What changed in this filing

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Item 1A. Risk Factors

2022-02-10 compared with 2021-02-11 · 46 added, 28 removed, 337 unchanged (18% of the section changed)

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When we refer to forward-looking statements or information, sometimes we use words such as “may,” “will,” “could,” “should,” “plans,” “intends,” “expects,” “believes,” “estimates,” “anticipates” and “continues.” In particular, the below risk factors describe forward-looking information.

The risk factors describe risks that may affect these statements but are not all-inclusive, particularly with respect to possible future events.

The risk factors describe risks that may

affect these statements but are not all-inclusive, particularly with respect to possible future events.

Many things can happen that can cause actual results to be different from those we describe.

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• higher than estimated construction or operating costs, including labor and material costs;

• possible delay in completion of a project because of a number of factors, including COVID-19, weather, labor disruptions, construction delays or delays in receipt of zoning or other regulatory approvals, acts of terror or other acts of violence, or acts of God (such as fires, earthquakes or floods).

• possible delay in completion of a project because of a number of factors, including COVID-19, supply chain disruptions and shortages, weather, labor disruptions, construction delays or delays in receipt of zoning or other regulatory approvals, acts of terror or other acts of violence, or acts of God (such as fires, earthquakes or floods).

Redevelopments and acquisitions may fail to perform as expected.

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As of December 31, 2021, we held 19 predominantly retail real estate projects jointly with other persons in addition to properties owned in a “downREIT” structure.

Additionally, as of December 31, 2020, we owned an interest in the joint ventures that own the hotel components of Pike & Rose and Assembly Row.

On January 4, 2021, we acquired our partner's 20% interest in our joint venture arrangement related to the Pike & Rose hotel.

Additionally, as of December 31, 2021, we owned an interest in the hotel component of Assembly Row.

We may make additional joint investments in the future.

Our existing and future joint investments may subject us to special risks, including the possibility that our partners or co-investors might become bankrupt, that those partners or co-investors might have economic or other business interests or goals which are unlike or incompatible with our business interests or goals, that those partners or co-investors might be in a position to take action contrary to our suggestions or instructions, or in opposition to our policies or objectives, and that disputes may develop with our joint venture partners over decisions affecting the property or the joint venture, which may result in litigation or arbitration or some other form of dispute resolution.

Although as of December 31, 2020, we held the controlling interests in all of our existing co-investments (except the hotel investments discussed above and the investment in the La Alameda shopping center acquired in 2017), we generally must obtain the consent of the co-investor or meet defined criteria to sell or to finance these properties.

Although as of December 31, 2021, we held the controlling interests in all of our existing co-investments (except the hotel investment discussed above and the investment in the La Alameda shopping center acquired in 2017), we generally must obtain the consent of the co-investor or meet defined criteria to sell or to finance these properties.

Joint ownership gives a third party the opportunity to influence the return we can achieve on some of our investments and may adversely affect our ability to make distributions to our shareholders.

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We therefore may cease to have insurance coverage against certain types of losses and/or there may be decreases in the limits of insurance available.

If an uninsured loss or a loss in excess of our insured limits occurs, we could lose all or a portion of the capital we have invested in a property, as well as the anticipated future revenue from the property, but still remain obligated for any mortgage debt or other financial

obligations related to the property.

We cannot guarantee that material losses in excess of insurance proceeds will not occur in the future.

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COVID-19 pandemic.

Such events could inhibit global, national and local economic activity;

adversely affect trading activity

in securities markets, which could negatively impact the trading prices of our common shares and debt securities and our ability

to access the securities markets as a source of liquidity;

adversely affect our tenants’ financial condition by limiting foot traffic

and staffing at their businesses, which could affect their ability to pay rent and willingness to make new leasing commitments;

Such events could:

• inhibit global, national and local economic activity;

• drive inflation, adversely affect trading activity in securities markets, which could negatively impact the trading prices of our common shares and debt securities and our ability to access the securities markets as a source of liquidity;

• adversely affect our tenants’ financial condition by limiting foot traffic and staffing at their businesses, which could affect their ability to pay rent and willingness to make new leasing commitments;

• reduce our cash flow, which could impact our ability to pay dividends at the current rate and in the current format or at all or to service our debt;

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• disrupt supply chains that could be important in our development and redevelopment activities;

• result in labor shortages;

• interfere with potential purchases and sales of properties;

• impact our ability to pay dividends at the current rate and in the current format or at all;

and have other direct and indirect effects that are difficult to predict.

• have other direct and indirect effects that are difficult to predict.

Such risks depend upon the nature and severity of the public health concern, as well as the extent and duration of government-mandated orders and personal decisions to limit travel, economic activity and personal interaction, none of which can be predicted with confidence.

In particular, we cannot predict the duration of stay-at-home and other government orders instituted in response to the COVID-19 pandemic, which vary by jurisdiction, or the pandemics' short and long term economic effects, each of which could have a material adverse effect on our business.

In particular, we cannot predict the impact of stay-at-home and other government orders instituted in response to the COVID-19 pandemic, which vary by jurisdiction, or the pandemics' short and long term economic effects, each of which could have a material adverse effect on our business.

An increased focus on metrics and reporting related to corporate responsibility, specifically related to environmental, social and governance ("ESG") factors, may impose additional costs and expose us to new risks.

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Our ability to grow will be limited if we cannot obtain additional capital.

Our growth strategy is focused on the redevelopment of properties we already own and the acquisition of additional properties.

Our growth strategy is focused on the development and redevelopment of properties we already own and the acquisition of additional properties.

We believe that it will be difficult to fund our expected growth with cash from operating activities because, in addition to other requirements, we are generally required to distribute to our shareholders at least 90% of our taxable income each year to continue to qualify as a REIT for federal income tax purposes.

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Additionally, we cannot guarantee that additional financing, refinancing or other capital will be available in the amounts we desire or on favorable terms.

Our access to debt or equity capital depends on a number of factors, including the market’s perception of our growth potential and risk profile, our ability to pay dividends, and our current and potential future earnings.

Our access to debt or equity capital depends on a number of factors, including the market’s

perception of our growth potential and risk profile, our ability to pay dividends, and our current and potential future earnings.

Depending on the outcome of these factors as well as the impact of the economic environment, we could experience delay or difficulty in implementing our growth strategy on satisfactory terms, or be unable to implement this strategy.

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This liability may be imposed whether or not we knew about, or were responsible for, the presence of hazardous or toxic substances.

Further, the presence of contamination on our properties or the failure to properly remediate contamination at any of our properties may adversely affect

our ability to sell or lease those properties or to borrow funds by using those properties as collateral.

Further, the presence of contamination on our properties or the failure to properly remediate contamination at any of our properties may adversely affect our ability to sell or lease those properties or to borrow funds by using those properties as collateral.

The costs or liabilities could exceed the value of the affected real estate.

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Non-compliance of this sort could reduce our revenues from a tenant, could require us to pay penalties or fines relating to any non-compliance, and could adversely affect our ability to sell or lease a property.

Failure to qualify as a REIT for federal income tax purposes would cause us to be taxed as a corporation, which would substantially reduce funds available for payment of distributions.

Failure to qualify as a REIT for federal income tax purposes would cause the Parent Company to be taxed as a corporation, which would substantially reduce funds available for payment of distributions.

We believe that we are organized and qualified as a REIT for federal income tax purposes and currently intend to operate in a manner that will allow us to continue to qualify as a REIT under the Code.

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• we would no longer be required by law to make any distributions to our shareholders.

To maintain our status as a REIT, we limit the amount of shares any one shareholder can own.

To maintain our status as a REIT, we limit the amount of shares any one shareholder of the Parent Company can own.

The Code imposes certain limitations on the ownership of the stock of a REIT.

For example, not more than 50% in value of our outstanding shares of capital stock may be owned, directly or indirectly, by five or fewer individuals (as defined in the Code) during the last half of any taxable year.

To protect our REIT status, our declaration of trust prohibits any one shareholder from

owning (actually or constructively) more than 9.8% in value of the outstanding common shares or of any class or series of outstanding preferred shares.

To protect our REIT status, the Parent Company's declaration of trust prohibits any one shareholder from owning (actually or constructively) more than 9.8% in value of the outstanding common shares or of any class or series of outstanding preferred shares.

The constructive ownership rules are complex.

Shares of our capital stock owned, actually or constructively, by a group of related individuals and/or entities may be treated as constructively owned by one of those individuals or entities.

Shares of the Parent Company's capital stock owned, actually or constructively, by a group of related individuals and/or entities may be treated as constructively owned by one of those individuals or entities.

As a result, the acquisition of less than 9.8% in value of the outstanding common shares and/or a class or series of preferred shares (or the acquisition of an interest in an entity that owns common shares or preferred shares) by an individual or entity could cause that individual or entity (or another) to own constructively more than 9.8% in value of the outstanding capital stock.

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The Board of Trustees may waive these restrictions on a case-by-case basis.

In addition, the Board of Trustees and two-thirds of our shareholders eligible to vote at a shareholder meeting may remove these restrictions if they determine it is no longer in our best interests to attempt to qualify, or to continue to qualify, as a REIT.

In addition, the Board of Trustees and two-thirds of our shareholders eligible to vote at a shareholder meeting may remove these restrictions if they determine it is no longer in our

best interests for the Parent Company to attempt to qualify, or to continue to qualify, as a REIT.

The 9.8% ownership restrictions may delay, defer or prevent a transaction or a change of our control that might involve a premium price for the common shares or otherwise be in the shareholders’ best interest.

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federal income tax consequences to us and our investors of such qualification.

Certain tax and anti-takeover provisions of our declaration of trust and bylaws may inhibit a change of our control.

Certain provisions contained in our declaration of trust and bylaws and the Maryland General Corporation Law, as applicable to Maryland REITs, may discourage a third party from making a tender offer or acquisition proposal to us.

Certain tax and anti-takeover provisions of the Parent Company's declaration of trust and bylaws, and certain restrictions in the Partnership's limited partnership agreement, may inhibit a change of our control.

Certain provisions contained in the Parent Company's declaration of trust and bylaws and the Maryland General Corporation Law, as applicable to Maryland REITs, may discourage a third party from making a tender offer or acquisition proposal to us.

If this were to happen, it could delay, deter or prevent a change in control or the removal of existing management.

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A “control share acquisition” means the acquisition of control shares, with some exceptions.

Our bylaws state that the Maryland control share acquisition law will not apply to any acquisition by any person of our common shares.

The Parent Company's bylaws state that the Maryland control share acquisition law will not apply to any acquisition by any person of our common shares.

This bylaw provision may be repealed, in whole or in part, at any time, whether before or after an acquisition of control shares, by a vote of a majority of the shareholders entitled to vote, and, upon such repeal, may, to the extent provided by any successor bylaw, apply to any prior or subsequent control share acquisition.

In addition, certain provisions in the Partnership’s limited partnership agreement (the “Partnership Agreement”) may delay or make more difficult unsolicited acquisitions of us or changes in our control.

These provisions could discourage third parties from making proposals involving an unsolicited acquisition of us or change of our control, although some shareholders might consider such proposals, if made, desirable.

These provisions also make it more difficult for third parties to alter the management structure of the Partnership without the concurrence of our Board of Trustees.

These provisions include, among others:

• redemption rights of limited partners and certain assignees of units of limited partnership interest ("OP Units");

• transfer restrictions on OP Units and restrictions on admissions of partners;

• a requirement that the General Partner may not be removed as the general partner of the Partnership without its consent;

• the ability of the General Partner to issue preferred partnership interests in the Partnership with terms that it may determine, without the approval or consent of any Limited Partner;

• restrictions on the ability of the General Partner, the Partnership or the Parent Company to transfer its interests in the Partnership or otherwise engage in certain extraordinary transactions, including, among others, certain mergers, business combinations, sales of all or substantially all of their assets and recapitalizations.

We may be required to incur additional debt to qualify as a REIT.

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Conversely, payment of dividends on our common shares may be subject to payment in full of the dividends on any preferred shares and payment of interest on any debt securities we may offer.

The Parent Company is a holding company with no direct operations, and it will rely on funds received from the Partnership to pay its obligations and make distributions to its shareholders.

The Parent Company is a holding company and expects to conduct substantially all of its operations through the Partnership.

The Parent Company will not have, apart from an interest in the Partnership, any independent operations.

As a result, the Parent Company will rely on distributions from the Partnership to make any distributions we declare on our common shares.

The Parent Company will also rely on distributions from the Partnership to meet its obligations, including any tax liability on taxable income allocated to the Parent Company from the Partnership.

Through its ownership and control of the General Partner, the Parent Company exercises exclusive control over the Partnership, including the authority to cause the Partnership to make distributions, subject to certain limited approval and voting rights of the Partnership’s Limited Partners as described in the Partnership Agreement.

In addition, because the Parent Company is a holding company, your claims as shareholders are structurally subordinated to all existing and future liabilities and obligations to preferred equity holders of the Partnership and its subsidiaries.

Therefore, in the event of a bankruptcy, insolvency, liquidation or reorganization of the Partnership or its subsidiaries, assets of the Partnership or the applicable subsidiary will be available to satisfy any claims of our shareholders only after such liabilities and obligations have been satisfied in full.

We currently own 100% of the OP Units issued by the Partnership and are its sole Limited Partner.

However, in connection with our future acquisition activities or otherwise, we may issue additional OP Units to third parties and admit additional Limited Partners.

Such issuances would reduce the Parent Company’s percentage ownership in the Partnership.

Loss of our key management could adversely affect performance and the value of our common shares.

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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