Item 2. Management’s Discussion and Analysis
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Certain statements contained herein constitute forward-looking statements as such term is defined in Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements are not guarantees of future performance. They represent our intentions, plans, expectations and beliefs and are subject to numerous assumptions, risks and uncertainties. Our future results, financial condition and business may differ materially from those expressed in these forward-looking statements. You can find many of these statements by looking for words such as "approximates," "believes," "expects," "anticipates," "estimates," "intends," "plans," "would," "may" or other similar expressions in this Quarterly Report on Form 10-Q. Many of the factors that will determine the outcome of these, and our other forward-looking statements are beyond our ability to control or predict. For further discussion of factors that could materially affect the outcome of our forward-looking statements, see "Risk Factors" in Item 1A of our Annual Report on Form 10-K for the year ended December 31, 2025 filed with the Securities and Exchange Commission on February 17, 2026 ("Annual Report") and "Management's Discussion and Analysis of Financial Condition and Results of Operations" in this Quarterly Report on Form 10-Q and our Annual Report.
For these forward-looking statements, we claim the protection of the safe harbor for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995. You are cautioned not to place undue reliance on our forward-looking statements, which speak only as of the date of this Quarterly Report on Form 10-Q. All subsequent written and oral forward-looking statements attributable to us or any person acting on our behalf are expressly qualified in their entirety by the cautionary statements contained or referred to in this section. We do not undertake any obligation to release publicly any revisions to our forward-looking statements to reflect events or circumstances occurring after the date of this Quarterly Report on Form 10-Q.
Organization and Basis of Presentation
JBG SMITH Properties ("JBG SMITH"), a Maryland real estate investment trust, owns, operates and develops mixed-use properties concentrated in amenity-rich, Metro-served submarkets in and around Washington, D.C., most notably National Landing, where through our focus on placemaking, we cultivate vibrant, highly amenitized, walkable neighborhoods. In addition, our third-party real estate services business provides fee-based real estate services.
Substantially all our assets are held by, and our operations are conducted through JBG SMITH Properties LP, our operating partnership. JBG SMITH is referred to herein as "we," "us," "our" or other similar terms. References to "our share" refer to our ownership percentage of consolidated and unconsolidated assets in real estate ventures, but exclude our 10.0% subordinated interest in one commercial building and our 33.5% subordinated interest in four commercial buildings, as well as the associated non-recourse mortgage loans, held through unconsolidated real estate ventures; these interests and debt are excluded because our investment in each real estate venture is zero, we do not anticipate receiving any near-term cash flow distributions from the real estate ventures, and we have not guaranteed their obligations or otherwise committed to providing financial support.
References to our financial statements refer to our unaudited condensed consolidated financial statements as of March 31, 2026 and December 31, 2025, and for the three months ended March 31, 2026 and 2025. References to our balance sheets refer to our condensed consolidated balance sheets as of March 31, 2026 and December 31, 2025. References to our statements of operations refer to our condensed consolidated statements of operations for the three months ended March 31, 2026 and 2025. References to our statements of cash flows refer to our condensed consolidated statements of cash flows for the three months ended March 31, 2026 and 2025.
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The accompanying financial statements and notes are prepared in accordance with accounting principles generally accepted in the United States of America ("GAAP"), which requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities, and the disclosure of contingent assets and liabilities as of the date of the financial statements and the reported amounts of revenue and expenses during the reporting periods. Actual results could differ from these estimates.
We have elected to be taxed as a real estate investment trust ("REIT") under sections 856-860 of the Internal Revenue Code of 1986, as amended (the "Code"). Under those sections, a REIT which distributes at least 90% of its REIT taxable income as dividends to its shareholders each year and which meets certain other conditions will not be taxed on that portion of its taxable income which is distributed to its shareholders. We currently adhere and intend to continue to adhere to these requirements and to maintain our REIT status in future periods. We also participate in the activities conducted by our subsidiary entities that have elected to be treated as taxable REIT subsidiaries under the Code. As such, we are subject to federal, state and local taxes on the income from those activities.
Our three operating and reportable segments are multifamily, commercial and third-party real estate services.
Our revenues and expenses are, to some extent, subject to seasonality during the year, which impacts quarterly net earnings, cash flows and funds from operations; this seasonality affects the sequential comparison of our results in individual quarters over time. For instance, we have historically experienced higher utility costs in the first and third quarters of the year.
We compete with many property owners, investors and developers. Our success depends upon, among other factors, trends affecting national and local economies, the financial condition and operating results of current and prospective tenants, the availability and cost of capital, interest rates, construction and renovation costs, taxes, governmental regulations and legislation, population trends, zoning laws, and our ability to lease, sublease or sell our assets at profitable levels. Our success is also subject to our ability to refinance existing debt with acceptable terms as it comes due.
Overview
As of March 31, 2026, our Operating Portfolio consisted of 38 operating assets comprising 15 multifamily assets totaling 6,519 units (6,333 units at our share), 22 commercial assets totaling 7.3 million square feet (6.9 million square feet at our share) and one wholly owned land asset for which we are the ground lessor. Additionally, our development pipeline, which consists of owned and entitled land on which we have the potential to commence construction subject to completion of design and/or market conditions, totaled 4.6 million square feet (3.3 million square feet at our share) of estimated potential development density. Our development pipeline excludes unentitled land parcels and land parcels controlled through an option agreement.
We continue to implement our comprehensive plan to reposition our holdings in National Landing by executing a broad array of placemaking strategies. Our placemaking includes the delivery of new multifamily assets, subject to demand; the delivery of redeveloped and new office assets; amenity retail; and thoughtful improvements to the streetscape, sidewalks, parks and other outdoor gathering spaces. In keeping with our dedication to placemaking, each new project is intended to contribute to an authentic and distinct neighborhood by creating a vibrant street environment with robust retail offerings and other amenities, including improved public spaces. In the second quarter of 2026, we completed construction of an office amenity hub at 2011 Crystal Drive. The repositioned asset brings to National Landing a large-scale externally managed meeting and conference facility, a coffee shop and all-day restaurant, an elevated wine bar and Italian restaurant, and an activated public lobby.
Outlook
Our capital allocation strategy remains anchored in our core objective of maximizing long-term net asset value ("NAV") per share growth. Drawing on our deep expertise in mixed-use, urban infill real estate, we have consistently rotated across asset classes based on relative value, cost of capital and risk-adjusted return potential. In today’s market environment, we believe that distressed office investment opportunities offer compelling economics. Consequently, we are actively pursuing new growth opportunities that align with our strategy and leverage our competitive strengths as a mixed-use owner, operator and developer. We expect to fund growth opportunities through a combination of asset sales and private equity joint ventures. During the three months ended March 31, 2026, we sold a development parcel for gross sales proceeds of $50.7 million. In April 2026, we recapitalized Tysons Dulles Plaza, which follows through on our plan to attract private capital
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partners to scale and diversify our distressed office investment strategy while also enhancing the efficiency of our platform with incremental fee revenue and potential carried interest income.
We intend to continue to opportunistically sell or recapitalize assets (which may be multifamily, commercial and/or retail assets) as well as land sites where a ground lease or joint venture execution may represent the most attractive path to maximizing value. In a climate where office valuations are near cyclical lows with limited liquidity, the most efficiently priced source of capital will likely come from our multifamily assets. To that end, we are currently marketing for sale select multifamily and land assets.
During the first quarter of 2026, we began to see improvements in our multifamily portfolio occupancy, which had experienced softness largely as a result of job losses primarily in the District of Columbia in 2025 due to federal government spending cuts and a hiring freeze. Our same store multifamily portfolio occupancy was 92.0% as of March 31, 2026, an increase of 160 basis points as compared to December 31, 2025. During the first quarter of 2026, effective rents, which represent the average change in rental rates versus expiring rental rates net of concessions, decreased by 10.5% for new leases and increased by 1.9% upon renewal while achieving a 62.4% renewal rate across our portfolio. Our recently delivered assets, The Zoe and Valen, which were placed into service in 2025, were 47.4% leased as of March 31, 2026. As a result of these deliveries, interest expense has increased for these assets as we have ceased capitalizing the related interest expense.
Our office portfolio occupancy was 75.2% as of March 31, 2026, an increase of 10 basis points as compared to December 31, 2025. Leasing activity in our National Landing portfolio continues to be driven primarily by office users who fall into three categories (i) tenants who require secure facility space; (ii) technology-related tenants; and (iii) defense-related tenants who have long resided in this submarket. Our leasing efforts continue to focus on buildings with long-term potential, concentrating occupancy in areas of National Landing that are accessible via multi-modal transportation and that we have enhanced through our placemaking interventions, including the delivery of our new office amenity hub at 2011 Crystal Drive. We expect to help foster a healthier long-term office market by repurposing older, underutilized office buildings for redevelopment or conversion to multifamily housing, hospitality and other complimentary uses that will support a vibrant mixed-use environment. We have already executed on this strategy at 1900 Crystal Drive and 2001 Richmond Highway, two obsolete office buildings we demolished and redeveloped into our new multifamily assets currently in lease up — The Grace, Reva, The Zoe and Valen. We have broadened this approach to four additional assets through adaptive reuse and conversion: 2100 Crystal Drive, which we entitled for conversion into a 345-key, dual-branded hotel and subsequently sold to a hotel developer; 2200 Crystal Drive, which we plan to convert into a 195-unit multifamily asset; and 1800 and 1901 South Bell Street, which we are in the process of entitling for conversion into multifamily.
We have 4.6 million square feet (3.3 million square feet at our share) of estimated potential development density in our development pipeline and intend to seek joint venture capital to fund these developments as market conditions permit.
Operating Results
Key highlights for the three months ended March 31, 2026 included:
● net loss attributable to common shareholders of $18.7 million, or $0.32 per diluted common share, for the three months ended March 31, 2026 compared to $45.7 million, or $0.56 per diluted common share, for the three months ended March 31, 2025;
● third-party real estate services revenue, including reimbursements, of $17.2 million and $14.9 million for the three months ended March 31, 2026 and 2025;
● same store multifamily portfolio leased and occupied percentages (1) at our share of 93.5% and 92.0% as of March 31, 2026, compared to 91.8% and 90.4% as of December 31, 2025, and 95.4% and 94.0% as of March 31, 2025;
● operating commercial portfolio leased and occupied percentages at our share of 76.9% and 75.2% as of March 31, 2026 compared to 77.5% and 75.1% as of December 31, 2025, and 78.3% and 76.4% as of March 31, 2025;
● the leasing of 332,000 square feet of office leases at our share, at an initial rent (2) of $46.36 per square foot and a GAAP-basis weighted average rent per square foot (3) of $45.64; and
● a decrease in same store (4) net operating income ("NOI") of 4.8% to $54.3 million for the three months ended March 31, 2026 compared to $57.1 million for the three months ended March 31, 2025.
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(1) 2221 S. Clark Street - Residential and 900 W Street are excluded from leased and occupied percentages as they are operated as short-term rental properties.
(2) Represents the cash basis weighted average starting rent per square foot at our share, which excludes free rent, fixed escalations and percentage rent .
(3) Represents the weighted average rent per square foot recognized over the term of the respective leases, including the effect of free rent and fixed escalations, but excluding the effect of percentage rent.
(4) Includes the results of the properties that are owned, operated and in-service for the entirety of both periods being compared, excluding assets for which significant redevelopment, renovation or repositioning occurred during either of the periods being compared.
Additionally, investing and financing activity during the three months ended March 31, 2026 included:
● the sale of a development parcel. See Note 3 to the financial statements for additional information;
● the extension of the maturity date of the Tranche A-1 Term Loan to January 2027;
● the net borrowing of $25.0 million under our revolving credit facility;
● the payment of dividends totaling $10.4 million and distributions to redeemable noncontrolling interests of $3.4 million;
● the repurchase and retirement of 1.6 million of our common shares for $25.4 million, a weighted average purchase price per share of $15.47; and
● the investment of $23.2 million in development costs, construction in progress and real estate additions.
Activity subsequent to March 31, 2026 included:
● the formation of a consolidated real estate venture to recapitalize Tysons Dulles Plaza. See Note 3 to the financial statements for additional information;
● the declaration of a quarterly dividend of $0.175 per common share, payable on May 28, 2026 to shareholders of record as of May 14, 2026; and
● the repurchase and retirement of 182,184 common shares for $2.6 million, a weighted average purchase price per share of $14.36, pursuant to a repurchase plan under Rule 10b5-1 of the Securities Exchange Act of 1934, as amended.
Critical Accounting Estimates
Our Annual Report contains a description of our critical accounting estimates, including asset acquisitions, real estate, investments in real estate ventures and revenue recognition. There have been no significant changes to our policies during the three months ended March 31, 2026.
In April 2026, we withheld payment under a ground lease option at a pre-development project with $44.0 million of capitalized costs, of which $17.1 million was recorded as part of the formation transaction in 2017, as the parties attempt to negotiate new ground lease terms. As of March 31, 2026, we believe the project remains probable of future development. Should our efforts to negotiate new ground lease terms prove unsuccessful or market conditions deteriorate, we may need to reassess the probability of future development and recoverability of the asset, which could result in impairment charges in future periods.
Recent Accounting Pronouncements
See Note 2 to the financial statements for a description of recent accounting pronouncements.
Results of Operations
In 2025, we sold 8001 Woodmont, WestEnd25 and The Batley. We collectively refer to these assets as the "Disposed Properties" in the discussion below. In 2025, we acquired Tysons Dulles Plaza and the remaining 45.0% interest in an unconsolidated real estate venture that owned 1101 17th Street. In 2025, we began leasing The Zoe and Valen, and in 2024, we began leasing The Grace and Reva.
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Comparison of the Three Months Ended March 31, 2026 to 2025
The following table summarizes certain line items from our statements of operations that we believe are important in understanding our operations and/or those items which significantly changed in the three months ended March 31, 2026 compared to the same period in 2025:
Three Months Ended March 31,
2026
2025
% Change
(Dollars in thousands)
Property rental revenue
$
105,856
$
101,499
4.3
%
Third-party real estate services revenue, including reimbursements
17,208
14,914
15.4
%
Depreciation and amortization expense
45,305
47,587
(4.8)
%
Property operating expense
36,218
33,437
8.3
%
Real estate taxes expense
12,046
12,172
(1.0)
%
General and administrative expense:
Corporate and other
15,287
15,557
(1.7)
%
Third-party real estate services
16,998
16,071
5.8
%
Transaction and other costs
9,841
1,911
*
Interest expense
35,548
35,200
1.0
%
Gain on the sale of real estate, net
21,075
537
*
Loss on the extinguishment of debt, net
—
4,636
(100.0)
%
Impairment loss
1,500
8,483
(82.3)
%
* Not meaningful.
Property rental revenue increased by approximately $4.4 million, or 4.3%, to $105.9 million in 2026 from $101.5 million in 2025. The increase was primarily due to a $12.5 million increase in revenue from our commercial assets, partially offset by a $5.3 million decrease in revenue from our multifamily assets and a $2.8 million decrease in other revenue. The increase in revenue from our commercial assets was primarily due to a $5.7 million increase related to the acquisition of Tysons Dulles Plaza and the consolidation of 1101 17th Street, a $3.6 million increase related to 2011 Crystal Drive due to the acceleration of lease incentives and deferred rent associated with an early termination in 2025 and a $1.5 million increase in lease termination revenue. The decrease in revenue from our multifamily assets was primarily due to a $9.1 million decrease related to the Disposed Properties and lower occupancy across the portfolio, partially offset by a $4.3 million increase related to the continued lease up of The Grace, Reva, The Zoe and Valen.
Third-party real estate services revenue, including reimbursements, increased by approximately $2.3 million, or 15.4%, to $17.2 million in 2026 from $14.9 million in 2025. The increase was primarily due to a $2.2 million increase in reimbursement revenue.
Depreciation and amortization expense decreased by approximately $2.3 million, or 4.8%, to $45.3 million in 2026 from $47.6 million in 2025. The decrease was primarily due to (i) a $2.3 million decrease related to the Disposed Properties, (ii) a $1.8 million decrease related to certain assets being either fully depreciated or written off in 2025 and (iii) a $1.4 million decrease related to 2011 Crystal Drive primarily due to the acceleration of depreciation for certain assets associated with an early termination in 2025. The decrease in depreciation and amortization expense was partially offset by (iv) a $2.3 million increase as The Zoe and Valen were placed into service and (v) a $1.5 million increase related to the acquisition of Tysons Dulles Plaza and the consolidation of 1101 17th Street.
Property operating expense increased by approximately $2.8 million, or 8.3%, to $36.2 million in 2026 from $33.4 million in 2025. The increase was primarily due to a $5.0 million increase in property operating expense from our commercial assets, partially offset by a $2.0 million decrease in other property operating expense and a $153,000 decrease from our multifamily assets. The increase in property operating expense from our commercial assets was primarily due to a $2.2 million increase related to the acquisition of Tysons Dulles Plaza and the consolidation of 1101 17th Street, and higher operating expenses primarily due to utilities. The decrease in property operating expense from our multifamily assets was primarily due to a $2.6 million decrease related to the Disposed Properties, partially offset by a $1.3 million increase related to the continued lease up of The Grace, Reva, The Zoe and Valen, and higher utilities across the portfolio.
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Real estate taxes expense decreased by approximately $126,000, or 1.0%, to $12.0 million in 2026 from $12.2 million in 2025. The decrease was primarily due to an $896,000 decrease related to the Disposed Properties and lower property tax assessments for certain assets, partially offset by a $534,000 increase related to the acquisition of Tysons Dulles Plaza and the consolidation of 1101 17th Street, and a $524,000 increase related to The Zoe and Valen, which were placed into service.
General and administrative expense: corporate and other decreased by approximately $270,000, or 1.7%, to $15.3 million in 2026 from $15.6 million in 2025. The decrease was primarily due to lower compensation expenses.
General and administrative expense: third-party real estate services increased by approximately $927,000, or 5.8%, to $17.0 million in 2026 from $16.1 million in 2025. The increase was primarily due to higher third-party reimbursable expenses, partially offset by lower overhead expenses and lower compensation expenses.
Transaction and other costs increased by approximately $7.9 million to $9.8 million in 2026 from $1.9 million in 2025. The increase was primarily due to a charge of $9.5 million, net of expected insurance recoveries, related to a criminal fraud scheme involving AI-enabled employee impersonation, which led to fraudulently induced wire transfers. See Note 12 to the financial statements for additional information.
Interest expense increased by approximately $348,000, or 1.0%, to $35.5 million in 2026 from $35.2 million in 2025. The increase was primarily due to (i) a $2.0 million decrease in capitalized interest primarily related to Valen, which was placed into service, (ii) a $1.8 million increase due to higher interest expense on our term loans and a higher outstanding balance on our revolving credit facility, (iii) a $509,000 increase related to the consolidation of 1101 17th Street and (iv) a $205,000 increase due to draws on the mortgage loan related to The Zoe and Valen. The increase in interest expense was partially offset by (v) a $1.7 million decrease related to mortgage loans on the Disposed Properties, (vi) a $1.4 million decrease related to the RiverHouse Apartments refinancing in March 2025 and (vii) a $1.1 million decrease related to variable rate mortgage loans.
Gain on the sale of real estate of $21.1 million in 2026 was due to the sale of a development parcel. Gain on the sale of real estate of $537,000 in 2025 was due to a gain related to prior year dispositions, partially offset by the loss on the sale of 8001 Woodmont.
Loss on the extinguishment of debt of $4.6 million in 2025 was due to the refinancing of the RiverHouse Apartments mortgage loan.
Impairment loss of $1.5 million in 2026 was related to a land asset, which was written down to its estimated fair value. Impairment loss of $8.5 million in 2025 was related to a development parcel, which was written down to its estimated fair value.
Funds from Operations ("FFO")
FFO is a non-GAAP financial measure computed in accordance with the definition established by the National Association of Real Estate Investment Trusts ("Nareit") in the Nareit FFO White Paper - 2018 Restatement. Nareit defines FFO as net income (loss) (computed in accordance with GAAP), excluding depreciation and amortization expense related to real estate, gains (losses) from the sale of certain real estate assets, gains (losses) from change in control and impairment write-downs of certain real estate assets and investments in entities when the impairment is directly attributable to decreases in the value of depreciable real estate held by the entity, including our share of such adjustments for unconsolidated real estate ventures.
We believe FFO is a meaningful non-GAAP financial measure useful in comparing our levered operating performance from period-to-period and as compared to similar real estate companies because FFO excludes real estate depreciation and amortization expense, which implicitly assumes that the value of real estate diminishes predictably over time rather than fluctuating based on market conditions and other non-comparable income and expenses. FFO does not represent cash generated from operating activities and is not necessarily indicative of cash available to fund cash requirements and should not be considered as an alternative to net income (loss) (computed in accordance with GAAP), as a performance measure or cash flow as a liquidity measure. FFO may not be comparable to similarly titled measures used by other companies.
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The following table reconciles net loss attributable to common shareholders, the most directly comparable GAAP measure, to FFO:
Three Months Ended March 31,
2026
2025
(In thousands)
Net loss attributable to common shareholders
$
(18,697)
$
(45,720)
Net loss attributable to redeemable noncontrolling interests
(4,350)
(7,978)
Net loss
(23,047)
(53,698)
Gain on the sale of real estate, net
(21,075)
(537)
Pro rata share of loss on the sale of unconsolidated real estate assets
35
—
Real estate depreciation and amortization
45,018
45,961
Impairment loss related to real estate
1,500
8,483
Pro rata share of real estate depreciation and amortization from unconsolidated real estate ventures
979
779
FFO attributable to redeemable noncontrolling interests in consolidated real estate ventures
(758)
—
FFO attributable to common limited partnership units ("OP Units")
2,652
988
FFO attributable to redeemable noncontrolling interests
(573)
(167)
FFO attributable to common shareholders
$
2,079
$
821
Note: The prior year FFO amounts have been restated to conform to the current year presentation.
NOI and Same Store NOI
NOI and same store NOI are non-GAAP financial measures management uses to assess an asset's performance. The most directly comparable GAAP measure is net income (loss) attributable to common shareholders. We use NOI internally as a performance measure and believe NOI and same store NOI provide useful information to investors regarding our financial condition and results of operations because it reflects only property related revenue (which includes base rent, tenant reimbursements and other operating revenue, net of free rent and payments associated with assumed lease liabilities) less operating expenses and ground rent for operating leases, if applicable. NOI and same store NOI exclude deferred rent, commercial lease termination revenue, related party management fees, interest expense, and certain other non-cash adjustments, including the accretion of acquired below-market leases and the amortization of acquired above-market leases and below-market ground lease intangibles. Management uses NOI, which includes our proportionate share of revenue and expenses attributable to real estate ventures, as a supplemental performance measure and believes it provides useful information to investors because it reflects only those revenue and expense items that are incurred at the asset level, excluding non-cash items. In addition, NOI is considered by many in the real estate industry to be a useful starting point for determining the value of a real estate asset or group of assets. However, because NOI excludes depreciation and amortization expense and captures neither the changes in the value of our assets that result from use or market conditions, nor the level of capital expenditures and capitalized leasing commissions necessary to maintain the operating performance of our assets, all of which have real economic effect and could materially impact the financial performance of our assets, the utility of NOI as a measure of the operating performance of our assets is limited. NOI presented by us may not be comparable to NOI reported by other REITs that define these measures differently. We believe to facilitate a clear understanding of our operating results, NOI should be examined in conjunction with net income (loss) attributable to common shareholders as presented in our financial statements. NOI should not be considered as an alternative to net income (loss) attributable to common shareholders as an indication of our performance or to cash flows as a measure of liquidity or our ability to make distributions.
Information provided on a same store basis includes the results of properties that are owned, operated and in-service for the entirety of both periods being compared, which excludes disposed properties or properties for which significant redevelopment, renovation or repositioning occurred during either of the periods being compared. During the three months ended March 31, 2026, our same store pool decreased to 32 properties from 33 properties due to 1831/1861 Wiehle Avenue being taken out of service. While there is judgment surrounding changes in designations, a property is removed from the same store pool when the property is considered to be under construction because it is undergoing significant redevelopment or renovation pursuant to a formal plan or is being repositioned in the market and such renovation or repositioning is expected to have a significant impact on property NOI. A development property or under-construction property is moved to the same store pool once a substantial portion of the growth expected from the development or redevelopment is reflected in both the current and comparable prior year period. Acquisitions are moved into the same store pool once we have owned
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the property for the entirety of the comparable periods and the property is not under significant development or redevelopment.
Same store NOI decreased $2.7 million, or 4.8%, to $54.3 million for the three months ended March 31, 2026 from $57.1 million for the same period in 2025. The decrease was substantially attributable to (i) lower occupancy and higher utilities expense in our multifamily portfolio and (ii) higher utilities expense and increased rent abatement, partially offset by lower real estate tax expense in our commercial portfolio.
The following table reconciles net loss attributable to common shareholders to NOI at our share and same store NOI at our share:
Three Months Ended March 31,
2026
2025
Net loss attributable to common shareholders
$
(18,697)
$
(45,720)
Net loss attributable to redeemable noncontrolling interests
(4,350)
(7,978)
Net loss
(23,047)
(53,698)
Add:
Depreciation and amortization expense
45,305
47,587
General and administrative expense:
Corporate and other
15,287
15,557
Third-party real estate services
16,998
16,071
Transaction and other costs
9,841
1,911
Interest expense
35,548
35,200
Loss on the extinguishment of debt, net
—
4,636
Impairment loss
1,500
8,483
Income tax expense (benefit)
7
(200)
Less:
Third-party real estate services, including reimbursements revenue
17,208
14,914
Loss from unconsolidated real estate ventures, net
(374)
(592)
Interest and other income, net
1,400
525
Gain on the sale of real estate, net
21,075
537
Adjustments:
NOI attributable to unconsolidated real estate ventures at our share
1,225
990
Real estate venture partner’s share of NOI attributable to consolidated real estate ventures
(801)
—
Non-cash rent adjustments (1)
(1,720)
2,439
Other adjustments (2)
87
1,693
Total adjustments
(1,209)
5,122
NOI at our share
60,921
65,285
Less: out-of-service NOI loss (3) (4)
(1,507)
(2,237)
Operating Portfolio NOI (4)
62,428
67,522
Non-same store NOI (4) (5)
8,102
10,466
Same store NOI (4) (6)
$
54,326
$
57,056
Change in same store NOI
(4.8%)
Number of properties in same store pool
32
(1) Adjustment to exclude deferred rent, above/below market lease amortization/accretion and lease incentive amortization.
(2) Adjustment to exclude commercial lease termination revenue, related party management fees, corporate entity activity and inter-segment activity.
(3) Includes the results of our under-construction assets, assets in the development pipeline and other land assets.
(4) Represents amounts at our share.
(5) Includes the results of properties that were not in-service for the entirety of both periods being compared, including disposed properties, and properties for which significant redevelopment, renovation or repositioning occurred during either of the periods being compared.
(6) Includes the results of the properties that are owned, operated and in-service for the entirety of both periods being compared.
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Reportable Segments
Our three operating and reportable segments are multifamily, commercial, and third-party real estate services. We measure and evaluate the performance of our operating segments, with the exception of the third-party real estate services business, based on NOI at our share, which includes our proportionate share of revenue and expenses attributable to real estate ventures.
The following table summarizes NOI at our share for our multifamily and commercial segments:
Multifamily
Commercial
Three Months Ended March 31,
2026
2025
% Change
2026
2025
% Change
(Dollars in thousands, at our share)
Property rental revenue
$
47,716
$
54,602
(12.6)
%
$
55,890
$
49,757
12.3
%
Other property revenue
608
621
(2.1)
%
3,820
3,736
2.2
%
Total property revenue
48,324
55,223
(12.5)
%
59,710
53,493
11.6
%
Property expense:
Real estate taxes
6,305
5,571
13.2
%
4,880
5,592
(12.7)
%
Payroll
3,804
3,742
1.7
%
3,432
3,007
14.1
%
Utilities
4,106
3,918
4.8
%
5,043
3,402
48.2
%
Repairs and maintenance
4,737
5,437
(12.9)
%
5,215
4,472
16.6
%
Other property operating
3,002
3,045
(1.4)
%
6,363
4,148
53.4
%
Total property expense
21,954
21,713
1.1
%
24,933
20,621
20.9
%
NOI from reportable segments
$
26,370
$
33,510
(21.3)
%
$
34,777
$
32,872
5.8
%
Comparison of the Three Months Ended March 31, 2026 to 2025
Multifamily: Property revenue at our share decreased by $6.9 million, or 12.5%, to $48.3 million in 2026 from $55.2 million in 2025. NOI at our share decreased by $7.1 million, or 21.3%, to $26.4 million in 2026 from $33.5 million in 2025. The decreases in property revenue at our share and NOI at our share were primarily due to the Disposed Properties, partially offset by the continued lease up of The Grace, Reva, The Zoe and Valen.
Commercial: Property revenue at our share increased by $6.2 million, or 11.6%, to $59.7 million in 2026 from $53.5 million in 2025. The increase in property revenue at our share was primarily due to the acquisitions of Tysons Dulles Plaza and Dulles View, and the consolidation of 1101 17th Street. NOI at our share increased by $1.9 million, or 5.8%, to $34.8 million in 2026 from $32.9 million in 2025. The increase in NOI at our share was primarily due to the acquisitions of Tysons Dulles Plaza and Dulles View, and the consolidation of 1101 17th Street, partially offset by higher property operating expenses primarily due to higher utilities across the portfolio.
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With respect to the third-party real estate services business, we review revenue streams generated by this segment, excluding reimbursement revenue, as well as the expenses attributable to this segment at our proportionate share, calculated by excluding real estate services revenue from our interests in real estate ventures. The following table summarizes our third-party real estate services business at our share:
Three Months Ended March 31,
2026
2025
Property management fees
$
3,356
$
3,361
Asset management fees
1,077
580
Development fees
369
523
Leasing fees
368
654
Construction management fees
219
231
Other service revenue
1,119
1,035
Third-party real estate services revenue, excluding reimbursements
6,508
6,384
Third-party real estate services expenses, excluding reimbursements
6,039
7,236
Net third-party real estate services, excluding reimbursements
$
469
$
(852)
Third-party real estate services revenue, excluding reimbursements, increased by $124,000, or 1.9%, to $6.5 million in 2026 from $6.4 million in 2025. The increase was primarily due to a $497,000 increase in asset management fees, partially offset by a $286,000 decrease in leasing fees. Third-party real estate services expenses, excluding reimbursements, decreased by $1.2 million, or 16.5%, to $6.0 million in 2026 from $7.2 million in 2025. The decrease was primarily due to lower overhead expenses and lower compensation expenses.
Liquidity and Capital Resources
Property rental income is our primary source of operating cash flow and depends on many factors including occupancy levels and rental rates, as well as our tenants' ability to pay rent. In addition, our third-party real estate services business provides fee-based real estate services. Our assets provide cash flow that enables us to pay operating expenses, debt service, recurring capital expenditures, dividends to shareholders, and distributions to holders of OP Units and long-term incentive partnership units ("LTIP Units"). Other sources of liquidity to fund cash requirements include proceeds from financings, recapitalizations, asset sales, and the issuance and sale of securities. We anticipate that cash flows from continuing operations and proceeds from financings, asset sales and recapitalizations, together with existing cash balances, will be adequate to fund our business operations, debt amortization, capital expenditures, any dividends to shareholders, and distributions to holders of OP Units and LTIP Units.
Mortgage Loans
The following table summarizes mortgage loans:
Weighted Average
Effective
Interest Rate (1)
March 31, 2026
December 31, 2025
(In thousands)
Variable rate (2)
5.17%
$
601,883
$
600,899
Fixed rate (3)
5.17%
1,019,751
1,020,690
Mortgage loans
1,621,634
1,621,589
Unamortized deferred financing costs and premium/discount, net (4)
(41,487)
(42,431)
Mortgage loans, net
$
1,580,147
$
1,579,158
(1) Weighted average effective interest rate as of March 31, 2026.
(2) Includes variable rate mortgage loans with interest rate cap agreements. For mortgage loans with interest rate caps, the weighted average interest rate cap strike was 3.18%, and the weighted average maturity date of the interest rate caps is in the fourth quarter of 2026. The interest rate cap strike is exclusive of the credit spreads associated with the mortgage loans. As of March 31, 2026, one-month term Secured Overnight Financing Rate ("SOFR") was 3.66%.
(3) Includes variable rate mortgage loans with interest rates fixed by interest rate swap agreements.
(4) As of March 31, 2026 and December 31, 2025, includes a discount of $29.6 million related to the 1101 17 th Street mortgage loan.
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As of March 31, 2026 and December 31, 2025, the net carrying value of real estate collateralizing our mortgage loans totaled $1.7 billion. Our mortgage loans contain covenants that limit our ability to incur additional indebtedness on these properties and, in certain circumstances, require lender approval of tenant leases and/or yield maintenance upon repayment prior to maturity.
As of March 31, 2026 and December 31, 2025, we had various interest rate swap and cap agreements on certain mortgage loans with an aggregate notional value of $756.0 million. See Note 15 to the financial statements for additional information.
Revolving Credit Facility and Term Loans
As of March 31, 2026 and December 31, 2025, our unsecured revolving credit facility and term loans totaling $1.5 billion consisted of a $750.0 million revolving credit facility maturing in June 2027, a $200.0 million term loan ("Tranche A-1 Term Loan") maturing in January 2027, as extended in January 2026, a $400.0 million term loan ("Tranche A-2 Term Loan") maturing in January 2028 and a $120.0 million term loan ("2023 Term Loan") maturing in June 2028. We have the option to increase the $750.0 million revolving credit facility or add term loans up to $500.0 million. The revolving credit facility has two six-month extension options.
The agreements for our unsecured revolving credit facility and term loans include customary restrictive covenants, that, among other things, restrict our ability to incur additional indebtedness, to engage in material asset sales, mergers, consolidations and acquisitions, and in certain circumstances, to pay dividends, make distributions and repurchase common shares, and also include requirements to maintain financial ratios. Our ability to borrow is subject to compliance with these covenants, and failure to comply with our covenants could cause a default, and we may then be required to repay such debt.
The following table summarizes amounts outstanding under the revolving credit facility and term loans:
Effective
Interest Rate (1)
March 31, 2026
December 31, 2025
(In thousands)
Revolving credit facility (2) (3)
5.27%
$
230,000
$
205,000
Tranche A-1 Term Loan (4)
5.44%
$
200,000
$
200,000
Tranche A-2 Term Loan (5)
4.30%
400,000
400,000
2023 Term Loan (6)
5.51%
120,000
120,000
Term loans
720,000
720,000
Unamortized deferred financing costs, net
(1,380)
(1,592)
Term loans, net
$
718,620
$
718,408
(1) Effective interest rate as of March 31, 2026. The interest rate for our revolving credit facility excludes a 0.20% facility fee.
(2) As of March 31, 2026, daily SOFR was 3.68%. As of March 31, 2026 and December 31, 2025, letters of credit totaling $4.8 million were outstanding under our revolving credit facility.
(3) As of March 31, 2026 and December 31, 2025, excludes $3.6 million and $4.4 million of net deferred financing costs related to our revolving credit facility that were included in "Other assets, net" in our balance sheets.
(4) The interest rate swaps fix SOFR at a weighted average interest rate of 4.00% through the maturity date.
(5) The interest rate swaps fix SOFR at a weighted average interest rate of 2.81% through the maturity date.
(6) The interest rate swap fixes SOFR at an interest rate of 4.01% through the maturity date.
Common Shares Repurchased
Our Board of Trustees has authorized the repurchase of up to $2.0 billion of our outstanding common shares. During the three months ended March 31, 2026, we repurchased and retired 1.6 million common shares for $25.4 million, a weighted average purchase price per share of $15.47. During the three months ended March 31, 2025, we repurchased and retired 12.2 million common shares for $187.5 million, a weighted average purchase price per share of $15.43. Since we began the
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share repurchase program through March 31, 2026, we have repurchased and retired 85.3 million common shares for $1.6 billion, a weighted average purchase price per share of $18.73.
During the second quarter of 2026, through May 1, 2026, we repurchased and retired 182,184 common shares for $2.6 million, a weighted average purchase price per share of $14.36, pursuant to a repurchase plan under Rule 10b5-1 of the Securities Exchange Act of 1934, as amended.
Purchases under the program are made either in the open market or in privately negotiated transactions from time to time as permitted by federal securities laws and other legal requirements. The timing, manner, price and amount of any repurchases will be determined by us at our discretion and will be subject to economic and market conditions, share price, applicable legal requirements and other factors. The program may be suspended or discontinued at our discretion without prior notice.
Material Cash Requirements
Our material cash requirements for the next 12 months and beyond are to fund:
● normal recurring expenses;
● debt service and principal repayment obligations, including balloon payments on maturing mortgage loans — As of March 31, 2026, we had maturities totaling $863.8 million related to our consolidated entities and $35.0 million related to our unconsolidated real estate ventures at our share scheduled to mature in 2026 and 2027;
● capital expenditures, including major renovations, tenant improvements and leasing costs — As of March 31, 2026, we had committed tenant-related obligations totaling $37.6 million ($34.4 million related to our consolidated entities and $3.2 million related to our unconsolidated real estate ventures at our share);
● development expenditures — As of March 31, 2026, we have remaining commitments related to Valen, a recently completed multifamily asset, and an office amenity hub at 2011 Crystal Drive that together, based on our current plans and estimates, require an additional $3.8 million to complete, which we anticipate will be primarily expended in the second quarter of 2026;
● dividends to shareholders and distributions to holders of OP Units and LTIP Units — On April 30, 2026, our Board of Trustees declared a quarterly dividend of $0.175 per common share;
● possible common share repurchases — During the second quarter of 2026, through May 1, 2026, we repurchased and retired 182,184 common shares for $2.6 million; and
● possible acquisitions of properties, either directly or indirectly through the acquisition of equity interests.
We expect to satisfy these needs using one or more of the following:
● cash and cash equivalents — As of March 31, 2026, we had cash and cash equivalents of $79.8 million ;
● cash flows from operations;
● distributions from real estate ventures;
● borrowing capacity under our revolving credit facility — As of March 31, 2026, we had $515.2 million of undrawn capacity under our revolving credit facility;
● proceeds from financings, joint venture capital, asset sales and recapitalizations; and
● proceeds from the issuance of securities.
During the three months ended March 31, 2026, there were no significant changes to the material cash requirements information presented in Item 7 of Part II of our Annual Report.
See additional information in the following pages under "Commitments and Contingencies."
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Summary of Cash Flows
The following summary discussion of our cash flows is based on our statements of cash flows and is not meant to be an all-inclusive discussion of the changes in our cash flows:
Three Months Ended March 31,
2026
2025
(In thousands)
Net cash provided by operating activities
$
3,409
$
12,935
Net cash provided by investing activities
23,991
161,314
Net cash used in financing activities
(15,835)
(237,106)
Cash Flows for the Three Months Ended March 31, 2026
Cash and cash equivalents, and restricted cash increased $11.6 million to $114.9 million as of March 31, 2026, compared to $103.3 million as of December 31, 2025. This increase resulted from $24.0 million of net cash provided by investing activities and $3.4 million of net cash provided by operating activities, partially offset by $15.8 million of net cash used in financing activities.
Net cash provided by operating activities of $3.4 million comprised: (i) $12.7 million of net income (before $56.8 million of non-cash items and a $21.1 million gain on the sale of real estate) and (ii) $594,000 of return on capital from unconsolidated real estate ventures, partially offset by (iii) $9.9 million of net change in operating assets and liabilities. Non-cash income adjustments of $56.8 million primarily include depreciation and amortization expense and share-based compensation expense.
Net cash provided by investing activities of $24.0 million primarily comprised: (i) $46.6 million of proceeds from the sale of real estate, partially offset by (ii) $23.2 million of development costs, construction in progress and real estate additions.
Net cash used in financing activities of $15.8 million primarily comprised: (i) $35.0 million of repayments on the revolving credit facility, (ii) $25.4 million of common shares repurchased, (iii) $10.4 million of dividends paid to common shareholders and (iv) $3.4 million of distributions to redeemable noncontrolling interests, partially offset by (v) $60.0 million of borrowings under the revolving credit facility.
Unconsolidated Real Estate Ventures
We consolidate entities in which we have a controlling interest or are the primary beneficiary in a variable interest entity. From time to time, we may have off-balance-sheet unconsolidated real estate ventures and other unconsolidated arrangements with varying structures.
As of March 31, 2026, we had investments in unconsolidated real estate ventures totaling $105.3 million. For these investments, we exercise significant influence over but do not control these entities and, therefore, account for these investments using the equity method of accounting. For a more complete description of our real estate ventures, see Note 4 to the financial statements.
From time to time, we (or ventures in which we have an ownership interest) have agreed, and may in the future agree with respect to unconsolidated real estate ventures, to (i) guarantee portions of the principal, interest and other amounts in connection with borrowings, (ii) provide customary environmental indemnifications and nonrecourse carve-outs (e.g., guarantees against fraud, misrepresentation and bankruptcy) in connection with borrowings or (iii) provide guarantees to lenders and other third parties for the completion and stabilization of development projects. We customarily have agreements with our outside venture partners whereby the partners agree to reimburse the real estate venture or us for their share of any payments made under certain of these guarantees. At times, we also have agreements with certain of our outside venture partners whereby we agree to either indemnify the partners and/or the associated ventures with respect to certain contingent liabilities associated with operating assets or to reimburse our partner for its share of any payments made by them under certain guarantees. Guarantees (excluding environmental) customarily terminate either upon the satisfaction of specified circumstances or repayment of the underlying debt. Amounts that we may be required to pay in future periods in relation to guarantees associated with budget overruns or operating losses are not estimable. As of March 31, 2026, we had no principal payment guarantees related to our unconsolidated real estate ventures.
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Commitments and Contingencies
Insurance
We maintain general liability insurance with limits of $102.0 million per occurrence and in the aggregate, and property and rental value insurance coverage with limits of $1.0 billion per occurrence, with sub-limits for certain perils such as floods and earthquakes on each of our properties. We also maintain coverage, through our wholly owned captive insurance subsidiary, for a portion of the first loss on the above limits and for both conventional terrorist acts and for nuclear, biological, chemical or radiological terrorism events with limits of $2.0 billion per occurrence. These policies are partially reinsured by third-party insurance providers.
We will continue to monitor the state of the insurance market, and the scope and costs of coverage for acts of terrorism. We cannot anticipate what coverage will be available on commercially reasonable terms in the future. We are responsible for deductibles and losses in excess of the insurance coverage, which could be material.
Our debt, consisting of mortgage loans secured by our properties, a revolving credit facility and term loans, contains customary covenants requiring adequate insurance coverage. Although we believe that we currently have adequate insurance coverage, we may not be able to obtain an equivalent amount of coverage at a reasonable cost in the future. If lenders insist on greater coverage than we can obtain, it could adversely affect our ability to finance or refinance our properties.
Construction Commitments
As of March 31, 2026, we have remaining commitments related to Valen, a recently completed multifamily asset, and an office amenity hub at 2011 Crystal Drive that together, based on our current plans and estimates, require an additional $3.8 million to complete, which we anticipate will be primarily expended in the second quarter of 2026.
Legal Proceedings
In November 2023, the District of Columbia filed a lawsuit in the Superior Court of the District of Columbia against RealPage, Inc., a provider of revenue management systems, numerous multifamily rental companies, and 14 owners and/or operators of multifamily housing in the District of Columbia, including JBG Associates, L.L.C., one of our subsidiaries, alleging that the defendants violated the District of Columbia Antitrust Act by unlawfully agreeing to use RealPage, Inc. revenue management systems and sharing sensitive data. The District of Columbia is seeking monetary damages, equitable relief, attorneys’ fees, interest and costs. While we intend to vigorously defend against this lawsuit, we are unable to predict the outcome or estimate the amount of loss, if any, that may result from the lawsuit. While we do not believe that these proceedings will have a material adverse effect on our financial condition, we cannot give assurance that the proceedings will not have a material effect on our results of operations or cash flows in the event of a negative outcome.
We, along with multiple other parties, are named defendants in a lawsuit arising out of a condominium development project known as Wardman Tower in Washington, D.C. The lawsuit was filed by the Wardman Tower Residential Condominium Unit Owners Association in the Superior Court of the District of Columbia on November 25, 2020. The lawsuit seeks damages resulting primarily from alleged construction and design deficiencies, alleged misrepresentations and claims alleged under the D.C. Consumer Protection Procedures Act ("CPPA"). The lawsuit seeks $185.0 million in compensatory damages, plus treble damages related to the CPPA claims, and attorneys' fees and costs. The bench trial began on November 10, 2025 and concluded on March 5, 2026. The court has not issued a ruling as of the date of this filing. The Wardman Tower project was designed and constructed by other parties and achieved substantial completion prior to our formation. We were not involved in any way with the project but one of our subsidiary entities, that was recently made a defendant in the litigation, had previously entered into a project management agreement with the project owner. We deny liability for the claims asserted and have vigorously defended ourselves against the claims alleged in the litigation. However, no assurance can be given that the matter will be resolved favorably.
There are various other legal actions arising in the ordinary course of business. In our opinion, the outcome of such matters is not expected to have a material adverse effect on our financial position, results of operations or cash flows. Our accrual for loss contingencies relating to unresolved legal matters was included in "Other liabilities, net" in our balance sheets.
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Actual losses may differ materially from amounts recorded and the ultimate outcome of these legal proceedings is generally not yet determinable.
Other
As of March 31, 2026, we had committed tenant-related obligations totaling $37.6 million ($34.4 million related to our consolidated entities and $3.2 million related to our unconsolidated real estate ventures at our share). The timing and amounts of payments for tenant-related obligations are uncertain and may only be due upon satisfactory performance of certain conditions.
As of March 31, 2026, we had unfunded capital commitments totaling $5.8 million related to our investments in real estate-focused technology companies and $1.5 million related to our investments in the WHI Impact Pool and the LEO Impact Housing Fund. See Note 18 to the financial statements for additional information.
With respect to borrowings of our consolidated entities, we may agree to (i) guarantee portions of the principal, interest and other amounts, (ii) provide customary environmental indemnifications and nonrecourse carve-outs (e.g., guarantees against fraud, misrepresentation and bankruptcy) or (iii) provide guarantees to lenders, tenants and other third parties for the completion and stabilization of development projects. As of March 31, 2026, we had no debt principal payment guarantees related to our consolidated real estate assets.
Environmental Matters
Under various federal, state and local laws, ordinances and regulations, a current or former owner or operator of real estate may be liable for conducting or paying for the costs of the investigation, removal or remediation of certain hazardous or toxic substances or petroleum products on, under or from that real estate. These laws often impose such liability without regard to whether the owner knew of, or was responsible for, the presence or release of hazardous or toxic substances or petroleum products, and the liability may be joint and several. The costs of investigation, remediation or removal of these substances may be substantial and could exceed the value of the property, and the presence of these substances, or the failure to promptly remediate these substances, may adversely affect the owner's ability to sell, operate, or develop the real estate or to borrow using the real estate as collateral. In connection with the ownership and operation of our current and former assets, we may be potentially liable for these costs. The operations of current and former tenants at our assets have involved, or may have involved, the presence or use of hazardous substances or petroleum products or the generation of hazardous wastes, and indemnities in our lease agreements may not fully protect us from liability, if, for example, a tenant responsible for environmental noncompliance or contamination becomes insolvent. The release of these hazardous substances and wastes and petroleum products could result in us incurring liabilities to investigate or remediate any resulting contamination. The presence of contamination or the failure to remediate contamination at our properties may (i) expose us to third-party liability (e.g., for cleanup costs, natural resource damages, bodily injury or property damage), (ii) subject our properties to liens in favor of the government for damages and costs the government incurs in connection with the contamination, (iii) impose restrictions on the manner in which a property may be used or businesses may be operated, or (iv) materially adversely affect our ability to sell, lease or develop the real estate or to borrow using the real estate as collateral. In addition, our assets are exposed to the risk of contamination originating from other sources. While a property owner may not be responsible for remediating contamination that has migrated onsite from an identifiable and viable offsite source, the contaminant's presence can have adverse effects on operations and the redevelopment of our assets. To the extent we arrange for contaminated materials to be sent to other locations for treatment or disposal, we may be liable for the cleanup of those sites if they become contaminated, without regard to whether we complied with environmental laws in doing so.
Most of our assets have been subject, at some point, to environmental assessments that are intended to evaluate the environmental condition of the subject and surrounding assets. These environmental assessments generally have included a historical review, a public records review, a visual inspection of the site and surrounding assets, visual or historical evidence of underground storage tanks and other features, and the preparation and issuance of a written report. Soil, soil vapor and/or groundwater subsurface testing is conducted at our assets, when necessary, to further investigate any conditions identified by the initial assessment that could reasonably be expected to pose a material concern to the property or result in us incurring material environmental liabilities as a result of redevelopment. The tests may not, however, have included extensive sampling or subsurface investigations. In each case where the environmental assessments have identified
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conditions requiring remedial actions required by law, we have initiated appropriate actions. The environmental assessments have not revealed any material environmental contamination that we believe would have a material adverse effect on our overall business, financial condition or results of operations, or that have not been anticipated and remediated during site redevelopment as required by law. Nevertheless, there can be no assurance that the identification of new areas of contamination, changes in the extent or known scope of contamination, the discovery of additional sites or changes in cleanup requirements would not result in significant cost to us. As disclosed in Note 17 to the financial statements, environmental liabilities totaled $5.7 million and $17.5 million as of March 31, 2026 and December 31, 2025, and are included in "Other liabilities, net" in our balance sheets.
Text extracted from the filing as submitted to EDGAR. Formatting, tables and exhibits are simplified for reading; the original document is authoritative for anything you rely on.