What changed in this filing

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Item 1. Financial Statements

2024-10-29 compared with 2024-07-30 · 214 added, 211 removed, 640 unchanged (40% of the section changed)

3 unchanged sentences

(In thousands, except par value amounts)

June 30, 2024

September 30, 2024

December 31, 2023

27 unchanged sentences

Common shares, $ 0.01 par value - 500,000 shares authorized;

87,306 and 94,309 shares issued and outstanding as of June 30, 2024 and December 31, 2023

84,434 and 94,309 shares issued and outstanding as of September 30, 2024 and December 31, 2023

Additional paid-in capital

Accumulated deficit

Accumulated other comprehensive income

Accumulated other comprehensive income (loss)

Total shareholders' equity of JBG SMITH Properties

5 unchanged sentences

(In thousands, except per share data)

Three Months Ended June 30,

Six Months Ended June 30,

Three Months Ended September 30,

Nine Months Ended September 30,

Property rental

15 unchanged sentences

Interest expense

Gain on the sale of real estate, net

Loss on the extinguishment of debt

Gain (loss) on the sale of real estate, net

Gain (loss) on the extinguishment of debt

Impairment loss

Total other income (expense)

INCOME (LOSS) BEFORE INCOME TAX (EXPENSE) BENEFIT

LOSS BEFORE INCOME TAX (EXPENSE) BENEFIT

Income tax (expense) benefit

NET INCOME (LOSS)

Net (income) loss attributable to redeemable noncontrolling interests

Net loss attributable to noncontrolling interests

NET INCOME (LOSS) ATTRIBUTABLE TO COMMON SHAREHOLDERS

EARNINGS (LOSS) PER COMMON SHARE - BASIC AND DILUTED

Net loss attributable to redeemable noncontrolling interests

Net (income) loss attributable to noncontrolling interests

NET LOSS ATTRIBUTABLE TO COMMON SHAREHOLDERS

LOSS PER COMMON SHARE - BASIC AND DILUTED

WEIGHTED AVERAGE NUMBER OF COMMON SHARES OUTSTANDING - BASIC AND DILUTED

1 unchanged sentence

JBG SMITH PROPERTIES

Condensed Consolidated Statements of Comprehensive Income (Loss)

Condensed Consolidated Statements of Comprehensive Loss

(In thousands)

Three Months Ended June 30,

Six Months Ended June 30,

NET INCOME (LOSS)

Three Months Ended September 30,

Nine Months Ended September 30,

OTHER COMPREHENSIVE INCOME (LOSS):

Change in fair value of derivative financial instruments

Reclassification of net income on derivative financial instruments from accumulated other comprehensive income into interest expense

Reclassification of net income on derivative financial instruments from accumulated other comprehensive income (loss) into interest expense

Total other comprehensive income (loss)

COMPREHENSIVE INCOME (LOSS)

Net (income) loss attributable to redeemable noncontrolling interests

Net loss attributable to noncontrolling interests

COMPREHENSIVE LOSS

Net loss attributable to redeemable noncontrolling interests

Net (income) loss attributable to noncontrolling interests

Other comprehensive (income) loss attributable to redeemable noncontrolling interests

Other comprehensive income attributable to noncontrolling interests

COMPREHENSIVE INCOME (LOSS) ATTRIBUTABLE TO JBG SMITH PROPERTIES

Other comprehensive (income) loss attributable to noncontrolling interests

COMPREHENSIVE LOSS ATTRIBUTABLE TO JBG SMITH PROPERTIES

See accompanying notes to the condensed consolidated financial statements (unaudited).

5 unchanged sentences

Noncontrolling

BALANCE AS OF MARCH 31, 2024

Net loss attributable to common shareholders and noncontrolling interests

Income (Loss)

BALANCE AS OF JUNE 30, 2024

Net income (loss) attributable to common shareholders and noncontrolling interests

Redemption of common limited partnership units ("OP Units") for common shares

3 unchanged sentences

( $ 0.175 per common share)

Acquisition of noncontrolling interests

Contributions from noncontrolling interests, net

Distributions to noncontrolling interests, net

Redeemable noncontrolling interests redemption value adjustment and total other comprehensive loss allocation

Total other comprehensive loss

Other comprehensive income attributable to noncontrolling interest

Other comprehensive loss attributable to noncontrolling interests

BALANCE AS OF SEPTEMBER 30, 2024

BALANCE AS OF JUNE 30, 2023

BALANCE AS OF MARCH 31, 2023

Net loss attributable to common shareholders and noncontrolling interests

7 unchanged sentences

Total other comprehensive income

Other comprehensive income attributable to noncontrolling interest

BALANCE AS OF JUNE 30, 2023

Other comprehensive income attributable to noncontrolling interests

BALANCE AS OF SEPTEMBER 30, 2023

See accompanying notes to the condensed consolidated financial statements (unaudited).

5 unchanged sentences

Noncontrolling

Income (Loss)

BALANCE AS OF DECEMBER 31, 2023

7 unchanged sentences

Contributions from noncontrolling interests, net

Redeemable noncontrolling interests redemption value adjustment and total other comprehensive income allocation

Total other comprehensive income

Redeemable noncontrolling interests redemption value adjustment and total other comprehensive loss allocation

Total other comprehensive loss

Other comprehensive income attributable to noncontrolling interests

BALANCE AS OF JUNE 30, 2024

BALANCE AS OF SEPTEMBER 30, 2024

BALANCE AS OF DECEMBER 31, 2022

Net income (loss) attributable to common shareholders and noncontrolling interests

Net loss attributable to common shareholders and noncontrolling interests

Redemption of OP Units for common shares

4 unchanged sentences

Distributions to noncontrolling interests, net

Redeemable noncontrolling interests redemption value adjustment and total other comprehensive loss allocation

Total other comprehensive loss

Redeemable noncontrolling interests redemption value adjustment and total other comprehensive income allocation

Total other comprehensive income

Other comprehensive income attributable to noncontrolling interests

BALANCE AS OF JUNE 30, 2023

BALANCE AS OF SEPTEMBER 30, 2023

See accompanying notes to the condensed consolidated financial statements (unaudited).

2 unchanged sentences

(In thousands)

Six Months Ended June 30,

Nine Months Ended September 30,

OPERATING ACTIVITIES:

Net income (loss)

Adjustments to reconcile net income (loss) to net cash provided by operating activities:

Adjustments to reconcile net loss to net cash provided by operating activities:

Share-based compensation expense

1 unchanged sentence

Deferred rent

Income from unconsolidated real estate ventures, net

(Income) loss from unconsolidated real estate ventures, net

Amortization of market lease intangibles, net

Amortization of lease incentives

Loss on the extinguishment of debt

(Gain) loss on the extinguishment of debt

Impairment loss

Gain on the sale of real estate, net

(Gain) loss on the sale of real estate, net

Loss (income) on operating lease and other receivables

13 unchanged sentences

Proceeds from derivative financial instruments

Payments on derivative financial instruments

Distributions of capital from unconsolidated real estate ventures and other investments

7 unchanged sentences

Repayments of revolving credit facility

Proceeds from derivative financial instruments

Payments on derivative financial instruments

10 unchanged sentences

(In thousands)

Six Months Ended June 30,

Net increase (decrease) in cash and cash equivalents, and restricted cash

Nine Months Ended September 30,

Net decrease in cash and cash equivalents, and restricted cash

Cash and cash equivalents, and restricted cash, beginning of period

16 unchanged sentences

Organization and Basis of Presentation

JBG SMITH Properties ("JBG SMITH"), a Maryland real estate investment trust ("REIT"), owns, operates, invests in and develops mixed-use properties in high growth and high barrier-to-entry submarkets in and around Washington, D.C., most notably National Landing.

JBG SMITH Properties ("JBG SMITH"), a Maryland real estate investment trust, owns, operates, invests in and develops mixed-use properties in high growth and high barrier-to-entry submarkets in and around Washington, D.C., most notably National Landing.

Through an intense focus on placemaking, JBG SMITH cultivates vibrant, amenity-rich, walkable neighborhoods throughout the Washington, D.C.

7 unchanged sentences

Substantially all our assets are held by, and our operations are conducted through, JBG SMITH Properties LP ("JBG SMITH LP"), our operating partnership.

As of June 30, 2024, JBG SMITH, as its sole general partner, controlled JBG SMITH LP and owned 86.4 % of its OP Units, after giving effect to the conversion of certain vested long-term incentive partnership units ("LTIP Units") that are convertible into OP Units.

As of September 30, 2024, JBG SMITH, as its sole general partner, controlled JBG SMITH LP and owned 85.8 % of its OP Units, after giving effect to the conversion of certain vested long-term incentive partnership units ("LTIP Units") that are convertible into OP Units.

JBG SMITH is referred to herein as "we," "us," "our" or other similar terms.

5 unchanged sentences

The Separation and the Combination are collectively referred to as the "Formation Transaction."

As of June 30, 2024, our Operating Portfolio consisted of 40 operating assets comprising 15 multifamily assets totaling 6,318 units ( 6,318 units at our share), 23 commercial assets totaling 7.2 million square feet ( 6.9 million square feet at our share) and two wholly owned land assets for which we are the ground lessor.

Additionally, we have two under-construction multifamily assets totaling 1,583 units ( 1,583 units at our share) and 18 assets in the development pipeline totaling 11.4 million square feet ( 9.3 million square feet at our share) of estimated potential development density.

We derive our revenue primarily from leases with multifamily and commercial tenants, which include fixed and percentage rents, and reimbursements from tenants for certain expenses such as real estate taxes, property operating expenses, and repairs and maintenance.

As of September 30, 2024, our Operating Portfolio consisted of 41 operating assets comprising 16 multifamily assets totaling 6,781 units ( 6,781 units at our share), 23 commercial assets totaling 7.2 million square feet ( 6.9 million square feet at our share) and two wholly owned land assets for which we are the ground lessor.

Additionally, we have one under-construction multifamily asset with 775 units ( 775 units at our share) and 18 assets in the development pipeline totaling 11.4 million square feet ( 9.3 million square feet at our share) of estimated potential development density.

We derive our revenue primarily from leases with multifamily and commercial tenants.

Our commercial leases include fixed and percentage rents, and reimbursements from tenants for certain expenses such as real estate taxes, property operating expenses, and repairs and maintenance.

In addition, our third-party asset management and real estate services business provides fee-based real estate services.

5 unchanged sentences

The results of operations

for the three and six months ended June 30, 2024 and 2023 are not necessarily indicative of the results that may be expected for a full year.

for the three and nine months ended September 30, 2024 and 2023 are not necessarily indicative of the results that may be expected for a full year.

These condensed consolidated financial statements should be read in conjunction with our Annual Report on Form 10-K for the year ended December 31, 2023, filed with the Securities and Exchange Commission ("SEC") on February 20, 2024 ("Annual Report").

2 unchanged sentences

The portions of the equity and net income (loss) of consolidated entities that are not attributable to us are presented separately as amounts attributable to noncontrolling interests in our condensed consolidated financial statements.

References to our financial statements refer to our unaudited condensed consolidated financial statements as of June 30, 2024 and December 31, 2023, and for the three and six months ended June 30, 2024 and 2023.

References to our balance sheets refer to our condensed consolidated balance sheets as of June 30, 2024 and December 31, 2023.

References to our statements of operations refer to our condensed consolidated statements of operations for the three and six months ended June 30, 2024 and 2023.

References to our statements of comprehensive income (loss) refer to our condensed consolidated statements of comprehensive income (loss) for the three and six months ended June 30, 2024 and 2023.

We have elected to be taxed as a REIT under sections 856-860 of the Internal Revenue Code of 1986, as amended (the "Code").

References to our financial statements refer to our unaudited condensed consolidated financial statements as of September 30, 2024 and December 31, 2023, and for the three and nine months ended September 30, 2024 and 2023.

References to our balance sheets refer to our condensed consolidated balance sheets as of September 30, 2024 and December 31, 2023.

References to our statements of operations refer to our condensed consolidated statements of operations for the three and nine months ended September 30, 2024 and 2023.

References to our statements of comprehensive loss refer to our condensed consolidated statements of comprehensive loss for the three and nine months ended September 30, 2024 and 2023.

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.

29 unchanged sentences

Topic 280 enhances disclosures of significant segment expenses and other segment items regularly provided to the chief operating decision maker ("CODM"), extends certain annual disclosures to interim periods and permits more than one measure of segment profit (loss) to be reported under certain conditions.

Topic 280 does not change the existing guidance on how a public entity identifies and determines its reportable segments.

The amendments are effective in fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024.

1 unchanged sentence

We are currently evaluating the potential impact of adopting this new guidance on our financial statement disclosures.

The following is a summary of activity for the six months ended June 30, 2024:

The following is a summary of activity for the nine months ended September 30, 2024:

Date Disposed

2 unchanged sentences

North End Retail

September 17, 2024

Fort Totten Square

(1) Primarily related to certain previously recorded contingent liabilities which were relieved in connection with the sale of Central Place Tower by one of our unconsolidated real estate ventures.

See Note 4 for additional information.

We are under contract to sell a multifamily asset located in Washington D.C.

for $ 86.8 million that went firm on July 29, 2024.

Subject to customary closing conditions, we anticipate that this transaction will close in 2024;

however, we can make no assurances as to when or if the transaction will close .

Investments in Unconsolidated Real Estate Ventures

1 unchanged sentence

Real Estate Venture

June 30, 2024

September 30, 2024

December 31, 2023

(In thousands)

Prudential Global Investment Management ("PGIM") (2)

Morgan Global Alternatives ("J.P.

1 unchanged sentence

Brandywine Realty Trust

CBREI Venture (4)

Prudential Global Investment Management ("PGIM") (3)

Landmark Partners (4)

CBREI Venture (5)

Total investments in unconsolidated real estate ventures (6) (7)

(1) Reflects our effective ownership interests as of June 30, 2024.

(1) Reflects our effective ownership interests as of September 30, 2024.

We have multiple investments with certain venture partners in the underlying real estate.

(2) In February 2024, the venture sold its interest in Central Place Tower for a gross sales price of $ 325.0 million.

Morgan is the advisor for an institutional investor.

(4) Excludes The Foundry for which we had a zero -investment balance and discontinued applying the equity method of accounting after September 30, 2023.

In April 2024, the lender foreclosed on the loan secured by The Foundry and took possession of the property.

(3) In February 2024, the venture sold its interest in Central Place Tower for a gross sales price of $ 325.0 million.

(4) Excludes the L'Enfant Plaza Assets for which we have a zero -investment balance and discontinued applying the equity method of accounting after September 30, 2022.

In October 2024, the lender foreclosed on the mortgage loan secured by the L’Enfant Plaza Assets and took possession of the properties.

(5) Excludes The Foundry for which we had a zero -investment balance and discontinued applying the equity method of accounting after September 30, 2023.

In April 2024, the lender foreclosed on the mortgage loan secured by The Foundry and took possession of the property.

(6) Excludes (i) 10.0 % subordinated interest in one commercial building, (ii) the Fortress Assets, (iii) the L'Enfant Plaza Assets and (iv) The Foundry.

2 unchanged sentences

further, we are not obligated to provide for losses, have not guaranteed its obligations or otherwise committed to provide financial support.

(7) As of June 30, 2024 and December 31, 2023, our total investments in unconsolidated real estate ventures were greater than our share of the net book value of the underlying assets by $ 9.6 million and $ 8.7 million, resulting principally from our zero -investment balance in certain real estate ventures and capitalized interest .

(7) As of September 30, 2024 and December 31, 2023, our total investments in unconsolidated real estate ventures were greater than our share of the net book value of the underlying assets by $ 10.3 million and $ 8.7 million, resulting principally from our zero -investment balance in certain real estate ventures and capitalized interest .

We provide leasing, property management and other real estate services to our unconsolidated real estate ventures.

We recognized revenue, including expense reimbursements, of $ 4.1 million and $ 8.7 million for the three and six months ended June 30, 2024, and $ 5.6 million and $ 10.8 million for the three and six months ended June 30, 2023 for such services.

We recognized revenue, including expense reimbursements, of $ 4.4 million and $ 13.0 million for the three and nine months ended September 30, 2024, and $ 5.4 million and $ 16.3 million for the three and nine months ended September 30, 2023, for such services.

The following is a summary of disposition activity by our unconsolidated real estate ventures:

8 unchanged sentences

Interest Rate (1)

June 30, 2024

September 30, 2024

December 31, 2023

5 unchanged sentences

Mortgage loans, net (4) (5)

(1) Weighted average effective interest rate as of June 30, 2024.

(2) Includes variable rate mortgages with interest rate cap agreements.

(3) Includes variable rate mortgages with interest rates fixed by interest rate swap agreements.

(1) Weighted average effective interest rate as of September 30, 2024.

(2) Includes variable rate mortgage loans with interest rate cap agreements.

(3) Includes variable rate mortgage loans with interest rates fixed by interest rate swap agreements.

(4) Excludes mortgage loans related to the Fortress Assets, the L'Enfant Plaza Assets and The Foundry.

In April 2024, the lender foreclosed on the loan secured by The Foundry and took possession of the property.

In April 2024, the lender foreclosed on the mortgage loan secured by The Foundry and took possession of the property.

In October 2024, the lender foreclosed on the mortgage loan secured by the L’Enfant Plaza Assets and took possession of the properties.

(5) See Note 17 for additional information on guarantees of the debt of certain of our unconsolidated real estate ventures.

The following is a summary of financial information for our unconsolidated real estate ventures:

June 30, 2024

September 30, 2024

December 31, 2023

7 unchanged sentences

Total liabilities and equity

Three Months Ended June 30,

Six Months Ended June 30,

Three Months Ended September 30,

Nine Months Ended September 30,

(In thousands)

1 unchanged sentence

Total revenue

Operating income (2)

Operating income (loss) (2)

(1) Excludes amounts related to the Fortress Assets and the L'Enfant Plaza Assets.

Excludes combined balance sheet information for both periods presented and combined income statement information for the three and six months ended June 30, 2024 related to The Foundry as we discontinued applying the equity method of accounting after September 30, 2023.

(2) Includes the gain on the sale of Central Place Tower of $ 894,000 for the six months ended June 30, 2024.

Excludes combined balance sheet information for both periods presented and combined income statement information for the three and nine months ended September 30, 2024 related to The Foundry as we discontinued applying the equity method of accounting after September 30, 2023.

(2) Includes the gain on the sale of Central Place Tower of $ 894,000 for the nine months ended September 30, 2024.

Includes the gain on the sale of Stonebridge at Potomac Town Center of $ 4.6 million for the three and nine months ended September 30, 2023.

Includes an impairment loss of $ 30.1 million for the three and nine months ended September 30, 2023.

Variable Interest Entities

We hold various interests in entities deemed to be VIEs, which we evaluate at acquisition, formation, after a change in the ownership agreement, after a change in the entity's economics or after any other reconsideration event to determine if the VIE should be consolidated in our financial statements or should no longer be considered a VIE.

An entity is a VIE because it is in the development stage and/or does not hold sufficient equity at risk, or conducts substantially all its operations on

behalf of an investor with disproportionately few voting rights.

An entity is a VIE because it is in the development stage and/or does not hold sufficient equity at risk or conducts substantially all its operations on behalf of an investor with disproportionately few voting rights.

We will consolidate a VIE if we are the primary beneficiary of the VIE, which entails having the power to direct the activities that most significantly impact the VIE’s economic performance.

1 unchanged sentence

Unconsolidated VIEs

As of June 30, 2024 and December 31, 2023, we had interests in entities deemed to be VIEs.

As of September 30, 2024 and December 31, 2023, we had interests in entities deemed to be VIEs.

Although we may be responsible for managing the day-to-day operations of these investees, we are not the primary beneficiary of these VIEs, as we do not hold unilateral power over activities that, when taken together, most significantly impact the respective VIE's economic performance.

We account for our investment in these entities under the equity method.

As of June 30, 2024 and December 31, 2023, the net carrying amounts of our investment in these entities were $ 88.4 million and $ 87.3 million, which were included in "Investments in unconsolidated real estate ventures" in our balance sheets.

As of September 30, 2024 and December 31, 2023, the net carrying amounts of our investment in these entities were $ 88.6 million and $ 87.3 million, which were included in "Investments in unconsolidated real estate ventures" in our balance sheets.

Our equity in the income of unconsolidated VIEs was included in "Income (loss) from unconsolidated real estate ventures, net" in our statements of operations.

12 unchanged sentences

We determined that 1900 Crystal Drive was a VIE and that we were the primary beneficiary of the VIE.

Accordingly, we consolidated the VIE with the lessee's ownership interest shown as "Noncontrolling interests" in our consolidated balance sheet.

Accordingly, we consolidated the VIE with the lessee's ownership interest shown as "Noncontrolling interests" in our balance sheet.

In June 2024, we acquired the ground lessee's interest in 1900 Crystal Drive for $ 26.6 million of which $ 4.7 million was a reduction of "Noncontrolling interests" in our balance sheet.

As a result of the transaction, 1900 Crystal Drive is no longer a VIE.

As of June 30, 2024, excluding JBG SMITH LP, we consolidated one VIE (2000/2001 South Bell Street) with total assets of $ 256.1 million and liabilities of $ 157.9 million, and as of December 31, 2023, excluding JBG SMITH LP, we consolidated two VIEs (1900 Crystal Drive and 2000/2001 South Bell Street) with total assets of $ 503.2 million and liabilities of $ 293.3 million.

As of September 30, 2024, excluding JBG SMITH LP, we consolidated one VIE (2000/2001 South Bell Street) with total assets of $ 271.4 million and liabilities of $ 173.1 million, and as of December 31, 2023, excluding JBG SMITH LP, we consolidated two VIEs (1900 Crystal Drive and 2000/2001 South Bell Street) with total assets of $ 503.2 million and liabilities of $ 293.3 million.

VIE assets primarily consisted of construction in progress and VIE liabilities primarily consisted of mortgage loans.

The assets of the VIEs can only be used to settle the obligations of the VIEs, and the liabilities include third-party liabilities of the VIEs for which the creditors or beneficial interest holders do not have recourse against us.

In October 2024, we provided notice of our intent to exercise our option to acquire the ground lessee’s interest in 2000/2001 South Bell Street which we anticipate will close in the fourth quarter of 2024.

Other Assets, Net

The following is a summary of other assets, net:

June 30, 2024

September 30, 2024

December 31, 2023

8 unchanged sentences

(1) Consists of investments in real estate-focused technology companies, which are recorded at their fair value based on their reported net asset value.

During the three and six months ended June 30, 2024, unrealized gains related to these investments were $ 797,000 and $ 1.3 million .

During the three and six months ended June 30, 2023, unrealized gains (losses) related to these investments were ($ 338,000 ) and $ 1.7 million.

During the three and six months ended June 30, 2024, realized losses related to these investments were $ 183,000 and $ 622,000 .

During the three and six months ended June 30, 2023, realized losses related to these investments were $ 189,000 and $ 318,000 .

During the three and nine months ended September 30, 2024, unrealized gains related to these investments were $ 2.7 million and $ 4.0 million .

During the three and nine months ended September 30, 2023, unrealized gains (losses) related to these investments were ($ 492,000 ) and $ 1.2 million.

During the three and nine months ended September 30, 2024, realized losses related to these investments were $ 143,000 and $ 765,000 .

During the three and nine months ended September 30, 2023, realized losses related to these investments were $ 165,000 and $ 483,000 .

Unrealized gains (losses) and realized losses were included in "Interest and other income, net" in our statements of operations.

(2) Primarily consists of equity investments that are carried at cost.

During the three and nine month s ended September 30 2023, realized gains related to these investments were $ 436,000 .

Realized gains were included in "Interest and other income, net" in our statements of operations.

Mortgage Loans

2 unchanged sentences

Interest Rate (1)

June 30, 2024

September 30, 2024

December 31, 2023

5 unchanged sentences

Mortgage loans, net

(1) Weighted average effective interest rate as of June 30, 2024.

(1) Weighted average effective interest rate as of September 30, 2024.

(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 3.52 % , and the weighted average maturity date of the interest rate caps was June 2025.

In July 2024, a new interest rate cap was executed that extended the weighted average maturity date of the interest rate caps to October 2025.

For mortgage loans with interest rate caps, the weighted average interest rate cap strike was 3.56 % , and the weighted average maturity date of the interest rate caps is in the fourth quarter of 2025.

The interest rate cap strike is exclusive of the credit spreads associated with the mortgage loans.

As of June 30, 2024, one-month term Secured Overnight Financing Rate ("SOFR") was 5.34 % .

(3) Includes variable rate mortgages with interest rates fixed by interest rate swap agreements.

As of June 30, 2024 and December 31, 2023, the net carrying value of real estate collateralizing our mortgage loans totaled $ 2.2 billion.

As of September 30, 2024, one-month term Secured Overnight Financing Rate ("SOFR") was 4.85 % .

(3) Includes variable rate mortgage loans with interest rates fixed by interest rate swap agreements.

As of September 30, 2024 and December 31, 2023, the net carrying value of real estate collateralizing our mortgage loans totaled $ 2.1 billion and $ 2.2 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.

Certain mortgage loans are recourse to us.

See Note 17 for additional information.

As of June 30, 2024 and December 31, 2023, we had various interest rate swap and cap agreements on certain mortgage loans with an aggregate notional value of $ 1.6 billion and $ 1.7 billion.

In September 2024, we repaid the $ 83.3 million mortgage loan collateralized by 201 12th Street S., 200 12th Street S., and 251 18th Street S.

As of September 30, 2024 and December 31, 2023, we had various interest rate swap and cap agreements on certain mortgage loans with an aggregate notional value of $ 1.7 billion.

See Note 15 for additional information.

Revolving Credit Facility and Term Loans

As of June 30, 2024 and December 31, 2023, 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 2025, 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.

The revolving credit facility has two six-month extension options, and the Tranche A-1 Term Loan has two one-year extension options.

As of September 30, 2024, 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 2026, as extended in September 2024, 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.

The revolving credit facility has two six-month extension options, and the Tranche A-1 Term Loan has one remaining one-year extension option.

The following is a summary of amounts outstanding under the revolving credit facility and term loans:

Interest Rate (1)

June 30, 2024

September 30, 2024

December 31, 2023

6 unchanged sentences

Term loans, net

(1) Effective interest rate as of June 30, 2024.

(1) Effective interest rate as of September 30, 2024.

The interest rate for our revolving credit facility excludes a 0.15 % facility fee.

(2) As of June 30, 2024, daily SOFR was 5.33 % .

As of June 30, 2024 and December 31, 2023, letters of credit with an aggregate face amount of $ 15.7 million and $ 467,000 were outstanding under our revolving credit facility.

(3) As of June 30, 2024 and December 31, 2023, excludes $ 8.7 million and $ 10.2 million of net deferred financing costs related to our revolving credit facility that were included in "Other assets, net" in our balance sheets.

(4) As of June 30, 2024 and December 31, 2023, the interest rate swaps fix SOFR at a weighted average interest rate of 1.46 % .

Interest rate swaps with a total notional value of $ 200.0 million matured in July 2024.

We have two forward-starting interest rate swaps that became effective in July 2024 with a total notional value of $ 200.0 million, which effectively fix SOFR at a weighted average interest rate of 4.00 % through January 2027.

(5) As of June 30, 2024 and December 31, 2023, the interest rate swaps fix SOFR at a weighted average interest rate of 2.29 % .

Interest rate swaps with a total notional value of $ 200.0 million matured in July 2024 and with a total notional value of $ 200.0 million will mature in January 2028.

(6) As of June 30, 2024 and December 31, 2023, the outstanding balance was fixed by an interest rate swap agreement, which fixes SOFR at an interest rate of 4.01 % through the maturity date.

(2) As of September 30, 2024, daily SOFR was 4.96 % .

As of September 30, 2024 and December 31, 2023, letters of credit with an aggregate face amount of $ 15.7 million and $ 467,000 were outstanding under our revolving credit facility.

(3) As of September 30, 2024 and December 31, 2023, excludes $ 8.0 million and $ 10.2 million of net deferred financing costs related to our revolving credit facility that were included in "Other assets, net" in our balance sheets.

(4) As of September 30, 2024, the interest rate swaps fixed SOFR at a weighted average interest rate of 4.00 % through the extended maturity date of January 2027.

(5) As of September 30, 2024, the interest rate swaps fixed SOFR at a weighted average interest rate of 2.81 % through the maturity date .

(6) As of September 30, 2024, the interest rate swap fixed SOFR at an interest rate of 4.01 % through the maturity date.

Other Liabilities, Net

The following is a summary of other liabilities, net:

June 30, 2024

September 30, 2024

December 31, 2023

11 unchanged sentences

Vested LTIP Units are redeemable into OP Units.

During the six months ended June 30, 2024 and 2023, unitholders redeemed 625,166 and 1.6 million OP Units, which we elected to redeem for an equivalent number of our common shares.

As of June 30, 2024, outstanding OP Units and redeemable LTIP Units totaled 13.8 million, representing a 13.6 % ownership interest in JBG SMITH LP.

During the nine months ended September 30, 2024 and 2023, unitholders redeemed 827,012 and 2.1 million OP Units, which we elected to redeem for an equivalent number of our common shares.

As of September 30, 2024, outstanding OP Units and redeemable LTIP Units totaled 13.9 million, representing a 14.2 % ownership interest in JBG SMITH LP.

Our OP Units and certain vested LTIP Units are presented at the higher of their redemption value or their carrying value, with adjustments to the redemption value recognized in "Additional paid-in capital" in our balance sheets.

Redemption value per OP Unit is equivalent to the market value of one common share at the end of the period.

In July 2024, unitholders redeemed 100,972 OP Units and LTIP Units, which we elected to redeem for an equivalent number of our common shares.

The following is a summary of the activity of redeemable noncontrolling interests:

Three Months Ended June 30,

Three Months Ended September 30,

(In thousands)

Balance, beginning of period

LTIP Units issued in lieu of cash compensation (1)

Other comprehensive income (loss)

3 unchanged sentences

Balance, end of period

Six Months Ended June 30,

Nine Months Ended September 30,

(In thousands)

1 unchanged sentence

LTIP Units issued in lieu of cash compensation (1)

Net income (loss)

Other comprehensive income (loss)

8 unchanged sentences

The following is a summary of property rental revenue from our non-cancellable leases:

Three Months Ended June 30,

Six Months Ended June 30,

Three Months Ended September 30,

Nine Months Ended September 30,

(In thousands)

9 unchanged sentences

The LTIP Units may not be sold while a trustee is serving on the Board of Trustees.

The aggregate grant-date fair value of the Time-Based LTIP Units and the LTIP Units granted during the six months ended June 30, 2024 was $ 20.3 million.

The aggregate grant-date fair value of the Time-Based LTIP Units and the LTIP Units granted during the nine months ended September 30, 2024 was $ 20.3 million.

The Time-Based LTIP Units and the LTIP Units were valued based on the closing common share price on the grant date, less a discount for post-grant restrictions.

11 unchanged sentences

The AO LTIP Units expire on the ten th anniversary of their grant date.

The aggregate grant-date fair value of the AO LTIP Units granted during the six months ended June 30, 2024 was $ 7.1 million, valued using Monte Carlo simulations based on the following significant assumptions:

The aggregate grant-date fair value of the AO LTIP Units granted during the nine months ended September 30, 2024 was $ 7.1 million, valued using Monte Carlo simulations based on the following significant assumptions:

Expected volatility

4 unchanged sentences

Vesting requirements and compensation expense recognition for the Time-Based RSUs are primarily consistent with those of the Time-Based LTIP Units granted in 2024.

The aggregate grant-date fair value of the RSUs granted during the six months ended June 30, 2024 was $ 1.3 million.

The aggregate grant-date fair value of the RSUs granted during the nine months ended September 30, 2024 was $ 1.3 million.

The Time-Based RSUs were valued based on the closing common share price on the date of grant.

Pursuant to the ESPP, employees purchased 44,569 common shares for $ 592,000 during the six months ended June 30, 2024, valued using the Black-Scholes model based on the following significant assumptions:

Pursuant to the ESPP, employees purchased 60,185 common shares for $ 792,000 during the nine months ended September 30, 2024, valued using the Black-Scholes model based on the following significant assumptions:

Expected volatility

26.0 % to 48.0 %

Dividend yield

4.2 % to 4.6 %

Risk-free interest rate

5.3 % to 5.6 %

Expected life

1 unchanged sentence

The following is a summary of share-based compensation expense:

Three Months Ended June 30,

Six Months Ended June 30,

Three Months Ended September 30,

Nine Months Ended September 30,

(In thousands)

10 unchanged sentences

(2) Included in "General and administrative expense:

Share-based compensation related to Formation Transaction and special equity awards" in our statement of operations.

Share-based compensation related to Formation Transaction and special equity awards" in our statements of operations.

Includes share-based compensation expense for awards issued in connection with the Formation Transaction and with our successful pursuit of Amazon's additional headquarters in National Landing all of which were fully expensed as of December 31, 2023.

As of June 30, 2024, we had $ 32.6 million of total unrecognized compensation expense related to unvested share-based payment arrangements, which is expected to be recognized over a weighted average period of 2.5 years.

In April 2024, our shareholders approved an amendment to the JBG SMITH 2017 Omnibus Share Plan, as amended, (the "Plan") to increase the common shares reserved for issuance under the Plan by 7.5 million common shares.

As of September 30, 2024, we had $ 27.8 million of total unrecognized compensation expense related to unvested share-based payment arrangements, which is expected to be recognized over a weighted average period of 2.3 years.

As of September 30, 2024, there were 10.1 million common shares available for issuance under the Plan.

Transaction and Other Costs

The following is a summary of transaction and other costs:

Three Months Ended June 30,

Six Months Ended June 30,

Three Months Ended September 30,

Nine Months Ended September 30,

(In thousands)

3 unchanged sentences

Transaction and other costs

(1) Primarily consists of dead deal costs.

(1) Primarily consists of dead deal costs and legal costs related to pursued transactions.

Interest Expense

The following is a summary of interest expense:

Three Months Ended June 30,

Six Months Ended June 30,

Three Months Ended September 30,

Nine Months Ended September 30,

(In thousands)

1 unchanged sentence

Amortization of deferred financing costs

Net loss on non-designated derivatives:

Net (gain) loss on non-designated derivatives:

Net unrealized loss

Net realized loss

Net realized gain

Capitalized interest

Interest expense

Shareholders' Equity and Earnings (Loss) Per Common Share

Shareholders' Equity and Loss Per Common Share

Common Shares Repurchased

Our Board of Trustees has authorized the repurchase of up to $ 1.5 billion of our outstanding common shares.

During the three and six months ended June 30, 2024, we repurchased and retired 4.7 million and 7.7 million common shares for $ 68.7 million and $ 118.1 million, a weighted average purchase price per share of $ 14.62 and $ 15.35 .

During the three and six months ended June 30, 2023, we repurchased and retired 9.3 million and 10.5 million common shares for $ 135.7 million and $ 155.8 million, a weighted average purchase price per share of $ 14.54 and $ 14.79 .

Since we began the share repurchase program through June 30, 2024, we have repurchased and retired 53.6 million common shares for $ 1.1 billion, a weighted average purchase price per share of $ 20.09 .

During July 2024, through the date of this filing, we repurchased and retired 897,531 common shares for $ 14.0 million, a weighted average purchase price per share of $ 15.55 , pursuant to a repurchase plan under Rule 10b5-1 of the Securities Exchange Act of 1934, as amended.

Earnings (Loss) Per Common Share

During the three and nine months ended September 30, 2024, we repurchased and retired 3.1 million and 10.8 million common shares for $ 50.2 million and $ 168.3 million, a weighted average purchase price per share of $ 16.23 and $ 15.61 .

During the three and nine months ended September 30, 2023, we repurchased and retired 7.9 million and 18.4 million common shares for $ 120.8 million and $ 276.7 million, a weighted average purchase price per share of $ 15.24 and $ 14.98 .

Since we began the share repurchase program through September 30, 2024, we have repurchased and retired 56.6 million common shares for $ 1.1 billion, a weighted average purchase price per share of $ 19.88 .

Loss Per Common Share

Basic earnings (loss) per common share is computed by dividing net income (loss) available to common shareholders by the weighted average common shares outstanding during the period.

3 unchanged sentences

During periods of net loss, losses are allocated only to the extent the participating securities are required to absorb their share of such losses.

Distributions to

participating securities in excess of their allocated income or loss are shown as a reduction to net income (loss) attributable to common shareholders.

Distributions to participating securities in excess of their allocated income or loss are shown as a reduction to net income (loss) attributable to common shareholders.

Diluted earnings (loss) per common share reflects the potential dilution of the assumed exchange of various unit and share-based compensation awards into common shares to the extent they are dilutive.

The following is a summary of the calculation of basic and diluted earnings (loss) per common share and a reconciliation of net income (loss) to the amounts of net income (loss) available to common shareholders used in calculating basic and diluted earnings (loss) per common share:

Three Months Ended June 30,

Six Months Ended June 30,

The following is a summary of the calculation of basic and diluted loss per common share and a reconciliation of net loss to the amounts of net loss available to common shareholders used in calculating basic and diluted loss per common share:

Three Months Ended September 30,

Nine Months Ended September 30,

(In thousands, except per share amounts)

Net income (loss)

Net (income) loss attributable to redeemable noncontrolling interests

Net loss attributable to noncontrolling interests

Net income (loss) attributable to common shareholders

Net loss attributable to redeemable noncontrolling interests

Net (income) loss attributable to noncontrolling interests

Net loss attributable to common shareholders

Distributions to participating securities

Net income (loss) available to common shareholders - basic and diluted

Net loss available to common shareholders - basic and diluted

Weighted average number of common shares outstanding - basic and diluted

Earnings (loss) per common share - basic and diluted

The effect of the redemption of OP Units, Time-Based LTIP Units, fully vested LTIP Units and special equity awards that were outstanding as of June 30, 2024 and 2023 is excluded in the computation of diluted earnings (loss) per common share as the assumed exchange of such units for common shares on a one-for-one basis was antidilutive (the assumed redemption of these units would have no impact on the determination of diluted earnings (loss) per share).

Since OP Units, Time-Based LTIP Units, LTIP Units and special equity awards, which are held by noncontrolling interests, are attributed gains at an identical proportion to the common shareholders, the gains attributable and their equivalent weighted average impact are excluded from net income (loss) available to common shareholders and from the weighted average number of common shares outstanding in calculating diluted earnings (loss) per common share.

AO LTIP Units, Performance-Based LTIP Units, formation awards and RSUs, which totaled 7.9 million for the three and six months ended June 30, 2024, and 5.2 million and 5.3 million for the three and six months ended June 30, 2023, were excluded from the calculation of diluted earnings (loss) per common share as they were antidilutive, but potentially could be dilutive in the future.

Dividends Declared in July 2024

On July 24, 2024 , our Board of Trustees declared a quarterly dividend of $ 0.175 per common share, payable on August 21, 2024 to shareholders of record as of August 7, 2024 .

Loss per common share - basic and diluted

The effect of the redemption of OP Units, Time-Based LTIP Units, fully vested LTIP Units and special equity awards that were outstanding as of September 30, 2024 and 2023 is excluded in the computation of diluted loss per common share as the assumed exchange of such units for common shares on a one-for-one basis was antidilutive (the assumed redemption of these units would have no impact on the determination of diluted loss per share).

Since OP Units, Time-Based LTIP Units, LTIP Units and special equity awards, which are held by noncontrolling interests, are attributed gains at an identical proportion to the common shareholders, the gains attributable and their equivalent weighted average impact are excluded from loss available to common shareholders and from the weighted average number of common shares outstanding in calculating diluted loss per common share.

AO LTIP Units, Performance-Based LTIP Units, formation awards and RSUs, which totaled 7.9 million for the three and nine months ended September 30, 2024, and 6.6 million and 6.9 million for the three and nine months ended September 30, 2023, were excluded from the calculation of diluted loss per common share as they were antidilutive, but potentially could be dilutive in the future.

Dividends Declared in October 2024

On October 24, 2024 , our Board of Trustees declared a quarterly dividend of $ 0.175 per common share, payable on November 22, 2024 to shareholders of record as of November 7, 2024 .

Fair Value Measurements

1 unchanged sentence

To manage or hedge our exposure to interest rate risk, we follow established risk management policies and procedures, including the use of a variety of derivative financial instruments.

As of June 30, 2024 and December 31, 2023, we had various derivative financial instruments consisting of interest rate swap and cap agreements that are measured at fair value on a recurring basis.

The net unrealized gain on our derivative financial instruments designated as effective hedges was $ 33.1 million and $ 22.7 million as of June 30, 2024 and December 31, 2023 and was recorded in "Accumulated other comprehensive income" in our balance sheets, of which a portion was allocated to "Redeemable noncontrolling interests." Within the next 12 months, we expect to reclassify $ 20.7 million of the net unrealized gain as a decrease to interest expense.

As of September 30, 2024 and December 31, 2023, we had various derivative financial instruments consisting of interest rate swap and cap agreements that are measured at fair value on a recurring basis.

The net unrealized gain (loss) on our derivative financial instruments designated as effective hedges was ($ 1.8 ) million and $ 22.7 million as of September 30, 2024 and December 31, 2023 and was recorded in "Accumulated other comprehensive income (loss)" in our balance sheets, of which a portion was allocated to "Redeemable noncontrolling interests." Within the next 12 months, we expect to reclassify $ 3.5 million of the net unrealized gain as a decrease to interest expense.

Accounting Standards Codification 820 ("Topic 820"), Fair Value Measurement and Disclosures, defines fair value and establishes a framework for measuring fair value.

9 unchanged sentences

(In thousands)

June 30, 2024

September 30, 2024

Derivative financial instruments designated as effective hedges:

Classified as assets in "Other assets, net"

Classified as liabilities in "Other liabilities, net"

Non-designated derivatives:

11 unchanged sentences

While it was determined that the majority of the inputs used to value the derivatives fall within Level 2 of the fair value hierarchy, the credit valuation adjustments associated with the derivatives also utilized Level 3 inputs, such as estimates of current credit spreads to evaluate the likelihood of default.

However, as of June 30, 2024 and December 31, 2023, the significance of the impact of the credit valuation adjustments on the overall valuation of the derivative financial instruments was assessed, and it was determined that these adjustments were not significant to the overall valuation of the derivative financial instruments.

However, as of September 30, 2024 and December 31, 2023, the significance of the impact of the credit valuation adjustments on the overall valuation of the derivative financial instruments was assessed, and it was determined that these adjustments were not significant to the overall valuation of the derivative financial instruments.

As a result, it was determined that the derivative financial instruments in their entirety should be classified in Level 2 of the fair value hierarchy.

The net unrealized gains (losses) included in "Other comprehensive income (loss)" in our statements of comprehensive income (loss) for the three and six months ended June 30, 2024 and 2023 were attributable to the net change in unrealized gains or losses related to effective derivative financial instruments that were outstanding during those periods, none of which were reported in our statements of operations as the derivative financial instruments were documented and qualified as hedging instruments.

The net unrealized gains (losses) included in "Total other comprehensive income (loss)" in our statements of comprehensive loss for the three and nine months ended September 30, 2024 and 2023 were attributable to the net change in unrealized gains or losses related to effective derivative financial instruments that were outstanding during those periods, none of which were reported in our statements of operations as the derivative financial instruments were documented and qualified as hedging instruments.

Realized and unrealized gains (losses) related to non-designated hedges are included in "Interest expense" in our statements of operations.

2 unchanged sentences

This assessment resulted in the impairment of two development parcels, which had an estimated fair value of $ 24.7 million based on a market approach and were classified as Level 2 in the fair value hierarchy.

The impairment loss totaled $ 1.0 million and $ 18.2 million, which was included in "Impairment loss" in our consolidated statements of operations for the three and six months ended June 30, 2024.

The impairment loss totaled $ 18.2 million, which was included in "Impairment loss" in our statement of operations for the nine months ended September 30, 2024.

Financial Assets and Liabilities Not Measured at Fair Value

As of June 30, 2024 and December 31, 2023, all financial assets and liabilities were reflected in our balance sheets at amounts which, in our estimation, reasonably approximated their fair values, except for the following:

June 30, 2024

As of September 30, 2024 and December 31, 2023, all financial assets and liabilities were reflected in our balance sheets at amounts which, in our estimation, reasonably approximated their fair values, except for the following:

September 30, 2024

December 31, 2023

17 unchanged sentences

The following represents the components of revenue from our third-party asset management and real estate services business:

Three Months Ended June 30,

Six Months Ended June 30,

Three Months Ended September 30,

Nine Months Ended September 30,

(In thousands)

10 unchanged sentences

(1) Represents reimbursement of expenses incurred by us on behalf of third parties, including allocated payroll costs and amounts paid to third-party contractors for construction management projects.

Management company assets primarily consist of management and leasing contracts with a net book value of $ 5.4 million and $ 8.1 million as of June 30, 2024 and December 31, 2023, which were included in "Intangible assets, net" in our balance sheets.

Management company assets primarily consist of management and leasing contracts with a net book value of $ 4.0 million and $ 8.1 million as of September 30, 2024 and December 31, 2023, which were included in "Intangible assets, net" in our balance sheets.

Consistent with internal reporting presented to our CODM and our definition of NOI, the third-party asset management and real estate services operating results are excluded from the NOI data below.

The following is the reconciliation of net income (loss) attributable to common shareholders to consolidated NOI:

Three Months Ended June 30,

Six Months Ended June 30,

The following is the reconciliation of net loss attributable to common shareholders to consolidated NOI:

Three Months Ended September 30,

Nine Months Ended September 30,

(In thousands)

Net income (loss) attributable to common shareholders

Net income (loss) attributable to redeemable noncontrolling interests

Net loss attributable to noncontrolling interests

Net income (loss)

Net loss attributable to common shareholders

Net loss attributable to redeemable noncontrolling interests

Net income (loss) attributable to noncontrolling interests

Depreciation and amortization expense

5 unchanged sentences

Interest expense

Loss on the extinguishment of debt

(Gain) loss on the extinguishment of debt

Impairment loss

4 unchanged sentences

Interest and other income, net

Gain on the sale of real estate, net

Gain (loss) on the sale of real estate, net

Consolidated NOI

1 unchanged sentence

Items classified in the Other column include development assets, corporate entities, land assets for which we are the ground lessor and the elimination of inter-segment activity.

Three Months Ended June 30, 2024

Three Months Ended September 30, 2024

(In thousands)

7 unchanged sentences

Consolidated NOI

Three Months Ended June 30, 2023

Three Months Ended September 30, 2023

(In thousands)

7 unchanged sentences

Consolidated NOI

Six Months Ended June 30, 2024

Nine Months Ended September 30, 2024

(In thousands)

7 unchanged sentences

Consolidated NOI

Six Months Ended June 30, 2023

Nine Months Ended September 30, 2023

(In thousands)

8 unchanged sentences

(In thousands)

June 30, 2024

September 30, 2024

Real estate, at cost

3 unchanged sentences

Investments in unconsolidated real estate ventures

(1) Property rental revenue excludes $ 738,000 and $ 11.1 million of other revenue including lease termination revenue for the three and six months ended June 30, 2024.

(1) Property rental revenue excludes $ 1.2 million and $ 12.3 million of other revenue including lease termination revenue for the three and nine months ended September 30, 2024.

Commitments and Contingencies

9 unchanged sentences

Construction Commitments

As of June 30, 2024, we had assets under construction that, based on our current plans and estimates, require an additional $ 98.5 million to complete, which we anticipate will be primarily expended over the next two years .

These capital expenditures are generally due as the work is performed, and we expect to finance them with debt proceeds, proceeds from asset sales and recapitalizations, and available cash.

As of September 30, 2024, we had an asset under construction that, based on our current plans and estimates, requires an additional $ 51.1 million to complete, which we anticipate will be primarily expended over the next year .

These capital expenditures are generally due as the work is performed, and we expect to finance them with debt proceeds.

Environmental Matters

4 unchanged sentences

In each case where the environmental assessments have identified 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.

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.

Environmental liabilities totaled $ 17.5 million and $ 17.6 million as of June 30, 2024 and December 31, 2023, and are included in "Other liabilities, net" in our balance sheets.

As of June 30, 2024, we had committed tenant-related obligations totaling $ 44.4 million ($ 44.3 million related to our consolidated entities and $ 144,000 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.

There are various legal actions against us in the ordinary course of business.

Environmental liabilities totaled $ 17.5 million and $ 17.6 million as of September 30, 2024 and December 31, 2023, and are included in "Other liabilities, net" in our balance sheets.

Legal Proceedings

In November 2023, the District of Columbia filed a lawsuit in the Superior Court of the District of Columbia alleging violations of its antitrust laws by RealPage, Inc., a seller of revenue management software products, and a number of large apartment community owners and operators, including JBG Associates, L.L.C., one of our subsidiaries.

The lawsuit alleges collusion among the defendants to illegally fix and inflate the pricing of multifamily rents and seeks monetary damages, attorneys’ fees and costs, and injunctive relief.

We believe there are defenses, both factual and legal, to the allegations in this proceeding, and we plan to vigorously defend the litigation.

At this stage in the proceeding, it is not possible to predict any outcome or estimate the amount of loss, if any, which could be associated with any adverse decision.

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.

There are various other legal actions against us in the ordinary course of business.

In our opinion, the outcome of such matters will not have a material adverse effect on our financial condition, results of operations or cash flows.

As of September 30, 2024, we had committed tenant-related obligations totaling $ 43.3 million ($ 43.2 million related to our consolidated entities and $ 126,000 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.

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 of development projects.

3 unchanged sentences

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 June 30, 2024, we had additional capital commitments and certain recorded guarantees to our unconsolidated real estate ventures and other investments totaling $ 58.0 million.

As of June 30, 2024, we had no debt principal payment guarantees related to our unconsolidated real estate ventures.

Additionally, with respect to borrowings of our consolidated entities, we have agreed, and may in the future 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 of development projects.

As of June 30, 2024, the aggregate amount of debt principal payment guarantees was $ 8.3 million for our consolidated entities.

As of September 30, 2024, we had additional capital commitments and certain recorded guarantees to our unconsolidated real estate ventures and other investments totaling $ 57.4 million.

As of September 30, 2024, we had no debt principal payment guarantees related to our unconsolidated real estate ventures.

Additionally, 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 of development projects.

As of September 30, 2024, we had no debt principal payment guarantees related to our consolidated real estate assets.

In connection with the Formation Transaction, we have an agreement with Vornado regarding tax matters (the "Tax Matters Agreement") that provides special rules that allocate tax liabilities if the distribution of JBG SMITH shares by Vornado, together with certain related transactions, is determined not to be tax-free.

4 unchanged sentences

In addition, certain members of our senior management team and Board of Trustees have ownership interests in the JBG Legacy Funds, and own carried interests in each fund and in certain of our real estate ventures that entitle them to receive cash payments if the fund or real estate venture achieves certain return thresholds.

We launched the Washington Housing Initiative ("WHI") with the Federal City Council in June 2018 as a scalable market-driven model that uses private capital to help address the scarcity of housing for middle income families.

The WHI Impact Pool completed fundraising in 2020 with capital commitments totaling $ 114.4 million, which included a commitment from us of $ 11.2 million.

As of June 30, 2024, our remaining unfunded commitment was $ 2.9 million.

During the second quarter of 2024, we combined our existing impact investing activities, including WHI, with the newly formed LEO Impact Capital ("LEO"), our workforce housing investment management platform.

During the second quarter of 2024, we combined our existing impact investing activities, including the Washington Housing Initiative ("WHI") formed with the Federal City Council in 2018, with the newly formed LEO Impact Capital ("LEO"), our workforce housing investment management platform.

LEO aims to acquire, operate and preserve middle-income housing in rapidly growing neighborhoods vulnerable to rising housing costs.

The third-party real estate services revenue, including expense reimbursements, from the JBG Legacy Funds and the WHI Impact Pool and its affiliates was $ 3.2 million and $ 7.2 million for the three and six months ended June 30, 2024, and $ 5.9 million and $ 10.8 million for the three and six months ended June 30, 2023.

As of June 30, 2024 and December 31, 2023, we had receivables from the JBG Legacy Funds and the WHI Impact Pool and its affiliates totaling $ 2.3 million and $ 3.5 million for such services.

Commencing in March 2023, in connection with the sale of an 80.0 % interest in 4747 Bethesda Avenue in 2023, we leased our corporate offices from an unconsolidated real estate venture and incurred $ 1.3 million and $ 2.8 million of rent expense for the three and six months ended June 30, 2024, and $ 1.6 million and $ 1.8 million of rent expense for the three and six months ended June 30, 2023,which was included in "General and administrative expense" in our statements of operations.

The WHI Impact Pool completed fundraising in 2020 with capital commitments totaling $ 114.4 million, which included a commitment from us of $ 11.2 million.

As of September 30, 2024, our remaining unfunded commitment was $ 2.9 million.

The third-party real estate services revenue, including expense reimbursements, from the JBG Legacy Funds and the WHI Impact Pool and its affiliates was $ 3.2 million and $ 10.3 million for the three and nine months ended September 30, 2024, and $ 4.8 million and $ 15.7 million for the three and nine months ended September 30, 2023.

As of September 30, 2024 and December 31, 2023, we had receivables from the JBG Legacy Funds and the WHI Impact Pool and its affiliates totaling $ 2.3 million and $ 3.5 million for such services.

Commencing in March 2023, in connection with the sale of an 80.0 % interest in 4747 Bethesda Avenue in 2023, we leased our corporate offices from an unconsolidated real estate venture and incurred $ 1.3 million and $ 4.1 million of rent expense for the three and nine months ended September 30, 2024, and $ 1.6 million and $ 3.4 million of rent expense for the three and nine months ended September 30, 2023, which was included in "General and administrative expense" in our statements of operations.

We have agreements with Building Maintenance Services ("BMS"), an entity in which we have a minor preferred interest, to supervise cleaning, engineering and security services at our properties.

We paid BMS $ 2.2 million and $ 4.7 million for the three and six months ended June 30, 2024, and $ 2.3 million and $ 4.6 million for the three and six months ended June 30, 2023, which was included in "Property operating expenses" in our statements of operations.

We paid BMS $ 2.5 million and $ 7.2 million for the three and nine months ended September 30, 2024, and $ 2.3 million and $ 7.0 million for the three and nine months ended September 30, 2023, which was included in "Property operating expenses" in our statements of operations.

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

What changed 10-Q

Item 1. Financial Statements