What changed in this filing

/stocks — the workspaceLOADING

Item 1. Financial Statements

2024-07-24 compared with 2024-04-24 · 164 added, 97 removed, 593 unchanged (31% of the section changed)

25 unchanged sentences

48,652,525 shares issued

and outstanding at March 31, 2024 and 47,700,432 at December 31, 2023

and outstanding at June 30, 2024 and 47,700,432 at December 31, 2023

Excess shares;

1 unchanged sentence

30,000,000 shares authorized;

zero shares issued

no shares issued

Additional paid-in capital 3,112,554 2,949,907

10 unchanged sentences

(IN THOUSANDS, EXCEPT PER SHARE DATA)

Three Months Ended

Three Months Ended Six Months Ended

June 30, June 30,

2024 2023 2024 2023

Income from real estate operations $ 157,333 138,811 311,407 272,775

29 unchanged sentences

(IN THOUSANDS, EXCEPT SHARE AND PER SHARE DATA)

For the three months ended March 31, 2024:

For the six months ended June 30, 2024:

Common Shares Additional

21 unchanged sentences

BALANCE, MARCH 31, 2024 5 2,997,210 ( 368,954 ) 30,782 316 2,659,359

For the three months ended March 31, 2023:

Net income — — 55,287 — 14 55,301

Net unrealized change in fair value of interest rate swaps — — — ( 1,095 ) — ( 1,095 )

Common dividends declared – $ 1.27 per

— — ( 61,889 ) — — ( 61,889 )

Stock-based compensation, net of forfeitures

— 2,644 — — — 2,644

Issuance of 639,299 shares of common

stock, common stock offering, net of expenses

— 112,710 — — — 112,710

Withheld 57 shares of common stock to satisfy tax withholding obligations in connection with the issuance of common stock

— ( 10 ) — — — ( 10 )

Net distributions to noncontrolling interest — — — — ( 73 ) ( 73 )

BALANCE, JUNE 30, 2024 $ 5 3,112,554 ( 375,556 ) 29,687 257 2,766,947

See accompanying Notes to Consolidated Financial Statements (unaudited).

EASTGROUP PROPERTIES, INC.

AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY

(IN THOUSANDS, EXCEPT SHARE AND PER SHARE DATA)

For the six months ended June 30, 2023:

Common Shares Additional

20 unchanged sentences

BALANCE, MARCH 31, 2023 4 2,355,476 ( 345,622 ) 26,109 415 2,036,382

Net income — — 43,450 — 15 43,465

Net unrealized change in fair value of interest rate swaps — — — 10,202 — 10,202

Common dividends declared – $ 1.25 per

— — ( 56,762 ) — — ( 56,762 )

Stock-based compensation, net of forfeitures

— 2,771 — — — 2,771

Issuance of 1,065,678 shares of common stock, common stock offering, net of expenses

— 177,749 — — — 177,749

Net distributions to noncontrolling interest — — — — ( 86 ) ( 86 )

BALANCE, JUNE 30, 2023 $ 4 2,535,996 ( 358,934 ) 36,311 344 2,213,721

See accompanying Notes to Consolidated Financial Statements (unaudited).

3 unchanged sentences

(IN THOUSANDS)

Three Months Ended March 31,

Six Months Ended June 30,

OPERATING ACTIVITIES

17 unchanged sentences

Leasing commissions ( 16,517 ) ( 16,548 )

Proceeds from involuntary conversion on real estate assets 2,450 1,339

Changes in accrued development costs ( 9,205 ) 20,614

12 unchanged sentences

Other ( 6,225 ) ( 4,911 )

NET CASH USED IN FINANCING ACTIVITIES ( 18,306 ) ( 19,304 )

NET CASH PROVIDED BY FINANCING ACTIVITIES 30,356 31,050

INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS ( 863 ) 1,026

18 unchanged sentences

The consolidated financial statements include the accounts of EastGroup, its wholly owned subsidiaries and the investee of any joint ventures in which the Company has a controlling interest.

As of March 31, 2024 and December 31, 2023, EastGroup had a 95 % controlling interest in a joint venture arrangement owning 6.5 acres of land in San Diego, known by the Company as Miramar Land.

As of June 30, 2024 and December 31, 2023, EastGroup had a 95 % controlling interest in a joint venture arrangement owning 6.5 acres of land in San Diego, known by the Company as Miramar Land.

During the year ended December 31, 2023, a joint venture, in which EastGroup owns a 99.5 % interest, acquired 29.3 acres of land in Denver, known by the Company as Arista 36 Business Park 1-3.

As of March 31, 2024 and December 31, 2023, EastGroup continued to hold a controlling interest in these two joint venture arrangements.

As of June 30, 2024 and December 31, 2023, EastGroup continued to hold a controlling interest in these two joint venture arrangements.

The Company records 100% of the assets, liabilities, revenues and expenses of the buildings and land held in joint ventures with the noncontrolling interests provided for in accordance with the joint venture agreements.

6 unchanged sentences

The Company’s primary source of revenue is rental income from business distribution space.

The table below presents the components of Income from real estate operations for the three months ended March 31, 2024 and 2023:

The table below presents the components of Income from real estate operations for the three and six months ended June 30, 2024 and 2023:

Three Months Ended

June 30, Six Months Ended June 30,

2024 2023 2024 2023

(In thousands)

9 unchanged sentences

If the carrying amount of an asset exceeds its estimated future cash flows, an impairment charge is recognized for the amount by which the carrying amount of the asset exceeds the fair value of the asset.

During the three month periods ended March 31, 2024 and 2023, the Company did not identify any impairment charges which should be recorded.

During the six month periods ended June 30, 2024 and 2023, the Company did not identify any impairment charges which should be recorded.

EASTGROUP PROPERTIES, INC.

4 unchanged sentences

Significant renovations and improvements that improve or extend the useful life of the assets are capitalized.

Depreciation expense was $ 37,205,000 and $ 33,846,000 for the three months ended March 31, 2024 and 2023, respectively.

The Company’s Real estate properties and Development and value-add properties at March 31, 2024 and December 31, 2023 were as follows:

Depreciation expense was $ 37,646,000 and $ 74,851,000 for the three and six months ended June 30, 2024, respectively, and $ 34,690,000 and $ 68,536,000 for the same periods in 2023.

The Company’s Real estate properties and Development and value-add properties at June 30, 2024 and December 31, 2023 were as follows:

2024 December 31,

18 unchanged sentences

Acquired properties meeting either of the following two conditions are considered value-add properties:

(1) Less than 75% leased as of the acquisition date (or will be less than 75% occupied within one year of acquisition date based on near term lease roll), or (2) 20% or greater of the acquisition cost will be spent to redevelop the property.

(1) Less than 75% leased as of the acquisition date (or will be less than 75% occupied within one year of the acquisition date based on near term lease roll), or (2) 20% or greater of the acquisition cost will be spent to redevelop the property.

Costs associated with development (i.e., land, construction costs, interest expense, property taxes and other costs associated with development) are aggregated into the total capitalized costs of the property.

11 unchanged sentences

Criteria considered in grouping similar assets include geographic location, market and operational risks and the physical characteristics of the assets.

EastGroup determined that its real estate property acquisitions in 2023 and the first three months of 2024 are considered to be acquisitions of groups of similar identifiable assets;

EastGroup determined that its real estate property acquisitions in 2023 and the first six months of 2024 are considered to be acquisitions of groups of similar identifiable assets;

EASTGROUP PROPERTIES, INC.

14 unchanged sentences

These intangible assets are included in Other assets on the Consolidated Balance Sheets and are amortized over the remaining terms of the existing leases.

Amortization of above and below market lease intangibles, which increased rental income by $ 607,000 and $ 599,000 for the three months ended March 31, 2024 and 2023, respectively, is included in Income from real estate operations .

Amortization expense for in-place lease intangibles, which was $ 1,926,000 and $ 1,962,000 for the three months ended March 31, 2024 and 2023, respectively, is included in Depreciation and amortization .

During the three months ended March 31, 2024, EastGroup acquired the following property:

REAL ESTATE PROPERTY ACQUIRED IN 2024

Amortization of above and below market lease intangibles, which is included in Income from real estate operations, increased rental income by $ 546,000 and $ 1,153,000 for the three and six months ended June 30, 2024, respectively, and $ 696,000 and $ 1,295,000 for the same periods in 2023.

Amortization expense for in-place lease intangibles, which is included in Depreciation and amortization, was $ 1,893,000 and $ 3,819,000 for the three and six months ended June 30, 2024, respectively, and $ 2,174,000 and $ 4,136,000 for the same periods in 2023.

During the six months ended June 30, 2024, EastGroup acquired the following properties:

REAL ESTATE PROPERTIES ACQUIRED IN 2024

Location Size Date

1 unchanged sentence

(Square feet) (In thousands)

Operating property acquired (2)(3)

Operating properties acquired (2)(3)

Spanish Ridge Industrial Park

Las Vegas, NV 231,000 01/23/2024 $ 54,859

147 Exchange Raleigh, NC 274,000 05/03/2024 52,945

Total operating property acquisitions 505,000 $ 107,804

(1) Cost is calculated in accordance with FASB ASC 805, Business Combinations, and represents the sum of the purchase price, closing costs and capitalized acquisition costs.

2 unchanged sentences

(3) Excludes acquired development land as discussed below.

There were no value-add acquisitions during the three months ended March 31, 2024.

There were no value-add acquisitions during the six months ended June 30, 2024.

EASTGROUP PROPERTIES, INC.

1 unchanged sentence

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

The following table summarizes the allocation of the total consideration for the acquired assets and assumed liabilities in connection with the acquisition identified in the table above which was acquired during the three months ended March 31, 2024.

The following table summarizes the allocation of the total consideration for the acquired assets and assumed liabilities in connection with the acquisitions identified in the table above which were acquired during the six months ended June 30, 2024.

ACQUIRED ASSETS AND ASSUMED LIABILITIES IN 2024

12 unchanged sentences

These costs are amortized over the remaining terms of the associated leases in place at the time of acquisition.

The leases in the property acquired during the three months ended March 31, 2024 had a weighted average remaining lease term at acquisition of approximately 6.2 years.

Also during the three months ended March 31, 2024, EastGroup purchased 34.3 acres of development land in Atlanta for $ 3,302,000 .

The leases in the properties acquired during the six months ended June 30, 2024 had a weighted average remaining lease term at acquisition of approximately 5.9 years.

Also during the six months ended June 30, 2024, EastGroup purchased 34.3 acres of development land in Atlanta for $ 3,302,000 .

During 2023, EastGroup acquired the following properties:

35 unchanged sentences

The Company periodically reviews the recoverability of goodwill (at least annually) and the recoverability of other intangibles (on a quarterly basis) for possible impairment.

No impairment of goodwill or other intangibles existed during the three month periods ended March 31, 2024 and 2023.

No impairment of goodwill or other intangibles existed during the three and six month periods ended June 30, 2024 and 2023.

(8) REAL ESTATE SOLD AND HELD FOR SALE

1 unchanged sentence

Real estate properties held for sale are reported at the lower of the carrying amount or fair value less estimated costs to sell and are not depreciated while they are held for sale.

The Company did not classify any properties as held for sale as of March 31, 2024 and December 31, 2023.

The Company did not classify any properties as held for sale as of June 30, 2024 and December 31, 2023.

In accordance with ASC 360 and ASC 205, Presentation of Financial Statements , the Company would report a disposal of a component of an entity or a group of components of an entity in discontinued operations if the disposal represents a strategic shift that has (or will have) a major effect on an entity’s operations and financial results when the component or group of components meets the criteria to be classified as held for sale or when the component or group of components is disposed of by sale or other than by sale.

6 unchanged sentences

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

A summary of Gain on sales of real estate investments for the three months ended March 31, 2024 and the year ended December 31, 2023 follows:

A summary of Gain on sales of real estate investments for the six months ended June 30, 2024 and the year ended December 31, 2023 follows:

REAL ESTATE PROPERTIES SOLD Location Size Date Sold Net Sales Price Basis Recognized Gain

8 unchanged sentences

The table above includes sales of operating properties.

During the three months ended March 31, 2024, the Company also sold 3.9 acres of land in San Francisco for $ 4,000,000 and recognized a gain on the sale of $ 222,000 .

During the six months ended June 30, 2024, the Company also sold 3.9 acres of land in San Francisco for $ 4,000,000 and recognized a gain on the sale of $ 222,000 .

During the year ended December 31, 2023, the Company sold 11.9 acres of land in Houston and Fort Worth for $ 4,750,000 and recognized gains on the sales of $ 446,000 .

40 unchanged sentences

(1) These loans have a fixed interest rate or an effectively fixed interest rate due to interest rate swaps.

The Company has a $ 625,000,000 unsecured bank credit facility with a group of 11 banks;

the facility has a maturity date of July 30, 2025 .

On June 13, 2024, EastGroup entered into amended and restated credit agreements related to its $625,000,000 and $50,000,000 unsecured bank credit facilities, to extend the maturity dates from July 30, 2025 to July 31, 2028.

There were no other material changes to the credit facilities, which are outlined below.

The Company has a $ 625,000,000 unsecured bank credit facility with a group of 10 banks, which has a maturity date of July 31, 2028 .

The credit facility contains options for two six-month extensions (at the Company's election) and an additional $ 625,000,000 accordion (with agreement by all parties).

The interest rate on each tranche is reset on a monthly basis and as of March 31, 2024, was Secured Overnight Financing Rate (“SOFR”) plus 76.5 basis points with an annual facility fee of 15 basis points.

As of March 31, 2024, the Company had no variable rate borrowings on this unsecured bank credit facility and an interest rate of 6.194 %.

The interest rate on each tranche is reset on a monthly basis and as of June 30, 2024, was Secured Overnight Financing Rate (“SOFR”) plus 76.5 basis points with an annual facility fee of 15 basis points.

As of June 30, 2024, the Company had no variable rate borrowings on this unsecured bank credit facility and an interest rate of 6.202 %.

The Company has two standby letters of credit totaling $ 2,655,000 pledged on this facility, which reduces borrowing capacity under the credit facility.

1 unchanged sentence

the Company also has two six-month extensions available if the extension options in the $ 625,000,000 facility are exercised.

The interest rate is reset on a daily basis and as of March 31, 2024, was SOFR plus 77.5 basis points with an annual facility fee of 15 basis points.

As of March 31, 2024, the interest rate was 6.215 % with no outstanding balance.

The interest rate is reset on a daily basis and as of June 30, 2024, was SOFR plus 77.5 basis points with an annual facility fee of 15 basis points.

As of June 30, 2024, the interest rate was 6.205 % with no outstanding balance.

For both facilities, the margin and facility fee are subject to changes in the Company's credit ratings.

1 unchanged sentence

This favorable pricing level will be retained provided that the Company’s consolidated leverage ratio, as defined in the applicable agreements, remains less than 32.5% .

The $ 625,000,000 facility also includes a sustainability-linked pricing component pursuant to which the applicable interest margin is reduced by one basis point if the Company meets a certain sustainability performance target.

The $ 625,000,000 facility is also subject to a sustainability-linked pricing component, pursuant to which the applicable interest margin is adjusted if the Company meets a certain sustainability performance target.

This sustainability metric is evaluated annually and was achieved for the years ended December 31, 2023 and 2022, which allowed for the interest rate reduction in each of the years subsequent to achieving the metric.

The margin was effectively reduced on this unsecured bank credit facility by one basis point, from 77.5 to 76.5 basis points.

Scheduled principal payments on long-term debt, including Unsecured debt, net of debt issuance costs (not including Unsecured bank credit facilities, net of debt issuance costs ), as of March 31, 2024, are as follows:

EASTGROUP PROPERTIES, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

Years Ending December 31, (In thousands)

2 unchanged sentences

Total $ 1,680,000

EASTGROUP PROPERTIES, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

(11) ACCOUNTS PAYABLE AND ACCRUED EXPENSES

26 unchanged sentences

$ 86,210 89,415

EASTGROUP PROPERTIES, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

(13) COMPREHENSIVE INCOME

3 unchanged sentences

Three Months Ended

June 30, Six Months Ended June 30,

2024 2023 2024 2023

(In thousands)

3 unchanged sentences

Balance at end of period $ 29,687 36,311 29,687 36,311

EASTGROUP PROPERTIES, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

(14) DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES

6 unchanged sentences

Interest rate swaps designated as cash flow hedges involve the receipt of variable-rate amounts from a counterparty in exchange for the Company making fixed-rate payments over the term of the agreements without exchange of the underlying notional amount.

As of March 31, 2024, the Company had seven interest rate swaps outstanding, all of which are used to hedge the variable cash flows associated with unsecured loans.

As of June 30, 2024, the Company had seven interest rate swaps outstanding, all of which are used to hedge the variable cash flows associated with unsecured loans.

All of the Company’s interest rate swaps convert the related loans’ SOFR rate components to effectively fixed interest rates, and the Company has concluded that each of the hedging relationships is highly effective.

4 unchanged sentences

The Company calculates its derivative valuations using mid-market prices.

As of March 31, 2024 and December 31, 2023, the Company had the following outstanding interest rate derivatives that are designated as cash flow hedges of interest rate risk:

Notional Value of Interest Rate Derivatives March 31,

EASTGROUP PROPERTIES, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

As of June 30, 2024 and December 31, 2023, the Company had the following outstanding interest rate derivatives that are designated as cash flow hedges of interest rate risk:

Notional Value of Interest Rate Derivatives June 30,

2024 December 31,

7 unchanged sentences

Interest Rate Swap 100,000 100,000

EASTGROUP PROPERTIES, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

The table below presents the fair value of the Company’s derivative financial instruments as well as their classification on the Consolidated Balance Sheets as of March 31, 2024 and December 31, 2023.

The table below presents the fair value of the Company’s derivative financial instruments as well as their classification on the Consolidated Balance Sheets as of June 30, 2024 and December 31, 2023.

See Note 18 for additional information on the fair value of the Company’s interest rate swaps.

As of March 31, 2024

As of June 30, 2024

As of December 31, 2023

4 unchanged sentences

Interest rate swap liabilities Other liabilities — Other liabilities 2,478

The table below presents the effect of the Company’s derivative financial instruments on the Consolidated Statements of Income and Comprehensive Income for the three months ended March 31, 2024 and 2023:

The table below presents the effect of the Company’s derivative financial instruments on the Consolidated Statements of Income and Comprehensive Income for the three and six months ended June 30, 2024 and 2023:

Three Months Ended

June 30, Six Months Ended June 30,

2024 2023 2024 2023

(In thousands)

1 unchanged sentence

Interest Rate Swaps:

Amount of income (loss) recognized in Other comprehensive income (loss) on derivatives

Amount of income recognized in Other comprehensive income (loss)

on derivatives

$ 3,634 14,452 14,274 8,255

Amount of (income) reclassified from Accumulated other comprehensive income into

Interest expense

Amount of (income) reclassified from Accumulated other comprehensive

income into Interest expense

( 4,729 ) ( 4,250 ) ( 9,475 ) ( 8,315 )

3 unchanged sentences

The Company has an agreement with its derivative counterparties containing a provision stating that the Company could be declared in default on its derivative obligations if the Company defaults on any of its indebtedness, including default where repayment of the indebtedness has not been accelerated by the lender.

As of March 31, 2024, we had not posted any collateral related to these agreements and were not in breach of any of the provisions of these agreements.

As of June 30, 2024, we had not posted any collateral related to these agreements and were not in breach of any of the provisions of these agreements.

If the Company had breached any of these provisions, it would be required to settle its obligations under the agreements at their termination value.

2 unchanged sentences

Basic EPS represents the amount of earnings for the period attributable to each share of common stock outstanding during the reporting period.

The Company’s basic EPS is calculated by dividing Net Income Attributable to EastGroup Properties, Inc.

The Company’s basic EPS is calculated by dividing Net Income Attributable to EastGroup

EASTGROUP PROPERTIES, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

Properties, Inc.

Common Stockholders by the weighted average number of common shares outstanding.

5 unchanged sentences

Any anti-dilutive securities are excluded from the diluted EPS calculation.

EASTGROUP PROPERTIES, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

Reconciliation of the numerators and denominators in the basic and diluted EPS computations is as follows:

Three Months Ended

June 30, Six Months Ended June 30,

2024 2023 2024 2023

(In thousands)

16 unchanged sentences

The Current 2023 ATM Program replaces our previous $ 750,000,000 ATM program, which was established on December 16, 2022, under which we had sold shares of our common stock having an aggregate gross sales price of $ 464,305,000 through October 25, 2023.

In connection with the Current 2023 ATM Program, we may sell shares of our common stock directly through sales agents or through certain financial institutions acting as forward purchasers whereby, at our discretion, the forward counterparties may borrow from third parties and subsequently sell shares of our common stock.

In connection with the Current 2023 ATM Program, we may sell shares of our common stock directly through sales agents or through certain financial institutions acting as forward counterparties whereby, at our discretion, the forward counterparties, or their agents or affiliates, may borrow from third parties and subsequently sell shares of our common stock.

The use of a forward equity sale agreement allows us to lock in a share price on the sale of shares of our common stock but defer settling and receiving the proceeds from the sale of shares until a later date.

Additionally, the forward price that we expect to receive upon settlement of an agreement will be subject to adjustment for (i) a floating interest rate factor equal to a specified daily rate less a spread, (ii) the forward purchaser’s stock borrowing costs and (iii) scheduled dividends during the term of the agreement.

EASTGROUP PROPERTIES, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

Direct Common Stock Issuance Activity

The following table presents the common stock issuance activity sold directly through sales agents pursuant to the Company's ATM programs:

Period Common Stock Issued (1)

Weighted Average Price Net Proceeds

(In shares) (Per share) (In thousands)

The following table presents the Company’s common stock issuance activity sold directly through sales agents pursuant to the Company's ATM programs during the six months ended June 30, 2024 and the year ended December 31, 2023:

Weighted Average Price Gross Proceeds Net Proceeds

(In shares) (Per share) (In thousands) (In thousands)

Three months ended March 31, 2024

— $ — $ — $ —

Three months ended June 30, 2024 (2)

218,929 168.62 36,916 36,547

Six months ended June 30, 2024 (2)

218,929 $ 168.62 $ 36,916 $ 36,547

Twelve months ended December 31, 2023

4,094,896 $ 170.77 $ 699,304 $ 692,312

(1) Excludes shares of common stock sold on a forward basis as described in the following paragraphs.

EASTGROUP PROPERTIES, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

Forward Equity Offerings

During the three months ended March 31, 2024, EastGroup entered into forward equity sale agreements with certain financial institutions acting as forward purchasers under our Current 2023 ATM Program with respect to 286,671 shares of common stock with an initial weighted average forward price of $ 181.95 per share.

The Company did not receive any proceeds from the sale of common shares by the forward purchasers at the time it entered into forward equity sale agreements.

During the year ended December 31, 2023, EastGroup entered into forward equity sale agreements with respect to 406,041 shares of common stock with an initial weighted average forward price of $ 183.92 per share.

The Company did not receive any proceeds from the sale of common shares by the forward purchasers at the time we entered into forward equity sale agreements.

During the three months ended March 31, 2024, the Company settled outstanding forward equity sale agreements that were previously entered into under our Current 2023 ATM Program by issuing 272,342 shares of common stock in exchange for net proceeds of approximately $ 49,294,000 .

(1) Excludes shares of common stock sold on a forward basis as described below.

(2) Excludes 77,650 shares sold on June 28, 2024, at a weighted average price of $168.63, providing net proceeds to the Company of $12,963,000.

These shares were not deemed to be issued and outstanding until settlement, subsequent to June 30, 2024, as disclosed in Note 22.

Forward Equity Offering Activity

The following table presents the Company’s forward equity offering activity during the three and six months ended June 30, 2024:

Common Stock Weighted Average Price Gross Proceeds

(In shares) (Per share) (In thousands)

Forward Sale Agreements Outstanding at December 31, 2023

406,041 $ 183.92 $ 74,679

Forward sale agreements settled — shares issued and proceeds

( 272,342 ) 183.59 ( 50,000 )

New forward sale agreements (2)

286,671 181.95 52,160

Forward Sale Agreements Outstanding at March 31, 2024

420,370 $ 182.79 $ 76,839

Forward sale agreements settled — shares issued and proceeds

( 420,370 ) 182.79 ( 76,839 )

New forward sale agreements (2)

600,053 166.65 100,000

Forward Sale Agreements Outstanding at June 30, 2024

600,053 $ 166.65 $ 100,000

(1) EastGroup settled outstanding forward equity sale agreements by issuing 272,342 shares of common stock in exchange for net proceeds of approximately $ 49,364,000 .

(2) The Company did not receive any proceeds from the sale of common shares by the forward counterparties at the time it entered into forward sale agreements.

(3) EastGroup settled outstanding forward equity sale agreements by issuing 420,370 shares of common stock in exchange for net proceeds of approximately $ 76,200,000 .

(17) STOCK-BASED COMPENSATION

7 unchanged sentences

The grant date fair value for awards that have been granted and are subject to a future market condition (total shareholder return) are determined using a Monte Carlo simulation pricing model developed to specifically accommodate the unique features of the awards.

EASTGROUP PROPERTIES, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

During the restricted period for awards no longer subject to contingencies, the Company accrues dividends and holds the certificates for the shares;

16 unchanged sentences

The shares are expensed using the graded vesting attribution method which recognizes each separate vesting portion of the award as a separate award on a straight-line basis over the requisite service period (34% vests at the end of the one year performance period and 33% vests in each of the following two years).

Any shares issued pursuant to the individual annual performance goals are determined by the Committee in its discretion

EASTGROUP PROPERTIES, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

following the performance period.

Any shares issued pursuant to the individual annual performance goals are determined by the Committee in its discretion following the performance period.

The Company begins recognizing the expense for the shares on the grant date and will expense on a straight-line basis over the remaining service period (34% vests at the end of the one year performance period and 33% vests in each of the following two years).

4 unchanged sentences

The Company has adjusted its stock-based compensation expense to accelerate the recognition of expense for retirement-eligible employees.

Stock-based compensation cost for employees was $ 3,976,000 for the three months ended March 31, 2024, of which $ 640,000 was capitalized as part of the Company’s development costs.

For the three months ended March 31, 2023, stock-based compensation cost for employees was $ 3,252,000 , of which $ 693,000 was capitalized as part of the Company’s development costs.

Stock-based compensation expense for directors was $ 171,000 for the three months ended March 31, 2024, and $ 225,000 for the same period in 2023.

Stock-based compensation cost for employees was $ 2,472,000 and $ 6,448,000 for the three and six months ended June 30, 2024, respectively, of which $ 400,000 and $ 1,040,000 was capitalized as part of the Company’s development costs.

For the three and six months ended June 30, 2023, stock-based compensation cost for employees was $ 2,579,000 and $ 5,831,000 , respectively, of which $ 601,000 and $ 1,294,000 was capitalized as part of the Company’s development costs.

Stock-based compensation expense for directors was $ 172,000 and $ 343,000 for the three and six months ended June 30, 2024, respectively, and $ 192,000 and $ 417,000 for the same periods in 2023.

EASTGROUP PROPERTIES, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

Following is a summary of the total restricted shares granted, forfeited and delivered (vested) to participants with the related weighted average grant date fair value share prices.

Of the shares that vested in the three months ended March 31, 2024, the Company withheld 33,381 shares to satisfy the tax obligations for those participants who elected this option as permitted under the applicable equity plan.

As of the grant dates, the fair value of shares that were granted during the three months ended March 31, 2024 was $ 8,891,000 .

As of the vesting dates, the aggregate fair value of shares that vested during the three months ended March 31, 2024 was $ 14,330,000 .

Of the shares that vested in the six months ended June 30, 2024, the Company withheld 33,381 shares to satisfy the tax obligations for those participants who elected this option as permitted under the applicable equity plan.

As of the grant dates, the fair value of shares that were granted during the six months ended June 30, 2024 was $ 9,702,000 .

As of the vesting dates, the aggregate fair value of shares that vested during the six months ended June 30, 2024 was $ 14,995,000 .

Award Activity:

Three Months Ended

March 31, 2024

June 30, 2024 Six Months Ended June 30, 2024

Weighted Average Grant Date Fair Value

Shares Weighted Average Grant Date Fair Value

Unvested at beginning of period 77,644 $ 157.27 84,564 $ 153.78

11 unchanged sentences

The FASB Codification requires disclosure of the level within the fair value hierarchy in which the fair value measurements fall, including measurements using quoted prices in active markets for identical assets or liabilities (Level 1), quoted prices for similar instruments in active markets or quoted prices for identical or similar instruments in markets that are not active (Level 2) and significant valuation assumptions that are not readily observable in the market (Level 3).

EASTGROUP PROPERTIES, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

The following table presents the carrying amounts and estimated fair values of the Company’s financial instruments in accordance with ASC 820 at March 31, 2024 and December 31, 2023.

March 31, 2024 December 31, 2023

The following table presents the carrying amounts and estimated fair values of the Company’s financial instruments in accordance with ASC 820 at June 30, 2024 and December 31, 2023.

June 30, 2024 December 31, 2023

Carrying Amount (1)

15 unchanged sentences

• Interest rate swap assets (included in Other assets on the Consolidated Balance Sheets):

The instruments are recorded at fair value based on models using inputs, such as interest rate yield curves, SOFR swap curves, observable for substantially the full term of the contract (Level 2 input).

The instruments are recorded at fair value based on models using inputs, such as interest rate yield curves, SOFR swap curves, observable

EASTGROUP PROPERTIES, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

for substantially the full term of the contract (Level 2 input).

See Note 14 for additional information on the Company’s interest rate swaps.

15 unchanged sentences

EastGroup has one reportable segment – industrial properties, consistent with the Company’s manner of internal reporting, measurement of operating results and allocation of the Company’s resources.

Entities with a single reportable segment are required to provide the disclosures required by the amendment and existing segment disclosure requirements in accordance with

EASTGROUP PROPERTIES, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

Entities with a single reportable segment are required to provide the disclosures required by the amendment and existing segment disclosure requirements in accordance with Topic 280.

ASU 2023-07 is effective for fiscal years beginning after December 15, 2023 and interim periods within fiscal years beginning after December 15, 2024, with early adoption permitted.

2 unchanged sentences

(22) SUBSEQUENT EVENTS

Subsequent to March 31, 2024, EastGroup settled outstanding forward equity sale agreements under our Current 2023 ATM Program by issuing 133,699 shares of common stock in exchange for net proceeds of approximately $ 24,496,000 .

On June 28, 2024, the Company sold 77,650 shares of common stock under the Current 2023 ATM Program at a weighted average price of $ 168.63 providing net proceeds to the Company of $ 12,963,000 .

These shares were not deemed to be issued and outstanding until settlement in July 2024.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements