What changed in this filing

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Item 2. Management’s Discussion and Analysis

2023-10-30 compared with 2023-07-31 · 126 added, 130 removed, 281 unchanged (48% of the section changed)

9 unchanged sentences

We own and operate one of the largest publicly-traded open-air retail portfolios by gross leasable area (“GLA”) in the United States (“U.S.”), comprised primarily of community and neighborhood shopping centers.

As of June 30, 2023, our portfolio was comprised of 365 shopping centers (the “Portfolio”) totaling approximately 65 million square feet of GLA.

As of September 30, 2023, our portfolio was comprised of 364 shopping centers (the “Portfolio”) totaling approximately 65 million square feet of GLA.

Our high-quality national Portfolio is primarily located within established trade areas in the top 50 Core-Based Statistical Areas in the U.S., and our shopping centers are primarily anchored by non-discretionary and value-oriented retailers, as well as consumer-oriented service providers.

As of June 30, 2023, our three largest tenants by annualized base rent (“ABR”) were The TJX Companies, Inc.

As of September 30, 2023, our three largest tenants by annualized base rent (“ABR”) were The TJX Companies, Inc.

(“TJX”), The Kroger Co.

22 unchanged sentences

Leasing Highlights

As of June 30, 2023, billed and leased occupancy were 90.4% and 94.1%, respectively, as compared to 89.0% and 92.5%, respectively, as of June 30, 2022.

The following table summarizes our executed leasing activity for the three months ended June 30, 2023 and 2022 (dollars in thousands, except for per square foot (“PSF”) amounts):

For the Three Months Ended June 30, 2023

As of September 30, 2023, billed and leased occupancy were 90.0% and 93.9%, respectively, as compared to 89.6% and 93.3%, respectively, as of September 30, 2022.

The following table summarizes our executed leasing activity for the three months ended September 30, 2023 and 2022 (dollars in thousands, except for per square foot (“PSF”) amounts):

For the Three Months Ended September 30, 2023

Leases GLA New ABR PSF Tenant Improvements and Allowances PSF Third Party Leasing Commissions PSF Rent Spread (1)

4 unchanged sentences

Option leases 59 984,489 13.06 — — 8.2 %

For the Three Months Ended June 30, 2022

For the Three Months Ended September 30, 2022

Leases GLA New ABR PSF Tenant Improvements and Allowances PSF Third Party Leasing Commissions PSF Rent Spread (1)

7 unchanged sentences

ABR PSF includes the GLA of lessee-owned leasehold improvements.

The following table summarizes our executed leasing activity for the six months ended June 30, 2023 and 2022 (dollars in thousands, except for per square foot (“PSF”) amounts):

For the Six Months Ended June 30, 2023

The following table summarizes our executed leasing activity for the nine months ended September 30, 2023 and 2022 (dollars in thousands, except for per square foot (“PSF”) amounts):

For the Nine Months Ended September 30, 2023

Leases GLA New ABR PSF Tenant Improvements and Allowances PSF Third Party Leasing Commissions PSF Rent Spread (1)

4 unchanged sentences

Option leases 177 2,901,728 12.93 — — 8.4 %

For the Six Months Ended June 30, 2022

For the Nine Months Ended September 30, 2022

Leases GLA New ABR PSF Tenant Improvements and Allowances PSF Third Party Leasing Commissions PSF Rent Spread (1)

8 unchanged sentences

Acquisition Activity

• During the six months ended June 30, 2023, we acquired one land parcel for an aggregate purchase price of $1.9 million, including transaction costs and closing credits.

• During the six months ended June 30, 2022, we acquired seven shopping centers, one outparcel, and one land parcel and paid less than $0.1 million related to previously acquired assets for an aggregate purchase price of $409.7 million, including transaction costs and closing credits.

• During the nine months ended September 30, 2023, we acquired one land parcel for an aggregate purchase price of $1.9 million, including transaction costs and closing credits.

• During the nine months ended September 30, 2022, we acquired seven shopping centers, one outparcel, and one land parcel and paid less than $0.1 million related to previously acquired assets for an aggregate purchase price of $409.7 million, including transaction costs and closing credits.

Disposition Activity

• During the six months ended June 30, 2023, we disposed of eight shopping centers and seven partial shopping centers for aggregate net proceeds of $145.3 million, resulting in aggregate gain of $52.1 million and aggregate impairment of $6.1 million.

In addition, during the six months ended June 30, 2023, we received aggregate net proceeds of $0.3 million related to a non-operating asset, resulting in net gain of $0.2 million.

• During the six months ended June 30, 2022, we disposed of ten shopping centers and four partial shopping centers for aggregate net proceeds of $140.0 million, resulting in aggregate gain of $44.8 million and aggregate impairment of $4.6 million.

In addition, during the six months ended June 30, 2022, we resolved contingencies related to previously disposed assets, resulting in net gain of $0.1 million.

• During the nine months ended September 30, 2023, we disposed of nine shopping centers and eight partial shopping centers for aggregate net proceeds of $161.9 million, resulting in aggregate gain of $58.9 million and aggregate impairment of $6.1 million.

In addition, during the nine months ended September 30, 2023, we disposed of a non-operating asset and resolved contingencies related to a previously disposed asset for aggregate net proceeds of $0.3 million, resulting in net gain of $0.1 million.

• During the nine months ended September 30, 2022, we disposed of 11 shopping centers and seven partial shopping centers for aggregate net proceeds of $168.2 million, resulting in aggregate gain of $58.2 million and aggregate impairment of $4.6 million.

In addition, during the nine months ended September 30, 2022, we resolved contingencies related to previously disposed assets and had land at one shopping center seized through eminent domain for aggregate net proceeds of $2.8 million, resulting in net gain of $2.4 million.

Results of Operations

The results of operations discussion is combined for BPG and the Operating Partnership because there are no material differences in the results of operations between the two reporting entities.

Comparison of the Three Months Ended June 30, 2023 to the Three Months Ended June 30, 2022

Comparison of the Three Months Ended September 30, 2023 to the Three Months Ended September 30, 2022

Revenues (in thousands)

Three Months Ended June 30,

Three Months Ended September 30,

2023 2022 $ Change

3 unchanged sentences

Rental income

The increase in rental income for the three months ended June 30, 2023 of $3.3 million, as compared to the corresponding period in 2022, was due to a $7.3 million increase for assets owned for the full period, partially offset by a $4.0 million decrease due to net transaction activity.

The increase in rental income for the three months ended September 30, 2023 of $2.5 million, as compared to the corresponding period in 2022, was due to an $8.2 million increase for assets owned for the full period, partially offset by a $5.7 million decrease due to net transaction activity.

The increase for assets owned for the full period was due to (i) a $7.3 million increase in base rent;

(ii) a $1.8 million increase in expense reimbursements;

(iii) a $0.8 million increase in straight-line rental income, net;

and (iv) a $0.1 million increase in ancillary and other rental income;

partially offset by (v) a $7.0 million decrease associated with revenues deemed uncollectible;

(vi) a $0.6 million decrease in accretion of below-market leases, net of amortization of above-market leases and tenant inducements;

(vii) a $0.4 million decrease in percentage rents;

and (viii) a $0.3 million decrease in lease termination fees.

The $9.5 million increase in base rent for assets owned for the full period was primarily due to contractual rent increases, positive rent spreads for new and renewal leases and option exercises of 13.8% during the six months ended June 30, 2023 and 12.7% during the year ended December 31, 2022, and an increase in weighted average billed occupancy.

The $5.2 million increase in expense reimbursements was primarily attributable to increases in weighted average billed occupancy, reimbursable operating costs, and real estate taxes.

The $7.0 million decrease associated with revenues deemed uncollectible was primarily attributable to reduced cash collections associated with amounts previously reserved.

(iii) a $0.3 million increase associated with revenues deemed uncollectible;

(iv) a $0.3 million increase in lease termination fees;

and (v) a $0.3 million increase in percentage rents;

partially offset by (vi) a $1.2 million decrease in straight-line rental income, net;

(vii) a $0.3 million decrease in accretion of below-market leases, net of amortization of above-market leases and tenant inducements;

and (viii) a $0.3 million decrease in ancillary and other rental income.

The $7.3 million increase in base rent for assets owned for the full period was primarily due to contractual rent increases, positive rent spreads for new and renewal leases and option exercises of 15.2% during the nine months ended September 30, 2023 and 12.7% during the year ended December 31, 2022, and an increase in weighted average billed occupancy.

The $1.8 million increase in expense reimbursements was primarily attributable to increases in weighted average billed occupancy and reimbursable operating costs, net of decreases in reimbursable real estate taxes.

Other revenues

The increase in other revenues for the three months ended June 30, 2023 of $0.4 million as compared to the corresponding period in 2022, was primarily due to an increase in tax increment financing income.

Other revenues remained generally consistent for the three months ended September 30, 2023 as compared to the corresponding period in 2022.

Operating Expenses (in thousands)

Three Months Ended June 30,

Three Months Ended September 30,

2023 2022 $ Change

3 unchanged sentences

Depreciation and amortization 96,254 84,773 11,481

Impairment of real estate assets 16,736 7 16,729

General and administrative 29,182 29,094 88

1 unchanged sentence

Operating costs

The increase in operating costs for the three months ended June 30, 2023 of $1.2 million, as compared to the corresponding period in 2022, was due to a $1.7 million increase in operating costs for assets owned for the full period, primarily due to increases in repairs and maintenance, partially offset by a $0.5 million decrease due to net transaction activity.

The increase in operating costs for the three months ended September 30, 2023 of $1.8 million, as compared to the corresponding period in 2022, was due to a $2.4 million increase in operating costs for assets owned for the full period, primarily due to increases in repairs and maintenance and insurance, partially offset by a $0.6 million decrease due to net transaction activity.

Real estate taxes

The increase in real estate taxes for the three months ended June 30, 2023 of $1.4 million, as compared to the corresponding period in 2022, was due to a $1.4 million increase in real estate taxes for assets owned for the full period, primarily due to an increase in current year assessments, a decrease in real estate tax refunds, and a decrease in favorable adjustments related to prior year assessments.

The decrease in real estate taxes for the three months ended September 30, 2023 of $2.0 million, as compared to the corresponding period in 2022, was due to a $1.3 million decrease in real estate taxes for assets owned for the full period, primarily due to an increase in favorable adjustments related to prior year assessments and an increase in real

estate tax refunds, partially offset by an increase in current year assessments, in addition to a $0.7 million decrease due to net transaction activity.

Depreciation and amortization

The increase in depreciation and amortization for the three months ended June 30, 2023 of $3.7 million, as compared to the corresponding period in 2022, was primarily due to a $4.7 million increase for assets owned for the full period, primarily due to capital expenditures, and an increase in accelerated depreciation and amortization related to tenant move-outs, partially offset by a $1.0 million decrease attributable to net transaction activity.

Impairment of real estate assets

During the three months ended June 30, 2023, aggregate impairment of $16.7 million was recognized on two shopping centers and two partial shopping centers, as a result of disposition activity, and one operating property.

During the three months ended June 30 2022, aggregate impairment of less than $0.1 million was recognized on one shopping center, as a result of disposition activity.

Impairments recognized were due to changes in anticipated hold periods primarily in connection with our capital recycling program.

The increase in depreciation and amortization for the three months ended September 30, 2023 of $11.5 million, as compared to the corresponding period in 2022, was primarily due to a $12.6 million increase for assets owned for the full period, primarily due to an increase in accelerated depreciation and amortization related to tenant move-outs and capital expenditures, partially offset by a $1.1 million decrease attributable to net transaction activity.

General and administrative

The decrease in general and administrative costs for the three months ended June 30, 2023 of $1.2 million, as compared to the corresponding period in 2022, was primarily due to a decrease in net compensation costs.

During the three months ended June 30, 2023 and 2022, construction compensation costs of $4.3 million and $4.3 million, respectively, were capitalized to building and improvements and leasing legal costs of $1.0 million and $0.9 million, respectively, and leasing commission costs of $1.8 million and $2.1 million, respectively, were capitalized to deferred charges and prepaid expenses, net.

General and administrative costs remained generally consistent for the three months ended September 30, 2023, as compared to the corresponding period in 2022.

During the three months ended September 30, 2023 and 2022, construction compensation costs of $4.7 million and $4.4 million, respectively, were capitalized to building and improvements and leasing legal costs of $0.9 million and $0.7 million, respectively, and leasing commission costs of $1.9 million and $2.1 million, respectively, were capitalized to deferred charges and prepaid expenses, net.

Other Income and Expenses (in thousands)

Three Months Ended June 30,

Three Months Ended September 30,

2023 2022 $ Change

7 unchanged sentences

Dividends and interest

Dividends and interest remained generally consistent for the three months ended June 30, 2023 as compared to the corresponding period in 2022.

The increase in dividends and interest for the three months ended September 30, 2023 of $0.2 million, as compared to the corresponding period in 2022 was primarily due to an increase in interest income.

Interest expense

The decrease in interest expense for the three months ended June 30, 2023 of $0.4 million, as compared to the corresponding period in 2022, was primarily due to a lower overall debt obligations, partially offset by a higher weighted average interest rate.

The decrease in interest expense for the three months ended September 30, 2023 of $1.4 million, as compared to the corresponding period in 2022, was primarily due to lower overall debt obligations, partially offset by a higher weighted average interest rate.

Gain on sale of real estate assets

During the three months ended June 30, 2023, three partial shopping centers were disposed of resulting in aggregate gain of $3.6 million.

In addition, during the three months ended June 30, 2023, we received aggregate net proceeds of $0.3 million related to a non-operating asset and resolved contingencies related to a previously disposed asset, resulting in net gain of $0.2 million.

During the three months ended June 30, 2022, four shopping centers and three partial shopping centers were disposed of resulting in aggregate gain of $23.0 million.

Gain (loss) on extinguishment of debt, net

During the three months ended June 30, 2023, we repurchased $199.6 million of the $500.0 million of our 3.65% Senior Notes due 2024 (the "2024 Notes") then outstanding, resulting in a $4.3 million gain on extinguishment of debt.

During the three months ended June 30, 2022, we amended and restated our unsecured credit facility agreements (the "Unsecured Credit Facility"), resulting in a $0.2 million loss on extinguishment of debt due to the acceleration of unamortized debt issuance costs.

The decrease in other expense for the three months ended June 30, 2023 of $0.9 million as compared to the corresponding period in 2022, was primarily due to a decrease in transaction costs.

Comparison of the Six Months Ended June 30, 2023 to the Six Months Ended June 30, 2022

During the three months ended September 30, 2023, one shopping center and one partial shopping center were disposed of resulting in aggregate gain of $6.8 million.

In addition, during the three months ended September 30, 2023, we resolved contingencies related to previously disposed assets, resulting in a net loss of $0.1 million.

During the three months ended September 30, 2022, one shopping center and three partial shopping centers were disposed of resulting in aggregate gain of $13.5 million.

In addition, during the three months ended September 30, 2022, we had land at one shopping center seized through eminent domain resulting in an aggregate gain of $2.3 million.

The decrease in other expense for the three months ended September 30, 2023 of $0.2 million as compared to the corresponding period in 2022, was primarily due to a decrease in transaction costs.

Comparison of the Nine Months Ended September 30, 2023 to the Nine Months Ended September 30, 2022

Revenues (in thousands)

Six Months Ended June 30,

Nine Months Ended September 30,

2023 2022 $ Change

3 unchanged sentences

Rental income

The increase in rental income for the six months ended June 30, 2023 of $16.1 million, as compared to the corresponding period in 2022, was due to a $19.1 million increase for assets owned for the full period, partially offset by a $3.0 million decrease due to net transaction activity.

The increase for assets owned for the full period was due to (i) an $18.4 million increase in base rent;

(ii) a $9.9 million increase in expense reimbursements;

The increase in rental income for the nine months ended September 30, 2023 of $18.5 million, as compared to the corresponding period in 2022, was due to a $26.8 million increase for assets owned for the full period, partially offset by an $8.3 million decrease due to net transaction activity.

The increase for assets owned for the full period was due to (i) a $25.5 million increase in base rent;

(ii) an $11.4 million increase in expense reimbursements;

(iii) a $1.1 million increase in lease termination fees;

(iv) a $0.1 million increase in straight-line rental income, net;

and (v) a less than $0.1 million increase in ancillary and other rental income;

partially offset by (vi) a $9.8 million decrease associated with revenues deemed uncollectible;

and (iv) a $0.2 million increase in percentage rents;

partially offset by (v) a $9.4 million decrease associated with revenues deemed uncollectible;

(vi) a $1.2 million decrease in straight-line rental income, net;

(vii) a $0.5 million decrease in accretion of below-market leases, net of amortization of above-market leases and tenant inducements;

and (viii) a $0.1 million decrease in percentage rents.

The $18.4 million increase in base rent for assets owned for the full period was primarily due to contractual rent increases, positive rent spreads for new and renewal leases and option exercises of 13.8% during the six months ended June 30, 2023 and 12.7% during the year ended December 31, 2022, and an increase in weighted average billed occupancy.

and (viii) a $0.3 million decrease in ancillary and other rental income.

The $25.5 million increase in base rent for assets owned for the full period was primarily due to contractual rent increases, positive rent spreads for new and renewal leases and option exercises of 15.2% during the nine months ended September 30, 2023 and 12.7% during the year ended December 31, 2022, and an increase in weighted average billed occupancy.

The $11.4 million increase in expense reimbursements was primarily attributable to increases in weighted average billed occupancy, reimbursable operating costs, and real estate taxes.

1 unchanged sentence

Other revenues

The increase in other revenues for the six months ended June 30, 2023 of $0.4 million as compared to the corresponding period in 2022, was primarily due to an increase in tax increment financing income.

The increase in other revenues for the nine months ended September 30, 2023 of $0.5 million, as compared to the corresponding period in 2022, was primarily due to an increase in tax increment financing income.

Operating Expenses (in thousands)

Six Months Ended June 30,

Nine Months Ended September 30,

2023 2022 $ Change

7 unchanged sentences

Operating costs

The increase in operating costs for the six months ended June 30, 2023 of $2.3 million, as compared to the corresponding period in 2022, was due to a $3.1 million increase in operating costs for assets owned for the full period, primarily due to increases in repairs and maintenance, partially offset by a $0.8 million decrease due to net transaction activity.

The increase in operating costs for the nine months ended September 30, 2023 of $4.1 million, as compared to the corresponding period in 2022, was due to a $5.7 million increase in operating costs for assets owned for the full period, primarily due to increases in repairs and maintenance, utilities, and insurance, partially offset by a $1.6 million decrease due to net transaction activity.

Real estate taxes

The increase in real estate taxes for the six months ended June 30, 2023 of $4.5 million, as compared to the corresponding period in 2022, was due to a $2.4 million increase in real estate taxes for assets owned for the full period, primarily due to an increase in current year assessments, a decrease in real estate tax refunds, and a decrease in favorable adjustments related to prior year assessments, in addition to a $2.1 million increase in real estate taxes due to net transaction activity.

The increase in real estate taxes for the nine months ended September 30, 2023 of $2.4 million, as compared to the corresponding period in 2022, was due to a $1.9 million increase in real estate taxes due to net transaction activity, in addition to a $0.5 million increase in real estate taxes for assets owned for the full period, primarily due to an increase in current year assessments, partially offset by an increase in favorable adjustments related to prior year assessments and an increase in real estate tax refunds.

Depreciation and amortization

The increase in depreciation and amortization for the six months ended June 30, 2023 of $7.2 million, as compared to the corresponding period in 2022, was primarily due to a $6.7 million increase for assets owned for the full period, primarily due to capital expenditures, and an increase in accelerated depreciation and amortization related to tenant move-outs, and a $0.5 million increase attributable to net transaction activity.

The increase in depreciation and amortization for the nine months ended September 30, 2023 of $18.7 million, as compared to the corresponding period in 2022, was primarily due to a $19.7 million increase for assets owned for the full period, primarily due to capital expenditures and an increase in accelerated depreciation and amortization related to tenant move-outs, partially offset by a $1.0 million decrease attributable to net transaction activity.

Impairment of real estate assets

During the six months ended June 30, 2023, aggregate impairment of $17.8 million was recognized on two shopping centers and two partial shopping centers, as a result of disposition activity, and one operating property.

During the six months ended June 30 2022, aggregate impairment of $4.6 million was recognized on two shopping centers, as a result of disposition activity.

Impairments recognized were due to changes in anticipated hold periods primarily in connection with our capital recycling program.

During the nine months ended September 30, 2023, aggregate impairment of $17.8 million was recognized on two shopping centers and two partial shopping centers, as a result of disposition activity, and one operating property.

During the nine months ended September 30, 2022, aggregate impairment of $4.6 million was recognized on two shopping centers, as a result of disposition activity.

General and administrative

General and administrative costs remained generally consistent for the six months ended June 30, 2023, as compared to the corresponding period in 2022.

During the six months ended June 30, 2023 and 2022, construction compensation costs of $8.9 million and $8.5 million, respectively, were capitalized to building and improvements and leasing legal costs of $2.4 million and $2.5 million, respectively, and leasing commission costs of $4.0 million and $3.9 million, respectively, were capitalized to deferred charges and prepaid expenses, net.

General and administrative costs remained generally consistent for the nine months ended September 30, 2023, as compared to the corresponding period in 2022.

During the nine months ended September 30, 2023 and 2022, construction compensation costs of $13.6 million and $12.9 million, respectively, were capitalized to building and improvements and leasing legal costs of $3.3 million and $3.1 million, respectively, and leasing commission costs of $5.9 million and $6.0 million, respectively, were capitalized to deferred charges and prepaid expenses, net.

Other Income and Expenses (in thousands)

Six Months Ended June 30,

Nine Months Ended September 30,

2023 2022 $ Change

7 unchanged sentences

Dividends and interest

Dividends and interest remained generally consistent for the six months ended June 30, 2023 as compared to the corresponding period in 2022.

The increase in dividends and interest for the nine months ended September 30, 2023 of $0.1 million, as compared to the corresponding period in 2022 was primarily due to an increase in interest income.

Interest expense

The increase in interest expense for the six months ended June 30, 2023 of $1.0 million, as compared to the corresponding period in 2022, was primarily due to a higher weighted average interest rate, partially offset by lower overall debt obligations.

The decrease in interest expense for the nine months ended September 30, 2023 of $0.4 million, as compared to the corresponding period in 2022, was primarily due to an increase in capitalized interest.

Gain on sale of real estate assets

During the six months ended June 30, 2023, six shopping centers and five partial shopping centers were disposed of resulting in aggregate gain of $52.1 million.

In addition, during the six months ended June 30, 2023, we received aggregate net proceeds of $0.3 million related to a non-operating asset, resulting in net gain of $0.2 million.

During the six months ended June 30, 2022, eight shopping centers and four partial shopping centers were disposed of resulting in aggregate gain of $44.8 million.

In addition, during the six months ended June 30, 2022, we resolved contingencies related to previously disposed assets resulting in net gain of $0.1 million.

During the nine months ended September 30, 2023, seven shopping centers and six partial shopping centers were disposed of resulting in aggregate gain of $58.9 million.

In addition, during the nine months ended September 30, 2023, we disposed of a non-operating asset and resolved contingencies relating to a previously disposed asset, resulting in net gain of $0.1 million.

During the nine months ended September 30, 2022, nine shopping centers and seven partial shopping centers were disposed of resulting in aggregate gain of $58.2 million.

Gain (loss) on extinguishment of debt, net

During the six months ended June 30, 2023, we repurchased $199.6 million of the $500.0 million of our 2024 Notes then outstanding, resulting in a $4.3 million gain on extinguishment of debt.

During the six months ended June 30, 2022, we amended and restated our Unsecured Credit Facility, resulting in a $0.2 million loss on extinguishment of debt due to the acceleration of unamortized debt issuance costs.

The decrease in other expense for the six months ended June 30, 2023 of $1.1 million as compared to the corresponding period in 2022, was primarily due to a decrease in transaction costs.

During the nine months ended September 30, 2023, we repurchased $199.6 million of the $500.0 million of our 2024 Notes then outstanding, resulting in a $4.4 million gain on extinguishment of debt.

During the nine months ended September 30, 2022, we amended and restated our unsecured credit facility agreements (the "Unsecured

Credit Facility"), resulting in a $0.2 million loss on extinguishment of debt due to the acceleration of unamortized debt issuance costs.

The decrease in other expense for the nine months ended September 30, 2023 of $1.3 million, as compared to the corresponding period in 2022, was primarily due to a decrease in transaction costs.

Liquidity and Capital Resources

3 unchanged sentences

• operating cash flow;

• available borrowings under the Unsecured Credit Facility (defined herein);

• available borrowings under the Unsecured Credit Facility;

• issuance of long-term debt;

4 unchanged sentences

• leasing capital expenditures;

• value-enhancing reinvestment capital expenditures;

• dividend/distribution payments;

• value-enhancing reinvestment capital expenditures;

• acquisitions;

4 unchanged sentences

Our Unsecured Credit Facility is comprised of a $1.25 billion revolving loan facility (the "Revolving Facility") and a $300.0 million term loan facility, in addition to a $200.0 million delayed draw term loan, which was drawn on April 24, 2023 (together the "Term Loan Facility").

As of June 30, 2023, we had $1.26 billion of available liquidity, including $1.25 billion available under our Revolving Facility and $14.9 million of cash and cash equivalents and restricted cash.

to continue to enhance our financial and operational flexibility through periodic extensions of the duration of our debt.

As of September 30, 2023, we had $1.26 billion of available liquidity, including $1.24 billion available under our Revolving Facility and $18.7 million of cash and cash equivalents and restricted cash.

We intend to continue to enhance our financial and operational flexibility through periodic extensions of the duration of our debt.

Material Cash Requirements

Our expected material cash requirements for the twelve months ended June 30, 2024 and thereafter are comprised of (i) contractually obligated expenditures;

Our expected material cash requirements for the twelve months ended September 30, 2024 and thereafter are comprised of (i) contractually obligated expenditures;

(ii) other essential expenditures;

1 unchanged sentence

Contractually Obligated Expenditures

The following table summarizes our debt maturities (excluding extension options), interest payment obligations, and obligations under non-cancelable operating leases (excluding renewal options), as of June 30, 2023 (dollars in millions):

Contractually Obligated Expenditures Twelve

June 30, 2024 Thereafter

September 30, 2024 Thereafter

Debt maturities (1)

4 unchanged sentences

(1) Amounts presented do not assume the issuance of new debt upon maturity of existing debt.

(2) Scheduled interest payments for variable rate loans are presented using rates (including the impact of interest rate swaps), as of June 30, 2023.

(2) Scheduled interest payments for variable rate loans are presented using rates (including the impact of interest rate swaps), as of September 30, 2023.

“Quantitative and Qualitative Disclosures about Market Risk” in our Annual Report on Form 10-K for the year ended December 31, 2022 for a further discussion of these and other factors that could impact interest payments.

9 unchanged sentences

We incur corporate level expenses such as employee compensation costs, professional fees, corporate office rents, and other platform expenses.

The amount of corporate level expenses we incur depends on the size and composition of our Portfolio and platform and prevailing market wages and rates.

The amount of corporate level expenses that we incur depends on the size and composition of our Portfolio and platform and prevailing market wages and rates.

Leases typically provide for the reimbursement of property operating expenses such as common area expenses, utilities, insurance, and real estate taxes, and certain capital expenditures related to the maintenance of our properties.

3 unchanged sentences

Our board of directors evaluates our dividend on a quarterly basis, taking into account a variety of relevant factors, including REIT taxable income.

The following table summarizes our dividend activity for the second and third quarters of 2023:

Quarter 2023 Third

The following table summarizes our dividend activity for the third and fourth quarters of 2023:

Quarter 2023 Fourth

Dividend declared per common share $ 0.2600 $ 0.2725

Dividend declaration date April 26, 2023 July 26, 2023

Dividend record date July 5, 2023 October 3, 2023

Dividend payable date July 17, 2023 October 16, 2023

Dividend declaration date July 26, 2023 October 24, 2023

Dividend record date October 3, 2023 January 3, 2024

Dividend payable date October 16, 2023 January 16, 2024

Opportunistic Expenditures

We also utilize cash for opportunistic expenditures such as value-enhancing reinvestment and acquisition activity.

The amount of value-enhancing reinvestment capital expenditures that we may incur in future periods is contingent on a variety of factors that may change from period to period, such as the number, total expected cost, and nature of value-enhancing reinvestment projects that are underway.

The amount of value-enhancing reinvestment capital expenditures that we incur depends on a variety of factors that may change from period to period, such as the number, total expected cost, and nature of value-enhancing

reinvestment projects that are underway.

See “Improvements to and investments in real estate assets” below for further information regarding our in-process reinvestment projects and our pipeline of future redevelopment projects.

The amount of future acquisition activity depends on the availability of opportunities that further concentrate our Portfolio in attractive retail submarkets and optimize the quality and long-term growth rate of our asset base.

The amount of future acquisition expenditures depends on the availability of opportunities that further concentrate our Portfolio in attractive retail submarkets and optimize the quality and long-term growth rate of our asset base.

Our acquisition strategy focuses on buying assets with strong growth potential that are located in our existing markets and will allow us to leverage our operational platform and expertise to create value.

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Brixmor Property Group Inc .

Six Months Ended June 30,

Nine Months Ended September 30,

2023 2022 $ Change

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Brixmor Operating Partnership LP

Six Months Ended June 30,

Nine Months Ended September 30,

2023 2022 $ Change

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Operating Activities

Net cash provided by operating activities primarily consists of cash inflows from tenant rental payments and expense reimbursements and cash outflows for property operating expenses, general and administrative expenses, and interest expense.

During the six months ended June 30, 2023, our net cash provided by operating activities increased $20.8 million as compared to the corresponding period in 2022.

The increase was primarily due to (i) an increase from net working capital;

(ii) an increase in same property net operating income;

Net cash provided by operating activities primarily consists of cash inflows from tenant rental payments and expense reimbursements and cash outflows for property operating costs, real estate taxes, general and administrative expenses, and interest expense.

During the nine months ended September 30, 2023, our net cash provided by operating activities increased $12.4 million as compared to the corresponding period in 2022.

The increase was primarily due to (i) an increase in same property net operating income;

(ii) an increase from net working capital;

and (iii) an increase in lease termination fees;

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Net cash used in investing activities is primarily impacted by the nature, timing, and magnitude of acquisition and disposition activity and improvements to and investments in our shopping centers, including capital expenditures associated with our value-enhancing reinvestment activity.

During the six months ended June 30, 2023, our net cash used in investing activities decreased $404.7 million as compared to the corresponding period in 2022.

The increase was primarily due to (i) a decrease of $407.8 million in acquisitions of real estate assets;

(ii) an increase of $5.6 million in net proceeds from sales of real estate assets;

and (iii) an increase of $0.4 million in proceeds from sales of marketable securities, net of purchases;

partially offset by (iv) an increase of $9.1 million in improvements to and investments in real estate assets.

During the nine months ended September 30, 2023, our net cash used in investing activities decreased $381.5 million as compared to the corresponding period in 2022.

The decrease was primarily due to (i) a decrease of $407.8 million in acquisitions of real estate assets and (ii) a decrease of $3.8 million in purchases of marketable securities, net of sales;

partially offset by (iii) an increase of $21.3 million in improvements to and investments in real estate

and (iv) a decrease of $8.8 million in net proceeds from sales of real estate assets.

Improvements to and investments in real estate assets

During the six months ended June 30, 2023 and 2022, we expended $156.1 million and $147.0 million, respectively, on improvements to and investments in real estate assets.

Included in these amounts are insurance proceeds of $0.2 million and $2.2 million, respectively, which were received during the six months ended June 30, 2023 and 2022.

During the nine months ended September 30, 2023 and 2022, we expended $254.4 million and $233.1 million, respectively, on improvements to and investments in real estate assets.

Included in these amounts are insurance proceeds of $0.5 million and $3.3 million, respectively, which were received during the nine months ended September 30, 2023 and 2022.

Maintenance capital expenditures represent costs to fund major replacements and betterments to our properties.

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Such initiatives are tenant driven and focus on upgrading our centers with strong, best-in-class retailers and enhancing the overall merchandise mix and tenant quality of our Portfolio.

As of June 30, 2023, we had 50 in-process anchor space repositioning, redevelopment, and outparcel development projects with an aggregate anticipated cost of $435.5 million, of which $240.9 million had been incurred as of June 30, 2023.

In addition, we have identified a pipeline of future redevelopment projects aggregating approximately $950 million of potential capital investment, which we expect to execute over the next several years.

As of September 30, 2023, we had 55 in-process anchor space repositioning, redevelopment, and outparcel development projects with an aggregate anticipated cost of $490.7 million, of which $263.6 million had been incurred as of September 30, 2023.

In addition, we have identified a pipeline of future redevelopment projects aggregating over $900 million of potential capital investment, which we expect to execute over the coming years.

We expect to fund these projects with cash and cash equivalents, net cash provided by operating activities, proceeds from sales of real estate assets, and/or proceeds from capital markets transactions.

Acquisitions of and proceeds from sales of real estate assets

We continue to evaluate the market for acquisition opportunities and we may acquire shopping centers when we believe strategic opportunities exist, particularly where we can further concentrate our Portfolio in attractive retail submarkets and optimize the quality and long-term growth rate of our asset base.

During the six months ended June 30, 2023, we acquired one land parcel for an aggregate purchase price of $1.9 million, including transaction costs and closing credits.

During the six months ended June 30, 2022, we acquired seven shopping centers, one outparcel, and one land parcel and paid less than $0.1 million related to previously acquired assets for an aggregate purchase price of $409.7 million, including transaction costs and closing credits.

We continue to evaluate the market for acquisition opportunities and we may acquire shopping centers when we believe strategic opportunities exist, to further concentrate our Portfolio in attractive retail submarkets and optimize the quality and long-term growth rate of our asset base.

During the nine months ended September 30, 2023, we acquired one land parcel for an aggregate purchase price of $1.9 million, including transaction costs and closing credits.

During the nine months ended September 30, 2022, we acquired seven shopping centers, one outparcel, and one land parcel and paid less than $0.1 million related to previously acquired assets for an aggregate purchase price of $409.7 million, including transaction costs and closing credits.

We may also dispose of properties when we believe value has been maximized, where there is downside risk, or where we have limited ability or desire to build critical mass in a particular submarket.

During the six months ended June 30, 2023, we disposed of eight shopping centers and seven partial shopping centers for aggregate net proceeds of $145.3 million.

In addition, during the six months ended June 30, 2023, we received aggregate net proceeds of $0.3 million related to a non-operating asset.

During the six months ended June 30, 2022, we disposed of ten shopping centers and four partial shopping centers for aggregate net proceeds of $140.0 million.

During the nine months ended September 30, 2023, we disposed of nine shopping centers and eight partial shopping centers for aggregate net proceeds of $161.9 million.

In addition, during the nine months ended September 30, 2023, we received aggregate net proceeds of $0.3 million related to a non-operating asset.

During the nine months ended September 30, 2022, we disposed of 11 shopping centers and seven partial shopping centers for aggregate net proceeds of $168.2 million.

In addition, during the nine months ended September 30, 2022, we had land at one shopping center seized through eminent domain for aggregate net proceeds of $2.8 million.

Financing Activities

Net cash used in financing activities is primarily impacted by the nature, timing, and magnitude of issuances and repurchases of debt and equity securities, as well as borrowings or principal payments associated with our outstanding indebtedness, including our Unsecured Credit Facility, and distributions made to our common stockholders.

During the six months ended June 30, 2023, our net cash used in financing activities increased $162.9 million as compared to the corresponding period in 2022.

The increase was primarily due to (i) a $109.2 million increase in debt repayments, net of borrowings;

During the nine months ended September 30, 2023, our net cash used in financing activities increased $129.9 million as compared to the corresponding period in 2022.

The increase was primarily due to (i) a $64.2 million decrease in debt borrowings, net of repayments;

(ii) a $53.1 million decrease in issuances of common stock;

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These measures should not be considered as alternatives to, or more meaningful than, net income (calculated in accordance with GAAP) or other GAAP financial measures, as an indicator of financial performance and are not alternatives to, or more meaningful than, cash flow from operating activities (calculated in accordance with GAAP) as a measure of liquidity.

Non-GAAP performance measures have limitations as they do not include all items of income and expense that affect operations, and accordingly, should always be considered as supplemental financial results to those calculated in accordance with GAAP.

Non-GAAP performance measures have limitations as they do not include all items of income and expense that affect operations, and

accordingly, should always be considered as supplemental financial results to those calculated in accordance with GAAP.

Our computation of these non-GAAP performance measures may differ in certain respects from the methodology utilized by other REITs and, therefore, may not be comparable to similarly titled measures presented by such other REITs.

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Considering the nature of our business as a real estate owner and operator, we believe that Nareit FFO is useful to investors in measuring our operating and financial performance because the definition excludes items included in net income that do not relate to or are not indicative of our operating and financial performance, such as depreciation and amortization related to real estate, and items which can make periodic and peer analyses of operating and financial performance more difficult, such as gains and losses from the sale of certain real estate assets and impairment write-downs of certain real estate assets.

Our reconciliation of net income to Nareit FFO for the three and six months ended June 30, 2023 and 2022 is as follows (in thousands, except per share amounts):

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

Our reconciliation of net income to Nareit FFO for the three and nine months ended September 30, 2023 and 2022 is as follows (in thousands, except per share amounts):

Three Months Ended September 30, Nine Months Ended September 30,

2023 2022 2023 2022

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Same property net operating income (“NOI”) is a supplemental, non-GAAP performance measure utilized to evaluate the operating performance of real estate companies.

Same property NOI is calculated (using properties owned for the entirety of both periods and excluding properties under development and completed new development

properties that have been stabilized for less than one year) as total property revenues (base rent, expense reimbursements, adjustments for revenues deemed uncollectible, ancillary and other rental income, percentage rents, and other revenues) less direct property operating expenses (operating costs and real estate taxes).

Same property NOI is calculated (using properties owned for the entirety of both periods and excluding properties under development and completed new development properties that have been stabilized for less than one year) as total property revenues (base rent, expense reimbursements, adjustments for revenues deemed uncollectible, ancillary and other rental income, percentage rents, and other revenues) less direct property operating expenses (operating costs and real estate taxes).

Same property NOI excludes (i) lease termination fees, (ii) straight-line rental income, net, (iii) accretion of below-market leases, net of amortization of above-market leases and tenant inducements, (iv) straight-line ground rent expense, net, (v) income or expense associated with our captive insurance company, (vi) depreciation and amortization, (vii) impairment of real estate assets, (viii) general and administrative expense, and (ix) other income and expense (including interest expense and gain on sale of real estate assets).

Considering the nature of our business as a real estate owner and operator, we believe that NOI is useful to investors in measuring the operating performance of our portfolio because the definition excludes various items included in net income that do not relate to, or are not indicative of, the operating performance of our properties, such as lease termination fees, straight-line rental income, net, accretion of below-market leases, net of amortization of above-market leases and tenant inducements, straight-line ground rent expense, net, depreciation and amortization, impairment of real estate assets, general and administrative expense, and other income and expense (including interest expense and gain on sale of real estate assets).

We believe that same property NOI is also useful to investors because it further eliminates disparities in NOI by only including NOI of properties owned for the entirety of both periods presented and excluding properties under development and completed new development properties that have been stabilized for less than one year, or income or expense associated with our captive insurance company, and therefore provides a more consistent metric for comparing the operating performance of our real estate between periods.

Comparison of the Three and Six Months Ended June 30, 2023 to the Three and Six Months Ended June 30, 2022

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

Considering the nature of our business as a real estate owner and operator, we believe that NOI is useful to investors in measuring the operating performance of our portfolio because the definition excludes various items included in net income that do not relate to, or are not indicative of, the operating performance of our properties, such as lease termination fees, straight-line rental income, net, accretion of below-market leases, net of amortization of above-market leases and tenant inducements, straight-line ground rent expense, net, income or expense associated with our captive insurance company, depreciation and amortization, impairment of real estate assets, general and administrative expense, and other income and expense (including interest expense and gain on sale of real estate assets).

therefore provides a more consistent metric for comparing the operating performance of our real estate between periods.

Comparison of the Three and Nine Months Ended September 30, 2023 to the Three and Nine Months Ended September 30, 2022

Three Months Ended September 30, Nine Months Ended September 30,

2023 2022 Change 2023 2022 Change

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The following table provides a reconciliation of net income to same property NOI for the periods presented (in thousands):

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

Three Months Ended September 30, Nine Months Ended September 30,

2023 2022 2023 2022

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Prior to 2021, inflation was low and had a minimal impact on our operating and financial performance;

however, inflation significantly increased over the last two years and may continue to be elevated or increase further.

however, inflation has significantly increased over the last two years and may continue to be elevated or increase further.

With respect to our shopping centers, our long-term leases generally contain provisions designed to mitigate the adverse impact of inflation, including contractual rent escalations and requirements for tenants to pay a portion of property operating expenses, including common area expenses, utilities, insurance, and real estate taxes, and certain capital expenditures related to the maintenance of our properties, thereby reducing our exposure to increases in property operating expenses resulting from inflation;

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With respect to our outstanding indebtedness, we periodically evaluate our exposure to interest rate fluctuations, and have and may continue to enter into interest rate protection agreements that mitigate, but do not eliminate, the impact of changes in interest rates on our variable rate loans.

With respect to general and administrative costs, we continually seek opportunities to offset inflationary cost pressures through routine evaluations of our spending levels and through ongoing efforts to utilize technology to enhance our operational efficiency.

With respect to general and administrative costs, we continually seek opportunities to offset inflationary cost pressures through routine

evaluations of our spending levels and through ongoing efforts to utilize technology to enhance our operational efficiency.

Quantitative and Qualitative Disclosures about Market Risk

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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