What changed in this filing

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Item 1A. Risk Factors

2023-02-09 compared with 2022-02-03 · 88 added, 83 removed, 319 unchanged (35% of the section changed)

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• changes in the national, regional, and local economic climate;

• local real estate conditions such as an oversupply of rentable space caused by increased development of new properties, a reduction in demand for rentable space caused by a change in the preferences and requirements of our tenants (including space usage), such as work-from-home practices and utilization of open workspaces or "co-working" space, or economic conditions decreasing the desirability of our locations;

• the attractiveness of our properties to tenants or buyers;

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• changes in market rental rates and related concessions granted to tenants including, but not limited to, free rent and tenant improvement allowances;

• uninsured losses as a result of casualty events;

• uninsured losses or losses in excess of our insurance coverage as a result of casualty events or other claims or events;

• insolvency of our insurance carriers;

• sociopolitical unrest such as political instability, civil unrest, armed hostilities, or political activism resulting in a disruption of day-to-day building operations;

• the impact of a public health crisis and the governmental and third party response to such a crisis;

• the need to periodically repair, renovate, and re-lease properties;

• changes in federal and state income tax laws as they affect real estate companies and real estate investors.

• changes in federal, state, and local income tax laws as they affect real estate companies and real estate investors;

• changes in interest rates and availability of permanent financing sources that may render the sale of a property difficult or unattractive or otherwise reduce returns to stockholders.

Uncertain economic conditions may adversely impact current tenants in our various markets and, accordingly, could affect their ability to pay rent owed to us pursuant to their leases.

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Our ability to collect rent from tenants may affect our ability to pay for adequate maintenance, insurance, and other operating costs (including real estate taxes).

Also, the expense of owning and operating a property is not necessarily reduced when circumstances such as reduced occupancy or other market factors cause a reduction in income from the property.

If a property is mortgaged and we are unable to meet the mortgage payments, the lender could foreclose on the mortgage and take

title to the property.

Also, the expense of owning and operating a property is not necessarily proportionally reduced when circumstances such as reduced occupancy or other market factors cause a reduction in income from the property.

If a property is mortgaged and we are unable to meet the mortgage payments, the lender could foreclose on the mortgage and take title to the property.

In addition, interest rates, financing availability, law changes, and governmental regulations (including those governing usage, zoning, and taxes) may adversely affect our financial condition.

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Leasing risk .

Our properties were 91.6% leased at December 31, 2021.

Our operating properties were 91.0% leased at December 31, 2022.

Our 20 largest customers account for a meaningful portion of our revenues.

Our operating revenues are dependent upon entering into leases with, and collecting rents from, our tenants.

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As of December 31, 2022, our top 20 tenants represented 37.9% of our annualized base rental revenues with no single tenant accounting for more tha n 7.3% of our annualized base rental revenues.

The inability of any of our significant tenants to pay rent or a decision by a significant tenant to vacate their premises prior to, or at the conclusion of, their lease term could have a significant negative impact on our results of operations or financial condition if a suitable replacement tenant is not secured in a timely manner.

For the three months ended December 31, 2021, 39.8% of our net operating income for properties owned was derived from the metropolitan Atlanta area, 26.8% was derived from the Austin area, 9.1% was derived from the Charlotte area, 9.0% was derived from the Tampa area, and 7.7% was derived from the Phoenix area.

Any adverse economic conditions impacting Atlanta, Austin, Charlotte, Tampa, or Phoenix could adversely affect our overall results of operations and financial condition.

The inability or refusal of any of our significant tenants to pay rent or a decision by a significant tenant to vacate their premises prior to, or at the conclusion of, their lease term could have a significant negative impact on our results of operations or financial condition if a suitable replacement tenant is not secured in a timely manner.

For the three months ended December 31, 2022, 36.4% of our net operating income for properties owned was derived from the metropolitan Atlanta area, 31.1% was derived from the Austin area, 9.7% was derived from the Tampa area, 8.9% was derived from the Phoenix area, and 8.8% was derived from the Charlotte area.

Any adverse economic conditions impacting Atlanta, Austin, Tampa, Phoenix, or Charlotte could adversely affect our overall results of operations and financial condition.

Uninsured losses and condemnation costs .

Accidents, earthquakes, hurricanes, floods, terrorism incidents, and other losses at our properties could adversely affect our operating results.

Accidents, earthquakes, hurricanes, floods, droughts, terrorism incidents, and other losses at our properties could adversely affect our operating results.

Casualties may occur that significantly damage an operating property or property under development, and insurance proceeds may be less than the total loss incurred by us.

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In addition, third parties may sue the owner or operator of a site for damages and costs resulting from regulated substances emanating from that site.

We manage this risk through Phase I Environmental Site Assessments and, as necessary, Phase II Environmental Site Assessments, which include environmental sampling on properties we acquire or develop.

We are not currently aware of any environmental liabilities at locations that we believe could have a material adverse effect on our business, assets, financial condition, or results of operations.

Unidentified environmental liabilities could arise, however, and could have an adverse effect on our financial condition and results of operations.

We manage this risk through Phase I Environmental Site Assessments and, as necessary, Phase II Environmental Site Assessments, which may include environmental sampling on properties we acquire or develop.

Inquiries about indoor air quality and water quality may necessitate special investigation and, depending on the results, remediation beyond our regular testing and maintenance programs.

Indoor air quality and water quality issues can stem from inadequate ventilation, chemical contaminants from indoor or outdoor sources, and biological contaminants such as molds,

pollen, viruses, and bacteria.

Indoor exposure to chemical or biological contaminants above certain levels can be alleged to be connected to allergic reactions or other health effects and symptoms in susceptible individuals.

Indoor air quality and water quality issues can stem from inadequate ventilation, chemical contaminants from indoor or outdoor sources, and biological contaminants such as molds, pollen, viruses, and bacteria.

When excessive moisture accumulates in buildings or on building materials, mold growth may occur, particularly if the moisture problem remains undiscovered or is not addressed over a period of time.

Indoor exposure to mold or other chemical or biological contaminants above certain levels can be alleged to be connected to allergic reactions or other health effects and symptoms in susceptible individuals.

If these conditions were to occur at one of our properties, we may be subject to third-party claims for personal injury or may need to undertake a targeted remediation program, including without limitation, steps to increase indoor ventilation rates and eliminate sources of contaminants.

Such remediation programs could be costly, necessitate the temporary relocation of some or all of the property’s tenants, or require rehabilitation of the affected property.

In addition, the presence of significant mold or other airborne contaminants could expose us to liability from our tenants, employees of our tenants, or others if property damage or personal injury occurs.

We are not currently aware of any environmental liabilities at locations that we believe could have a material adverse effect on our business, assets, financial condition, or results of operations.

Unidentified environmental liabilities could arise, however, and could have an adverse effect on our financial condition and results of operations.

Sustainability strategies .

Our sustainability strategy is to develop and maintain durable buildings that are operated in an environmentally and socially responsible manner, encouraging office users to select us for their corporate operations while enhancing the communities in which our buildings are located.

Failure to develop and maintain sustainable buildings relative to our peers could adversely impact our ability to lease space at competitive rates and negatively impact our results of operations and portfolio attractiveness.

Our sustainability strategy is to develop and maintain resilient buildings that are operated in an environmentally and socially responsible manner, encouraging office users to select us for their corporate operations while enhancing the communities in which our buildings are located.

Failure to develop and maintain sustainable and resilient buildings relative to our peers could adversely impact our ability to lease space at competitive rates and negatively impact our results of operations and portfolio attractiveness.

Climate change risks .

The physical effects of climate change could have a material adverse effect on our properties, operations, and business.

To the extent climate change causes changes in weather patterns or severity, our markets could experience increase in storm intensity (including floods, tornadoes, hurricanes, or ice storms), rising sea-levels, and changes in precipitation, temperature, air quality, and quality and availability of water.

To the extent climate change causes changes in weather patterns or severity, our markets could experience increases in storm intensity (including floods, fires, tornadoes, hurricanes, or ice storms), rising sea-levels, and changes in precipitation, temperature, air quality, and quality and availability of water.

Over time, these conditions could result in physical damage to, or declining demand for, our properties or our inability to operate the buildings efficiently or at all.

Climate change may also indirectly affect our business by increasing the cost of (or making unavailable) property insurance on terms we find acceptable, increasing the cost of required resources, including energy, other fuel sources, water, and waste removal services, and increasing the risk and severity of flood and earthquakes at our properties.

Should the impact of climate change be severe or occur for lengthy periods of time, our financial condition or results of operations could be adversely impacted.

In addition, compliance with new or more stringent laws or regulations or stricter interpretations of existing laws may require material expenditure by us.

For example, various federal, state, and local laws and regulations have been implemented or are under consideration to mitigate the effects of climate change caused by greenhouse gas emissions.

For example, various federal, state, and local laws and regulations have been implemented or are under consideration to mitigate the effects of climate change caused by

greenhouse gas emissions.

Among other things, "green" building codes may seek to reduce emissions through the imposition of standards for design, construction materials, water and energy usage and efficiency, and waste management.

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Our venture partners may have rights to take actions over which we have no control, or the right to withhold approval of actions that we propose, either of which could adversely affect our interests in the related joint ventures, and in some cases, our overall financial condition and results of operations.

These structures involve participation by other parties whose interests and rights may not be the same as ours.

For example, a venture partner may have economic and/or other business interests or goals that are incompatible with our business interests or goals and that venture partner may be in a position to take action contrary to our interests.

A venture partner may have economic and/or other business interests or goals that are incompatible with our business interests or goals and that venture partner may be in a position to take action contrary to our interests.

In addition, such venture partners may default on their obligations, including loans secured by property owned by the joint venture that could have an adverse impact on the financial condition and operations of the joint venture.

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Title insurance risk .

We did not acquire new title insurance policies in connection with the merger with TIER in 2019, instead relying on existing policies benefiting those entities' subsidiaries.

We did not acquire new title insurance policies in connection with the mergers with Parkway in 2016 or TIER in 2019, instead relying on existing policies benefiting those entities' subsidiaries.

We generally do acquire title insurance policies for all developed and acquired properties;

however, these policies may be for amounts less than the current or future values of the covered properties.

If there were a title defect related to any of these properties, or to any of the properties acquired in connection with the merger with TIER where title insurance policies are ruled unenforceable, we could lose both our capital invested in and our anticipated profits from such property.

If there were a title defect related to any of these properties, or to any of the properties acquired in connection with the mergers with Parkway or TIER where title insurance policies are ruled unenforceable, we could lose both our capital invested in and our anticipated profits from such property.

Liquidity risk .

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Ground lease risks .

As of December 31, 2021, we had interests in nine land parcels in various markets that we lease individually on a long-term basis.

As of December 31, 2022, we had interests in eight land parcels in various markets that we lease individually on a long-term basis.

As of December 31, 2022, we had 2.0 million aggregate square feet of rental space located on these leased parcels, from which we recognized 11% of total Net Operating Income ("NOI") in the fourth quarter of 2022.

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Many of these ground leases and other restrictive agreements impose significant limitations on our uses of the subject property and restrict our ability to sell or otherwise transfer our interests in the property.

These restrictions may limit our ability to timely sell or exchange the property, impair the property's value, or negatively impact our ability to find suitable tenants for the property.

These restrictions may limit our ability to timely sell or exchange the property, may impair the property's value, or may negatively impact our ability to find suitable tenants for the property.

In addition, if we default under the terms of any particular lease, we may lose the ownership rights to the property subject to the lease.

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The Americans with Disabilities Act generally requires that certain buildings, including office buildings, be made accessible to disabled persons.

We are currently in compliance with these requirements.

Noncompliance could result in the imposition of fines by the federal government or the award of damages to private litigants.

If, under the Americans with Disabilities Act, we are required to make substantial alterations and capital expenditures in one or more of our properties, including the removal of access barriers, it could adversely impact our earnings and cash flows, thereby impacting our ability to service debt and make distributions to our stockholders.

If, under the Americans with Disabilities Act, we are required to make substantial alterations and capital expenditures in one or more of our properties, including the removal of access barriers or the addition of access enhancements, it could adversely impact our earnings and cash flows, thereby impacting our ability to service debt and make distributions to our stockholders.

Our properties are subject to various federal, state, and local regulatory requirements, such as state and local fire, health, and life safety requirements.

We are currently in compliance with these requirements.

If we fail to comply with these requirements, we could incur fines or other monetary damages.

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Financing Risks

At certain times, interest rates and other market conditions for obtaining capital are unfavorable, and, as a result, we may be unable to raise the capital needed to invest in acquisition or development opportunities, maintain our properties, or otherwise satisfy our commitments on a timely basis, or we may be forced to raise capital at a higher cost or under restrictive terms, which could adversely affect returns on our investments, our cash flows, and results of operations.

At certain times, interest rates and other market conditions for obtaining capital could be unfavorable, and, as a result, we may be unable to raise the capital needed to invest in acquisition or development opportunities, maintain our properties, or otherwise satisfy our commitments on a timely basis, or we may be forced to raise capital at a higher cost or under restrictive terms, which could adversely affect returns on our investments, our cash flows, and results of operations.

We generally finance our acquisition and development projects through one or more of the following:

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If a property is mortgaged to secure payment of indebtedness and we are unable to make the mortgage payments, the lender may foreclose.

Further, at the time a mortgage matures, the

property may be worth less than the mortgage amount and, as a result, we may determine not to refinance the mortgage and permit foreclosure, potentially generating defaults on other debt.

Further, at the time a mortgage matures, the property may be worth less than the mortgage amount and, as a result, we may determine not to refinance the mortgage and permit foreclosure, potentially generating defaults on other debt.

• Asset sales .

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• Common stock .

We can also provide no assurance that conditions will be favorable for future issuances of common stock when we need capital.

We consider public issuances of common stock to be an available source of capital for our acquisitions, development, and general corporate purposes.

We can provide no assurance that conditions will be favorable for future issuances of common stock when we need capital.

In addition, common stock issuances may have a dilutive effect on our earnings per share and funds from operations per share.

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The per share trading price of our common stock could decline as a result of the sale of shares of our common stock in the market in connection with an offering or as a result of the perception or expectation that such sales could occur.

We regularly issue common stock to key employees and our directors under our 2019 Omnibus Incentive Stock Plan.

We also issue shares of common stock to participants in our 2021 Employee Stock Purchase Plan.

• Preferred stock .

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Covenants contained in our Credit Facility, senior unsecured notes, term loans, and mortgages could restrict our operational flexibility, which could adversely affect our results of operations.

Our Credit Facility, senior unsecured notes, and our unsecured term loan impose financial and operating restrictions on us.

Our Credit Facility, senior unsecured notes, and our unsecured term loans impose financial and operating restrictions on us.

These restrictions may be modified from time to time, but restrictions of this type include limitations on our ability to incur debt, as well as limitations on the amount of our secured debt, unsecured debt, and on the amount of joint venture activity in which we may engage.

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If we fail to comply with these covenants, our ability to borrow may be impaired, which could potentially make it more difficult to fund our capital and operating needs.

Our failure to comply with such covenants could cause a default, and we may then be required to repay our outstanding debt with capital from other sources.

Our failure to comply with such covenants could cause a default, and we may then be

required to repay our outstanding debt with capital from other sources.

Under those circumstances, other sources of capital may not be available to us or may be available only on unattractive terms, which could materially and adversely affect our financial condition and results of operations.

In addition, the cross default provisions on the Credit Facility, senior unsecured notes, and term loan may affect business decisions on other debt.

In addition, the cross default provisions on the Credit Facility, senior unsecured notes, and term loans may affect business decisions on other debt.

Some of our mortgages contain customary negative covenants, including limitations on our ability, without the lender’s prior consent, to further mortgage that specific property, to enter into new leases, to modify existing leases, or to redevelop or sell the property.

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Our degree of leverage could limit our ability to obtain additional financing or affect the market price of our securities.

Net debt as a percentage of either total asset value or total market capitalization and net debt as a multiple of annualized EBITDA re are often used by analysts to gauge the financial health of equity REITs like us.

Net debt as a percentage of either total asset value or total market capitalization and net debt as a multiple of annualized EBITDA re are non-GAAP metrics often used by analysts to gauge the financial health of equity REITs like us.

If our degree of leverage is viewed unfavorably by lenders or potential joint venture partners, it could affect our ability to obtain additional financing.

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The London Interbank Offered Rate ("LIBOR") has been the subject of regulatory guidance and proposals for reform, and in March 2021, the United Kingdom's Financial Conduct Authority (the authority that regulates LIBOR) announced it intends to stop compelling banks to submit rates for the calculation of LIBOR after June 30, 2023.

Changes in, or the planned discontinuation of, LIBOR would cause changes in how interest is calculated on our variable rate debt including our Credit Facility and term loan.

Recent proposals for LIBOR reforms may result in the establishment of new methods of calculating LIBOR or the establishment of one or more alternative benchmark rates.

Our variable-interest debt instruments, including our Credit Facility and term loan facilities, provide for alternate interest rate calculations if LIBOR is no longer widely available or should the alternative interest rate prove more favorable.

There can be no assurances as to what alternative interest rates may be and whether such interest rates, such as the Secured Overnight Financing Rate ("SOFR"), will be more or less favorable than LIBOR and any other unforeseen impacts of the potential discontinuation of LIBOR.

In December 2022, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2022-06 to defer the sunset date of FASB Accounting Standards Codification (ASC) Topic 848, Reference Rate Reform until December 31, 2024.

As of December 31, 2022, we have one loan (within our Neuhoff joint venture) with a LIBOR-based variable interest rate.

This construction loan bears interest at LIBOR plus 3.60% and matures on September 30, 2025.

The Neuhoff loan provides for alternate interest rate calculations if LIBOR is no longer widely available, including the Secured Overnight Financing Rate ("SOFR").

There can be no assurances as to what alternative interest rates may be and whether such interest rates, such as SOFR, will be more or less favorable than LIBOR and any other unforeseen impacts of the discontinuation of LIBOR.

Real Estate Acquisition and Development Risks

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• the timing of acquisitions may not match the timing of dispositions, leading to periods of time where proceeds are not invested as profitably as we desire or where we increase short-term borrowings until sales proceeds become available;

• a change in our sustainability or resiliency profile, including an increase in key performance metrics like energy consumption intensity and greenhouse gas emissions, and/or a decrease in the percentage of our operating portfolio with key sustainability certifications;

• the inability to obtain financing for acquisitions on favorable terms, or at all;

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The development process inherently requires that a large number of opportunities be pursued with only a few actually being developed.

We may incur significant costs for predevelopment activity for projects that are abandoned, which would directly affect our results of operations.

For projects that are abandoned, we must expense certain costs, such as salaries, that would have otherwise been capitalized.

We may incur significant costs for predevelopment activity for projects that are ultimately abandoned, which would directly affect our results of operations.

For projects that are abandoned, we must expense certain costs, such as salaries and interest on debt, that would have otherwise been capitalized.

We have procedures and controls in place that are intended to minimize this risk, but it is likely that we will incur predevelopment expense on abandoned projects on an ongoing basis.

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These additional costs can be significant and could adversely impact our return on a project and the expected results of operations upon completion of the project.

Also, construction costs vary over time based upon many factors, including the cost of labor and building materials.

Also, construction costs vary over time based upon many factors, including the cost of labor, building materials, and compliance with applied regulations.

We attempt to mitigate the risk of unanticipated increases in construction costs on our development projects through guaranteed maximum price contracts and pre-ordering of certain materials, but we may be adversely affected by increased construction costs on our current and future projects.

• Construction delays .

Real estate development carries the risk that a project could be delayed due to a number of issues that may arise including, but not limited to, weather and other forces of nature, availability of materials, availability of skilled labor, and the financial health of general contractors or sub-contractors.

Construction delays could cause adverse financial impacts to us which could include higher interest and other carrying costs than originally budgeted, monetary penalties from tenants pursuant to their leases, and higher construction costs.

Real estate development carries the risk that a project could be delayed due to a number of issues that may arise including, but not limited to, weather and other forces of nature, availability of materials, availability of skilled labor, the financial health of general contractors or sub-contractors, and the competing demands on plan-approving authorities.

Construction delays could cause adverse financial impacts to us which could include incurring more interest and other carrying costs than originally budgeted, monetary penalties from tenants pursuant to their leases, and higher construction costs.

Delays could also result in a violation of terms of construction loans that could increase fees, interest, or trigger additional recourse of a construction loan to us.

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• Governmental approvals .

All necessary zoning, land-use, building, occupancy, and other required governmental permits and authorizations may not be obtained, may only be obtained subject to onerous conditions, or may not be obtained on a timely basis resulting in possible delays, decreased profitability, and increased management time and attention.

All necessary zoning, land-use, building, occupancy, and other required governmental approvals, permits, and authorizations may not be obtained, may only be obtained subject to onerous conditions, or may not be obtained on a timely basis resulting in possible delays, decreased profitability, and increased management time and attention.

• Competition .

We compete for tenants in our Sun Belt markets by highlighting our locations, rental rates, services, amenities, reputation, and the design and condition of our facilities including operational efficiencies and sustainability improvements.

As the competition for tenants is intense, we may be required to provide rent abatements, incur charges for tenant improvements and other concessions, or we may not be able to lease vacant space in a timely manner.

As the competition for tenants is intense, we may be required to provide rent abatements, increase our capital improvement expenditures, incur charges for tenant improvements and other concessions, and may not be able to lease vacant space in a timely manner.

• Risks associated with the development of mixed-use properties .

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Any failure to continue to qualify as a REIT for federal income tax purposes could have a material adverse impact on us and our stockholders.

We intend to continue to operate in a manner to qualify as a REIT for federal income tax purposes.

Qualification as a REIT involves the application of highly technical and complex provisions of the Internal Revenue Code (the “Code”), for

which there are only limited judicial or administrative interpretations.

We intend to continue to operate in a manner intended to qualify us as a REIT for federal income tax purposes.

Qualification as a REIT involves the application of highly technical and complex provisions of the Internal Revenue Code (the “Code”), for which there are only limited judicial or administrative interpretations.

Certain facts and circumstances not entirely within our control may affect our ability to qualify as a REIT.

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• 100% of our undistributed taxable income (including any net capital gains) from prior years.

We generally intend to make distributions to our stockholders to comply with the 90% distribution requirement to avoid corporate-level tax on undistributed taxable income and to avoid the nondeductible excise tax.

We intend to make distributions to our stockholders to comply with the 90% distribution requirement, to avoid corporate-level tax on undistributed taxable income, and to avoid the nondeductible excise tax.

Distributions could be made in cash, in stock, or in a combination of cash and stock.

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These changes have impacted us and our stockholders in various ways, some of which are adverse or potentially adverse compared to prior law.

Additional changes to tax laws were enacted with the Inflation Reduction Act ("IRA") of 2022, signed into law on August 16, 2022.

Many of the material provisions of the IRA exempt REITs.

To date, the IRS has issued only limited guidance with respect to certain of the new provisions, and there are numerous interpretive issues that will require further guidance.

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There can be no assurance, however, that technical clarifications or changes needed to prevent unintended or unforeseen tax consequences will be enacted by Congress in the near future.

Additional changes to tax laws are likely to continue to occur in the future, and we cannot assure investors that any such changes will not adversely affect the

taxation of our stockholders.

Additional changes to tax laws are likely to continue to occur in the future, and we cannot assure investors that any such changes will not adversely affect the taxation of our stockholders.

Any such changes could have an adverse effect on an investment in shares or on the market value or the resale potential of our properties.

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General Risks

A pandemic, epidemic or outbreak of a contagious disease, such as the ongoing global pandemic of COVID-19, could adversely affect us.

Public health crises, pandemics, and epidemics, such as the ongoing COVID-19 pandemic, have had, and could continue to have, a material adverse effect on global, national, and local economies, as well as on our business and our tenants’ businesses.

A pandemic, epidemic or outbreak of a contagious disease could adversely affect us.

Public health crises, pandemics, and epidemics have had, and could continue to have, a material adverse effect on global, national, and local economies, as well as on our business and our tenants’ businesses.

The potential impact of a pandemic, epidemic, or outbreak of a contagious disease on our tenants and our properties is difficult to predict or assess.

The extent to which the ongoing COVID-19 pandemic, including the outbreaks in Atlanta, Austin, Charlotte, Phoenix, Tampa, Dallas, and Nashville and actions taken to contain or slow them, continues to impact our operations and those of our tenants, will depend on future developments.

These may include the scope, severity, and duration of the pandemic, and the actions taken to mitigate its impact including the availability and effectiveness of vaccines or other treatments;

all of which are highly uncertain and unpredictable, but could be material.

The long-term impact of COVID-19 on the U.S.

and global economies is uncertain and could result in prolonged world-wide economic downturns and recessions that may lead to corporate bankruptcies among our tenants.

Any of these developments and other effects of the ongoing global pandemic of COVID-19 or any other pandemic, epidemic, or outbreak of contagious disease, could adversely affect us.

In addition to the general economic impact of a pandemic, epidemic, or outbreak of a contagious disease, if an outbreak of COVID-19 occurs within the workforce of our tenants or otherwise disrupts their management and other personnel, the business and operating results of our tenants could be negatively impacted.

Large-scale “shelter in place”, “stay safe”, or "social distancing" executive orders and health guidance in Atlanta, Austin, Charlotte, Phoenix, Tampa, Dallas, or Nashville, where we have high concentrations of our lease revenues and/or development activity, have caused many of our tenants, including retailers, restaurants, and our business partners, to stay closed or operate at reduced capacity for an extended period

Although many (but not all) of these restrictions have been gradually lifted, national "social distancing" guidance has remained, and it remains unclear whether an initial surge in the level of business activity is likely to be sustained, especially if the areas in which our properties are located experience a resurgence in COVID-19 cases and/or are subject to the reimposition of previously lifted business restrictions, the imposition of new business restrictions, or the issuance of new or revised local or national health guidance.

The negative impact upon our tenants may include an immediate reduction in cash flow available to pay rent under our leases, and although various governmental financial programs may mitigate this, governmental assistance may not be available to all affected tenants or may be significantly delayed or discontinued.

In turn, our tenants' inability to pay rent under our leases could adversely affect our own liquidity, and there can be no guarantee that additional liquidity will be readily available or available on favorable terms in the future.

Large-scale executive orders and other measures taken to curb the spread of COVID-19 may also negatively impact the ability of our properties and developments to continue to obtain necessary goods and services or provide adequate staffing, which may also adversely affect our operating results and reputation.

Any increased costs or lost revenue as a result of tenant financial difficulty, or their need to comply with executive orders or any OSHA regulations, or other health agencies or departments may not be fully recoverable under our leases or adequately covered by insurance, which could impact our profitability.

In addition to the potential consequences listed above, these same factors may cause prospective tenants to delay their leasing decisions or to lease less space.

Even after the pandemic has ceased to be active, the prevalence of work-from-home policies during the pandemic may alter tenant preferences in the long-term with respect to the demand for leasing office space.

If an outbreak occurs within the workforce of our tenants or otherwise disrupts their management and other personnel, the business and operating results of our tenants could be negatively impacted.

We are dependent upon the services of certain key personnel, including members of the Board of Directors, the loss of any of whom could adversely impact our ability to execute our business.

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The loss of services of any of these key persons could have an adverse effect upon our results of operations, financial condition, and our ability to execute our business strategy.

We may change our policies without obtaining the approval of our stockholders.

Our operating and financial policies, including our policies with respect to acquisitions, development and dispositions of real estate, growth, target markets, operations, indebtedness, capitalization, and dividends are exclusively determined by the Company's Board of Directors.

Accordingly, our stockholders do not control these policies.

Any such changes may increase our costs or otherwise affect the profitability of our business or the value of our assets.

Employee misconduct or misconduct by members of the Board of Directors could adversely impact our ability to execute our business.

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The market price of our common stock may fluctuate.

The market prices of shares of our common stock have been, and may continue to be, subject to fluctuation due to many events and factors such as those described in this report including:

The market price of shares of our common stock have been, and may continue to be, subject to fluctuation due to many events and factors such as those described in this report including:

• actual or anticipated variations in our operating results, funds from operations, or liquidity;

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• general market and economic conditions;

in particular, market and economic conditions of Atlanta, Austin, Charlotte, Phoenix, Tampa, Dallas, and Nashville;

in particular, market and economic conditions of Atlanta, Austin, Tampa, Phoenix, Charlotte, Dallas, and Nashville;

• the realization of any of the other risk factors described in this report.

Many of the factors listed above are beyond our control.

Those factors may cause market prices of shares of our common stock to decline, regardless of our financial performance, condition, and prospects.

Those factors may cause the market price of shares of our common stock to decline, regardless of our financial performance, condition, and prospects.

The market price of shares of our common stock may fall significantly in the future, and it may be difficult for our stockholders to resell our common stock at prices they find attractive.

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Such estimates are inherently subject to uncertainty and should not be relied upon as being indicative of the performance that we anticipate for any applicable period.

Our actual revenues, net income, and funds from operations may differ materially from what is projected by securities analysts.

Our actual revenues, net income, funds from operations, and funds available for distribution may differ materially from what is projected by securities analysts.

If our actual results do not meet analysts’ guidance, our stock price could decline significantly.

We face risks associated with security breaches through cyber attacks, cyber intrusions, or otherwise, as well as other significant disruptions of our information technology (IT) networks and related systems.

We face risks associated with security breaches through cyber attacks or cyber intrusions, as well as other significant disruptions of our information technology (IT) networks and related systems.

We face risks associated with security breaches or disruptions, whether through cyber attacks or cyber intrusions over the internet, malware, computer viruses, attachments to emails, persons inside our organization, persons with access to systems inside our organization, and other significant disruptions of our IT networks and related systems.

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Our IT networks and related systems are essential to the operation of our business and our ability to perform day-to-day operations (including managing our building systems) and, in some cases, may be critical to the operations of certain of our tenants.

While, to date, we have not had a significant cyber breach or attack that had a material impact on our business or results of operations, there can be no assurance that our efforts to maintain the security and integrity of these types of IT networks and related systems will be effective or that attempted security breaches or disruptions would not be successful or damaging.

A security breach or other significant disruption involving our IT networks and related systems could adversely impact our financial condition, results of operations, cash flows, liquidity, and the market price of our common stock.

A security breach or other significant disruption involving our IT networks and systems could result in our inability

to maintain the building systems relied upon by our customers for their efficient use of their leased space, and the continuation of that circumstance could entitle the affected tenants to abate a portion of their rent.

Further, one or more of our tenants could experience a cyber incident which could impact their operations and ability to perform under the terms of their lease with us.

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Public attention to environmental, social, and governance matters.

Recently, more attention is being directed towards publicly-traded companies regarding environmental, social, and governance ("ESG") matters.

Our efforts to improve our ESG profile and practices, including reducing emissions and improve the efficiency of our building operations, may require capital expenditures and may result in short- or long-term increases in our operating costs, all of which could adversely impact our financial condition or results of operations.

A failure, or a perceived failure, to respond to investor, customer, employee, or other stakeholder expectations related to ESG concerns, or to comply with regulatory requirements, including a failure, or a perceived failure, to achieve any voluntarily adopted goals or initiatives, could negatively impact our reputation, ability to do business with certain partners, access to

capital, stock price, and customer and employee attraction and retention.

Recently, more attention is being directed towards publicly-traded companies regarding ESG matters.

Our efforts to improve our ESG profile and practices, including reducing emissions and improving the efficiency of our building operations, may require capital expenditures and may result in short- or long-term increases in our operating costs, all of which could adversely impact our financial condition or results of operations.

Our ability to achieve our ESG goals and objectives and to accurately and transparently report our progress presents numerous operational, financial, legal, and other risks and are partially dependent on the actions of our customers and vendors.

In addition, organizations that provide information to investors on corporate governance and other matters have developed rating systems for evaluating companies on their approach to ESG.

Unfavorable ESG ratings may lead to negative investor sentiment, which could have a negative impact on our stock price.

Additionally, while we strive to create and maintain an inclusive culture and a diverse workforce where everyone feels valued and respected, a failure, or a perceived failure, to properly address matters of culture, including inclusivity and diversity matters, could result in a reputational harm or an inability to attract and retain customers or employees.

As the nature, scope, and complexity of ESG reporting, diligence, and disclosure requirements expand, we may have to undertake additional costs to control, assess, and report on ESG metrics.

Any failure or perceived failure, whether or not valid, to pursue or fulfill our ESG goals, targets, and objectives or to satisfy various ESG reporting standards within the timelines we announce, or at all, could increase the risk of litigation.

Additionally, while we strive to create and maintain an inclusive culture and a diverse workforce where everyone is valued and respected, a failure, or a perceived failure, to properly address matters of culture, including inclusivity and diversity matters, could result in reputational harm or an inability to attract and retain customers or employees.

Unresolved Staff Comments

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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-K

Item 1A. Risk Factors