents.

As of June 30, 2026, we held $109.7 million in cash and cash equivalents.

Our short-term liquidity requirements consist primarily of operating expenses and other expenditures associated with our properties, regular debt service requirements, dividend payments to American Assets Trust, Inc.'s stockholders required to maintain its REIT status, distributions to our unitholders, capital expenditures and, potentially, acquisitions.

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Our ability to access the equity capital markets will be dependent on a number of factors as well, including general market conditions for REITs and market perceptions about our company.

Our overall capital requirements for the remainder of 2026 will depend upon acquisition opportunities and the level of improvements and redevelopments on existing properties.

Our overall capital requirements for the remainder of 2026 and for the first half of 2027 will depend upon acquisition opportunities and the level of improvements and redevelopments on existing properties.

Our capital investments will be funded on a short-term basis with, among other sources of capital, cash on hand, cash flow from operations and/or our revolving line of credit.

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We currently do not have any off-balance sheet arrangements.

Comparison of the three months ended March 31, 2026 to the three months ended March 31, 2025

Cash and cash equivalents were $118.3 million and $143.9 million at March 31, 2026 and 2025, respectively.

Net cash provided by operating activities increased $1.7 million to $38.6 million for the three months ended March 31, 2026 compared to $36.9 million for the three months ended March 31, 2025.

Comparison of the six months ended June 30, 2026 to the six months ended June 30, 2025

Cash and cash equivalents were $109.7 million and $143.7 million at June 30, 2026 and 2025, respectively.

Net cash provided by operating activities increased $1.4 million to $87.5 million for the six months ended June 30, 2026 compared to $86.0 million for the six months ended June 30, 2025.

The increase in cash from operations was primarily due to an increase in rental revenue and changes in operating assets and liabilities.

Net cash used in investing activities increased $55.9 million to $23.2 million for the three months ended March 31, 2026 compared to cash provided by investing activities of $32.7 million for the three months ended March 31, 2025.

The increase in cash used in investing activities was primarily due to an increase in capital expenditures related to new tenant improvement projects, leasing commissions and building renovation capital projects.

Net cash used in investing activities increased $59.3 million to $49.7 million for the six months ended June 30, 2026 compared to cash provided by investing activities of $9.6 million for the six months ended June 30, 2025.

The cash provided by investing activities during 2025 was primarily due to the proceeds from the sale of Del Monte Center, offset by the use of cash for the acquisition of Genesee Park.

Net cash used in financing activities decreased $324.9 million to $26.4 million for the three months ended March 31, 2026 compared to $351.3 million for the three months ended March 31, 2025.

Net cash used in financing activities decreased $320.1 million to $57.5 million for the six months ended June 30, 2026 compared to $377.6 million for the six months ended June 30, 2025.

The decrease in cash used in financing activities was primarily due to the repayment of the $225 million aggregate outstanding balance on our Term Loan B and Term Loan C on January 2, 2025 and the repayment of the $100 million outstanding balance on our Series C Notes, on February 3, 2025.

This was partially offset by an increase in debt issuance costs related to the Fourth Amended and Restated Credit Facility entered into on April 1, 2026.

Net Operating Income

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Other companies may use different methods for calculating NOI or similarly entitled measures and, accordingly, our NOI may not be comparable to similarly entitled measures reported by other companies that do not define the measure exactly as we do.

The following is a reconciliation of our NOI to net income for the three months ended March 31, 2026 and 2025 computed in accordance with GAAP (in thousands):

Three Months Ended March 31,

The following is a reconciliation of our NOI to net income for the three and six months ended June 30, 2026 and 2025 computed in accordance with GAAP (in thousands):

Three Months Ended June 30, Six Months Ended June 30,

2026 2025 2026 2025

Net operating income $ 67,923 $ 67,610 $ 134,849 $ 134,912

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FFO also should not be used as a supplement to or substitute for cash flow from operating activities computed in accordance with GAAP.

The following table sets forth a reconciliation of our net income for the three months ended March 31, 2026 to FFO, the nearest GAAP equivalent (in thousands, except per share and share data):

Three Months Ended March 31,

The following table sets forth a reconciliation of our net income for the three and six months ended June 30, 2026 to FFO, the nearest GAAP equivalent (in thousands, except per share and share data):

Three Months Ended June 30, Six Months Ended June 30,

2026 2025 2026 2025

Funds from Operations (FFO)

Net income $ 6,790 $ 7,121 $ 13,529 $ 61,228

Real estate depreciation and amortization 32,311 30,494

Depreciation and amortization of real estate assets 32,712 32,782 65,023 63,276

Gain on sale of real estate — — — (44,476)

Funds from operations 39,502 39,903 78,552 80,028

Nonforfeitable dividends on incentive restricted stock awards (216) (180)

Nonforfeitable dividends on restricted stock awards (216) (180) (432) (360)

FFO attributable to common stock and units $ 39,286 $ 39,723 $ 78,120 $ 79,668

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 2. Management’s Discussion and Analysis