What changed in this filing

/stocks — the workspaceLOADING

Item 1. Business

2023-02-21 compared with 2022-02-22 · 166 added, 138 removed, 210 unchanged (59% of the section changed)

2 unchanged sentences

metropolitan area with high barriers to entry and vibrant urban amenities.

Over half of our portfolio is in National Landing where we serve as the developer for Amazon's new over five million square foot headquarters and where Virginia Tech's $1 billion Innovation Campus is under construction.

In addition, our third-party asset management and real estate services business provides fee-based real estate services to Amazon, the WHI Impact Pool, the JBG Legacy Funds and other third parties.

Approximately two-thirds of our portfolio is in National Landing, which is anchored by four key demand drivers:

Amazon's new headquarters, which is being developed by us;

Virginia Tech's under-construction $1 billion Innovation Campus;

the submarket’s proximity to the Pentagon;

and our deployment of next-generation public and private 5G digital infrastructure.

In addition, our third-party asset management and real estate services business provides fee-based real estate services to the WHI, the JBG Legacy Funds and other third parties.

Substantially all our assets are held by, and our operations are conducted through, JBG SMITH LP.

As of December 31, 2021, JBG SMITH, as its sole general partner, controlled JBG SMITH LP and owned 89.5% of its OP Units.

As of December 31, 2022, JBG SMITH, as its sole general partner, controlled JBG SMITH LP and owned 88.3% of its OP Units, after giving effect to the conversion of certain vested LTIP Units that are convertible into OP Units.

JBG SMITH is referred to herein as "we,"

2 unchanged sentences

or other similar terms.

As of December 31, 2021, our Operating Portfolio consisted of 64 operating assets comprising 42 commercial assets totaling 13.1 million square feet (11.3 million square feet at our share) and 22 multifamily assets totaling 8,208 units (6,557 units at our share).

Additionally, we have:

(i) one under-construction multifamily asset with 808 units (808 units at our share);

(ii) 11 near-term development pipeline assets totaling 5.3 million square feet (5.0 million square feet at our share) of estimated potential development density;

and (iii) 25 future development pipeline assets totaling 14.3 million square feet (11.6 million square feet at our share) of estimated potential development density.

As of December 31, 2022, our Operating Portfolio consisted of 51 operating assets comprising 31 commercial assets totaling 9.7 million square feet (8.4 million square feet at our share), 18 multifamily assets totaling 6,756 units (6,755 units at our share) and two wholly owned land assets for which we are the ground lessor.

Additionally, we have two under-construction multifamily assets with 1,583 units (1,583 units at our share) and 20 assets in the development pipeline totaling 12.5 million square feet (9.7 million square feet at our share) of estimated potential development density.

We present combined portfolio operating data that aggregates assets we consolidate in our consolidated financial statements and assets in which we own an interest, but do not consolidate in our financial results.

3 unchanged sentences

We own and operate urban mixed-use properties concentrated in what we believe are the highest growth, Metro-served submarkets in the Washington, D.C.

metropolitan area, including National Landing, that have significant barriers to entry and key urban amenities and plan to grow through value-added development and acquisitions.

We have significant expertise with multifamily, office and retail assets, our core asset classes.

metropolitan area, including National Landing, that have significant barriers to entry and key urban amenities.

We have significant expertise with multifamily, office and retail assets.

We believe that we are known for our creative deal-making and capital allocation skills and for our development and value creation expertise.

Since 2017, we have completed the sale, recapitalization and/or ground lease of $1.7 billion of primarily office assets.

We intend to continue to opportunistically sell non-core office assets outside of National Landing as well as land sites where a ground lease or joint venture execution may represent the most attractive path to maximizing value.

Recycling the proceeds from these sales will not only fund our planned extensive growth, but will also further advance the strategic shift in the composition of our portfolio to majority multifamily.

We intend to continue to opportunistically sell or recapitalize assets as well as land sites where a ground lease or joint venture execution may represent the most attractive path to maximizing value.

Recycling the proceeds from these sales will not only fund our planned growth through value-added development and acquisitions, but will also further advance the strategic shift in the composition of our portfolio to majority multifamily, with an office portfolio concentrated in National Landing.

One of our approaches to value creation uses a series of complementary disciplines through a process we call "Placemaking."

1 unchanged sentence

Through this process, we create synergies, and thus value, across those varied uses leading to unique, amenity-rich, walkable neighborhoods that are desirable and enhance tenant and investor demand.

We believe our Placemaking approach will increase occupancy and rental rates in our portfolio, in particular with respect to our concentrated and extensive land and operating asset holdings in National Landing, the location of Amazon's new headquarters and Virginia Tech's $1 billion Innovation Campus, which is under construction.

We believe our Placemaking approach will increase occupancy and rental rates in our portfolio, in particular with respect to our concentrated and extensive land and operating asset holdings in National Landing, the location of Amazon's second headquarters and Virginia Tech's currently under construction $1 billion Innovation Campus.

National Landing, situated in Northern Virginia directly across the Potomac River from Washington, D.C., is the interconnected and walkable neighborhood that encompasses Crystal City, the eastern portion of Pentagon City and the northern portion of Potomac Yard.

2 unchanged sentences

Utilizing our Placemaking expertise, each new project is intended to contribute to authentic and distinct neighborhoods by creating a vibrant street environment with robust retail offerings and other amenities, including improved public spaces.

Additionally, the cutting-edge digital infrastructure investments we are making in National Landing, including the purchase of CBRS wireless spectrum and an agreement with AT&T, are advancing our efforts to make National Landing among the first 5G-operable submarkets in the nation, as discussed below.

In November 2018, Amazon announced it had selected sites in National Landing as the location of its new headquarters.

We currently have leases with Amazon totaling 1.0 million square feet at six office buildings in National Landing.

In March 2019, we executed purchase and sale agreements with Amazon for two of our National Landing development sites, Metropolitan Park and Pen Place, on which Amazon is constructing its new headquarters.

We are currently constructing two new office buildings for Amazon on Metropolitan Park, totaling 2.1 million square feet, inclusive of over 50,000 square feet of street-level retail with new shops and restaurants.

The sale of Pen Place to Amazon is expected to close, subject to customary closing conditions, during the second quarter of 2022, and we expect Amazon to begin construction of four new buildings (three office towers and The Helix) in 2022.

In December 2021, we finalized the agreement for the sale of Pen Place to Amazon for $198.0 million, which represents a $48.1 million increase over the previously estimated contract value.

Additionally, the cutting-edge digital infrastructure investments we are making in National Landing, including the CBRS wireless spectrum we own and agreements with AT&T and Federated Wireless, are advancing our efforts to make National Landing among the first 5G-operable submarkets in the nation, as discussed below.

Amazon's new headquarters is located in National Landing.

We currently have leases with Amazon totaling 1.0 million square feet across six office buildings in National Landing.

We sold Amazon two of our National Landing development sites, Metropolitan Park and Pen Place.

We are the developer, property manager and retail leasing agent for Amazon's new headquarters at National Landing.

In connection with Amazon's new headquarters in National Landing, the Commonwealth of Virginia enacted an incentives bill, which provides tax incentives to Amazon to create a minimum of 25,000 new full-time jobs and potentially 37,850 full-time jobs in National Landing with average annual wage targets for each calendar year, starting with $150,000 in 2019, and escalating 1.5% per year.

We, alongside Amazon, Virginia Tech, and federal, state and local governments plan to invest in aggregate more than $12.4 billion, including infrastructure investments, that will directly benefit National Landing.

We are currently constructing two new office buildings for Amazon on Metropolitan Park, totaling 2.1 million square feet, inclusive of approximately 50,000 square feet of street-level retail with new shops and restaurants.

We expect to deliver Metropolitan Park and Amazon to occupy it this summer.

In connection with Amazon's new headquarters in National Landing, the Commonwealth of Virginia agreed to provide tax incentives to Amazon to create a minimum of 25,000 new full-time jobs and potentially 37,850 full-time jobs in National Landing with average annual wage targets for each calendar year, starting with $150,000 in 2019, and escalating 1.5% per year.

We, alongside Amazon, Virginia Tech, and federal, state, and local governments plan to invest more than $12.4 billion, including infrastructure investments, that will directly benefit National Landing.

The infrastructure investments include:

8 unchanged sentences

In the fall of 2020, Virginia Tech virtually launched the inaugural academic year of its $1 billion Innovation Campus in National Landing, which is under construction.

This expected powerful demand driver sits adjacent to 2.2 million square feet of development density we own in National Landing and a new, under-construction Potomac Yard Metro station, all approximately one mile south of Amazon's new headquarters.

This expected powerful demand driver sits adjacent to 2.0 million square feet of development density we own in National Landing and a new, under-construction Potomac Yard Metro station (scheduled to open this summer), all approximately one mile south of Amazon's new headquarters.

The campus is part of a 20-acre innovation district, of which the fully entitled first phase encompasses approximately 1.6 million square feet of space, including four office towers and two residential buildings, with ground-level retail.

4 unchanged sentences

Capitalize on Significant Demand Catalysts in National Landing.

We believe the strong technology sector tailwinds created by Amazon, the Virginia Tech Innovation Campus, and our National Landing digital infrastructure initiative will contribute to substantial growth from our Operating Portfolio and our 7.3 million square foot development pipeline in National Landing.

Over half our holdings are located in National Landing, and over 80% are located within a 20-minute commute of the submarket, where Amazon's new headquarters will house a minimum of 25,000 new full-time jobs and potentially 37,850 planned employees, and Virginia Tech's $1 billion Innovation Campus is under construction.

Amazon's growth in National Landing is expected to increase the daytime population in the submarket from approximately 50,000 people to nearly 90,000 people in the future, representing a growth of nearly 80%, according to estimates from Amazon and the National Landing Business Improvement District.

We believe the strong technology sector tailwinds created by Amazon, the Virginia Tech Innovation Campus, the Pentagon and our National Landing digital infrastructure initiative will contribute to substantial growth from our Operating Portfolio and our 6.6 million square foot development pipeline in National Landing.

Approximately two-thirds of our portfolio is located in National Landing where Amazon is incentivized to employ a minimum of 25,000 new full-time jobs and potentially 37,850 planned employees, and Virginia Tech's $1 billion Innovation Campus is under construction.

Given National Landing’s proximity to the Pentagon, recent historic increases in the U.S.

defense budget and robust foreign defense spending, National Landing is positioned to capture growing defense demand, particularly as tech and defense are increasingly intertwined.

Evidencing this point, in 2022, Huntington Ingalls Industries, Inc., a large defense contractor responsible for building a majority of the U.S.

Navy fleet, leased significant space from us in National Landing.

Two other large defense contractors — The Boeing Company and Raytheon Technologies Corporation — have also announced their global headquarter relocations to the National Landing area.

We believe our investment in next-generation connectivity infrastructure such as dense, redundant, and secure fiber networks, data center access, and world-class 5G connectivity, will be a key advantage in continuing to attract companies to National Landing.

In September 2020, we took our first step in implementing the strategy by securing access to multiple blocks for between 30 and 40 megahertz of licensed CBRS wireless spectrum to support 5G broadband communications for the geographic license areas stretching across National Landing, and as of December 31, 2021, we have invested a total of $25.8 million.

In addition to other investments that we are making in the submarket, we believe this investment in CBRS spectrum and an agreement with AT&T will allow us to control the process of attracting and partnering with best-in-class service providers, making National Landing among the first 5G-operable submarkets in the nation.

We have secured access to multiple blocks for between 30 and 40 megahertz of licensed CBRS wireless spectrum to support 5G broadband communications for the geographic license areas stretching across National Landing.

In addition to other investments that we are making in the submarket, we believe this investment in CBRS spectrum and agreements with AT&T and Federated Wireless will allow us to control the process of attracting and partnering with best-in-class service providers, making National Landing among the first 5G-operable submarkets in the nation.

This digital infrastructure will also provide us with valuable tenant inducement tools, such as the ability to offer ubiquitous and redundant fiber connectivity and 5G private cellular networks.

These features are increasingly important to technology companies, especially innovators in cybersecurity, internet of things, artificial intelligence and cloud computing.

In addition to our Primary Focus on National Landing, Invest in and Operate Mixed-Use Assets in High-Growth, Metro-Served Submarkets in the Washington, D.C.

In addition to our Primary Focus on National Landing, Invest in and Operate Mixed-Use Assets in Other High-Growth, Metro-Served Submarkets in the Washington, D.C.

Metropolitan Area.

7 unchanged sentences

metropolitan area as a whole.

Drive Incremental Growth Through Lease-up and Stabilization of Our Operating Assets.

We believe that, given our leasing capabilities and the tenant demand for high-quality space in our submarkets, we are well-positioned to achieve significant internal growth from the lease-up of vacant space in our in-service Operating Portfolio.

As of December 31, 2021, we had 42 in-service operating commercial assets totaling 13.1 million square feet (11.3 million square feet at our share), which were 84.9% leased at our share, resulting in 1.7 million square feet available for lease.

As of December 31, 2021, we had 21 in-service multifamily assets totaling 7,886 units (6,396 units at our share), which were 95.4% leased at our share.

Further, we expect increases in NOI from:

(i) the commencement of signed but not yet commenced leases ($21.2 million total annualized estimated rent as of December 31, 2021) and (ii) contractual rent escalators in our non-GSA office and retail leases, which are based on increases in the Consumer Price Index or a fixed percentage.

While COVID-19 has negatively impacted our operating results, our multifamily portfolio has seen an improvement in percentage occupied and leased as residents continue to return to urban environments, offices reinstate in-person mandates, and cities repopulate.

Although asking rents in our portfolio ended the year above pre-pandemic levels, average in-place rents ended the year approximately 9% below asking rents.

We expect multifamily in-place rents to increase as leases roll, resulting in incremental NOI growth.

Deliver Our Under-Construction Assets and Stabilize Our Recently Delivered Assets.

As of December 31, 2021, we had one 808-unit multifamily asset under construction in National Landing, 1900 Crystal Drive, that will, based on our current plans and estimates, require an additional $291.4 million to complete.

In January 2022, we commenced construction on two multifamily towers at 2000/2001 South Bell Street with 775 units located in National Landing.

Since the fourth quarter of 2019, we have completed construction and placed into service four multifamily assets with 1,011 units (833 units at our share) and three commercial assets with 843,739 square feet (722,428 square feet at our share).

As of December 31, 2021, these multifamily assets were 77.9% leased, and these commercial assets were 95.0% leased.

Drive Incremental Growth Through Lease-up and Stabilization of Our Operating Assets, and Deliver Our Under-Construction Assets.

Given our leasing capabilities and tenant demand for high-quality space in our submarkets, we believe that we are well-positioned to achieve significant internal growth from the lease-up of vacant space in our in-service Operating Portfolio.

As of December 31, 2022, we had 31 operating commercial assets totaling 9.7 million square feet (8.4 million square feet at our share), which were 88.5% leased at our share, resulting in 939,000 square feet available for lease.

As of December 31, 2022, we had 18 multifamily assets totaling 6,756 units (6,755 units at our share), which were 94.5% leased at our share.

In addition to portfolio lease-up, we expect increases in NOI from:

(i) the commencement of signed but not yet commenced leases ($16.4 million total annualized estimated rent as of December 31, 2022, of which $9.8 million is expected in 2023) and (ii) contractual rent escalators in our non-GSA office and retail leases, which are based on increases in the Consumer Price Index or a fixed percentage.

As of December 31, 2022, we had 1,583 multifamily units under construction in National Landing across two projects (4 buildings):

1900 Crystal Drive and 2000/2001 South Bell Street.

Based on our current plans and estimates, these assets will require an additional $403.5 million to complete.

We have one multifamily asset in its initial lease up, 8001 Woodmont, which was delivered in the second quarter of 2021 and was 81.1% occupied as of December 31, 2022.

Monetize Our Significant Development Pipeline.

We intend to create value from our significant pipeline of ground-up development opportunities, which we expect will produce favorable risk-adjusted returns on invested capital.

We divide our 17.5 million (14.6 million at our share) square foot land portfolio into our near-term development pipeline and our future development pipeline, the latter of which comprises potentially longer-term opportunities.

The development pipeline excludes the 2.1 million square feet of land (Pen Place) held for sale to Amazon, which we expect to close during the second quarter of 2022.

As of December 31, 2021, our near-term development pipeline consists of 11 assets, and we estimate that it can support 5.3 million (5.0 million square feet at our share) of estimated potential development density, 73% of which are multifamily projects located in the high-growth submarkets of National Landing, the Ballpark, and Union Market/NoMa/H Street.

We expect four of these multifamily projects to deliver 2,300 units within a half mile of Amazon's new headquarters.

We commenced construction in January 2022 on the two multifamily projects located in National Landing at 2000/2001 South Bell Street with 775 units.

We intend to invest in multifamily development as market demand evolves, matching delivery dates with Amazon's expected job growth in National Landing, and new office development subject to preleasing.

While these opportunities have the potential to commence construction over the next 36 months, subject to receipt of full entitlements, completion of design and market conditions, these potential investment opportunities will be subject to our rigorous return requirements.

As of December 31, 2021, our future development pipeline consisted of 25 assets, and we estimate it can support over 14.3 million square feet (11.6 million square feet at our share), including the 2.1 million square feet under contract for sale to Amazon, of estimated potential development density, with 98.2% of this potential development density being Metro-served.

We expect our pipeline of ground-up development opportunities will produce favorable risk-adjusted returns on invested capital.

As of December 31, 2022, our development pipeline consists of 20 assets, and we estimate it can support 12.5 million square feet (9.7 million square feet at our share) of estimated potential development density:

83.1% of this potential development density comprises multifamily projects located in the high-growth submarkets of National Landing, the Ballpark, and Union Market/NoMa/H Street;

and 100.0% of this potential development density is Metro-served.

We expect five of these multifamily projects to deliver 4,105 units within a half mile of Amazon's new headquarters.

We intend to invest in multifamily development as market demand evolves, matching delivery dates with Amazon's expected job growth in National Landing, and in new office development subject to preleasing.

While we expect these opportunities to be entitled over the next 24 months, construction remains subject to completion of design, market conditions and our rigorous return requirements.

The estimated potential development densities and uses reflect our current business plans as of December 31, 2022 and are subject to change based on market conditions.

In addition to developing select assets in these pipelines, we will consider opportunities to unlock value through opportunistic asset sales, ground leases and recapitalizations.

Actively Allocate our Capital and Reposition Our Portfolio to Majority Multifamily and Concentrate our Office Portfolio in National Landing.

In addition to developing select assets in this pipeline, we expect to unlock value through opportunistic asset sales, ground leases and recapitalizations.

Actively Allocate our Capital, Reposition Our Portfolio to Majority Multifamily and Concentrate our Office Portfolio in National Landing.

A fundamental component of our strategy to maximize long-term NAV per share is active capital allocation.

We evaluate development, acquisition, disposition, share repurchase and other investment decisions based on how they may impact long-term NAV per share.

Since 2017, we have completed the sale, recapitalization and/or ground lease of $1.7 billion of primarily office assets.

Successful execution of our capital allocation strategy will enable us to source capital at NAV from the disposition of assets generating low cash yields and invest those proceeds in new acquisitions with higher cash yields and growth, as well as in development projects with significant yield spreads and profit potential.

We view this strategy as a key tool to source capital and intend to continue disposing of assets where the disparity in public and private market valuations are the greatest.

Successful execution of our capital allocation strategy enables us to source capital at NAV from the disposition of assets generating low cash yields and invest those proceeds in new acquisitions with higher cash yields and growth, as well as in development projects with significant yield spreads and profit potential.

We view this strategy as a key tool to source capital.

Consequently, at any given time, we expect to be in various stages of discussions and negotiations with potential buyers, real estate venture partners, ground lessors, and other counterparties with respect to sales, joint ventures, and/or ground leases for certain of our assets, including portfolios thereof.

These discussions and negotiations may or may not lead to definitive documentation or closed transactions.

Redeploying the proceeds from these sales will not only help fund our planned growth, but will also further advance the strategic shift of our portfolio to majority multifamily.

We anticipate redeploying the proceeds from these sales will not only help fund our planned growth, but will also further advance the strategic shift of our portfolio to majority multifamily.

We expect near-term acquisition activity to be focused on assets in emerging growth neighborhoods, as well as assets adjacent to our existing holdings where the combination of sites can add unique value to any new investment with a focus on multifamily given our long-term objective of growing our portfolio to majority multifamily.

Where there are opportunities to trade out of higher risk assets with extensive capital needs or those outside of our geographic footprint, we will consider like-kind exchanges under Section 1031 of the Code.

Subject to customary closing conditions, we expect to close the sale of Pen Place to Amazon during the second quarter of 2022 and exchange into The Batley, which was acquired in November 2021 through a third-party intermediary.

Third-Party Services Business

Our third-party asset management and real estate services business provides fee-based real estate services to Amazon, the WHI Impact Pool, the JBG Legacy Funds and other third parties.

Our third-party asset management and real estate services business provides fee-based real estate services to the WHI, the JBG Legacy Funds and other third parties.

The WHI pursues a transformational approach to producing affordable workforce housing and creating sustainable, mixed-income communities in the Washington, D.C.

Although a significant portion of the assets and interests in assets formerly owned by certain of the JBG Legacy Funds were contributed to us in the Combination, the JBG Legacy Funds retained certain assets that were not consistent with our long-term business strategy.

With respect to the remaining investments of the JBG Legacy Funds, we provide substantially the same asset management, property management, development, construction management, leasing and

other services that were provided prior to the Combination.

Other than those related to the WHI, we do not intend to raise any future investment funds, and we expect to continue to earn fees for the management of the JBG Legacy Funds until their investments are liquidated.

With respect to the remaining investments of the JBG Legacy Funds, we provide asset management, property management, development, construction management, leasing and other services.

We expect to continue to earn fees for the management of the JBG Legacy Funds until their investments are liquidated.

Certain individual members of our management team own direct equity co-investment and promote interests in the JBG Legacy Funds and certain of the funds' investments that were not contributed to us.

9 unchanged sentences

Leasing is a major component of our business and is highly competitive.

The principal means of competition in leasing are lease terms (including rent charged and tenant improvement allowances), location, services provided and the nature and condition of the asset to be leased.

The principal means of competition in leasing are lease terms (including rent charged and tenant improvement allowances), location, services provided and the nature and condition of

the asset to be leased.

If our competitors offer space at rental rates below current market rates, below the rental rates we currently charge our tenants, in better locations within our markets, in higher quality assets or offer better services, we may lose existing and potential tenants, and we may be pressured to reduce our rental rates below those we currently charge to retain tenants when our tenants' leases expire.

17 unchanged sentences

Percentage of commercial segment rental revenue

Percentage of total rental revenue

Percentage of rental revenue

Our business values integrate environmental sustainability, social responsibility, D&I, and strong governance practices throughout our organization.

4 unchanged sentences

We intend to continue publishing an annual ESG report with key performance indicators that are aligned with the Global Reporting Initiative reporting framework, United Nations Sustainable Development Goals, Sustainability Accounting Standards Board Standards, and recommendations set forth by the Task Force on Climate-Related Financial Disclosures.

During 2021, we achieved carbon neutrality across our Operating Portfolio for energy associated with the operations of our buildings.

This was accomplished through the purchase of verified carbon offsets for Scope 1 emissions produced by onsite natural gas consumption and Green-e RECs for Scope 2 emissions produced by consuming onsite electricity procured by us.

Our planned next step toward long-term sustainability includes the development and execution of an offsite renewable energy strategy, which is expected to replace a significant portion of our annual REC purchases, which add renewable energy capacity to the national electrical grid.

Our detailed sustainability information, including our strategy, key performance targets and indicators, annual absolute and like-for-like comparisons, achievements and historical ESG reports are available on our website at https://www.JBGSMITH.com/About/Sustainability.

Our Internet website and the information contained therein or connected thereto are not intended to be incorporated into this Annual Report on Form 10-K.

We achieved carbon neutrality across our Operating Portfolio for energy associated with the operations of our buildings in 2021.

In 2022, we expanded our ESG reporting commitment to include full coverage of Scope 1.

Carbon neutrality was

accomplished first through energy and water efficiency, then the purchase of verified carbon offsets for Scope 1 emissions produced by onsite natural gas consumption and fugitive refrigerant emissions, and the purchase of Green-e RECs for Scope 2 emissions produced by consuming onsite electricity procured by us.

(We own three company vehicles with emissions that are less than 0.01% of our carbon footprint and, therefore, are not included in our calculations of carbon neutrality.) Our planned next step toward long-term sustainability includes the development and execution of an offsite renewable energy strategy, which is expected to replace a significant portion of our annual REC purchases, which add renewable energy capacity to the national electrical grid.

Our detailed sustainability information, including our strategy, key performance targets and indicators, annual absolute comparisons, achievements and historical ESG reports are available on our website at https://www.JBGSMITH.com/About/Sustainability.

All energy, water, waste and greenhouse gas emissions data in our ESG report is third-party, limited assurance verified following ISO 14064-3.

Our website and the information contained therein or connected thereto are not intended to be incorporated into this Annual Report on Form 10-K.

We focus on operating efficiency, responding to evolving environmental and social trends, and delivering on the needs of our tenants and communities.

We have demonstrated the results of this focus by:

● Achieving a 5-star rating in the GRESB Global ESG Benchmark for Real Assets for both diversified operating assets and future development, and being recognized as a 2021 Global Sector Leader - Diversified - Office/Residential Sector.

● Achieving a 5-star designation in the GRESB Global ESG Benchmark for Real Assets for both diversified operating assets and future development, and being recognized as a 2021 Global Sector Leader - Diversified - Office/Residential Sector.

● Being named 2021 Nareit Diversified Leader in the Light award winner for sustained ESG excellence.

● Being recognized by Newsweek's America's Most Responsible Companies 2021.

● Maintaining oversight of environmental and social matters by the Board of Trustees' Corporate Governance & Nominating Committee.

● Improving the diversity of our Board of Trustees, which currently comprises 36% females.

● Establishing an ESG Committee and maintaining oversight of environmental and social matters by the Board of Trustees' Corporate Governance & Nominating Committee.

● Being named to Bloomberg's Gender Equality Index.

● Improving the diversity of our Board of Trustees, which currently comprises 36% women.

Reflecting the strength and diversity of our national labor force, our Board of Trustees has made a long-term commitment to evolve its composition to have equal balance between men and women and to reflect the ethnic diversity of our country.

● Surpassing $114 million in investor commitments to the JBG SMITH-managed WHI Impact Pool, which raises funds from third parties and, through year ended 2021, closed $55.8 million in financing related to the purchase of residential communities that contain 1,610 units.

We launched the WHI in 2018 in partnership with the Federal City Council to preserve or build between 2,000 and 3,000 units of affordable workforce housing in the

Washington, D.C.

In 2022, the WHI Impact Pool was named ESG Investing Awards' 2022 Best ESG Investment Fund:

Our sustainability team works directly with our business units to integrate our ESG principles throughout our operations and investment process.

The team is responsible for annual ESG reporting, maintaining building certifications, energy, water and waste benchmarking, sustainability strategy development, ESG improvement programs and implementation and coordination with industry and community partners.

● Surpassing $114 million in investor commitments to the JBG SMITH-managed WHI Impact Pool, which raises funds from third parties and, through 2022, closed $64.7 million in financing related to the purchase of residential communities that contain 2,565 units.

We launched the WHI in 2018 in partnership with the Federal City Council to preserve or build between 2,000 and 3,000 units of affordable workforce housing in the Washington, D.C.

In 2022, WHI was named ESG Investing Awards' 2022 Best ESG Investment Fund:

Our sustainability team works directly with our business units to integrate our ESG principles throughout our operations and investment processes.

Our sustainability team is responsible for leading annual ESG reporting efforts, maintaining building certifications, energy, water and waste benchmarking, sustainability strategy development and implementation and coordination with industry and community partners.

To ensure that our ESG principles are fully integrated into our business practices, our sustainability, human resources, legal, accounting, D&I and WHI teams, as well as members of our management team, provide top-down support for the implementation of ESG initiatives.

The sustainability team provides our Board of Trustees' Corporate Governance & Nominating Committee with periodic updates on ESG strategy.

Energy and Water Management

We believe that the efficient use of natural resources will result in sustainable long-term value.

By 2030, we have committed to:

reduce energy consumption 25%, predicted energy consumption 25%, water consumption 20%, predicted water consumption 20%, embodied carbon 20%, and greenhouse gas emissions (Scope 1 and 2) 25%;

increase waste diversion to 60%;

and, verify all assets are using green building and health and well-being certifications across our Operating Portfolio and development pipeline.

Our ESG Committee is responsible for ESG improvement programs and provides our Board of Trustees' Corporate Governance & Nominating Committee with periodic updates on ESG strategy.

Energy and Water Efficiency and Management

We believe that the efficient use of natural resources will result in sustainable long-term value and mitigate climate-related risks.

By 2030, we have committed to reduce:

energy consumption 25%, predicted energy consumption 25%, water consumption 20%, predicted water consumption 20%, embodied carbon 20%, and greenhouse gas emissions (Scope 1 and 2) 25%.

Further, by 2030, we have committed to increase waste diversion to 60% and verify all assets using green building and health and well-being certifications across our Operating Portfolio and development pipeline.

In addition to our 2030 targets, we have a legacy commitment to improve the energy efficiency of our commercial Operating Portfolio by at least 20% over the 10-year period ending in 2024 through the Department of Energy Better Buildings Challenge.

We have improved energy performance by 21% since 2014, and are on track to meet or exceed the improvement goal by 2024.

We achieve this improvement through real time energy use monitoring.

this improvement through real time energy use monitoring.

We plan to report progress on these commitments annually in our ESG report.

Our long-term strategy to reduce energy and water consumption includes operational and capital improvements that align with our business plan and contribute to our sustainability targets.

Our long-term strategy to reduce energy and water consumption includes operational and capital improvements that align with our business plan and contribute to attaining our performance targets.

Asset teams review historical performance, conduct energy audits and regularly assess opportunities to achieve efficiency targets.

Capital investment planning considers the useful life of equipment, energy and water efficiency, occupant health impacts and maintenance requirements.

Our development strategy focuses on reducing predicted energy and water consumption and embodied carbon, contributing to our sustainability targets.

Asset-level business plans that include energy and water efficiency capital investments are underway.

Our development strategy focuses on reducing predicted energy and water consumption and embodied carbon, contributing to attaining our performance targets.

Development teams use energy, water, and embodied carbon modeling to inform design decisions that best fit each individual building program, adapt to identified climate change conditions for our region, and promote healthy buildings.

3 unchanged sentences

As of December 31, 2022:

● 71% of all operating assets, based on square footage, have earned at least one green certification:

● 91% of all operating assets, based on square footage, have earned at least one green building or health and well-being certification:

o 4.7 million square feet of LEED Certified Commercial Space (57%)

2 unchanged sentences

o 2.5 million square feet of ENERGY STAR Certified Multifamily Space (45%)

o 6.5 million square feet of BOMA 360 Certified Commercial Space (77%)

o 7.7 million square feet of Fitwel Viral Response Module Certified Commercial Space (92%)

o 2.1 million square feet of Fitwel Full Building Certified Commercial and Multifamily Space (15%)

● 99.4% of our operating assets' energy and water use are benchmarked

2 unchanged sentences

Our mission includes creating a unique experience at all our properties where our tenants' needs are our highest priority.

We believe in sustainability as a service — by integrating efficiency and conservation into standard operating practices, we engage on topics that are most impactful to

our tenants and residents.

We believe in sustainability as a service — by integrating efficiency and conservation into standard operating practices, we engage on topics that are most impactful to our tenants and residents.

We are committed to providing a healthy living and working environment for building occupants.

We accomplish this goal through monitoring and improving indoor air quality, eliminating toxic chemicals, providing access to nature and daylight, nutritious fresh foods in our common areas, fitness, composting and waste reduction programs.

We accomplish this goal through monitoring and improving indoor air quality, eliminating toxic chemicals, providing access to nature and daylight, fresh foods, fitness, composting and waste reduction programs.

We are a Green Lease Leader established by the Institute for Market Transformation and the U.S.

3 unchanged sentences

This language is included in 100% of our new office and retail leases and renewals.

Nearly all of our tenants are metered at the whole building level for their grid electricity and water usage.

Nearly all our commercial tenants are metered at the whole building level for their grid electricity and water usage.

Many of our retail tenants in multifamily buildings are billed directly for electricity and water.

2 unchanged sentences

These tenants are not considered to be separately metered or sub-metered.

Climate Change Adaptation

We take seriously climate change and the risks associated with climate change, and we are committed to aligning our investment strategy with science.

Climate Change Resilience

We take climate change and the associated risks seriously, and we are committed to managing and avoiding the impacts of climate change using science to inform action.

We stand with our communities, tenants and shareholders in supporting meaningful solutions that address this global challenge.

To develop a more informed view of future climate conditions and further our understanding of the direct physical risks to our properties, we have conducted a physical climate risk assessment, which includes our operating assets and land holdings in our development pipeline.

To develop a more informed view of future climate conditions and further our understanding of the direct physical risks to our properties, we have conducted a physical climate-related risk assessment (both acute and chronic risks), which includes our operating assets and land holdings in our development pipeline.

We intend to conduct periodic physical climate-related risk assessments.

We continue to proactively assess the potential risks that may impact our portfolio and endeavor to conduct more robust analyses surrounding transitional and financial risks.

Climate Change Risk Management Strategy

We have aligned our climate-related disclosures with the recommendations of the TCFD.

As defined by the TCFD framework, physical risks associated with climate change include acute risks (extreme weather-related events) and chronic risks (such as extreme heat and sea-level rise), and transition risks associated with climate change include policy and legal risks, market and reputation-related risks and decarbonization technology risks.

We continue to assess the potential risks that may impact our portfolio and endeavor to expand our assessments further into additional transitional and financial risk dimensions.

Our preliminary physical climate-related assessment on our portfolio was conducted by a third party.

The assessment and physical risk scoring was based on an RCP 8.5 emissions scenario, which is a worst-case, high emissions scenario, under a time horizon up to 2040.

The assessment included all in-service assets, and our development pipeline and landholdings, and included climate events such as hurricane, wildfire, heat, water stress, flooding and sea-level rise.

The assessment of our portfolio identified flooding and heat stress as top hazards.

We currently have no properties in a Federal Emergency Management Agency hazard designated area.

Management intends to use the results of this assessment to inform both our asset management planning and design of our new developments.

In 2021, our insurance team conducted a resilience assessment of our portfolio.

Data collected from this exercise is currently being reviewed and will further inform capital planning.

We work with our insurance team to benchmark resilience features and adaptations for short-term horizons.

Asset-Level Risk Management

We are managing transition risks by benchmarking energy, carbon, water and waste performance at the asset level and review this information with asset management and operations teams quarterly.

As a leader in green building, we will continue to make capital investments that enhance building performance and tenant comfort, energy and water efficiency, on-site renewable energy and other decarbonization strategies.

Carbon-Neutral Operations Strategy

Our strategy to maintain carbon-neutral operations includes the following steps:

● First and foremost, plan for and deploy energy and water efficiency at all assets.

● Plan for and deploy energy, water, and embodied carbon reductions in the design of our buildings.

● Deploy on-site renewable energy where most impactful.

● Develop and deploy off-site renewable procurement strategies.

● To the extent necessary, offset any remaining emissions by purchasing verified renewable energy credits and carbon offsets.

Social Responsibility

2 unchanged sentences

metropolitan area through continued investment in our projects and local communities.

We recognize, however, that new development can foster challenging growth dynamics, with issues of social equity at the forefront.

We strive to work alongside community members, leaders, and local and federal governments to appropriately respond to these challenges.

We recognize, however, that new development can foster challenging growth dynamics, with matters of social equity at the forefront.

We strive to work alongside community members, leaders, and local and

federal governments to appropriately respond to these challenges.

One of our efforts is the WHI, which we launched in 2018 in partnership with the Federal City Council.

1 unchanged sentence

The WHI is a scalable, market-driven model funded by a unique relationship between philanthropy and private investment.

As of December 31, 2021, we have committed to invest $11.2 million in the WHI Impact Pool, and our Executive Vice President of Social Impact Investing manages this effort.

As of December 31, 2022, we have committed to invest $11.2 million in the WHI, and our Executive Vice President of Social Impact Investing manages this effort.

As of December 31, 2022, our remaining commitment was $4.8 million.

The WHI's Impact Pool has completed closings of capital commitments totaling $114.4 million, and closed $55.8 million in financing related to the purchase of residential communities that contain 1,610 units.

The WHI Impact Pool has completed closings of capital commitments totaling $114.4 million, and closed $64.7 million in financing related to the purchase of residential communities that contain 2,565 units.

The initiatives' goals include:

2 unchanged sentences

To learn more about our ESG initiatives and performance, please visit https://www.JBGSMITH.com/About/Sustainability and download our ESG Report.

The expected publication date of our 2022 ESG report is March 31, 2022.

Our Internet website and the information contained therein or connected thereto are not intended to be incorporated into this Annual Report on Form 10-K.

The expected publication date of our 2023 ESG report is April 30, 2023.

Our website and the information contained therein or connected thereto are not intended to be incorporated into this Annual Report on Form 10-K.

We have a comprehensive, multi-year D&I strategy.

See "Human Capital"

section below for further discussion.

below for further discussion.

We are engaged in addressing ESG matters, including climate-related matters, at all levels of our organization.

Management’s role in overseeing, assessing, and managing climate-related risks, opportunities and initiatives is integrated throughout our business units.

We have a dedicated team of sustainability professionals focused on ESG matters that coordinates and collaborates across business units and with our Board of Trustees and management, and which advises on environmental sustainability matters and develops and implements related initiatives.

In 2022, management established a new ESG Committee to help inform ESG strategy and more robustly advise the Board of Trustees on climate-related risks and opportunities.

The ESG Committee is responsible for ensuring compliance with guidelines from the SEC and other regulatory bodies, and assists in establishing our general strategy as it relates to ESG matters that may affect our business, operation, performance or reputation.

The ESG Committee reports to the Chief Legal Officer, with oversight provided by the Corporate Governance and Nominating Committee.

Co-chairs include our Deputy General Counsel and Senior Vice President of Sustainability, with representation by business leaders from various groups across the organization.

Regulatory Matters

Environmental Matters

Under various federal, state and local laws, ordinances and regulations, an owner of real estate is liable for the costs of removal or remediation of certain hazardous or toxic substances on such real estate.

These laws often impose such liability without regard to whether the owner knew of, or was responsible for, the presence of such hazardous or toxic substances.

The costs of remediation or removal of such substances may be substantial and the presence of such substances, or the failure to promptly remediate such substances, may adversely affect the owner's ability to sell such real estate or to borrow using such real estate as collateral.

In connection with the ownership and operation of our assets, we may be potentially liable for such costs.

These laws often impose such liability without regard to whether the owner knew of, or was responsible for, the presence of hazardous or toxic substances.

The costs of remediation or removal of these substances may be substantial, and the presence of these substances, or the failure to promptly remediate these substances, may adversely affect the owner's ability to sell the real estate or to borrow using the real estate as collateral.

In connection with the ownership and operation of our 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 use of hazardous materials or generated hazardous wastes.

The release of such hazardous materials and wastes could result in us incurring liabilities to 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.

The release of these hazardous materials and wastes could result in us incurring liabilities to 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.

4 unchanged sentences

Soil and/or groundwater subsurface testing is conducted at our assets, when necessary, to further investigate any issues raised 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.

They may not, however, have included extensive sampling or subsurface investigations.

The tests may not, however, have included extensive sampling or subsurface investigations.

In each case where the environmental assessments have identified conditions requiring remedial actions required by law, we have initiated appropriate actions.

18 unchanged sentences

federal government is a significant tenant.

Lease agreements with federal government agencies contain provisions required by federal law, which require, among other things, that the lessor of the property agree to comply with certain rules and regulations, including rules and regulations related to anti-kickback procedures, examination of records, audits and records, equal opportunity provisions, prohibition against segregated facilities, certain executive orders, subcontractor cost or pricing data, and certain provisions intending to assist small businesses.

examination of records, audits and records, equal opportunity provisions, prohibition against segregated facilities, certain executive orders, subcontractor cost or pricing data, and certain provisions intending to assist small businesses.

We directly manage assets with federal government agency tenants, which subjects us to additional risks associated with compliance with applicable federal rules and regulations.

In addition, there are additional requirements relating to the potential application of equal opportunity provisions and related requirements to prepare written affirmative action plans applicable to government contractors and subcontractors.

Some of the factors used to determine whether these requirements apply to a company that is affiliated with the actual government contractor (the legal entity that is the lessor under a lease with a federal government agency) include whether such company and the government contractor are under common ownership, have common management, and are under common control.

Some of the factors used to determine whether these requirements apply to a company that is affiliated with the actual government contractor (the legal entity that is the lessor under a lease with a federal government agency) include whether that company and the government contractor are under common ownership, have common management, and are under common control.

We own the entity that is the government contractor and the property manager, increasing the risk that requirements of the Employment Standards Administration's Office of Federal Contract Compliance Programs and requirements to prepare affirmative action plans pursuant to the applicable executive order may be determined to be applicable to us.

1 unchanged sentence

Human Capital

Our headquarters are located at 4747 Bethesda Avenue, Suite 200, Bethesda, MD 20814.

Our headquarters is located at 4747 Bethesda Avenue, Suite 200, Bethesda, MD 20814.

As of December 31, 2022, we had 912 employees.

2 unchanged sentences

We utilize talent management practices in the broadest sense to create a holistic, engaging work experience for our employees.

The upshot of these practices has resulted (based on employee surveys) in us continuing to be an employer of

choice, with an extremely engaged workforce (92% favorable) that has also shown a strong positive attitude around the great work we have done in D&I (91% favorable).

Our ability to cultivate an inclusive environment that values diversity and fosters a sense of belonging and connection, has resulted in D&I becoming one of our key drivers of overall engagement.

The upshot of these practices has resulted (based on employee surveys) in us continuing to be an employer of choice, with an extremely engaged workforce (92% favorable) that has also shown a strong positive attitude around the work we have done in D&I (91% favorable).

Our ability to cultivate an inclusive environment that values diversity and fosters a sense of belonging and connection, has resulted in D&I becoming a key driver of overall engagement.

In addition to our inclusive culture, our pay equity study results show no systemic disparity in compensation related to race or gender, affirming our strong belief in treating people equitably.

While many companies continued to work from home throughout 2021, our on-site teams continued to come in throughout the pandemic, and the corporate office team came back to the office in early October 2021.

With our hybrid schedule, flexibility and keen focus on health and welfare (e.g., early adopters of a vaccinated only environment, weekly testing, etc.), our employees were able to be confident in their in-office experience and demonstrate the energy and excitement that comes from being together and collaborating with coworkers to achieve desirable outcomes.

A key to our strong levels of engagement is ensuring we are putting our employees' needs first and creating an inclusive workplace experience where employees thrive.

For example, as the work from home fatigue set in, we increased our focus on mental health by offering access to free counseling, app-based resources and enabling greater flexibility (e.g., meeting-free Monday mornings, reduced meeting times) to help employees better manage the confluence of work and life.

Beyond support throughout the pandemic, we continued our investment in our employee population, ensuring our employee experience more broadly continues to help us attract and retain the best talent in the industry.

The list below is a more comprehensive list of offerings that together, help create a compelling employee experience:

With our hybrid corporate office schedule, flexibility, and keen focus on health and welfare, we offer our employees an environment that enables them to be confident in their in-office experience and demonstrate the energy and excitement that comes from being together and collaborating with coworkers to achieve desirable outcomes.

Key to our high levels of engagement is ensuring we are putting our employees' needs first and creating an inclusive workplace experience where employees thrive.

We are proud to have been recognized by the Washington Post as a "Top Workplace"

several times in past years, and are focused on providing a positive employee experience to ensure that we remain an employer of choice.

We continually invest in our employee population, ensuring our employee experience more broadly continues to help us attract and retain the best talent in the industry.

The list below is a more comprehensive list of offerings that help create a compelling employee experience:

● Talent reviews and 360 surveys for senior leaders

4 unchanged sentences

● Flexible paid time off

● Town halls & video updates from our Chief Executive Officer

● Employee surveys / pulse surveys

● Regular town halls where senior management updates the entire team on recent progress and other important matters

● Employee surveys

● Mentorship program to develop and retain talent

● Monthly D&I newsletters

● Monthly D&I communications

● Employee roundtable discussions on pertinent current events, workplace issues and teambuilding

● Utilization of JBGS Inclusion Community and Women's Initiative to guide programming

● D&I Deep Dialogue Series and employee roundtables

● Partnerships with schools and organizations to facilitate recruitment of diverse talent

● Workforce development partnerships focused on diverse pipeline development

● Employee referral program

● Generous company subsidy on health-related benefits

● Lunches with Leaders

● Volunteer opportunities

In addition to the above, we have a strong pay-for-performance culture where compensation is tied to both company and individual performance, ensuring that employees focus on both broader business focused goals, as well as their individual goals.

To that end, we also have a strong track record of promoting from within.

Hence, the opportunities for growth and development are another factor that helps to keep our population engaged and motivated.

Consequently, the opportunities for growth and development also help to keep our population engaged and motivated.

2022 continued the evolution of our comprehensive, multi-year D&I strategy.

2 unchanged sentences

We pride ourselves on our strong, collaborative culture, and we strive to create an inclusive and healthy work environment for our employees, which helps us continue to attract innovators to our organization.

Our workforce comprises 38% females and 56% minorities, and our senior leadership has 43% female representation.

Our workforce comprises 36% women and 56% minorities, and our senior leadership has 41% women representation.

Implementing more inclusive, equitable systems and practices had a significant impact on our ability to identify diverse talent, particularly related to our entry-level recruitment efforts.

Our 2022 intern hires were 67% diverse (i.e.

women and/or people of color) and the new entry-level hires (Interns, Analyst and Associates) in our Development department were 100% diverse.

women and/or people of color).

In addition, we have continued to expand our strategic partnerships with diverse educational, professional and community organizations.

In the early part of the year, we launched our first workforce development program, which also resulted in newly established collaborations, partnerships and hires.

Available Information

6 unchanged sentences

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 1. Business