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Item 7. Management’s Discussion and Analysis

2026-02-05 compared with 2025-02-06 · 158 added, 107 removed, 354 unchanged (43% of the section changed)

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Overview of 2025 Performance and Company and Industry Trends

Our strategy is to create value for our stockholders through ownership of the premier office portfolio in Sun Belt markets of the United States, with a particular focus on Atlanta, Austin, Tampa, Charlotte, Phoenix, Dallas, and Nashville.

Our strategy is to create value for our stockholders through ownership of the premier office portfolio in Sun Belt markets of the United States, with a particular focus on Austin, Atlanta, Charlotte, Tampa, Phoenix, Dallas, and Nashville.

This strategy is based on a disciplined approach to capital allocation that includes opportunistic acquisitions, selective development, and timely dispositions of non-core assets, with a goal of maintaining a portfolio of newer and more efficient properties with lower capital expenditure requirements.

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We utilize our strong local operating platforms within each of our major markets to implement this strategy.

During 2024, we completed two strategic acquisitions of operating properties and entered into one joint venture that acquired an operating property.

We acquired Vantage South End, a 639,000 square foot lifestyle office property in South End Charlotte, for a purchase price of $328.5 million and Sail Tower, a 804,000 square foot lifestyle office property in Downtown Austin, for a purchase price of $521.8 million.

We also acquired a 20% interest in a joint venture for $16.7 million that acquired Proscenium, a 525,000 square foot office property in Midtown Atlanta for a purchase price of $83.3 million.

Finally, we acquired multiple investments in real estate debt during the year including two mezzanine real estate loans for $27.2 million, which are subordinated to the first priority mortgage loans and secured by pledges of equity interests, and one mortgage loan at par for $138.0 million, which was secured by the Saint Ann Court office property in Dallas.

During 2024, we completed several financing and equity market activities to fund the previously mentioned acquisitions, pay off maturing debt, and maintain a strategic mix of floating and fixed rate debt.

We completed offerings of the 2032 Notes and the 2034 Notes, generating net proceeds of $397.9 million and $498.5 million, respectively, each after an original issue discount;

issued 6,000,000 shares of common stock at $31.01 per share, and 9,500,000 shares of common stock at $29.765 per share, generating proceeds of $186.1 million and $282.8 million, net of underwriting discounts, respectively;

repaid in full the $70.9 million remaining balance on the mortgage secured by our Domain 10 property in Austin;

and entered into a floating-to-fixed interest rate swap on the remaining $200 million of the $400 million Term Loan maturing March 2025, fixing the underlying SOFR rate at 4.6675%.

During 2024, we leased or renewed 2.0 million square feet of office space.

During 2025, we completed the strategic acquisition of an operating property, The Link, a 292,000 square foot lifestyle office property in Uptown Dallas, for a purchase price of $218.0 million.

We also received repayment at par for two investments in real estate debt, secured by interests, respectively in Saint Ann Court in Dallas and Radius in Nashville of $138.0 million and $12.8 million, respectively, as well as loaned our Neuhoff joint venture partner $19.6 million at an interest rate of SOFR plus 625 basis points which the partner used to fund their portion of the joint venture loan repayment.

Finally, we sold our bankruptcy claim with SVB Financial group for $4.6 million.

During 2025, we completed an offering of the public senior notes maturing in 2030 generating net proceeds of $496.9 million to fund the acquisition of the Link and to pay off $250 million of privately placed senior notes.

In conjunction with our loan to our joint venture partner mentioned above, the joint venture amended its existing Neuhoff construction loan, repaying $39.2 million of the outstanding principal, extending the maturity date to September 2026, and lowering the spread over SOFR to 300 basis points from 345 basis points.

The joint venture has an option to extend the maturity date an additional 12 months, subject to conditions.

Additionally, we sold 2.9 million shares under Forward Sales contracts at an average price of $30.44 per share.

The future net settlement proceeds will be $88.5 million.

During 2025, we leased a total of 2.1 million square feet of office space.

Our office operating portfolio was 90.7% percent leased as of December 31, 2025 and the weighted average economic occupancy during the fourth quarter of 2025 was 88.3%.

The weighted average net effective rent per square foot, representing base rent excluding operating expense reimbursements and leasing costs, for new or renewed non-amenity leases with terms greater than one year signed in 2024, was $28.17 per square foot.

In 2025, the weighted average net effective rent per square foot, representing base rent excluding operating expense reimbursements and leasing costs, for leases with a term greater than one year, was $25.86 per square foot.

Cash-basis net effective rent per square foot increased 3.5% on spaces that had been previously occupied in the past year.

Cash-basis net effective rent represents net rent at the end of the term paid by the prior tenant compared to the net rent at the beginning of the term paid by the current tenant.

Cash-basis net effective rent represents net rent at the end of the term paid under the prior lease compared to the net rent at the beginning of the term paid under the current lease.

Our same property net operating income for the year increased 2.4% on a straight-line basis and increased 0.9% on a cash-basis.

We believe the Sun Belt, and in particular the seven Sun Belt markets in which we own properties, will continue to outperform the broader office sector evidenced by a clear bifurcation between Sun Belt and Gateway market fundamentals.

We believe the Sun Belt, and in particular the seven Sun Belt markets listed above, will continue to outperform the broader office sector evidenced by a clear bifurcation between Sun Belt and Gateway market fundamentals.

In addition, as the flight to quality trend accelerates among office users, we believe our trophy portfolio is well positioned to benefit from, and ultimately outperform in, the current real estate environment.

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Most of our lease amendments result in a lease modification of our operating leases which will likely require us to reassess both the lease term and fixed lease payments, including considering any prepaid or accrued lease rentals relating to the original lease as a part of the lease payments for the modified lease.

Tenants sometimes negotiate to terminate their lease prior to the end of the lease term.

Tenants sometimes terminate their lease prior to the end of the lease term, as allowed under negotiated termination options included in the lease or through separate negotiations with us.

Such negotiations generally require payment of a termination fee that reimburses us for a portion of the remaining rent under the original lease term and the undepreciated lease inception costs such as commissions, tenant improvements, and lease incentives.

Termination fee income, included in rental property revenue, is recognized on a straight-line basis from the date of the executed termination agreement through lease expiration when the amount of the fee is determinable and collectability of the fee is reasonably assured.

Termination fee income, included in rental property revenue, is recognized on a straight-line basis from the date the termination is executed through lease expiration when the amount of the fee is determinable and collectability of the fee is reasonably assured.

This fee income is adjusted on a straight-line basis by any accrued straight-line rent receivable and any above- or below-market lease intangible assets or liabilities related to the lease projected at the date of tenant vacancy.

Leases representing 35% and 32% of the square footage of our occupied portfolio as of December 31, 2025 and 2024, respectively, had early termination options at some point in their lease terms, all of which require a fee for early termination.

During the years ended December 31, 2025 and 2024, five and three tenants representing 391,000 and 170,000 square feet, respectively, exercised early termination options in their leases.

The early termination fee recognized in rental property revenues on these leases during the years ended December 31, 2025 and 2024 was $2.9 million and $2.5 million, respectively.

Real Estate Carrying Value

The carrying values of our real estate assets are subject to several processes that involve a significant use of judgments and estimates.

Those processes primarily include (i) purchase price allocations for acquired assets, (ii) depreciation and

amortization, and (iii) impairment.

Those processes primarily include (i) purchase price allocations for acquired assets, (ii) depreciation and amortization, and (iii) impairment.

The judgments and estimates used in each of these processes have a material impact on our financial condition, results of operations, and cash flows.

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We identify an asset group based on the lowest level of identifiable cash flows and take into consideration such things as shared expenses and amenities.

includes our operating properties, properties under development, and land holdings (including any capitalized predevelopment costs).

This review includes our operating properties, properties under development, and land holdings (including any capitalized predevelopment costs).

The first step in this process is for us to determine whether an asset is considered to be held-for-investment or held-for-sale.

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In the impairment analysis for assets held-for-investment, we must determine whether there are indicators of impairment.

For operating properties, these indicators could include a reduction in our estimated hold period, a significant decline in a property’s leasing percentage, a current period operating loss or negative cash flows combined with a history of losses at the property, a significant decline in lease rates for that property or others in the property’s market, a significant change in the market value of the property, or an adverse change in the financial condition of significant tenants.

For land holdings, indicators could include an overall decline in the market value of land in the region, a decline in development activity for the intended use of the land, or other adverse economic and market conditions.

For projects under development, indicators could include material budget overruns without a corresponding funding source, significant delays in construction, occupancy, or stabilization timing, regulatory changes or economic trends that have a significant impact on the market, or an adverse change in the financial condition of a significant future tenant.

For operating properties, these indicators could include a significant decline in a property’s leasing percentage, a current period operating loss or negative cash flows combined with a history of losses at the property, a decline in lease rates for that property or others in the property’s market, a significant change in the market value of the property, an adverse change in the financial condition of significant tenants, or a more likely than not probability that there has been a significant decrease in the estimated hold period.

For projects under development, indicators could include material budget overruns, significant delays in construction, occupancy, or stabilization timing, regulatory changes or economic trends that have a significant impact on the market, or an adverse change in the financial condition of a significant future tenant.

For land holdings, indicators could include an overall decline in the market value of land in the region, regulatory changes that impact ability to develop the land, a decline in development activity for the intended use of the land, or other adverse economic and market conditions.

If we determine that an asset that is held-for-investment has indicators of impairment, we must determine whether the undiscounted cash flows associated with the asset exceed the carrying amount of the asset.

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We are involved in all stages of real estate ownership, including development and redevelopment.

Prior to the point at which a project becomes probable of being developed (defined as more likely than not), we expense predevelopment costs.

After we determine a project is probable, all subsequently-incurred predevelopment costs, as well as interest and real estate taxes on qualifying assets and certain internal personnel and associated costs directly related to the project under development or redevelopment, are capitalized in accordance with accounting rules.

Prior to the point at which a project becomes probable of being developed, we expense predevelopment costs.

After we determine a project is probable, all subsequently-incurred predevelopment costs, including certain internal personnel and associated costs directly related to the project under development or redevelopment, are capitalized in accordance with accounting rules.

Once on-going activities commence necessary to prepare the project for its intended use, interest as well as property taxes and insurance are capitalized.

If we abandon development or redevelopment of a project that had earlier been deemed probable, we charge all previously capitalized costs to expense.

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If we determine that a project is probable, interest, general and administrative, and other expenses could be materially different than if we determine the project is not probable.

During the predevelopment period of a probable project and the period in which a project is under construction, we capitalize all direct and indirect costs associated with planning, developing, and constructing the project.

Determination of

what costs constitute direct and indirect project costs requires us, in some cases, to exercise judgment.

If we determine certain costs to be direct or indirect project costs, amounts recorded in projects under development on the balance sheet and amounts recorded in general and administrative and other expenses on the statements of operations could be materially different than if we determine these costs are not directly or indirectly associated with the project.

Determination of what costs constitute project costs requires us, in some cases, to exercise judgment.

Once a certain project is constructed and ready for occupancy, carrying costs, such as real estate taxes, interest, internal personnel costs, and associated costs, are expensed as incurred.

Determination of when construction of a project is held available for occupancy requires judgment.

We consider projects and/or project phases to be held for occupancy at the earlier of the date on which the project or phase reaches economic occupancy of 90% or one year from cessation of major construction activity, which may occur prior to economic stabilization.

Our judgment of the date the project is held for occupancy has a direct impact on our operating expenses and net income for the period.

We consider projects and/or project phases to be ready for occupancy at the earlier of the date on which the project or phase reaches economic occupancy of 90% or one year from cessation of major construction activity, which may occur prior to economic stabilization.

Our judgment of the date the project is ready for occupancy has a direct impact on our operating expenses and net income for the period.

Results of Operations For The Year Ended December 31, 2025

Net income available to common stockholders for the years ended December 31, 2025 and 2024 was $40.5 million and $46.0 million, respectively.

The decrease in net income is primarily attributable to increased depreciation expense.

We detail below material changes in the components of net income available to common stockholders for the year ended 2024 compared to 2023.

In 2025, we recorded $14.3 million of impairment losses related to our Harborview property and the 303 Tremont land parcel.

We detail below other material changes in the components of net income available to common stockholders for the year ended 2025 compared to 2024.

Management's Discussion and Analysis of Financial Condition and Results of Operations - Results of Operations" from our 2024 Annual Report on Form 10-K for a comparison of 2024 to 2023 financial results.

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Same Property amounts for the 2025 versus 2024 comparison are from properties that were stabilized and owned as of January 1, 2024 through December 31, 2025.

We consider many factors in determining whether a property has stabilized, including the property’s occupancy (independently and relative to its submarket) and current leasing pipeline, as well as time since the cessation of major construction activity.

Management evaluates the performance of its property portfolio, in part, based on Net Operating Income ("NOI").

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Depreciation and amortization 415,359 365,045

Operating property impairment 13,286 —

Land and related predevelopment cost impairment 1,034 —

Reimbursed expenses 544 634

Other expenses 1,801 2,097

Loss (income) from unconsolidated joint ventures 2,796 (2,299)

Loss from unconsolidated joint ventures 8,159 2,796

Gain on investment property transactions — (98)

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Same Property NOI allows analysts, investors, and management to analyze continuing operations and evaluate the growth trend of the Company's portfolio.

Same Property Rental Property Revenues and NOI increased between 2024 and 2023 primarily due to an increase in economic occupancy at our BriarLake Plaza, San Jacinto Center, and Promenade Tower office properties and increases in revenues recognized from tenant funded improvements owned by us.

In addition, parking revenue from our Same Property portfolio increased between 2024 and 2023.

Non-Same Property Rental Property Revenues, Rental Property Operating Expenses, and NOI increased between 2024 and 2023 primarily due to the commencement of operations at our Domain 9 building in the first quarter of 2024, increased economic occupancy at our recently redeveloped Promenade Central operating property, and the acquisitions of Vantage South End and Sail Tower in December 2024.

This increase is partially offset by a full building redevelopment at our Hayden Ferry 1 building, which began in the fourth quarter of 2023.

Same Property Rental Property Revenues and NOI increased between 2025 and 2024 primarily due to an increase in economic occupancy at our Promenade Tower, Corporate Center, and 3350 Peachtree office properties and increases in revenues recognized from tenant funded improvements owned by us.

In addition, parking revenue from our Same Property portfolio increased in 2025 compared to 2024 .

Non-Same Property Rental Property Revenues, Rental Property Operating Expenses, and NOI increased between 2025 and 2024 primarily due to the acquisitions of our Vantage South End and Sail Tower office properties in December 2024 as well as the acquisition of The Link in July 2025.

The following table details NOI from properties aggregated by market:

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$ Change % Change

Atlanta $ 194,837 $ 188,451 $ 6,386 3.4 %

Austin $ 242,424 $ 191,758 $ 50,666 26.4 %

Atlanta 203,272 194,837 8,435 4.3 %

Charlotte 63,971 42,164 21,807 51.7 %

Tampa 52,653 49,383 3,270 6.6 %

Phoenix 48,923 44,597 4,326 9.7 %

Charlotte 42,164 43,124 (960) (2.2) %

Dallas 22,604 13,937 8,667 62.2 %

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(2) Includes operations at land sites held for future development as well as a parking garage in Charlotte.

NOI for the Austin market increased $21.7 million, or 12.7%, between 2024 and 2023 primarily due to the commencement of operations at our Domain 9 building in the first quarter of 2024 as well as an increase in revenues recognized from tenant funded improvements owned by us.

NOI from Other markets increased $7.7 million, or 52.5%, between 2024 and 2023 primarily due to the an increase in economic occupancy at our BriarLake Plaza office property in Houston.

Other income increased $4.8 million, or 194.4%, between 2024 and 2023 primarily due to the interest income from the two mezzanine loans and the Saint Ann Court mortgage loan acquired in 2024.

These transactions are described in further detail in note 5 to the consolidated financial statements in this Form 10-K.

NOI for the Austin market increased $50.7 million, or 26.4%, between 2025 and 2024 primarily due to the acquisition of Sail Tower in December 2024.

NOI for the Charlotte market increased $21.8 million, or 51.7%, primarily due to the acquisition of Vantage South End in December 2024.

NOI from the Dallas market increased $8.7 million, or 62.2%, primarily due to the acquisition of The Link in July 2025.

Other income increased $4.0 million, or 55.4%, between 2025 and 2024 primarily due to the sale of our Silicon Valley Bank ("SVB") bankruptcy claim in the first quarter of 2025 and interest income earned on the proceeds from the offering of the 2030 Notes prior to the repayment of the $250 million privately placed senior notes, partially offset by a decrease in interest income from investments in real estate debt driven by the repayment from our borrowers on two of our real estate debt investments.

The SVB and investment in real estate debt transactions are described in further detail in notes 5 and 14 to the consolidated financial statements in this Form 10-K.

General and Administrative Expenses

General and administrative expenses increased $4.2 million, or 13.1%, between 2024 and 2023 primarily due to increases in stock compensation expense and an increase in expenses related to annual performance-based compensation paid in cash.

General and administrative expenses increased $2.1 million, or 5.7%, between 2025 and 2024 primarily due to increases in stock compensation expense.

Interest Expense

Interest expense, net of amounts capitalized, increased $36.8 million, or 30.0%, between 2025 and 2024.

T his increase is primarily due to the issuances of the $500 million and $400 million public unsecured senior notes in August and December of 2024, respectively, and decreases in capitalized interest as we finished construction on the core building and began operations at our Domain 9 building in the first quarter of 2024.

T his increase is primarily due to the issuances of the $500 million and $400 million public unsecured senior notes in August and December of 2024, respectively, as well as the issuance of the $500 million public unsecured senior notes in June 2025, partially offset by the repayments of the $250 million senior note in July 2025 and the repayment of $100 million of the 2021 Term Loan in August 2024, as well as a lower average balance outstanding on the Credit Facility in 2025.

Depreciation and Amortization

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Total Depreciation and Amortization $ 415,359 $ 365,045 $ 50,314 13.8 %

Same Property depreciation and amortization increased between 2024 and 2023 primarily due to an increase of assets in service during the current period, primarily from tenant improvements.

Non-Same Property depreciation and amortization increased between 2024 and 2023 primarily due to completion of development at Domain 9 and a full building redevelopment at Promenade Central, the Sail Tower Acquisition and the Vantage Acquisition in December 2024, as well as changes in the estimated useful lives of buildings and improvements at some of our operating properties.

These increases were partially offset by our suspension of depreciation related to our full building redevelopment at our Hayden Ferry 1 building, which began in the fourth quarter of 2023.

Income and Net Operating Income from Unconsolidated Joint Ventures

Income (loss) from unconsolidated joint ventures consisted of the following in 2024 and 2023 ($ in thousands):

Non-Same Property depreciation and amortization increased between 2025 and 2024 primarily due to the acquisitions of Sail Tower and Vantage South End in December 2024, the acquisition of The Link in July 2025, and the completion of development at Domain 9.

Loss and Net Operating Income from Unconsolidated Joint Ventures

The following table reconciles loss from unconsolidated joint ventures to unconsolidated NOI for each of the periods presented ($ in thousands):

Year Ended December 31,

2025 2024 $ Change % Change

Income (loss) from unconsolidated joint ventures $ (2,796) $ 2,299 $ (5,095) (221.6) %

Loss from unconsolidated joint ventures $ (8,159) $ (2,796) $ (5,363) 191.8 %

Depreciation and amortization 10,739 4,745 5,994 126.3 %

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Net operating income from unconsolidated joint ventures $ 12,349 $ 6,617 $ 5,732 86.6 %

The change in income (loss) from unconsolidated joint ventures was driven by increases in unconsolidated depreciation and amortization as well as unconsolidated interest expense.

Unconsolidated depreciation and amortization expense increased between 2024 and 2023 primarily due to development activities winding down and initial operations beginning at our joint venture's Neuhoff property in the fourth quarter of 2023 and the acquisition of Proscenium in August 2024.

Unconsolidated interest expense increased between 2024 and 2023 primarily due to a reduction in capitalized interest at our Neuhoff joint venture as portions of its development project were completed in 2024 as well as the June 2023 refinance of the mortgage on the property in our Crawford Long joint venture.

Non-Same Property NOI from unconsolidated joint ventures increased between 2024 and 2023 primarily due to the acquisition of Proscenium in August 2024.

The change in loss from unconsolidated joint ventures was driven by increases in unconsolidated depreciation and amortization as well as unconsolidated interest expense.

Unconsolidated depreciation and amortization expense increased between 2025 and 2024 primarily due to:

(i) assets being placed in service as portions of the development were completed and initial operations started at our joint venture's Neuhoff property in the fourth quarter of 2023 and (ii) the acquisition of Proscenium in August 2024.

Unconsolidated interest expense increased between 2025 and 2024, primarily due to a reduction in capitalized interest at our Neuhoff joint venture as further portions of its development project were completed in 2025.

Non-Same Property NOI from unconsolidated joint ventures increased between 2025 and 2024 primarily due to operations at Neuhoff, as the property continues to increase occupancy, and the acquisition of Proscenium in August 2024.

Funds from Operations

The table below shows Funds from Operations Available to Common Stockholders (“FFO”), a non-GAAP financial measure, and the related reconciliation from net income available to common stockholders.

We calculate FFO as defined by the National Association of Real Estate Investment Trusts ("Nareit"), which is net income (loss) available to common stockholders (computed in accordance with GAAP), excluding depreciation and amortization related to real estate, gains and losses from sales of depreciable property, gains and losses from changes in control and impairment of depreciable real estate, plus depreciation and amortization of real estate assets, impairment on depreciable investment property, and after adjustments for unconsolidated partnerships and joint ventures to reflect FFO on the same basis.

plus depreciation and amortization of real estate assets, impairment on depreciable investment property, and after adjustments for unconsolidated partnerships and joint ventures to reflect FFO on the same basis.

FFO is used by industry analysts and investors as a supplemental measure of an equity REIT’s operating performance.

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Noncontrolling interest related to unitholders 7 25 — 8 25 —

Potentially dilutive common shares — 2 — — — —

Potentially dilutive common shares - ESPP — — — — 2 —

Conversion of unvested restricted stock units — 772 — — 575 —

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Partners' share of real estate depreciation (1,005) — (0.01) (1,106) — (0.01)

Loss (gain) on sale of depreciated properties:

Gain on sale of depreciated properties:

Consolidated properties — — — (101) — —

Operating property impairment 13,286 — 0.08 — — —

Funds From Operations $ 478,401 168,716 $ 2.84 $ 414,092 154,015 $ 2.69

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• proceeds from unsecured loans;

• proceeds from offerings of equity securities;

• proceeds from offerings of equity and securities;

• joint venture formations.

Our material capital expenditure commitments for 2025 include $95.8 million of unfunded tenant improvements and development costs.

Our material capital expenditure commitments as of December 31, 2025 include $172.9 million of unfunded tenant improvements and development costs.

As of December 31, 2025, we had $116.0 million drawn under our Credit Facility with the ability to borrow the remaining $884.0 million, as well as $5.7 million of cash and cash equivalents.

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a secured leverage ratio of no more than 50%;

and an overall leverage ratio of no more than 60%.

and overall and unsecured leverage ratios of no more than 60%.

The Credit Facility matures on April 30, 2027.

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In addition to the interest rate, the Credit Facility is also subject to an annual facility fee of 0.125% to 0.30%, depending on our credit rating and leverage ratio, on the entire $1 billion capacity.

There can be no assurance that we will maintain any particular rating in the future and if our credit ratings decrease, then we may be subject to higher applicable spreads.

There can be no assurance that

we will maintain any particular rating in the future and if our credit ratings decrease, then we may be subject to higher applicable spreads.

In April 2024, we notified the administrative agent of the Credit Facility of our receipt of corporate investment grade ratings.

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On October 3, 2022, we entered into a Delayed Draw Term Loan Agreement (the "2022 Term Loan") and borrowed the full $400 million available under the loan.

Under the 2022 Term Loan, the applicable interest rate varies according to our credit rating and leverage ratio and may, at our election, be determined based on either (1) the Daily SOFR or Term SOFR, plus a SOFR adjustment of 0.10% ("Adjusted SOFR") and a spread of between 0.80% and 1.60%, or (2) the greater of (i) Bank of America's prime rate, (ii) the federal funds rate plus 0.50%, (iii) Term SOFR, plus a SOFR adjustment of 0.10%, and 1.00%, or (iv) 1.00%, plus a spread of between 0.00% and 0.65%, based on leverage.

The loan had an initial maturity of March 3, 2025 with four consecutive options to extend the maturity date for an additional six months each.

In December 2024, we exercised the first of the four six month extension options, extending the maturity date to September 3, 2025.

Under the 2022 Term Loan the interest rate applicable varies according to our credit rating and leverage ratio and may, at our election, be determined based on either (1) the Daily SOFR or Term SOFR, plus a SOFR adjustment of 0.10% ("Adjusted SOFR") and a spread of between 0.80% and 1.60%, or (2) the greater of (i) Bank of America's prime rate, (ii) the federal funds rate plus 0.50%, (iii) Term SOFR, plus a SOFR adjustment of 0.10%, and 1.00%, (iv) or 1.00%, plus a spread of between 0.00% and 0.65%, based on leverage.

There can be no assurance that we will maintain any particular rating in the future and if our credit ratings decrease, then we may be subject to higher applicable spreads.

We have exercised the third of the four six-month extension options, which becomes effective March 3, 2026, with an extended maturity date of September 3, 2026.

The final maturity date, should we elect to exercise the one remaining extensions, would be March 3, 2027.

The covenants under the 2022 Term Loan are the same as the Credit Facility.

At December 31, 2024, the spread over the underlying SOFR rates was 0.85% for the 2022 Term Loan.

On April 19, 2023, we entered into a floating-to-fixed rate swap with respect to $200 million of the $400 million 2022 Term Loan through the initial maturity date of March 3, 2025.

This swap fixed the underlying SOFR rate at 4.298%.

On January 26, 2024, we entered into a floating-to-fixed rate swap with respect to the remaining $200 million of the $400 million 2022 Term Loan through the initial maturity date of March 3, 2025.

This swap fixed the underlying SOFR rate at 4.6675% (see note 10 to the consolidated financial statements).

These two swaps fix the underlying SOFR rate for the full $400 million at a weighted average of 4.483%.

On January 26, 2024, we entered into a floating-to-fixed rate swap with respect to remaining $200 million of the $400 million 2022 Term Loan through the initial maturity date of March 3, 2025.

This swap fixed the underlying SOFR rate at 4.6675% (see note 10).

These two swaps fixed the underlying SOFR rate for the full $400 million at a weighted average of 4.483%.

These swaps expired on March 3, 2025.

For the 2022 Term Loan, a six-month Term SOFR of 4.2018% was in effect from March 3, 2025 through September 2, 2025, and a six-month Term SOFR of 4.206% was in effect from September 3, 2025 to March 2, 2026.

At December 31, 2025, the spread over the underlying SOFR rates was 0.85% for the 2022 Term Loan.

On June 28, 2021, we entered into an Amended and Restated Term Loan Agreement (the "2021 Term Loan") that amended the former term loan agreement.

Under the 2021 Term Loan, we have borrowed $350 million with an initial maturity of August 30, 2024 with four consecutive options to extend the maturity date for an additional 180 days each.

Under the 2021 Term Loan, we borrowed $350 million with an initial maturity of August 30, 2024 with four consecutive options to extend the maturity date for an additional 180 days each.

In August 2024, we paid down $100 million of the $350 million outstanding and exercised the first of our four 180 day extension options, extending the maturity date on the remaining $250 million to February 26, 2025.

In December 2024, we exercised the second of our four 180 day extension options, extending the maturity date on the remaining $250 million to August 25, 2025.

In December 2025, we exercised the fourth of our four 180 day extension options, which becomes effective February 20, 2026, with an extended maturity date of August 17, 2026.

On September 19, 2022, we entered into the First Amendment to the 2021 Term Loan.

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Unsecured Senior Notes

At December 31, 2025, we had $2.2 billion aggregate principal amount of senior unsecured notes outstanding.

In June 2025, CPLP issued $500.0 million in aggregate principal amount of 5.250% senior unsecured notes.

Upon issuance of the 2030 Notes, CPLP received proceeds of $499.9 million dollars, net of the original issue discount of $65,000, resulting in an effective interest rate of 5.251%.

These senior unsecured notes are fully and unconditionally guaranteed by the Company.

The proceeds were used to repay, at maturity, the $250.0 million outstanding amount of the privately placed senior notes due July 7, 2025, to partially fund the acquisition of The Link on July 28, 2025, and for general corporate purposes.

These public senior notes had issuance costs of $4.2 million and mature on July 15, 2030.

In December 2024, CPLP issued $400.0 million in aggregate principal amount of 5.375% senior unsecured notes.

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The 2032 Notes are fully and unconditionally guaranteed by us.

The proceeds were used to fund part of the purchase prices for the Sail Tower Acquisition and the Vantage Acquisition in December 2024.

The proceeds were used to fund part of the purchase prices for the Sail Tower and the Vantage acquisitions in December 2024.

The 2032 Notes had issuance costs of $3.6 million and mature on February 15, 2032.

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The 2032 Notes and the 2034 Notes are sometimes referred to herein as the "public senior unsecured notes."

The public senior unsecured notes are subject to certain typical covenants that, subject to certain exceptions, include (a) a limitation on the ability of the Company and CPLP to, among other things, incur additional secured and unsecured indebtedness;

The above described senior unsecured notes are subject to certain typical covenants that, subject to certain exceptions, include (a) a limitation on the ability of the Company and CPLP to, among other things, incur additional secured and unsecured indebtedness;

(b) a limitation on the ability of the Company and CPLP to merge, consolidate, sell, lease or otherwise dispose of their properties and assets substantially as an entirety;

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To avoid any such limitations, these covenants require, among other things, maintaining the following financial metrics as defined in the agreement:

unencumbered debt ratio of at least 150%;

an EBITDA to debt service ratio of at least 1.50x;

a secured leverage ratio of no more than 40%;

and an overall leverage ratio of no more than 60%.

At December 31, 2024, we had $1.9 billion aggregate principal amount of unsecured senior notes outstanding, including $1 billion outstanding principal amount of senior unsecured notes issued in a private placement of five tranches.

These unsecured senior notes have maturity dates that range from 2025 to 2034 and the weighted average fixed interest rates on these notes is 4.74%.

The senior unsecured notes issued in the private placement are sometimes referred to herein as the privately placed senior unsecured notes.

The unsecured senior notes contain financial covenants that are consistent with those of our Credit Facility, with the exception of a secured leverage ratio of no more than 40%.

(a) unencumbered debt ratio of at least 150%;

(b) an EBITDA to debt service ratio of at least 1.50x;

(d) and an overall leverage ratio of no more than 60%.

We also have $750.0 million aggregate principal amount of privately placed unsecured senior notes outstanding in four tranches as of December 31, 2025.

The privately placed unsecured senior notes contain financial covenants that are generally consistent with those of our Credit Facility, with the exception of a secured leverage ratio of no more than 40%.

The $250 million outstanding amount of the privately placed senior notes due July 7, 2025 were repaid at maturity.

The senior notes also contain customary representations and warranties, both affirmative and negative covenants, and customary events of default.

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Except as previously discussed, based on the nature of the activities conducted in these ventures, management cannot estimate with any degree of accuracy amounts that we may be required to fund in the short- or long-term.

However, management does not believe that additional funding of these ventures will have a material adverse effect on our financial condition or results of operations.

management does not believe that additional funding of these ventures will have a material adverse effect on our financial condition or results of operations.

At December 31, 2025, our unconsolidated joint ventures had aggregate outstanding indebtedness to third parties of $332.4 million.

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Our existing mortgage debt is solely non-recourse, fixed-rate mortgage notes secured by various real estate assets.

joint venture equity, the issuance of common stock, the issuance of preferred stock, or the issuance of units of CPLP.

We expect to either refinance our non-recourse mortgage loans at maturity or repay the mortgage loans with other capital sources, includin g ou r credit facility, public and private unsecured debt, non-recourse mortgages, construction loans, the sale of assets, joint venture equity, the issuance of common stock, the issuance of preferred stock, or the issuance of units of CPLP.

Many of our non-recourse mortgages contain covenants which, if not satisfied, could result in acceleration of the maturity of the debt.

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Net cash used in investing activities (425,661) (1,305,402) 879,741

Net cash provided by (used in) financing activities 906,471 (71,725) 978,196

Net cash provided by financing activities 21,757 906,471 (884,714)

The reasons for significant increases and decreases in cash flows between the periods are as follows:

Cash Flows from Operating Activities.

Cash provided by operating activities increased $31.9 million between 2024 and 2023 primarily due to increased economic occupancy and the end of rent abatement periods at our 100 Mill, San Jacinto Center, and Tempe Gateway office properties;

the commencement of operations at our Domain 9 office property in 2024;

the timing and amount of interest payments;

and the timing of property tax payments and the timing of receipt of rent payments from tenants;

all partially offset by the suspension of operations related to our full building redevelopment of Hayden Ferry 1 that began in the fourth quarter of 2023.

Cash provided by operating activities increased $2.0 million between 2025 and 2024 primarily due to increased economic occupancy and the end of rent abatement periods at our Domain 9, Promenade Central, and Buckhead Plaza office properties and the acquisitions of our Vantage South End and Sail Tower office properties in December 2024, as well as our acquisition of The Link office property in July 2025.

These increases are partially offset by increases in interest payments on debt.

Cash Flows from Investing Activities.

Cash used in investing activities increased $1.0 billion between 2024 and 2023.

Cash used in investing activities was higher in 2024 primarily due to the Sail Tower Acquisition and the Vantage Acquisition for an aggregate price of $838.0 million in December 2024 and the acquisitions of investments in real estate debt for $167.2 million during 2024.

Cash used in investing activities decreased $879.7 million between 2025 and 2024 primarily driven by the acquisitions of Sail Tower and Vantage for an aggregate price of $838.0 million in December 2024, when compared to the acquisition of The Link in July 2025 for $215.0 million.

Cash Flows from Financing Activities.

Cash flows provided by financing activities increased $978.2 million between 2024 and 2023.

The increase in cash provided by financing activities is primarily driven by the proceeds from the 2024 issuances of common stock and public unsecured senior notes.

This increase is partially offset by cash used in repayments of the Domain 10 mortgage note, $100 million of the $350 million 2021 Term Loan, and an increase in net repayments on our Credit Facility in 2024.

Cash flows provided by financing activities decreased by $884.7 million between 2025 and 2024.

In 2025, securities offerings generated gross proceeds of $500.0 million which was partially offset

by debt maturity repayments of $250.0 million.

In 2024, securities offerings generated gross proceeds $1.4 billion in proceeds which was partially offset by debt maturity payments of $172.7 million.

Capital Expenditures.

We incur capital expenditures for the development of new properties, the redevelopment of existing or newly purchased properties, building improvements, direct leasing costs for new or replacement tenants, and capitalized interest and salaries.

We incur capital expenditures for the development of new properties, the redevelopment of existing or newly purchased properties, general building improvements, direct leasing costs such as commissions or tenant improvements, and capitalized interest and salaries.

Components of expenditures included in this line item for the years ended December 31, 2025 and 2024 are as follows ($ in thousands):

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(1) Includes initial leasing costs.

Capital expenditures decreased $26.8 million between 2024 and 2023 primarily due to decre ases in projects under development activities and related capitalized interest and salaries due to the Domain 9 development commencing initial operations in the first quarter of 2024.

These decreases are partially offset by the following:

(i) increased spending on operating property redevelopments compared to 2023 with the commencement of a full building redevelopment of Hayden Ferry 1 in the fourth quarter of 2023, partially offset by the renovations at 3350 Peachtree and Promenade Central which were substantially completed in 2023, and (ii) an increased spending on building improvements.

The weighted average leasing costs on a per square foot basis for leases signed during 2024 and 2023 were as follows:

New leases $12.30 $13.41

Renewal leases $9.70 $9.36

Expansion leases $13.16 $6.12

All signed leases $11.60 $10.59

Capital expenditures increased $14.5 million between 2025 and 2024 primarily due to increased leasing costs at our operating properties.

This is primarily related to timing of tenant improvement reimbursement requests and to our strong leasing activity.

This is partially offset by lower spending on projects under development, as the Domain 9 property became fully operational in 2025.

The above leasing costs include leasing commissions and tenant improvements, which are both capitalized as a component of our real estate assets as they are incurred.

Commitments toward those costs are calculated on square foot basis and are included in our leasing activity as leases are executed.

Leasing activity details, including the components of net effective rent per square foot, for our office portfolio on leases executed during the years ended December 31, 2025 and 2024 are as follows:

Year Ended December 31, 2025

New Renewal Expansion Total

Net leased square feet (1) 938,531 950,010 236,417 2,124,958

Number of transactions 76 66 25 167

Lease term in years (2) 9.2 7.8 8.3 8.5

Net effective rent calculation (per square foot per year) (2)

Net annualized rent (3) $ 38.51 $ 36.38 $ 40.33 $ 37.76

Net free rent (2.37) (1.91) (1.52) (2.07)

Leasing commissions (3.06) (2.57) (2.84) (2.82)

Tenant improvements (8.49) (5.32) (7.80) (7.01)

Total leasing costs (13.92) (9.80) (12.16) (11.90)

Net effective rent $ 24.59 $ 26.58 $ 28.17 $ 25.86

Second generation leased square footage (4) 1,574,998

Increase in straight-line basis second generation net rent per square foot (5) 21.5 %

Increase in cash-basis second generation net rent per square foot (6) 3.5 %

Year Ended December 31, 2024

New Renewal Expansion Total

Net leased square feet (1) 1,200,044 612,763 206,827 2,019,634

Number of transactions 78 57 22 157

Lease term in years (2) 8.3 7.0 8.6 7.9

Net effective rent calculation (per square foot per year) (2)

Net annualized rent (3) $ 42.80 $ 35.86 $ 33.75 $ 39.77

Net free rent (1.84) (2.20) (1.98) (1.97)

Leasing commissions (3.09) (2.32) (2.67) (2.81)

Tenant improvements (7.37) (5.18) (8.51) (6.82)

Total leasing costs (12.30) (9.70) (13.16) (11.60)

Net effective rent $ 30.50 $ 26.16 $ 20.59 $ 28.17

Second generation leased square footage (4) 1,405,400

Increase in straight-line basis second generation net rent per square foot (5) 28.2 %

Increase in cash-basis second generation net rent per square foot (6) 8.5 %

(1) Comprised of total square feet leased, unadjusted for ownership share.

Excludes leases approximately one year or less, along with apartment, retail, amenity, storage, and intercompany space leases.

(2) Weighted average of net leased square feet.

(3) Straight-line net rent per square foot (operating expense reimbursements deducted from gross leases) over the lease term, prior to any deductions for leasing costs.

Excludes percent rent leases.

(4) Excludes leases executed for spaces that were vacant upon acquisition, new leases in development properties, percent rent leases, and leases for spaces that have been vacant for one year or more.

(5) Increase in second generation straight-line basis net annualized rent on a weighted average basis.

(6) Increase in second generation net cash rent at the end of the term paid under the prior lease compared to net cash rent at the beginning of the term (after any free rent period) paid under the current lease on a weighted average basis.

For early renewals, the final net cash rent paid under the original lease is compared to the first net cash rent paid under the terms of the renewal.

Net cash rent is net of any recovery of operating expenses but prior to any deductions for leasing costs.

Our office portfolio was 90.7% leased as of December 31, 2025, down slightly from 91.6% leased as of December 31, 2024, which is inclusive of 2.1 million and 2.0 million square feet of new, renewal, and expansion leases executed in 2025 and 2024, respectively, and 1.2 million and 488,000 square feet of leases expiring without renewal in 2025 and 2024, respectively.

The amounts of leasing costs on a per square foot basis vary by lease and by market.

We paid common dividends of $215.8 million and $195.4 million in 2025 and 2024, respectively.

We funded these dividends with cash provided by operating activities.

We also expect to fund our future quarterly common dividends with cash provided by operating activities.

Proceeds from investment property sales, distributions from unconsolidated joint ventures, and indebtedness will be used, if necessary.

The increase of common dividends paid in the comparative periods is largely driven by the issuance of 15.5 million shares of common stock in the fourth quarter of 2024.

We expect to fund our future quarterly common dividends with cash provided by operating activities, proceeds from investment property sales, distributions from unconsolidated joint ventures, indebtedness, and proceeds from offerings of equity and other securities, if necessary.

On a quarterly basis, we review the amount of our common dividend in light of current and projected future cash provided by operating activities and also consider the requirements needed to maintain our REIT status.

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We routinely monitor the status of our common dividend payments in light of the covenants of our credit agreements.

Guarantor Information.

The Company and CPLP have filed a registration statement on Form S-3 with the SEC registering, among other securities, debt securities of CPLP, which are fully and unconditionally guaranteed by the Company.

Separate Consolidated Financial Statements of CPLP have not been presented in accordance with the amendments to Rule 3-10 of Regulation S-X.

Furthermore, as permitted under Rule 13-01(a)(4)(vi), the Company has excluded the summarized financial information for CPLP as the assets, liabilities, and results of operations of the Company and CPLP are not

materially different than the corresponding amounts presented in the Consolidated Financial Statements of the Company, and management believes such summarized financial information would be repetitive and not provide incremental value to investors.

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 7. Management’s Discussion and Analysis