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Item 2. Management’s Discussion and Analysis

2024-10-28 compared with 2024-07-29 · 125 added, 125 removed, 285 unchanged (47% 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, 2024, our portfolio was comprised of 360 shopping centers (the "Portfolio") totaling approximately 64 million square feet of GLA.

As of September 30, 2024, our portfolio was comprised of 360 shopping centers (the "Portfolio") totaling approximately 63 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, 2024, our three largest tenants by annualized base rent ("ABR") were The TJX Companies, Inc.

As of September 30, 2024, our three largest tenants by annualized base rent ("ABR") were The TJX Companies, Inc.

("TJX"), The Kroger Co.

11 unchanged sentences

• Fully-Integrated Operating Platform – We manage a fully-integrated operating platform, leveraging our national scope and demonstrating our commitment to operating with a strong regional and local presence.

We provide our tenants with dedicated service through both our national accounts leasing team based in New York and our network of four regional offices in Atlanta, Chicago, Philadelphia, and San Diego, as well as our 11 leasing and property management satellite offices throughout the country.

We provide our tenants with dedicated service through both our national accounts leasing team based in New York and our network of three regional offices in Atlanta, Philadelphia, and San Diego, as well as our 11 leasing and property management satellite offices throughout the country.

We believe that this structure enables us to obtain critical national market intelligence, while also benefiting from the regional and local expertise of our leasing and operations teams.

8 unchanged sentences

Leasing Highlights

As of June 30, 2024, billed and leased occupancy were 91.4% and 95.4%, respectively, as compared to 90.4% and 94.1%, respectively, as of June 30, 2023.

The following table summarizes our executed leasing activity for the three months ended June 30, 2024 and 2023 (dollars in thousands, except for per square foot ("PSF") amounts):

For the Three Months Ended June 30, 2024

As of September 30, 2024, billed and leased occupancy were 91.9% and 95.6%, respectively, as compared to 90.0% and 93.9%, respectively, as of September 30, 2023.

The following table summarizes our executed leasing activity for the three months ended September 30, 2024 and 2023 (dollars in thousands, except for per square foot ("PSF") amounts):

For the Three Months Ended September 30, 2024

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

4 unchanged sentences

Option leases 53 950,667 10.86 — — 6.9 %

For the Three Months Ended June 30, 2023

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)

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, 2024 and 2023 (dollars in thousands, except for PSF amounts):

For the Six Months Ended June 30, 2024

The following table summarizes our executed leasing activity for the nine months ended September 30, 2024 and 2023 (dollars in thousands, except for PSF amounts):

For the Nine Months Ended September 30, 2024

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

4 unchanged sentences

Option leases 165 3,163,791 11.84 — — 7.1 %

For the Six Months Ended June 30, 2023

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)

8 unchanged sentences

Acquisition Activity

• During the six months ended June 30, 2024, we acquired one shopping center for an aggregate purchase price of $17.5 million, including any transaction costs and closing credits.

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

• During the nine months ended September 30, 2024, we acquired three shopping centers and one land parcel for an aggregate purchase price of $81.9 million, including any 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 any transaction costs and closing credits.

Disposition Activity

• During the six months ended June 30, 2024, we disposed of three shopping centers, one partial shopping center, and one land parcel for aggregate net proceeds of $67.4 million, resulting in aggregate gain of $15.0 million and aggregate impairment of $0.2 million.

In addition, during the six months ended June 30, 2024, we received aggregate net proceeds of $1.9 million related to land at one shopping center previously seized through eminent domain and resolved contingencies related to previously disposed assets, resulting in aggregate gain of $1.9 million.

• 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 nine months ended September 30, 2024, we disposed of five shopping centers, four partial shopping centers, and two land parcels for aggregate net proceeds of $140.0 million, resulting in aggregate gain of $52.1 million and aggregate impairment of $0.5 million.

In addition, during the nine months ended September 30, 2024, we received aggregate net proceeds of $1.9 million related to land at one shopping center previously seized through eminent domain and resolved contingencies related to previously disposed assets, resulting in aggregate gain of $1.9 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 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 $0.1 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, 2024 to the Three Months Ended June 30, 2023

Comparison of the Three Months Ended September 30, 2024 to the Three Months Ended September 30, 2023

Revenues (in thousands)

Three Months Ended June 30,

Three Months Ended September 30,

2024 2023 $ Change

3 unchanged sentences

Rental income

The increase in rental income for the three months ended June 30, 2024 of $6.4 million, as compared to the corresponding period in 2023, was due to a $9.4 million increase for assets owned for the full period, partially offset by a $3.0 million decrease due to net transaction activity.

The increase in rental income for the three months ended September 30, 2024 of $12.9 million, as compared to the corresponding period in 2023, was due to a $14.3 million increase for assets owned for the full period, partially offset by a $1.4 million decrease due to net transaction activity.

The increase for assets owned for the full period was due to (i) an $11.1 million increase in base rent;

(ii) a $0.6 million increase in rental income associated with revenues deemed uncollectible;

(ii) a $5.1 million increase in expense reimbursements;

(iii) a $3.0 million increase in straight-line rental income, net;

(iv) a $0.4 million increase in percentage rents;

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

(vi) a $0.2 million increase in ancillary and other rental income;

and (vii) a $0.2 million increase in accretion of below-market leases, net of amortization of above-market leases and tenant inducements;

partially offset by (viii) a $1.0 million decrease in expense reimbursements.

The $8.2 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 16.8% during the six months ended June 30, 2024 and 15.3% during the year ended December 31, 2023, and an increase in weighted average billed occupancy.

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

partially offset by (v) a $4.2 million decrease in rental income 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 $0.3 million decrease in percentage rents;

and (viii) a $0.1 million decrease in ancillary and other rental income.

The $11.1 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 16.6% during the nine months ended September 30, 2024 and 15.3% during the year ended December 31, 2023, and an increase in weighted average billed occupancy.

Other revenues

The decrease in other revenues for the three months ended June 30, 2024 of $0.5 million as compared to the corresponding period in 2023, was primarily due to a decrease in tax increment financing income.

The increase in other revenues for the three months ended September 30, 2024 of $0.5 million as compared to the corresponding period in 2023, was primarily due to an increase in tax increment financing income.

Operating Expenses (in thousands)

Three Months Ended June 30,

Three Months Ended September 30,

2024 2023 $ Change

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Operating costs

The increase in operating costs for the three months ended June 30, 2024 of $1.2 million, as compared to the corresponding period in 2023, was due to a $2.2 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 $1.0 million decrease due to net transaction activity.

The increase in operating costs for the three months ended September 30, 2024 of $1.4 million, as compared to the corresponding period in 2023, was due to a $2.0 million increase in operating costs for assets owned for the full period, primarily due to an increase in repairs and maintenance, partially offset by a $0.6 million decrease due to net transaction activity.

Real estate taxes

The decrease in real estate taxes for the three months ended June 30, 2024 of $7.4 million, as compared to the corresponding period in 2023, was due to a $6.4 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, a decrease in current year assessments, and an increase in real estate tax refunds, in addition to a $1.0 million decrease due to net

transaction activity.

The increase in real estate taxes for the three months ended September 30, 2024 of $0.7 million, as compared to the corresponding period in 2023, was due to a $1.2 million increase in real estate taxes for assets owned for the full period, primarily due to a decrease in favorable adjustments related to prior year assessments and a decrease in real estate tax refunds, partially offset by a decrease in current year assessments and a $0.5 million decrease due to net transaction activity.

Depreciation and amortization

The increase in depreciation and amortization for the three months ended June 30, 2024 of $3.2 million, as compared to the corresponding period in 2023, was due to a $3.9 million increase for assets owned for the full period primarily due to an increase in capital expenditures, partially offset by a $0.7 million decrease attributable to net transaction activity and a decrease in accelerated depreciation and amortization related to tenant move-outs.

The decrease in depreciation and amortization for the three months ended September 30, 2024 of $1.4 million, as compared to the corresponding period in 2023, was due to a $1.9 million decrease for assets owned for the full period, primarily due to a decrease in accelerated depreciation and amortization related to tenant move-outs, partially offset by an increase in capital expenditures and a $0.5 million increase due to net transaction activity.

Impairment of real estate assets

During the three months ended June 30, 2024, aggregate impairment of $5.3 million was recognized on one partial shopping center, as a result of disposition activity, and one operating property.

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 September 30, 2024, aggregate impairment of $5.9 million was recognized on one land parcel, as a result of disposition activity, and one operating property.

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

General and administrative

The increase in general and administrative costs of $1.2 million for the three months ended June 30, 2024, as compared to the corresponding period in 2023, was primarily due to an increase in net compensation costs, partially offset by a decrease in office rent expenses.

During the three months ended June 30, 2024 and 2023, construction compensation costs of $5.0 million and $4.3 million, respectively, were capitalized to building and improvements and leasing legal costs of $0.7 million and $1.0 million, respectively, and leasing commission costs of $2.0 million and $1.8 million, respectively, were capitalized to deferred charges and prepaid expenses, net.

The increase in general and administrative costs of $1.1 million for the three months ended September 30, 2024, as compared to the corresponding period in 2023, was primarily due to one-time severance costs of $2.4 million associated with the realignment of the Company's regional operating structure, partially offset by a decrease in other net compensation costs.

During the three months ended September 30, 2024 and 2023, construction compensation costs of $4.5 million and $4.7 million, respectively, were capitalized to building and improvements and leasing legal costs of $0.8 million and $0.9 million, respectively, and leasing commission costs of $2.0 million and $1.9 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,

2024 2023 $ Change

7 unchanged sentences

Dividends and interest

The increase in dividends and interest for the three months ended June 30, 2024 of $6.6 million, as compared to the corresponding period in 2023 was primarily due to an increase in interest income associated with higher cash and cash equivalent balances and a higher weighted average interest rate return.

The increase in dividends and interest for the three months ended September 30, 2024 of $5.0 million, as compared to the corresponding period in 2023 was primarily due to an increase in interest income associated with higher cash and cash equivalent balances and a higher weighted average interest rate return.

Interest expense

The increase in interest expense for the three months ended June 30, 2024 of $6.2 million, as compared to the corresponding period in 2023, was primarily due to higher overall debt obligations, in addition to a higher weighted average interest rate.

The increase in interest expense for the three months ended September 30, 2024 of $8.0 million, as compared to the corresponding period in 2023, was primarily due to higher overall debt obligations, in addition to a higher weighted average interest rate.

Gain on sale of real estate assets

During the three months ended June 30, 2024, one land parcel was disposed of resulting in aggregate gain of less than $0.1 million.

In addition, during the three months ended June 30, 2024, we received aggregate net proceeds of $1.8 million related to land at one shopping center previously seized through eminent domain, resulting in aggregate gain of $1.8 million.

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 September 30, 2024, two shopping centers and three partial shopping centers were disposed of resulting in aggregate gain of $37.0 million.

In addition, during the three months ended September 30, 2024, we resolved contingencies related to previously disposed assets, resulting in net loss of less than $0.1 million.

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.

Gain on extinguishment of debt, net

During the three months ended June 30, 2024, we repurchased $30.0 million of the $700.0 million 3.85% Senior Notes due 2025 (the "2025 Notes") then outstanding, resulting in a $0.3 million gain on extinguishment of debt.

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

The decrease in other expense for the three months ended June 30, 2024 of $0.3 million, as compared to the corresponding period in 2023, was primarily due to a decrease in anticipated environmental remediation costs.

Comparison of the Six Months Ended June 30, 2024 to the Six Months Ended June 30, 2023

During the three months ended September 30, 2024, we repurchased $37.7 million of the $670.0 million 3.85% Senior Notes due 2025 (the "2025 Notes") then outstanding, resulting in a $0.3 million gain on extinguishment of debt.

Other expense remained generally consistent for the three months ended September 30, 2024, as compared to the corresponding period in 2023.

Comparison of the Nine Months Ended September 30, 2024 to the Nine Months Ended September 30, 2023

Revenues (in thousands)

Six Months Ended June 30,

Nine Months Ended September 30,

2024 2023 $ Change

3 unchanged sentences

Rental income

The increase in rental income for the six months ended June 30, 2024 of $14.8 million, as compared to the corresponding period in 2023, was due to a $22.1 million increase for assets owned for the full period, partially offset by a $7.3 million decrease due to net transaction activity.

The increase in rental income for the nine months ended September 30, 2024 of $27.6 million, as compared to the corresponding period in 2023, was due to a $36.3 million increase for assets owned for the full period, partially offset by a $8.7 million decrease due to net transaction activity.

The increase for assets owned for the full period was due to (i) a $27.4 million increase in base rent;

(ii) a $7.1 million increase in straight-line rental income, net;

(iii) a $1.9 million increase in rental income associated with revenues deemed uncollectible;

(iii) a $5.6 million increase in expense reimbursements;

(iv) a $0.6 million increase in percentage rents;

(v) a $0.6 million increase in ancillary and other rental income;

and (vi) a $0.5 million increase in expense reimbursements;

partially offset by (vii) a $1.6 million decrease in lease termination fees;

and (viii) a $0.7 million decrease in accretion of below-market leases, net of amortization of above-market leases and tenant inducements.

The $16.3 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 16.8% during the six months ended June 30, 2024 and 15.3% during the year ended December 31, 2023, and an increase in weighted average billed occupancy.

and (v) a $0.5 million increase in ancillary and other rental income;

partially offset by (vi) a $2.2 million decrease in rental income associated with revenues deemed uncollectible;

(vii) a $1.4 million decrease in accretion of below-market leases, net of amortization of above-market leases and tenant inducements;

and (viii) a $1.3 million decrease in lease termination fees.

The $27.4 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 16.6% during the nine months ended September 30, 2024 and 15.3% during the year ended December 31, 2023, and an increase in weighted average billed occupancy.

Other revenues

Other revenues remained generally consistent for the six months ended June 30, 2024 as compared to the corresponding period in 2023.

The increase in other revenues for the nine months ended September 30, 2024 of $0.4 million as compared to the corresponding period in 2023, 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,

2024 2023 $ Change

7 unchanged sentences

Operating costs

The increase in operating costs for the six months ended June 30, 2024 of $2.5 million, as compared to the corresponding period in 2023, was due to a $4.3 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 $1.8 million decrease due to net transaction activity.

The increase in operating costs for the nine months ended September 30, 2024 of $3.9 million, as compared to the corresponding period in 2023, was due to a $6.3 million increase in operating costs for assets owned for the full period, primarily due to an increase in repairs and maintenance, partially offset by a $2.4 million decrease due to net transaction activity.

Real estate taxes

The decrease in real estate taxes for the six months ended June 30, 2024 of $10.6 million, as compared to the corresponding period in 2023, was due to an $8.9 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, a decrease in current year assessments, and an increase in real estate tax refunds, in addition to a $1.7 million decrease due to net transaction activity.

The decrease in real estate taxes for the nine months ended September 30, 2024 of $9.9 million, as compared to the corresponding period in 2023, was due to a $7.7 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 a decrease in current year assessments, in addition to a $2.2 million decrease due to net transaction activity, partially offset by a decrease in real estate tax refunds.

Depreciation and amortization

The increase in depreciation and amortization for the six months ended June 30, 2024 of $6.7 million, as compared to the corresponding period in 2023, was due to an $8.6 million increase for assets owned for the full period primarily due to an increase in capital expenditures and an increase in accelerated depreciation and amortization related to tenant move-outs, partially offset by a $1.9 million decrease attributable to net transaction activity.

The increase in depreciation and amortization for the nine months ended September 30, 2024 of $5.3 million, as compared to the corresponding period in 2023, was due to a $6.7 million increase for assets owned for the full period, primarily due to an increase in capital expenditures, partially offset by a decrease in accelerated depreciation and amortization related to tenant move-outs and a $1.4 million decrease attributable to net transaction activity.

Impairment of real estate assets

During the six months ended June 30, 2024, aggregate impairment of $5.3 million was recognized on one partial shopping center, as a result of disposition activity, and one operating property.

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 nine months ended September 30, 2024, aggregate impairment of $11.1 million was recognized on one partial shopping center and one land parcel, as a result of disposition activity, and two operating properties.

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.

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

General and administrative

The increase in general and administrative costs of $0.5 million for the six months ended June 30, 2024, as compared to the corresponding period in 2023, was primarily due to an increase in net compensation costs, partially offset by a decrease in office rent expenses.

During the six months ended June 30, 2024 and 2023, construction compensation costs of $10.0 million and $8.9 million, respectively, were capitalized to building and improvements and leasing legal costs of $1.7 million and $2.4 million, respectively, and leasing commission costs of $4.1 million and $4.0 million, respectively, were capitalized to deferred charges and prepaid expenses, net.

The increase in general and administrative costs of $1.6 million for the nine months ended September 30, 2024, as compared to the corresponding period in 2023, was primarily due to an increase in net compensation costs, including one-time severance costs of $2.4 million associated with the realignment of the Company's regional operating structure, partially offset by a decrease in office rent expenses.

During the nine months ended September 30, 2024 and 2023, construction compensation costs of $14.4 million and $13.6 million, respectively, were capitalized to building and improvements and leasing legal costs of $2.5 million and $3.3 million, respectively, and leasing commission costs of $6.0 million and $5.9 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,

2024 2023 $ Change

7 unchanged sentences

Dividends and interest

The increase in dividends and interest for the six months ended June 30, 2024 of $10.4 million, as compared to the corresponding period in 2023 was primarily due to an increase in interest income associated with higher cash and cash equivalent balances and a higher weighted average interest rate return.

The increase in dividends and interest for the nine months ended September 30, 2024 of $15.5 million, as compared to the corresponding period in 2023 was primarily due to an increase in interest income associated with higher cash and cash equivalent balances and a higher weighted average interest rate return.

Interest expense

The increase in interest expense for the six months ended June 30, 2024 of $9.0 million, as compared to the corresponding period in 2023, was primarily due to higher overall debt obligations, in addition to a higher weighted average interest rate.

The increase in interest expense for the nine months ended September 30, 2024 of $17.0 million, as compared to the corresponding period in 2023, was primarily due to higher overall debt obligations, in addition to a higher weighted average interest rate.

Gain on sale of real estate assets

During the six months ended June 30, 2024, three shopping centers and one land parcel were disposed of resulting in aggregate gain of $15.0 million.

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 nine months ended September 30, 2024, five shopping centers, three partial shopping centers, and one land parcel were disposed of resulting in aggregate gain of $52.1 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.

Gain on extinguishment of debt, net

During the six months ended June 30, 2024, we repurchased $30.0 million of the $700.0 million 2025 Notes then outstanding, resulting in a $0.3 million gain on extinguishment of debt.

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

Other expense remained generally consistent for the six months ended June 30, 2024 as compared to the corresponding period in 2023.

During the nine months ended September 30, 2024, we repurchased $67.7 million of the $700.0 million 2025 Notes then outstanding, resulting in a $0.6 million gain on extinguishment of debt.

During the nine months ended September 30, 2023, we repurchased $199.6 million of the $500.0 million 3.65% Senior Notes due 2024 then outstanding, resulting in a $4.4 million gain on extinguishment of debt.

Other expense remained generally consistent for the nine months ended September 30, 2024 as compared to the corresponding period in 2023.

Liquidity and Capital Resources

15 unchanged sentences

We believe our capital structure provides us with the financial flexibility and capacity to fund our current capital needs as well as future growth opportunities.

We generate significant operating cash flow and have access to multiple forms of external capital, including secured property level debt, unsecured corporate level debt, preferred

equity, and common equity, which will allow us to efficiently execute on our strategic and operational objectives.

We generate significant operating cash flow and have access to multiple forms of external capital, including secured property level debt, unsecured corporate level debt, preferred equity, and common equity, which will allow us to efficiently execute on our strategic and operational objectives.

We have investment grade credit ratings from all three major credit rating agencies.

Our unsecured credit facility as amended and restated April 28, 2022 (the "Unsecured Credit Facility") is comprised of a $1.25 billion revolving loan facility (the "Revolving Facility") and a $500.0 million term loan facility (the "Term Loan Facility").

As of June 30, 2024, we had $1.72 billion of available liquidity, including $1.25 billion available under our Revolving Facility and $475.0 million of cash, cash equivalents and restricted cash.

Our unsecured credit facility as amended and restated April 28, 2022 (the "Unsecured Credit Facility") is comprised of a $1.25 billion revolving loan

facility (the "Revolving Facility") and a $500.0 million term loan facility (the "Term Loan Facility").

As of September 30, 2024, we had $1.70 billion of available liquidity, including $1.25 billion available under our Revolving Facility and $452.4 million of cash, 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, 2025 and thereafter are comprised of (i) contractually obligated expenditures;

Our expected material cash requirements for the twelve months ended September 30, 2025 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, 2024 (dollars in millions):

Contractually Obligated Expenditures Twelve

June 30, 2025 Thereafter

September 30, 2025 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, 2024.

(2) Scheduled interest payments for variable rate loans are presented using rates (including the impact of interest rate swaps), as of September 30, 2024.

“Quantitative and Qualitative Disclosures about Market Risk” in our Annual Report on Form 10-K for the year ended December 31, 2023 for a further discussion of these and other factors that could impact interest payments.

15 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 2024:

Quarter 2024 Third

The following table summarizes our dividend activity for the third and fourth quarters of 2024:

Quarter 2024 Fourth

Dividend declared per common share $ 0.2725 $ 0.2875

Dividend declaration date April 25, 2024 July 24, 2024

Dividend record date July 2, 2024 October 2, 2024

Dividend payable date July 15, 2024 October 15, 2024

Dividend declaration date July 24, 2024 October 23, 2024

Dividend record date October 2, 2024 January 3, 2025

Dividend payable date October 15, 2024 January 15, 2025

Opportunistic Expenditures

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Brixmor Property Group Inc .

Six Months Ended June 30,

Nine Months Ended September 30,

2024 2023 $ Change

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Brixmor Operating Partnership LP

Six Months Ended June 30,

Nine Months Ended September 30,

2024 2023 $ Change

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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 six months ended June 30, 2024, our net cash provided by operating activities increased $17.1 million as compared to the corresponding period in 2023.

During the nine months ended September 30, 2024, our net cash provided by operating activities increased $16.0 million as compared to the corresponding period in 2023.

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

(ii) an increase in cash inflows for dividends and interest income;

(iii) a decrease in cash outflows for interest expense;

and (iv) a decrease in cash outflows for general and administrative expense;

partially offset by (v) a decrease in cash from net working capital;

(vi) a decrease in net operating income due to net transaction activity and other non-same property net operating income;

and (vii) a decrease in lease termination fees.

and (ii) an increase in cash inflows for dividends and interest income;

partially offset by (iii) a decrease in cash from net working capital;

(iv) an increase in cash outflows for interest expense;

(v) a decrease in net operating income due to net transaction activity and other non-same property net operating income;

(vi) a decrease in lease termination fees;

and (vii) an increase in cash outflows for general and administrative expense.

Investing Activities

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, 2024, our net cash used in investing activities increased $105.2 million as compared to the corresponding period in 2023.

The increase was primarily due to (i) a decrease of $76.2 million in net proceeds from sales of real estate assets;

(ii) an increase of $15.6 million in acquisitions of real estate assets;

(iii) an increase of $11.0 million in improvements to and investments in real estate assets;

and (iv) a decrease of $2.4 million in sales of marketable securities, net of purchases.

During the nine months ended September 30, 2024, our net cash used in investing activities increased $103.2 million as compared to the corresponding period in 2023.

The increase was primarily due to (i) an increase of $80.0 million in acquisitions of real estate assets;

(ii) a decrease of $20.3 million in net proceeds from sales of real estate assets;

(iii) an increase of $1.9 million in purchases of marketable securities, net of sales;

and (iv) an increase of $1.0 million in improvements to and investments in real estate assets.

Improvements to and investments in real estate assets

During the six months ended June 30, 2024 and 2023, we expended $167.0 million and $156.1 million, respectively, on improvements to and investments in real estate assets.

Included in these amounts are insurance proceeds of $3.1 million and $0.2 million, respectively, which were received during the six months ended June 30, 2024 and 2023.

During the nine months ended September 30, 2024 and 2023, we expended $255.4 million and $254.4 million, respectively, on improvements to and investments in real estate assets.

Included in these amounts are insurance proceeds of $4.5 million and $0.5 million, respectively, which were received during the nine months ended September 30, 2024 and 2023.

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, 2024, we had 44 in-process anchor space repositioning, redevelopment, and outparcel development projects with an aggregate anticipated cost of $509.6 million, of which $231.0 million had been incurred as of June 30, 2024.

In addition, we have identified a pipeline of future redevelopment projects aggregating over $600 million of potential capital investment, which we expect to execute over the coming years.

As of September 30, 2024, we had 43 in-process anchor space repositioning, redevelopment, and outparcel development projects with an aggregate anticipated cost of $506.8 million, of which $246.4 million had been incurred as of September 30, 2024.

In addition, we have identified a pipeline of future redevelopment projects aggregating approximately $700 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, to 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, 2024, we acquired one shopping center for an aggregate purchase price of $17.5 million, including transaction costs and closing credits.

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.

We continue to evaluate the market for acquisition opportunities and we may acquire individual shopping centers or portfolios of 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, 2024, we acquired three shopping centers and one land parcel for an aggregate purchase price of $81.9 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.

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, 2024, we disposed of three shopping centers, one partial shopping center, and one land parcel for aggregate net proceeds of $67.4 million.

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 nine months ended September 30, 2024, we disposed of five shopping centers, four partial shopping centers, and two land parcels for aggregate net proceeds of $140.0 million.

In addition, during the nine months ended September 30, 2024, we received aggregate net proceeds of $1.9 million related to land at one shopping center previously seized through

eminent domain and resolved contingencies related to previously disposed assets.

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.

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, 2024, our net cash provided by (used in) financing activities increased $550.5 million as compared to the corresponding period in 2023.

Net cash provided by (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 nine months ended September 30, 2024, our net cash provided by (used in) financing activities increased $523.3 million as compared to the corresponding period in 2023.

The increase was primarily due to (i) a $524.4 million increase in debt borrowings, net of repayments;

partially offset by (ii) a $7.7 million increase in distributions to our common stockholders;

(iii) a $6.9 million increase in deferred financing and debt extinguishment costs;

and (iv) a $1.7 million increase in repurchases of common stock.

and (ii) a $19.3 million increase in issuances of common stock;

partially offset by (iii) an $11.7 million increase in distributions to our common stockholders;

(iv) a $7.0 million increase in deferred financing costs;

and (v) a $1.7 million increase in repurchases of common stock.

Non-GAAP Performance Measures

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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, 2024 and 2023 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, 2024 and 2023 is as follows (in thousands, except per share amounts):

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

2024 2023 2024 2023

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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 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, 2024 to the Three and Six Months Ended June 30, 2023

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

Comparison of the Three and Nine Months Ended September 30, 2024 to the Three and Nine Months Ended September 30, 2023

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

2024 2023 Change 2024 2023 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,

2024 2023 2024 2023

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Same property NOI $ 225,926 $ 217,112 $ 678,053 $ 644,614

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

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

We continue to monitor the impacts of inflation on our operating and financial performance.

Although recent inflationary pressures have begun to abate, inflation may increase in the future.

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