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Item 2. Management’s Discussion and Analysis

2025-04-28 compared with 2024-10-28 · 103 added, 190 removed, 220 unchanged (57% 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 September 30, 2024, our portfolio was comprised of 360 shopping centers (the "Portfolio") totaling approximately 63 million square feet of GLA.

As of March 31, 2025, our portfolio was comprised of 361 shopping centers (the "Portfolio") totaling approximately 64 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 September 30, 2024, our three largest tenants by annualized base rent ("ABR") were The TJX Companies, Inc.

As of March 31, 2025, 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 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)

As of March 31, 2025, billed and leased occupancy were 90.0% and 94.1%, respectively, as compared to 90.6% and 95.1%, respectively, as of March 31, 2024.

The following table summarizes our executed leasing activity for the three months ended March 31, 2025 and 2024 (dollars in thousands, except for per square foot ("PSF") amounts):

For the Three Months Ended March 31, 2025

GLA New ABR PSF (2)

Tenant Improvements and Allowances PSF Third Party Leasing Commissions PSF Rent Spread (3)

New, renewal and option leases 334 2,247,394 $ 18.96 $ 2.42 $ 1.71 15.0 %

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Option leases 65 952,402 14.41 — — 7.1 %

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)

For the Three Months Ended March 31, 2024

GLA New ABR PSF (2)

Tenant Improvements and Allowances PSF Third Party Leasing Commissions PSF Rent Spread (3)

New, renewal and option leases 351 2,626,599 $ 16.83 $ 3.43 $ 1.73 14.1 %

3 unchanged sentences

Option leases 57 1,304,520 10.93 — — 7.1 %

(1) Based on comparable leases only, which consist of new leases signed on units that were occupied within the prior 12 months and renewal or option leases signed with the same tenant in all or a portion of the same location or that include the expansion into space that was occupied within the prior 12 months.

(1) Excludes leases executed for terms of less than one year.

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

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)

New, renewal and option leases 1,050 7,044,014 $ 17.60 $ 3.41 $ 2.02 16.6 %

New and renewal leases 885 3,880,223 22.29 6.20 3.66 23.1 %

New leases 360 1,874,583 22.55 11.02 7.48 41.3 %

Renewal leases 525 2,005,640 22.05 1.69 0.09 16.5 %

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

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)

New, renewal and option leases 1,251 7,489,943 $ 18.71 $ 4.80 $ 2.29 15.2 %

New and renewal leases 1,074 4,588,215 22.36 7.83 3.75 19.2 %

New leases 427 2,182,430 22.27 14.18 7.82 41.3 %

Renewal leases 647 2,405,785 22.44 2.07 0.05 13.1 %

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

(3) Based on comparable leases only, which consist of new leases signed on units that were occupied within the prior 12 months and renewal or option leases signed with the same tenant in all or a portion of the same location or that include the expansion into space that was occupied within the prior 12 months.

Excludes leases executed for terms of less than one year.

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

Acquisition Activity

• 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.

• During the three months ended March 31, 2025, we acquired one land parcel for an aggregate purchase price of $3.1 million, including transaction costs and closing credits.

• During the three months ended March 31, 2024, we did not acquire any assets.

Disposition Activity

• 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.

• During the three months ended March 31, 2025, we disposed of two shopping centers and two partial shopping centers for aggregate net proceeds of $21.6 million, resulting in aggregate gain of $3.1 million.

• During the three months ended March 31, 2024, we disposed of three shopping centers for aggregate net proceeds of $67.2 million, resulting in aggregate gain of $15.0 million.

In addition, during the three months ended March 31, 2024, we resolved contingencies related to previously disposed assets for aggregate net proceeds of $0.1 million, resulting in aggregate 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 September 30, 2024 to the Three Months Ended September 30, 2023

Comparison of the Three Months Ended March 31, 2025 to the Three Months Ended March 31, 2024

Revenues (in thousands)

Three Months Ended September 30,

Three Months Ended March 31,

2025 2024 $ Change

3 unchanged sentences

Rental income

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;

The increase in rental income for the three months ended March 31, 2025 of $17.8 million, as compared to the corresponding period in 2024, was due to a $12.3 million increase for assets owned for the full period, in addition to a $5.5 million increase due to net transaction activity.

The increase for assets owned for the full period was due to:

(i) a $7.6 million increase in base rent;

(ii) a $5.4 million increase in expense reimbursements;

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

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

(iii) a $3.0 million increase in lease termination fees;

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

partially offset by (v) a $2.8 million decrease in rental income associated with revenues deemed uncollectible;

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(vii) a $0.4 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 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 September 30,

2024 2023 $ Change

Operating expenses

Operating costs $ 36,442 $ 35,058 $ 1,384

Real estate taxes 42,902 42,156 746

Depreciation and amortization 94,829 96,254 (1,425)

Impairment of real estate assets 5,863 — 5,863

General and administrative 30,250 29,182 1,068

Total operating expenses $ 210,286 $ 202,650 $ 7,636

Operating costs

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 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 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 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 $1.1 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 September 30,

2024 2023 $ Change

Other income (expense)

Dividends and interest $ 5,289 $ 273 $ 5,016

Interest expense (55,410) (47,364) (8,046)

Gain on sale of real estate assets 37,018 6,712 30,306

Gain on extinguishment of debt, net 273 6 267

Other (726) (555) (171)

Total other expense $ (13,556) $ (40,928) $ 27,372

Dividends and interest

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 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 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 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)

Nine Months Ended September 30,

2024 2023 $ Change

Rental income $ 955,065 $ 927,440 $ 27,625

Other revenues 1,547 1,111 436

Total revenues $ 956,612 $ 928,551 $ 28,061

Rental income

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 $5.6 million increase in expense reimbursements;

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

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.

and (viii) a $0.3 million decrease in straight-line rental income, net.

The $7.6 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 15.0% during the three months ended March 31, 2025 and 16.5% during the year ended December 31, 2024, and an increase in weighted average billed occupancy.

Other revenues

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.

The decrease in other revenues for the three months ended March 31, 2025 of $0.5 million as compared to the corresponding period in 2024, was primarily due to a decrease in tax increment financing income.

Operating Expenses (in thousands)

Nine Months Ended September 30,

Three Months Ended March 31,

2025 2024 $ Change

3 unchanged sentences

Depreciation and amortization 105,597 91,218 14,379

Impairment of real estate assets 11,143 17,836 (6,693)

General and administrative 28,173 28,491 (318)

1 unchanged sentence

Operating costs

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.

The increase in operating costs for the three months ended March 31, 2025 of $2.1 million, as compared to the corresponding period in 2024, was due to a $1.9 million increase in operating costs for assets owned for the full

period, primarily due to an increase in repairs and maintenance, in addition to a $0.2 million increase due to net transaction activity.

Real estate taxes

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.

The increase in real estate taxes for the three months ended March 31, 2025 of $3.5 million, as compared to the corresponding period in 2024, was due to a $2.9 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 an increase in current year assessments, partially offset by an increase in real estate tax refunds, in addition to a $0.6 million increase due to net transaction activity.

Depreciation and amortization

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 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.

The increase in depreciation and amortization for the three months ended March 31, 2025 of $14.4 million, as compared to the corresponding period in 2024, was due to a $7.7 million increase for assets owned for the full period, primarily due to an increase in accelerated depreciation and amortization related to tenant move-outs, an increase in capital expenditures, and a $6.7 million increase due to net transaction activity.

General and administrative

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.

The decrease in general and administrative costs of $0.3 million for the three months ended March 31, 2025, as compared to the corresponding period in 2024, was primarily due to a decrease in net compensation costs, partially offset by an increase in office rent expense.

During the three months ended March 31, 2025 and 2024, construction compensation costs of $4.5 million and $4.9 million, respectively, were capitalized to building and improvements and leasing legal costs of $0.3 million and $1.0 million, respectively, and leasing commission costs of $1.8 million and $2.1 million, respectively, were capitalized to deferred charges and prepaid expenses, net.

Other Income and Expenses (in thousands)

Nine Months Ended September 30,

Three Months Ended March 31,

2025 2024 $ Change

3 unchanged sentences

Gain on sale of real estate assets 3,070 15,142 (12,072)

Gain on extinguishment of debt, net 554 4,356 (3,802)

Other (593) (593) —

1 unchanged sentence

Dividends and interest

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.

The decrease in dividends and interest for the three months ended March 31, 2025 of $2.2 million, as compared to the corresponding period in 2024, was primarily due to a decrease in interest income associated with lower cash and cash equivalent balances and a lower weighted average interest rate return.

Interest expense

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.

The increase in interest expense for the three months ended March 31, 2025 of $2.6 million, as compared to the corresponding period in 2024, was primarily due to a higher weighted average interest rate, partially offset by lower overall debt obligations.

Gain on sale of real estate assets

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 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.

During the three months ended March 31, 2025, two shopping centers and two partial shopping centers were disposed of, resulting in aggregate gain of $3.1 million.

During the three months ended March 31, 2024, three shopping centers were disposed of, resulting in aggregate gain of $15.0 million.

In addition, during the three months ended March 31, 2024, we resolved contingencies related to previously disposed assets, resulting in aggregate gain of $0.1 million.

Other expense remained generally consistent for the three months ended March 31, 2025, as compared to the corresponding period in 2024.

Liquidity and Capital Resources

17 unchanged sentences

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 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.

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 March 31, 2025, we had $1.36 billion of available liquidity, including $1.25 billion available under our Revolving Facility and $107.4 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.

See Note 18 included elsewhere on this Quarterly Report on Form 10-Q for additional information on the Unsecured Credit Facility.

Material Cash Requirements

Our expected material cash requirements for the twelve months ended September 30, 2025 and thereafter are comprised of (i) contractually obligated expenditures;

Our expected material cash requirements for the twelve months ended March 31, 2026 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 September 30, 2024 (dollars in millions):

Contractually Obligated Expenditures Twelve

September 30, 2025 Thereafter

March 31, 2026 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 September 30, 2024.

(2) Scheduled interest payments for variable rate loans are presented using rates (including the impact of interest rate swaps), as of March 31, 2025.

"Quantitative and Qualitative Disclosures about Market Risk" in our Annual Report on Form 10-K for the year ended December 31, 2024 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 third and fourth quarters of 2024:

Quarter 2024 Fourth

The following table summarizes our dividend activity for the first and second quarters of 2025:

Quarter 2025 Second

Dividend declared per common share $ 0.2875 $ 0.2875

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

Dividend declaration date February 5, 2025 April 25, 2025

Dividend record date April 2, 2025 July 2, 2025

Dividend payable date April 15, 2025 July 15, 2025

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 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.

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.

4 unchanged sentences

Brixmor Property Group Inc .

Nine Months Ended September 30,

Three Months Ended March 31,

2025 2024 $ Change

6 unchanged sentences

Brixmor Operating Partnership LP

Nine Months Ended September 30,

Three Months Ended March 31,

2025 2024 $ Change

7 unchanged sentences

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, 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;

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.

During the three months ended March 31, 2025, our net cash provided by operating activities increased $1.6 million as compared to the corresponding period in 2024.

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

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

(iii) an increase in lease termination fees;

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

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

partially offset by (vi) an increase in cash outflows for interest expense;

and (vii) a decrease in cash inflows for dividends and interest income.

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 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.

During the three months ended March 31, 2025, our net cash used in investing activities increased $54.3 million as compared to the corresponding period in 2024.

The increase was primarily due to (i) a decrease of $45.6 million in net proceeds from sales of real estate assets;

(ii) an increase of $5.7 million in improvements to and investments in real estate assets;

and (iii) an increase of $3.1 million in acquisitions of real estate assets;

partially offset by (iv) an

increase of $0.1 million in sales of marketable securities, net of purchases.

Improvements to and investments in real estate assets

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.

During the three months ended March 31, 2025 and 2024, we expended $82.5 million and $76.9 million, respectively, on improvements to and investments in real estate assets.

Included in these amounts are insurance proceeds of $0.6 million and $2.3 million, respectively, which were received during the three months ended March 31, 2025 and 2024.

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 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.

As of March 31, 2025, we had 37 in-process anchor space repositioning, redevelopment, and outparcel development projects with an aggregate anticipated cost of $390.9 million, of which $195.6 million had been incurred as of March 31, 2025.

In addition, we have identified a pipeline of future redevelopment projects, 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.

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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.

During the three months ended March 31, 2025, we acquired one land parcel for an aggregate purchase price of $3.1 million, including transaction costs and closing credits.

During the three months ended March 31, 2024, we did not acquire any assets.

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 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.

During the three months ended March 31, 2025, we disposed of two shopping centers and two partial shopping centers for aggregate net proceeds of $21.6 million.

During the three months ended March 31, 2024, we disposed of three shopping centers for aggregate net proceeds of $67.2 million.

In addition, during the three months ended March 31, 2024, we resolved contingencies related to previously disposed assets for aggregate net proceeds of $0.1 million.

Financing Activities

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;

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.

During the three months ended March 31, 2025, our net cash provided by (used in) financing activities decreased $618.1 million as compared to the corresponding period in 2024.

The decrease was primarily due to (i) a $613.8 million increase in debt repayments, net of borrowings;

(ii) a $5.5 million increase in distributions to our common stockholders;

and (iii) a $0.1 million decrease in issuances of common stock;

partially offset by (iv) a $1.3 million decrease in repurchases of common stock;

and (v) a less than $0.1 million decrease in deferred financing costs.

Non-GAAP Performance Measures

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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.

by such other REITs.

Investors are cautioned that items excluded from these non-GAAP performance measures are relevant to understanding and addressing financial performance.

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Nareit FFO (defined hereafter) is a supplemental, non-GAAP performance measure utilized to evaluate the operating and financial performance of real estate companies.

Nareit defines funds from operations ("FFO") as net income (loss), calculated in accordance with GAAP, excluding (i) depreciation and amortization related to real estate, (ii) gains and losses from the sale of certain real estate assets, (iii) gains and losses from change in control, (iv) impairment write-downs of certain real estate assets and investments in entities when the impairment is directly attributable to decreases in the value of depreciable real estate held by the entity and (v) after adjustments for unconsolidated joint ventures calculated to reflect FFO on the same basis.

Nareit defines funds from operations ("FFO") as net income (calculated in accordance with GAAP) excluding (i) depreciation and amortization related to real estate, (ii) gains and losses from the sale of certain real estate assets, (iii) gains and losses from change in control, (iv) impairment write-downs of certain real estate assets and investments in entities when the impairment is directly attributable to decreases in the value of depreciable real estate held by the entity and (v) after adjustments for unconsolidated joint ventures calculated to reflect FFO on the same basis.

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 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,

Our reconciliation of net income (calculated in accordance with GAAP) to Nareit FFO for the three months ended March 31, 2025 and 2024 is as follows (in thousands, except per share amounts):

Three Months Ended March 31,

Net income attributable to Brixmor Property Group Inc.

$ 69,729 $ 88,905

Net income $ 96,840 $ 63,736 $ 255,870 $ 232,390

Depreciation and amortization related to real estate 104,448 89,673

Gain on sale of real estate assets (3,070) (15,142)

Impairment of real estate assets 5,863 — 11,143 17,836

Nareit FFO $ 171,107 $ 163,436

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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 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

Comparison of the Three Months Ended March 31, 2025 to the Three Months Ended March 31, 2024

Three Months Ended March 31,

2025 2024 Change

Number of properties 348 348 —

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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 September 30, Nine Months Ended September 30,

Three Months Ended March 31,

Net income attributable to Brixmor Property Group Inc.

$ 69,729 $ 88,905

Net income $ 96,840 $ 63,736 $ 255,870 $ 232,390

Non-same property NOI (8,850) (7,705)

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Depreciation and amortization 105,597 91,218

Impairment of real estate assets 5,863 — 11,143 17,836

General and administrative 28,173 28,491

Total other expense 49,901 33,062

Net income attributable to non-controlling interests 8 —

Same property NOI $ 230,585 $ 224,297

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.

Although recent inflationary pressures have begun to abate, inflation may increase in the future, and recent tariff activity has introduced additional uncertainty into the macroeconomic environment.

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.

However, we have exposure to increases in certain non-reimbursable property operating expenses, including expenses incurred on vacant units.

We believe that many of our existing rental rates are below current market rates for comparable space and that upon renewal or re-leasing, such rates may be increased to be consistent with, or closer to, current market rates, which may also offset certain non-reimbursed inflationary expense pressures.

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.

In addition, tariffs may contribute to rising construction and redevelopment costs and tariffs on imported goods may impact many of our tenants, particularly those who rely on international supply chains, by increasing their cost of goods sold or delaying inventory deliveries.

If tenants are unable to pass these increased costs on to customers, it could adversely affect their financial performance and ability to meet lease obligations.

With respect to our outstanding indebtedness, we periodically evaluate our exposure to interest rate fluctuations and have entered, 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.

Quantitative and Qualitative Disclosures about Market Risk

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What changed 10-Q

Item 2. Management’s Discussion and Analysis