KITE REALTY GROUP TRUST 10-K

ITEM 9A. CONTROLS AND PROCEDURES Kite Realty Group Trust Evaluation of Disclosure Controls and Procedures An evaluation was performed under the supervision and with the participation of the Parent Company’s management, including its Chief Executive Officer and Chief Financial Officer, of the effectiveness of its disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities and Exchange Act of 1934, as amended) as of the end of the period covered by this report. Based on that evaluation, the Parent Company's Chief Executive Officer and Chief Financial Officer concluded that these disclosure controls and procedures were effective. Changes in Internal Control Over Financial Reporting There has been no change in the Parent Company’s internal control over financial reporting (as defined in Rule 13a-15(f) under the Securities Exchange Act of 1934) identified in connection with the evaluation required by Rule 13a-15(b) under the Securities Exchange Act of 1934 of the effectiveness of our disclosure controls and procedures (as defined in Rule 13a-15(e) under the Securities Exchange Act of 1934) as of December 31, 2020 that has materially affected, or is reasonably likely to materially affect, its internal control over financial reporting. Management Report on Internal Control Over Financial Reporting The Parent Company is responsible for establishing and maintaining adequate internal control over financial reporting, as that term is defined in Rule 13a-15(f) of the Exchange Act. Under the supervision of and with the participation of the Parent Company's management, including its Chief Executive Officer and Chief Financial Officer, the Parent Company conducted an evaluation of the effectiveness of its internal control over financial reporting based on the 2013 framework in Internal Control – Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission. Based on its evaluation under the framework in Internal Control – Integrated Framework, the Parent Company's management has concluded that its internal control over financial reporting was effective as of December 31, 2020. 59 The Parent Company's independent auditors, KPMG LLP, an independent registered public accounting firm, have issued a report on its internal control over financial reporting as stated in their report which is included herein. The Parent Company's internal control system was designed to provide reasonable assurance to our management and Board of Trustees regarding the preparation and fair presentation of published financial statements. All internal control systems, no matter how well designed, have inherent limitations. Therefore, even those systems determined to be effective can provide only reasonable assurance with respect to financial statement preparation and presentation. Kite Realty Group, L.P. Evaluation of Disclosure Controls and Procedures An evaluation was performed under the supervision and with the participation of the Operating Partnership’s management, including its Chief Executive Officer and Chief Financial Officer, of the effectiveness of its disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities and Exchange Act of 1934, as amended) as of the end of the period covered by this report. Based on that evaluation, the Operating Partnership's Chief Executive Officer and Chief Financial Officer concluded that these disclosure controls and procedures were effective. Changes in Internal Control Over Financial Reporting There has been no change in the Operating Partnership’s internal control over financial reporting (as defined in Rule 13a-15(f) under the Securities Exchange Act of 1934) identified in connection with the evaluation required by Rule 13a-15(b) under the Securities Exchange Act of 1934 of the effectiveness of our disclosure controls and procedures (as defined in Rule 13a-15(e) under the Securities Exchange Act of 1934) as of December 31, 2020 that has materially affected, or is reasonably likely to materially affect, its internal control over financial reporting. Management Report on Internal Control Over Financial Reporting The Operating Partnership is responsible for establishing and maintaining adequate internal control over financial reporting, as that term is defined in Rule 13a-15(f) of the Exchange Act. Under the supervision of and with the participation of the Operating Partnership's management, including its Chief Executive Officer and Chief Financial Officer, the Operating Partnership conducted an evaluation of the effectiveness of its internal control over financial reporting based on the 2013 framework in Internal Control – Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission. Based on its evaluation under the framework in Internal Control – Integrated Framework, the Operating Partnership's management has concluded that its internal control over financial reporting was effective as of December 31, 2020. The Operating Partnership's independent auditors, KPMG LLP, an independent registered public accounting firm, have issued a report on its internal control over financial reporting as stated in their report which is included herein. The Operating Partnership's internal control system was designed to provide reasonable assurance to our management and Board of Trustees regarding the preparation and fair presentation of published financial statements. All internal control systems, no matter how well designed, have inherent limitations. Therefore, even those systems determined to be effective can provide only reasonable assurance with respect to financial statement preparation and presentation. Report of Independent Registered Public Accounting Firm To the Shareholders and Board of Trustees of Kite Realty Group Trust: Opinion on Internal Control Over Financial Reporting We have audited Kite Realty Group Trust and subsidiaries’ (the Company) internal control over financial reporting as of December 31, 2020, based on criteria established in Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission. In our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, 2020, based on criteria established in Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission. We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated balance sheet of the Company as of December 31, 2020, the related consolidated statements of operations and comprehensive income, shareholders’ equity, and cash flows for the year ended December 31, 2020, and the related notes and financial statement schedule III – Consolidated Real Estate and Accumulated Depreciation (collectively, the consolidated financial statements), and our report dated February 22, 2021 expressed an unqualified opinion on those consolidated financial statements. Basis for Opinion The Company’s management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying Management Report on Internal Control Over Financial Reporting. Our responsibility is to express an opinion on the Company’s internal control over financial reporting based on our audit. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects. Our audit of internal control over financial reporting included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. Our audit also included performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion. Definition and Limitations of Internal Control Over Financial Reporting A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements. Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. /s/ KPMG LLP Indianapolis, Indiana February 22, 2021 Report of Independent Registered Public Accounting Firm To the Partners of Kite Realty Group, L.P. and subsidiaries and Board of Trustees of Kite Realty Group Trust: Opinion on Internal Control Over Financial Reporting We have audited Kite Realty Group, L.P. and subsidiaries’ (the Partnership) internal control over financial reporting as of December 31, 2020, based on criteria established in Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission. In our opinion, the Partnership maintained, in all material respects, effective internal control over financial reporting as of December 31, 2020, based on criteria established in Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission. We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated balance sheet of the Partnership as of December 31, 2020, the related consolidated statements of operations and comprehensive income, partner’s equity, and cash flows for the year ended December 31, 2020, and the related notes and financial statement schedule III – Consolidated Real Estate and Accumulated Depreciation (collectively, the consolidated financial statements), and our report dated February 22, 2021 expressed an unqualified opinion on those consolidated financial statements. Basis for Opinion The Partnership’s management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying Management Report on Internal Control Over Financial Reporting. Our responsibility is to express an opinion on the Partnership’s internal control over financial reporting based on our audit. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Partnership in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects. Our audit of internal control over financial reporting included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. Our audit also included performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion. Definition and Limitations of Internal Control Over Financial Reporting A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements. Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. /s/ KPMG LLP Indianapolis, Indiana February 22, 2021 ITEM 9B. OTHER INFORMATION None 63 PART III ITEM 10. INFORMATION ABOUT OUR EXECUTIVE OFFICERS The information required by this Item is hereby incorporated by reference to the material appearing in our 2021 Annual Meeting Proxy Statement (the “Proxy Statement”), which we intend to file within 120 days after our fiscal year-end in accordance with Regulation 14A. ITEM 11. EXECUTIVE COMPENSATION The information required by this Item is hereby incorporated by reference to the material appearing in our Proxy Statement. ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED SHAREHOLDER MATTERS The information required by this Item is hereby incorporated by reference to the material appearing in our Proxy Statement. ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS AND DIRECTOR INDEPENDENCE The information required by this Item is hereby incorporated by reference to the material appearing in our Proxy Statement. ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES The information required by this Item is hereby incorporated by reference to the material appearing in our Proxy Statement. PART IV ITEM 15. EXHIBIT AND FINANCIAL STATEMENT SCHEDULES (a) Documents filed as part of this report: (1) Financial Statements: Consolidated financial statements for the Company listed on the index immediately preceding the financial statements at the end of this report. (2) Financial Statement Schedule: Financial statement schedule for the Company listed on the index immediately preceding the financial statements at the end of this report. (3) Exhibits: The Company files as part of this report the exhibits listed on the Exhibit Index. (b) Exhibits: The Company files as part of this report the exhibits listed on the Exhibit Index. Other financial statement schedules are omitted because they are not applicable or the required information is shown in the financial statements or notes thereto. (c) Financial Statement Schedule: The Company files as part of this report the financial statement schedule listed on the index immediately preceding the financial statements at the end of this report. EXHIBIT INDEX Exhibit No. Description Location 2.1 Agreement and Plan of Merger by and among Kite Realty Group Trust, KRG Magellan, LLC and Inland Diversified Real Estate Trust, Inc., dated February 9, 2014 Incorporated by reference to Exhibit 2.1 to the Current Report on Form 8-K of Kite Realty Group Trust filed with the SEC on February 11, 2014 3.1 Articles of Amendment and Restatement of Declaration of Trust of the Kite R ealty Group Trust , as supplemented and amended Incorporated by reference to Exhibit 3.1 to the Annual Report on Form 10-K of Kite Realty Group Trust filed with the SEC on February 27, 2015 3.2 Articles of Amendment to the Articles of Amendment and Restatement of Declaration of Trust of Kite Realty Group Trust, as supplemented and amended Incorporated by reference to Exhibit 3.1 to the Current Report on Form 8-K of Kite Realty Group Trust filed with the SEC on May 28, 2015 3.3 Articles of Amendment to the Articles of Amendment and Restatement of Declaration of Trust of Kite Realty Group Trust, as supplemented and amended Incorporated by reference to Exhibit 3.1 to the Current Report on Form 8-K of Kite Realty Group Trust filed with the SEC on May 20, 2020 3.4 Second Amended and Restated Bylaws of the Company, as amended Incorporated by reference to Exhibit 3.2 to the Annual Report on Form 10-K of Kite Realty Group Trust filed with the SEC on February 27, 2015 3.5 First Amendment to the Second Amended and Restated Bylaws of Kite Realty Group Trust, as amended Incorporated by reference to Exhibit 3.2 to the Current Report on Form 8-K of Kite Realty Group Trust filed with the SEC on May 28, 2015 3.6 Second Amendment to the Second Amended and Restated Bylaws of Kite Realty Group Trust, as amended Incorporated by reference to Exhibit 3.2 to the Current Report on Form 8-K of Kite Realty Group Trust filed with the SEC on May 20, 2020 3.7 Certificate of Limited Partnership of Kite Realty Group, L.P. Filed herewith 4.1 Form of Common Share Certificate Incorporated by reference to Exhibit 4.1 to Kite Realty Group Trust’s registration statement on Form S-11 (File No. 333-114224) declared effective by the SEC on August 10, 2004 4.2 Indenture, dated September 26, 2016, between Kite Realty Group, L.P., as issuer, and U.S. Bank National Association, as trustee Incorporated by reference to Exhibit 4.1 to the Current Report on Form 8-K of Kite Realty Group Trust filed with the SEC on September 27, 2016 4.3 First Supplemental Indenture, dated September 26, 2016, among Kite Realty Group, L.P., Kite Realty Group Trust, as possible future guarantor, and U.S. Bank National Association Incorporated by reference to Exhibit 4.2 to the Current Report on Form 8-K of Kite Realty Group Trust filed with the SEC on September 27, 2016 4.4 Form of Global Note representing the Notes Incorporated by reference to Exhibits 4.2 and 4.3 to the Current Report on Form 8-K of Kite Realty Group Trust filed with the SEC on September 27, 2016 4.5 Description of Registrant's Securities Filed herewith 66 10.1 Amended and Restated Agreement of Limited Partnership of Kite Realty Group, L.P., dated as of August 16, 2004 Incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K of Kite Realty Group Trust filed with the SEC on August 20, 2004 10.2 Amendment No. 1 to Amended and Restated Agreement of Limited Partnership of Kite Realty Group, L.P., dated as of December 7, 2010 Incorporate by reference to Exhibit 10.1 to the Current Report on Form 8-K of Kite Realty Group Trust filed with the SEC on December 13, 2010 10.3 Amendment No. 2 to Amended and Restated Agreement of Limited Partnership of Kite Realty Group, L.P. Incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K of Kite Realty Group Trust filed with the SEC on March 12, 2012 10.4 Amendment No. 3 to Amended and Restated Agreement of Limited Partnership of Kite Realty Group, L.P. Incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K of Kite Realty Group Trust filed with the SEC on July 29, 2014 10.5 Amendment No. 4 to Amended and Restated Agreement of Limited Partnership of Kite Realty Group, L.P. Incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K of Kite Realty Group Trust filed with the SEC on March 5, 2019 10.6 Amendment No. 5 to Amended and Restated Agreement of Limited Partnership of Kite Realty Group, L.P. Incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K of Kite Realty Group Trust filed with the SEC on March 26, 2019 10.7 Executive Employment Agreement, dated as of December 29, 2 020 , by and between the Company and John A. Kite* Incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K of Kite Realty Group Trust filed with the SEC on December 31, 2020 10.8 Executive Employment Agreement, dated as of December 29, 2020 , by and between the Company and Thomas K. McGowan* Incorporated by reference to Exhibit 10.2 to the Current Report on Form 8-K of Kite Realty Group Trust filed with the SEC on December 31, 2020 10.9 Executive Employment Agreement, dated as of December 29, 2020 , by and between the Company and Heath R. Fear * Incorporated by reference to Exhibit 10.3 the Current Report on Form 8-K of Kite Realty Group Trust filed with the SEC on December 31, 2020 10.10 Executive Employment Agreement, dated as of August 6, 2014 , by and between the Company and Scott E. Murray * Incorporated by reference to Exhibit 10.8 to the Quarterly Report on Form 10-Q of Kite Realty Group Trust filed with the SEC on November 10, 2014 10.11 Separation Agreement, dated as of November 3, 2020, by and between the Company and Scott E. Murray* Filed herewith 10.12 Indemnification Agreement, dated as of August 16, 2004, by and between Kite Realty Group Trust, Kite Realty Group, L.P. and Alvin E. Kite* Incorporated by reference to Exhibit 10.16 to the Current Report on Form 8-K of Kite Realty Group Trust filed with the SEC on August 20, 2004 10.13 Indemnification Agreement, dated as of August 16, 2004, by and between Kite Realty Group Trust, Kite Realty Group, L.P. and John A. Kite* Incorporated by reference to Exhibit 10.17 to the Current Report on Form 8-K of Kite Realty Group Trust filed with the SEC on August 20, 2004 10.14 Indemnification Agreement, dated as of August 16, 2004, by and between Kite Rea lty Group Trust, Kite Realty Group, L.P. and Thomas K. McGowan* Incorporated by reference to Exhibit 10.18 to the Current Report on Form 8-K of Kite Realty Group Trust filed with the SEC on August 20, 2004 67 10.15 Indemnification Agreement, dated as of August 16, 2004, by and between Kite Realty Group Trust, Kite Realty Group, L.P. and Daniel R. Sink* Incorporated by reference to Exhibit 10.19 to the Current Report on Form 8-K of Kite Realty Group Trust filed with the SEC on August 20, 2004 10.16 Indemnification Agreement, dated as of February 27, 2015, by and between Kite Rea lty Group Trust, Kite Realty Group, L.P., and Scott E. Murray* Incorporated by reference to Exhibit 10.13 to the Annual Report on Form 10-K of Kite Realty Group Trust filed with the SEC on February 27, 2015 10.17 Indemnification Agreement, dated as of November 5, 2018, by and among Kite Realty Group Trust, Kite Realty Group, L.P. and Heath R. Fear* Incorporated by reference to Exhibit 10.2 to the Current Report on Form 8-K of Kite Realty Group Trust filed with the SEC on November 7, 2018 10.18 Indemnification Agreement, dated as of August 16, 2004, by and between Kite Realty Group Trust, Kite Realty Group, L.P. and William E. Bindley* Incorporated by reference to Exhibit 10.20 to the Current Report on Form 8-K of Kite Realty Group Trust filed with the SEC on August 20, 2004 10.19 Indemnification Agreement, dated as of August 16, 2004, by and between Kite Realty Group Trust, Kite Realty Group, L.P. and Michael L. Smith* Incorporated by reference to Exhibit 10.21 to the Current Report on Form 8-K of Kite Realty Group Trust filed with the SEC on August 20, 2004 10.20 Indemnification Agreement, dated as of August 16, 2004, by and between Kite R eal ty Group Trust, Kite Realty Group, L.P. and Eugene Golub* Incorporated by reference to Exhibit 10.22 to the Current Report on Form 8-K of Kite Realty Group Trust filed with the SEC on August 20, 2004 10.21 Indemnification Agreement, dated as of August 16, 2004, by and between Kite Realty Group Trust, Kite Realty Group, L.P. and Richard A. Cosier* Incorporated by reference to Exhibit 10.23 to the Current Report on Form 8-K of Kite Realty Group Trust filed with the SEC on August 20, 2004 10.22 Indemnification Agreement, dated as of August 16, 2004, by and between Kite Realty Group Trust, Kite Realty Group, L.P. and Gerald L. Moss* Incorporated by reference to Exhibit 10.24 to the Current Report on Form 8-K of Kite Realty Group Trust filed with the SEC on August 20, 2004 10.23 Indemnification Agreement, dated as of November 3, 2008, by and between Kite Realty Group Trust, Kite Realty Group, L.P. and Darell E. Zink, Jr.* Incorporated by reference to Exhibit 10.4 to the Quarterly Report on Form 10-Q of Kite Realty Group Trust filed with the SEC on November 11, 2008 10.24 Indemnification Agreement, dated as of March 8, 2013, by and between Kite Realty Group Trust, Kite Realty Group, L.P. and Victor J. Coleman* Incorporated by reference to Exhibit 10.20 to the Annual Report on Form 10-K of Kite Realty Group Trust filed with the SEC on March 8, 2013 10.25 Indemnification Agreement, dated as of March 7, 2014, by and between Kite Realty Group Trust, Kite Realty Group, L.P. and Christie B. Kelly* Incorporated by reference to Exhibit 10.21 to the Annual Report on Form 10-K of Kite Realty Group Trust filed with the SEC on March 7, 2014 10.26 Indemnification Agreement, dated as of March 7, 2014, by and between Kite Realty Group Trust, Kite Realty Group, L.P. and David R. O’Reilly* Incorporated by reference to Exhibit 10.22 to the Annual Report on Form 10-K of Kite Realty Group Trust filed with the SEC on March 7, 2014 10.27 Indemnification Agreement, dated as of March 7, 2014, by and between K ite Realty Group Trust, Kite Realty Group, L.P. and Barton R. Peterson* Incorporated by reference to Exhibit 10.23 to the Annual Report on Form 10-K of Kite Realty Group Trust filled with the SEC on March 7, 2014 10.28 Indemnification Agreement, dated as of February 27, 2015, by and between Kite Realty Group Trust, Kite Realty Group, L.P., and Lee A. Daniels* Incorporated by reference to Exhibit 10.24 to the Annual Report on Form 10-K of Kite Realty Group Trust filed with the SEC on February 27, 2015 68 10.29 Indemnification Agreement, dated as of February 27, 2015, by and between Kite Rea lty Grou p T rust, Kite Realty Group, L.P., and Gerald W. Grupe* Incorporated by reference to Exhibit 10.25 to the Annual Report on Form 10-K of Kite Realty Group Trust filed with the SEC on February 27, 2015 10.30 Indemnification Agreement, dated as of February 27, 2015, by and between Kite Realty Grou p Trust, Kite Realty Group, L.P., and Charles H. Wurtzebach* Incorporated by reference to Exhibit 10.26 to the Annual Report on Form 10-K of Kite Realty Group Trust filed with the SEC on February 27, 2015 10.31 Indemnification Agreement, dated as of February 16, 2021, by and between Kite Realty Group Trust, Kite Realty Group, L.P. and Caroline L. Young* Filed herewith 10.32 Kite Realty Group Trust 2008 Employee Share Purchase Plan* Incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K of Kite Realty Group Trust filed with the SEC on May 12, 2008 10.33 Registration Rights Agreement, dated as of August 16, 2004, by and among the Company, Alvin E. Kite, Jr., John A. Kite, Paul W. Kite, Thomas K. McGowan, Daniel R. Sink, George F. McMannis, Mark Jenkins, C. Kenneth Kite, David Grieve and KMI Holdings, LLC Incorporated by reference to Exhibit 10.32 to the Current Report on Form 8-K of Kite Realty Group Trust filed with the SEC on August 20, 2004 10.34 Amendment No. 1 to Registration Rights Agreement, dated August 29, 2005, by and among the Company and the other parties listed on the signature page thereto Incorporated by reference to Exhibit 10.2 to the Quarterly Report on Form 10-Q of Kite Realty Group Trust filed with the SEC on November 14, 2005 10.35 Tax Protection Agreement, dated August 16, 2004, by and among the Company, Kite Realty Group, L.P., Alvin E. Kite, Jr., John A. Kite, Paul W. Kite, Thomas K. McGowan and C. Kenneth Kite Incorporated by reference to Exhibit 10.33 to the Current Report on Form 8-K of Kite Realty Group Trust filed with the SEC on August 20, 2004 10.36 Form of 2014 Outperformance LTIP Unit Award Agreement * Incorporated by reference to Exhibit 10.5 to the Current Report on Form 8-K of Kite Realty Group Trust filed with the SEC on July 29, 2014 10.37 Form of 2016 Outperformance Plan LTIP Unit Agreement* Incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K of Kite Realty Group Trust filed with the SEC on February 3, 2016 10.38 Kite Realty Group Trust 2013 Equity Incentive Plan, as amended and restated as of February 28, 2019 * Incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K of Kite Realty Group Trust filed with the SEC on May 17, 2019 10.39 Form of Nonqualified Share Option Agreement under 2013 Equity Incentive Plan* Incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K of Kite Realty Group Trust filed with the SEC on May 14, 2013 10.40 Form of Restricted Share Agreement under 2013 Equity Incentive Plan* Incorporated by reference to Exhibit 10.2 of the Current Report on Form 8-K of Kite Realty Group Trust filed with the SEC on May 14, 2013 10.41 Schedule of Non-Employee Trustee Fees and Other Compensation* Incorporated by reference to Exhibit 10.49 of the Annual Report on Form 10-K of Kite Realty Group Trust filed with the SEC on February 20, 2018 10.42 Kite Realty Group Trust Trustee Deferred Compensation Plan* Incorporated by reference to Exhibit 10.1 to the Quarterly Report on Form 10-Q of Kite Realty Group Trust filed with the SEC on August 9, 2006 69 10.43 Form of Performance Share Unit Agreement under 2013 Equity Incentive Plan* Incorporated by reference to Exhibit 10.38 of the Annual Report on Form 10-K of Kite Realty Group Trust filed with the SEC on February 27, 2017 10.44 Form of Performance Restricted Share Agreement under 2013 Equity Incentive Plan* Incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K of Kite Realty Group Trust filed with the SEC on November 7, 2018 10.45 Form of Appreciation Only LTIP Unit Agreement* Incorporated by reference to Exhibit 10.2 to the Current Report on Form 8-K of Kite Realty Group Trust filed with the SEC on March 5, 2019 10.46 Form of LTIP Unit Agreement* Filed herewith 10.47 Fifth Amended and Restated Credit Agreement, dated as of July 28, 2016, by and among Kite Realty Group, L.P., KeyBank National Association, as Administrative Agent, and the other lenders party thereto Incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K of Kite Realty Group Trust filed with the SEC on July 29, 2016 10.48 First Amended and Restated Springing Guaranty, dated as of July 28, 2016, by Kite Realty Group Trust Incorporated by reference to Exhibit 10.2 to the Current Report on Form 8-K of Kite Realty Group Trust filed with the SEC on July 29, 2016 10.49 Term Loan Agreement, dated as of April 30, 2012, by and among the Operating Partnership, the Company, KeyBank National Association, as Administrative Agent, Wells Fargo Bank, National Association, as Syndication Agent, the Huntington National Bank, as Documentation Agent, Keybanc Capital Markets and Wells Fargo Securities, LLC, as Joint Bookrunners and Joint Lead Arrangers, and the other lenders Incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K of Kite Realty Group Trust filed with the SEC on May 4, 2012 10.50 First Amendment to Term Loan Agreement, dated as of February 26, 2013, by and among the Operating Partnership, the Company, certain subsidiaries of the Operating Partnership party thereto, KeyBank National Association, as a lender and as Administrative Agent, and the other lenders party thereto Incorporated by reference to Exhibit 10.3 to the Current Report on Form 8-K of Kite Realty Group Trust filed with the SEC on March 4, 2013 10.51 Second Amendment to Term Loan Agreement, dated as of August 21, 2013, by and among the Operating Partnership, the Company, certain subsidiaries of the Operating Partnership party thereto, KeyBank National Association, as a lender and as Administrative Agent, and the other lenders party thereto Incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K of Kite Realty Group Trust filed with the SEC on August 27, 2013 10.52 Guaranty, dated as of April 30, 2012, by the Company and certain subsidiaries of the Operating Partnership party thereto Incorporated by reference to Exhibit 10.2 to the Current Report on Form 8-K of Kite Realty Group Trust filed with the SEC on May 4, 2012 10.53 First Amendment to Fifth Amended and Restated Credit Agreement, dated as of April 24, 2018, by and among Kite Realty Group, L.P., Kite Realty Group Trust, KeyBank National Association, as Administrative Agent, and the other lenders party thereto Incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K of Kite Realty Group Trust filed with the SEC on April 25, 2018 10.54 Term Loan Agreement, dated as of October 25, 2018, by and among Kite Realty Group, L.P., KeyBank National Association, as Administrative Agent, and the other lenders party thereto Incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K of Kite Realty Group Trust filed with the SEC on October 26, 2018 10.55 Springing Guaranty, dated as of October 25, 2018, by Kite Realty Group Trust Incorporated by reference to Exhibit 10.2 to the Current Report on Form 8-K of Kite Realty Group Trust filed with the SEC on October 26, 2018 70 10.56 Note Purchase Agreement, dated as of August 28, 2015, by and among Kite Realty Group, L.P., and the other parties named therein as Purchasers Incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K of Kite Realty Group Trust filed with the SEC on September 3, 2015 21.1 List of Subsidiaries Filed herewith 23.1 Consent of Ernst & Young LLP relating to the Parent Company Filed herewith 23.2 Consent of Ernst & Young LLP relating to the Operating Partnership Filed herewith 23.3 Consent of KPMG LLP relating to the Parent Company Filed herewith 23.4 Consent of KPMG LLP relating to the Operating Partnership Filed herewith 31.1 Certification of principal executive officer of the Parent Company required by Rule 13a-14(a)/15d-14(a) under the Exchange Act, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 Filed herewith 31.2 Certification of principal financial officer of the Parent Company required by Rule 13a-14(a)/15d-14(a) under the Exchange Act, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 Filed herewith 31.3 Certification of principal executive officer of the Operating Partnership required by Rule 13a-14(a)/15d-14(a) under the Exchange Act, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 Filed herewith 31.4 Certification of principal financial officer of the Operating Partnership required by Rule 13a-14(a)/15d-14(a) under the Exchange Act, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 Filed herewith 32.1 Certification of Chief Executive Officer and Chief Financial Officer of the Parent Company pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 Filed herewith 32.2 Certification of Chief Executive Officer and Chief Financial Officer of the Operating Partnership pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 Filed herewith 99.1 Material U.S. Federal Income Tax Considerations Filed herewith 101.INS Inline XBRL Instance Document Filed herewith 101.SCH Inline XBRL Taxonomy Extension Schema Document Filed herewith 101.CAL Inline XBRL Taxonomy Extension Calculation Linkbase Document Filed herewith 101.DEF Inline XBRL Taxonomy Extension Definition Linkbase Document Filed herewith 101.LAB Inline XBRL Taxonomy Extension Label Linkbase Document Filed herewith 101.PRE Inline XBRL Taxonomy Extension Presentation Linkbase Document Filed herewith 104 Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101) Filed herewith 71 ____________________ * Denotes a management contract or compensatory, plan contract or arrangement. ITEM 16. FORM 10-K SUMMARY Not applicable. 72 SIGNATURES Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrants have duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. KITE REALTY GROUP TRUST (Registrant) /s/ John A. Kite John A. Kite February 22, 2021 Chairman and Chief Executive Officer (Date) (Principal Executive Officer) /s/ Heath R. Fear Heath R. Fear February 22, 2021 Executive Vice President and Chief Financial Officer (Date) (Principal Financial Officer) KITE REALTY GROUP L.P. (Registrant) By: Kite Realty Group Trust, its sole general partner /s/ John A. Kite John A. Kite February 22, 2021 Chairman and Chief Executive Officer (Date) (Principal Executive Officer) /s/ Heath R. Fear Heath R. Fear February 22, 2021 Executive Vice President and Chief Financial Officer (Date) (Principal Financial Officer) Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the Registrant and in the capacities and on the dates indicated. 73 Signature Title Date /s/ John A. Kite Chairman, Chief Executive Officer, and Trustee (Principal Executive Officer) February 22, 2021 (John A. Kite) /s/ William E. Bindley Trustee February 22, 2021 (William E. Bindley) /s/ Victor J. Coleman Trustee February 22, 2021 (Victor J. Coleman) /s/ Christie B. Kelly Trustee February 22, 2021 (Christie B. Kelly) /s/ David R. O’Reilly Trustee February 22, 2021 (David R. O’Reilly) /s/ Barton R. Peterson Trustee February 22, 2021 (Barton R. Peterson) /s/ Lee A. Daniels Trustee February 22, 2021 (Lee A. Daniels) /s/ Charles H. Wurtzebach Trustee February 22, 2021 (Charles H. Wurtzebach) /s/ Caroline L. Young Trustee February 22, 2021 (Caroline L. Young) /s/ Heath R. Fear Executive Vice President and Chief Financial Officer (Principal Financial Officer) February 22, 2021 (Heath R. Fear) /s/ David E. Buell Senior Vice President, Chief Accounting Officer February 22, 2021 (David E. Buell) 74 Kite Realty Group Trust and Kite Realty Group, L.P. and subsidiaries Index to Financial Statements Page Consolidated Financial Statements: Kite Realty Group Trust: Report s of Independent Registered Public Accounting Fir ms F-1 Kite Realty Group, L.P. and subsidiaries Report s of Independent Registered Public Accounting Fir ms F-3 Kite Realty Group Trust: Balance Sheets as of December 31, 20 20 and 201 9 F-7 Statements of Operations and Comprehensive Income for the Years Ended December 31, 20 20 , 201 9 , and 201 8 F-8 Statements of Shareholders’ Equity for the Years Ended December 31, 20 20 , 201 9 , and 201 8 F-9 Statements of Cash Flows for the Years Ended December 31, 20 20 , 201 9 , and 201 8 F-10 Kite Realty Group, L.P. and subsidiaries Balance Sheets as of December 31, 20 20 and 201 9 F-11 Statements of Operations and Comprehensive Income for the Years Ended December 31, 20 20 , 201 9 , and 201 8 F-12 Statements of Partner's Equity for the Years Ended December 31, 20 20 , 201 9 , and 201 8 F-13 Statements of Cash Flows for the Years Ended December 31, 20 20 , 201 9 , and 201 8 F-14 Kite Realty Group Trust and Kite Realty Group, L.P. and subsidiaries: Notes to Consolidated Financial Statements F-15 Financial Statement Schedule: Kite Realty Group Trust and Kite Realty Group, L.P. and subsidiaries: Schedule III – Consolidated Real Estate and Accumulated Depreciation F-41 Notes to Schedule III F-45 All other schedules for which provision is made in the applicable accounting regulation of the Securities and Exchange Commission are not required under the related instructions or are inapplicable and therefore have been omitted. Report of Independent Registered Public Accounting Firm To the Shareholders and Board of Trustees of Kite Realty Group Trust: Opinion on the Consolidated Financial Statements We have audited the accompanying consolidated balance sheet of Kite Realty Group Trust and subsidiaries (the Company) as of December 31, 2020, the related consolidated statements of operations and comprehensive income, shareholders’ equity, and cash flows for the year ended December 31, 2020, and the related notes and financial statement schedule III – Consolidated Real Estate and Accumulated Depreciation (collectively, the consolidated financial statements). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2020, and the results of its operations and its cash flows for the year ended December 31, 2020, in conformity with U.S. generally accepted accounting principles. We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company’s internal control over financial reporting as of December 31, 2020, based on criteria established in Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission, and our report dated February 22, 2021 expressed an unqualified opinion on the effectiveness of the Partnership’s internal control over financial reporting. Basis for Opinion These consolidated financial statements are the responsibility of the Partnership’s management. Our responsibility is to express an opinion on these consolidated financial statements based on our audits. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Partnership in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud. Our audits included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. We believe that our audits provide a reasonable basis for our opinion. Critical Audit Matter The critical audit matter communicated below is a matter arising from the current period audit of the consolidated financial statements that was communicated or required to be communicated to the audit committee and that: (1) relates to accounts or disclosures that are material to the consolidated financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of a critical audit matter does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing separate opinion on the critical audit matter or on the accounts or disclosures to which it relates. Evaluation of investment properties for potential impairment As discussed in Note 2 of the consolidated financial statements, land, buildings, and improvements as of December 31, 2020 was $3,109,122 thousand. The Company’s investment properties are reviewed for impairment whenever events or changes in circumstances indicate that the carrying value of an asset may not be recoverable. This review for possible impairment triggering events requires certain assumptions, estimates, and significant judgment. The evaluation of investment properties for potential impairment is subject to certain management assumptions which includes the anticipated holding period for a real estate investment property. We identified the evaluation of investment properties for potential impairment as a critical audit matter. Subjective and challenging auditor judgment was required to evaluate the Company’s intent and ability to hold investment properties for particular periods of time . A shortening of the anticipated holding period could indicate a potential impairment. The following are the primary procedures we performed to address this critical audit matter. We evaluated the design and tested the operating effectiveness of an internal control over the Company’s process to evaluate potential impairment triggering events, including evaluation of holding period. We compared the holding period assumed in the F-1 Company’s analysis to the Company’s historical holding period for similar assets. We inquired of Company officials and inspected documents, such as meeting minutes of the board of trustees and sub-committees and the capital allocation committee to evaluate the Company’s intent and ability to hold investment properties for particular periods of time. We read external communications with investors and analysts in order to identify information regarding potential sales of the Company’s investment properties. /s/ KPMG LLP We have served as the Company’s auditor since 2020. Indianapolis, Indiana February 22, 2021 F-2 Report of Independent Registered Public Accounting Firm To the Partners of Kite Realty Group, L.P. and subsidiaries and Board of Trustees of Kite Realty Group Trust: Opinion on the Consolidated Financial Statements We have audited the accompanying consolidated balance sheet of Kite Realty Group, L.P. and subsidiaries (the Partnership) as of December 31, 2020, the related consolidated statements of operations and comprehensive income, partner’s equity, and cash flows for the year ended December 31, 2020, and the related notes and financial statement schedule III – Consolidated Real Estate and Accumulated Depreciation (collectively, the consolidated financial statements). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Partnership as of December 31, 2020, and the results of its operations and its cash flows for the year ended December 31, 2020, in conformity with U.S. generally accepted accounting principles. We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Partnership’s internal control over financial reporting as of December 31, 2020, based on criteria established in Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission, and our report dated February 22, 2021 expressed an unqualified opinion on the effectiveness of the Company’s internal control over financial reporting. Basis for Opinion These consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these consolidated financial statements based on our audits. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud. Our audits included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. We believe that our audits provide a reasonable basis for our opinion. Critical Audit Matter The critical audit matter communicated below is a matter arising from the current period audit of the consolidated financial statements that was communicated or required to be communicated to the audit committee and that: (1) relates to accounts or disclosures that are material to the consolidated financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of a critical audit matter does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing separate opinion on the critical audit matter or on the accounts or disclosures to which it relates. Evaluation of investment properties for potential impairment As discussed in Note 2 of the consolidated financial statements, land, buildings, and improvements as of December 31, 2020 was $3,109,122 thousand. The Partnership’s investment properties are reviewed for impairment whenever events or changes in circumstances indicate that the carrying value of an asset may not be recoverable. This review for possible impairment triggering events requires certain assumptions, estimates, and significant judgment. The evaluation of investment properties for potential impairment is subject to certain management assumptions which includes the anticipated holding period for a real estate investment property. We identified the evaluation of investment properties for potential impairment as a critical audit matter. Subjective and challenging auditor judgment was required to evaluate the Partnership’s intent and ability to hold investment properties for particular periods of time . A shortening of the anticipated holding period could indicate a potential impairment. F-3 The following are the primary procedures we performed to address this critical audit matter. We evaluated the design and tested the operating effectiveness of an internal control over the Partnership’s process to evaluate potential impairment triggering events, including evaluation of holding period. We compared the holding period assumed in the Partnership’s analysis to the Partnership’s historical holding period for similar assets. We inquired of Partnership officials and inspected documents, such as meeting minutes of the Parent Company’s board of trustees and sub-committees and the capital allocation committee to evaluate the Partnership’s intent and ability to hold investment properties for particular periods of time. We read external communications with investors and analysts in order to identify information regarding potential sales of the Partnership’s investment properties. /s/ KPMG LLP We have served as the Partnership’s auditor since 2020. Indianapolis, Indiana February 22, 2021 F-4 Report of Independent Registered Public Accounting Firm The Shareholders and Board of Trustees of Kite Realty Group Trust: Opinion on the Financial Statements We have audited the accompanying consolidated balance sheet of Kite Realty Group Trust (the Company) as of December 31, 2019, the related consolidated statements of operations and comprehensive income, shareholders’ equity and cash flows for each of the two years in the period ended December 31, 2019, and the related notes and financial statement schedule listed in the Index at Item 15(a) (collectively referred to as the “consolidated financial statements”). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company at December 31, 2019, and the results of its operations and its cash flows for each of the two years in the period ended December 31, 2019, in conformity with U.S. generally accepted accounting principles . Adoption of ASU No. 2016-02 As discussed in Note 2 to the consolidated financial statements, the Company changed its method of accounting for leases in 2019 due to the adoption of Accounting Standards Update (ASU) No. 2016-02, Leases (Topic 842), and the related amendments. Basis for Opinion These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s financial statements based on our audits. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion. /s/ Ernst & Young LLP We served as the Company’s auditor from 2004 until 2020. Indianapolis, Indiana February 20, 2020 F-5 Report of Independent Registered Public Accounting Firm The Partners of Kite Realty Group, L.P. and subsidiaries and the Board of Trustees of Kite Realty Group Trust: Opinion on the Financial Statements We have audited the accompanying consolidated balance sheet of Kite Realty Group, L.P. and subsidiaries (the Partnership) as of December 31, 2019, the related consolidated statements of operations and comprehensive income, partner’s equity and cash flows for each of the two years in the period ended December 31, 2019, and the related notes and financial statement schedule listed in the Index at Item 15(a) (collectively referred to as the “consolidated financial statements”). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Partnership at December 31, 2019, and the results of its operations and its cash flows for each of the two years in the period ended December 31, 2019, in conformity with U.S. generally accepted accounting principles . Adoption of ASU No. 2016-02 As discussed in Note 2 to the consolidated financial statements, the Partnership changed its method of accounting for leases in 2019 due to the adoption of Accounting Standards Update (ASU) No. 2016-02, Leases (Topic 842), and the related amendments. Basis for Opinion These financial statements are the responsibility of the Partnership’s management. Our responsibility is to express an opinion on the Partnership’s financial statements based on our audits. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Partnership in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion. /s/ Ernst & Young LLP We served as the Partnership’s auditor from 2015 until 2020. Indianapolis, Indiana February 20, 2020 F-6 Kite Realty Group Trust Consolidated Balance Sheets ($ in thousands, except share data) December 31, 2020 December 31, 2019 Assets: Investment properties at cost: $ 3,143,961 $ 3,087,391 Less: accumulated depreciation ( 755,100 ) ( 666,952 ) 2,388,861 2,420,439 Cash and cash equivalents 43,648 31,336 Tenant and other receivables, including accrued straight-line rent of $ 24,783 and $ 27,256 , respectively 57,154 55,286 Restricted cash and escrow deposits 2,938 21,477 Deferred costs, net 63,171 73,157 Prepaid and other assets 39,975 34,548 Investments in unconsolidated subsidiaries 12,792 12,644 Total Assets $ 2,608,539 $ 2,648,887 Liabilities and Shareholders' Equity: Mortgage and other indebtedness, net $ 1,170,794 $ 1,146,580 Accounts payable and accrued expenses 77,469 69,817 Deferred revenue and other liabilities 85,649 90,180 Total Liabilities 1,333,912 1,306,577 Commitments and contingencies Limited Partners' interests in Operating Partnership and other 43,275 52,574 Equity: Kite Realty Group Trust Shareholders' Equity: Common Shares, $ 0.01 par value, 225,000,000 shares authorized, 84,187,999 and 83,963,369 shares issued and outstanding at December 31, 2020 and December 31, 2019, respectively 842 840 Additional paid in capital 2,085,003 2,074,436 Accumulated other comprehensive loss ( 30,885 ) ( 16,283 ) Accumulated deficit ( 824,306 ) ( 769,955 ) Total Kite Realty Group Trust Shareholders' Equity 1,230,654 1,289,038 Noncontrolling Interest 698 698 Total Equity 1,231,352 1,289,736 Total Liabilities and Shareholders' Equity $ 2,608,539 $ 2,648,887 The accompanying notes are an integral part of these consolidated financial statements. F-7 Kite Realty Group Trust Consolidated Statements of Operations and Comprehensive Income ($ in thousands, except share and per share data) Year Ended December 31, 2020 2019 2018 Revenue: Rental income $ 257,670 $ 308,399 $ 338,523 Other property related revenue 8,597 6,326 13,138 Fee income 378 448 2,523 Total revenue 266,645 315,173 354,184 Expenses: Property operating 41,012 45,575 50,356 Real estate taxes 35,867 38,777 42,378 General, administrative, and other 30,840 28,214 21,320 Depreciation and amortization 128,648 132,098 152,163 Impairment charges — 37,723 70,360 Total expenses 236,367 282,387 336,577 Gains on sale of operating properties, net 4,733 38,971 3,424 Operating income 35,011 71,757 21,031 Interest expense ( 50,399 ) ( 59,268 ) ( 66,785 ) Income tax benefit of taxable REIT subsidiary 696 282 227 Loss on debt extinguishment — ( 11,572 ) — Equity in loss of unconsolidated subsidiary ( 1,685 ) ( 628 ) ( 278 ) Other income (expense), net 254 ( 573 ) ( 646 ) Consolidated net loss ( 16,123 ) ( 2 ) ( 46,451 ) Net income attributable to noncontrolling interests ( 100 ) ( 532 ) ( 116 ) Net loss attributable to Kite Realty Group Trust ( 16,223 ) ( 534 ) ( 46,567 ) Net income per common share – basic & diluted $ ( 0.19 ) $ ( 0.01 ) $ ( 0.56 ) Weighted average common shares outstanding - basic 84,142,261 83,926,296 83,693,385 Weighted average common shares outstanding - diluted 84,142,261 83,926,296 83,693,385 Dividends declared per common share $ 0.4495 $ 1.2700 $ 1.2700 Consolidated net loss $ ( 16,123 ) $ ( 2 ) $ ( 46,451 ) Change in fair value of derivatives ( 14,969 ) ( 13,158 ) ( 6,647 ) Total comprehensive loss ( 31,092 ) ( 13,160 ) ( 53,098 ) Comprehensive loss (income) attributable to noncontrolling interests 367 ( 160 ) 44 Comprehensive loss attributable to Kite Realty Group Trust $ ( 30,725 ) $ ( 13,320 ) $ ( 53,054 ) The accompanying notes are an integral part of these consolidated financial statements. F-8 Kite Realty Group Trust Consolidated Statements of Shareholders’ Equity ($ in thousands, except share data) Common Shares Additional Paid-in Capital Accumulated Other Comprehensive (Loss) Income Accumulated Deficit Total Shares Amount Balances, December 31, 2017 83,606,068 $ 836 $ 2,071,418 $ 2,990 $ ( 509,833 ) $ 1,565,411 Stock compensation activity 163,318 2 5,695 — — 5,697 Other comprehensive loss attributable to Kite Realty Group Trust — — ( 6,487 ) — ( 6,487 ) Distributions declared to common shareholders — — — — ( 106,335 ) ( 106,335 ) Net loss attributable to Kite Realty Group Trust — — — — ( 46,567 ) ( 46,567 ) Exchange of redeemable noncontrolling interests for common shares 31,500 — 561 — — 561 Adjustment to redeemable noncontrolling interests 0 0 425 — — 425 Balances, December 31, 2018 83,800,886 $ 838 $ 2,078,099 $ ( 3,497 ) $ ( 662,735 ) $ 1,412,705 Stock compensation activity 152,184 2 6,147 — — 6,149 Other comprehensive loss attributable to Kite Realty Group Trust — — ( 12,786 ) — ( 12,786 ) Distributions declared to common shareholders — — — — ( 106,686 ) ( 106,686 ) Net loss attributable to Kite Realty Group Trust — — — — ( 534 ) ( 534 ) Exchange of redeemable noncontrolling interests for common shares 10,299 — 167 — — 167 Adjustment to redeemable noncontrolling interests — — ( 9,977 ) — — ( 9,977 ) Balances, December 31, 2019 83,963,369 $ 840 $ 2,074,436 $ ( 16,283 ) $ ( 769,955 ) $ 1,289,038 Stock compensation activity 206,591 2 5,483 — — 5,485 Other comprehensive loss attributable to Kite Realty Group Trust — — ( 14,602 ) — ( 14,602 ) Distributions declared to common shareholders — — — — ( 38,128 ) ( 38,128 ) Net loss attributable to Kite Realty Group Trust — — — — ( 16,223 ) ( 16,223 ) Acquisition of partner's noncontrolling interest in Pan Am Plaza — — ( 2,500 ) — — ( 2,500 ) Exchange of redeemable noncontrolling interests for common shares 18,039 — 187 — — 187 Adjustment to redeemable noncontrolling interests — — 7,397 — — 7,397 Balances, December 31, 2020 84,187,999 $ 842 $ 2,085,003 $ ( 30,885 ) $ ( 824,306 ) $ 1,230,654 The accompanying notes are an integral part of these consolidated financial statements. F-9 Kite Realty Group Trust Consolidated Statements of Cash Flows ($ in thousands) Year Ended December 31, 2020 2019 2018 Cash flow from operating activities: Consolidated net loss $ ( 16,123 ) $ ( 2 ) $ ( 46,451 ) Adjustments to reconcile consolidated net income to net cash provided by operating activities: Gain on sale of operating properties ( 4,733 ) ( 38,971 ) ( 3,424 ) Impairment charge — 37,723 70,360 Loss on debt extinguishment — 11,572 — Straight-line rent 3,131 ( 2,158 ) ( 3,060 ) Depreciation and amortization 130,783 134,860 156,107 Compensation expense for equity awards 5,998 5,375 4,869 Amortization of debt fair value adjustment ( 444 ) ( 1,467 ) ( 2,630 ) Amortization of in-place lease liabilities ( 3,822 ) ( 3,776 ) ( 6,360 ) Changes in assets and liabilities: Tenant receivables ( 3,062 ) 3,170 ( 642 ) Deferred costs and other assets ( 7,618 ) ( 6,265 ) ( 13,396 ) Accounts payable, accrued expenses, deferred revenue, and other liabilities ( 8,595 ) ( 2,099 ) ( 990 ) Net cash provided by operating activities 95,515 137,962 154,383 Cash flow from investing activities: Acquisitions of interests in properties ( 65,298 ) ( 58,205 ) — Capital expenditures ( 38,266 ) ( 53,278 ) ( 59,304 ) Net proceeds from sales of land 9,134 — — Net proceeds from sales of operating properties 13,888 529,417 218,387 Small business loan funding ( 2,199 ) — — Change in construction payables 2,442 ( 542 ) ( 777 ) Capital contribution to unconsolidated joint venture ( 541 ) ( 798 ) ( 9,973 ) Net cash (used in) provided by investing activities ( 80,840 ) 416,594 148,333 Cash flow from financing activities: Proceeds from issuance of common shares, net 72 350 76 Repurchases of common shares upon the vesting of restricted shares ( 1,336 ) ( 533 ) ( 350 ) Loan proceeds 325,000 75,000 399,500 Loan transaction costs — — ( 5,208 ) Loan payments ( 302,477 ) ( 470,515 ) ( 551,379 ) Debt extinguishment costs — ( 14,455 ) — Distributions paid – common shareholders ( 38,128 ) ( 133,258 ) ( 106,316 ) Distributions paid – redeemable noncontrolling interests ( 1,533 ) ( 3,838 ) ( 3,716 ) Acquisition of partner's interest in Pan Am Plaza joint venture ( 2,500 ) — — Acquisition of partners' interests in Territory joint venture — — ( 21,993 ) Net cash used in financing activities ( 20,902 ) ( 547,249 ) ( 289,386 ) Net change in cash, cash equivalents, and restricted cash ( 6,227 ) 7,307 13,330 Cash, cash equivalents, and restricted cash beginning of period 52,813 45,506 32,176 Cash, cash equivalents, and restricted cash end of period $ 46,586 $ 52,813 $ 45,506 Supplemental disclosures Cash paid for interest, net of capitalized interest $ 50,387 $ 60,534 $ 67,998 Non-cash investing activities Net investment in sales-type lease $ 4,665 $ — $ — The accompanying notes are an integral part of these consolidated financial statements. F-10 Kite Realty Group, L.P. and subsidiaries Consolidated Balance Sheets ($ in thousands, except unit data) December 31, 2020 December 31, 2019 Assets: Investment properties at cost: $ 3,143,961 $ 3,087,391 Less: accumulated depreciation ( 755,100 ) ( 666,952 ) 2,388,861 2,420,439 Cash and cash equivalents 43,648 31,336 Tenant and other receivables, including accrued straight-line rent of $ 24,783 and $ 27,256 , respectively 57,154 55,286 Restricted cash and escrow deposits 2,938 21,477 Deferred costs, net 63,171 73,157 Prepaid and other assets 39,975 34,548 Investments in unconsolidated subsidiaries 12,792 12,644 Total Assets $ 2,608,539 $ 2,648,887 Liabilities and Equity: Mortgage and other indebtedness, net $ 1,170,794 $ 1,146,580 Accounts payable and accrued expenses 77,469 69,817 Deferred revenue and other liabilities 85,649 90,180 Total Liabilities 1,333,912 1,306,577 Commitments and contingencies Limited Partners' interests in Operating Partnership and other 43,275 52,574 Partners Equity: Parent Company: Common equity, 84,187,999 and 83,963,369 units issued and outstanding at December 31, 2020 and December 31, 2019, respectively 1,261,539 1,305,321 Accumulated other comprehensive loss ( 30,885 ) ( 16,283 ) Total Partners Equity 1,230,654 1,289,038 Noncontrolling Interests 698 698 Total Equity 1,231,352 1,289,736 Total Liabilities and Equity $ 2,608,539 $ 2,648,887 The accompanying notes are an integral part of these consolidated financial statements. F-11 Kite Realty Group, L.P. and subsidiaries Consolidated Statements of Operations and Comprehensive Income ($ in thousands, except unit and per unit data) Year Ended December 31, 2020 2019 2018 Revenue: Rental income $ 257,670 $ 308,399 $ 338,523 Other property related revenue 8,597 6,326 13,138 Fee income 378 448 2,523 Total revenue 266,645 315,173 354,184 Expenses: Property operating 41,012 45,575 50,356 Real estate taxes 35,867 38,777 42,378 General, administrative, and other 30,840 28,214 21,320 Depreciation and amortization 128,648 132,098 152,163 Impairment charge — 37,723 70,360 Total expenses 236,367 282,387 336,577 Gain on sale of operating properties, net 4,733 38,971 3,424 Operating income 35,011 71,757 21,031 Interest expense ( 50,399 ) ( 59,268 ) ( 66,785 ) Income tax benefit of taxable REIT subsidiary 696 282 227 Loss on debt extinguishment — ( 11,572 ) — Equity in loss of unconsolidated subsidiaries ( 1,685 ) ( 628 ) ( 278 ) Other income (expense), net 254 ( 573 ) ( 646 ) Net loss ( 16,123 ) ( 2 ) ( 46,451 ) Net income attributable to noncontrolling interests ( 528 ) ( 528 ) ( 1,151 ) Net loss attributable to common unitholders $ ( 16,651 ) $ ( 530 ) $ ( 47,602 ) Allocation of net (loss) income: Limited Partners $ ( 428 ) $ 4 $ ( 1,035 ) Parent Company ( 16,223 ) ( 534 ) ( 46,567 ) $ ( 16,651 ) $ ( 530 ) $ ( 47,602 ) Net loss per unit - basic and diluted $ ( 0.19 ) $ ( 0.01 ) $ ( 0.56 ) Weighted average common units outstanding - basic 86,361,139 86,027,409 85,740,449 Weighted average common units outstanding - diluted 86,361,139 86,027,409 85,740,449 Distributions declared per common unit $ 0.4495 $ 1.2700 $ 1.2700 Consolidated net loss $ ( 16,123 ) $ ( 2 ) $ ( 46,451 ) Change in fair value of derivatives ( 14,969 ) ( 13,158 ) ( 6,647 ) Total comprehensive loss ( 31,092 ) ( 13,160 ) ( 53,098 ) Comprehensive income attributable to noncontrolling interests ( 528 ) ( 528 ) ( 1,151 ) Comprehensive loss attributable to common unitholders $ ( 31,620 ) $ ( 13,688 ) $ ( 54,249 ) The accompanying notes are an integral part of these consolidated financial statements. F-12 Kite Realty Group, L.P. and subsidiaries Consolidated Statements of Partner's Equity ($ in thousands) General Partner Total Common Equity Accumulated Other Comprehensive (Loss) Income Balances, December 31, 2017 $ 1,562,421 $ 2,990 $ 1,565,411 Stock compensation activity 5,697 — 5,697 Other comprehensive loss attributable to Parent Company — ( 6,487 ) ( 6,487 ) Distributions declared to Parent Company ( 106,335 ) — ( 106,335 ) Net loss attributable to Parent Company ( 46,567 ) — ( 46,567 ) Conversion of Limited Partner Units to shares of the Parent Company 561 — 561 Adjustment to redeemable noncontrolling interests 425 — 425 Balances, December 31, 2018 $ 1,416,202 $ ( 3,497 ) $ 1,412,705 Stock compensation activity 6,149 — 6,149 Other comprehensive loss attributable to Parent Company — ( 12,786 ) ( 12,786 ) Distributions declared to Parent Company ( 106,686 ) — ( 106,686 ) Net loss attributable to Parent Company ( 534 ) — ( 534 ) Conversion of Limited Partner Units to shares of the Parent Company 167 — 167 Adjustment to redeemable noncontrolling interests ( 9,977 ) — ( 9,977 ) Balances, December 31, 2019 $ 1,305,321 $ ( 16,283 ) $ 1,289,038 Stock compensation activity 5,485 — 5,485 Other comprehensive loss attributable to Parent Company — ( 14,602 ) ( 14,602 ) Distributions declared to Parent Company ( 38,128 ) — ( 38,128 ) Net loss attributable to Parent Company ( 16,223 ) — ( 16,223 ) Acquisition of partner's noncontrolling interest in Pan Am Plaza ( 2,500 ) — ( 2,500 ) Conversion of Limited Partner Units to shares of the Parent Company 187 — 187 Adjustment to redeemable noncontrolling interests 7,397 — 7,397 Balances, December 31, 2020 $ 1,261,539 $ ( 30,885 ) $ 1,230,654 The accompanying notes are an integral part of these consolidated financial statements. F-13 Kite Realty Group, L.P. and subsidiaries Consolidated Statements of Cash Flows ($ in thousands) Year Ended December 31, 2020 2019 2018 Cash flow from operating activities: Consolidated net loss $ ( 16,123 ) $ ( 2 ) $ ( 46,451 ) Adjustments to reconcile consolidated net income to net cash provided by operating activities: Gain on sales of operating properties ( 4,733 ) ( 38,971 ) ( 3,424 ) Impairment charge — 37,723 70,360 Loss on debt extinguishment — 11,572 — Straight-line rent 3,131 ( 2,158 ) ( 3,060 ) Depreciation and amortization 130,783 134,860 156,107 Compensation expense for equity awards 5,998 5,375 4,869 Amortization of debt fair value adjustment ( 444 ) ( 1,467 ) ( 2,630 ) Amortization of in-place lease liabilities ( 3,822 ) ( 3,776 ) ( 6,360 ) Changes in assets and liabilities: Tenant receivables ( 3,062 ) 3,170 ( 642 ) Deferred costs and other assets ( 7,618 ) ( 6,265 ) ( 13,396 ) Accounts payable, accrued expenses, deferred revenue, and other liabilities ( 8,595 ) ( 2,099 ) ( 990 ) Net cash provided by operating activities 95,515 137,962 154,383 Cash flow from investing activities: Acquisitions of interests in properties ( 65,298 ) ( 58,205 ) — Capital expenditures ( 38,266 ) ( 53,278 ) ( 59,304 ) Net proceeds from sales of land 9,134 — — Net proceeds from sales of operating properties 13,888 529,417 218,387 Change in construction payables 2,442 ( 542 ) ( 777 ) Small business loan funding ( 2,199 ) — — Capital contribution to unconsolidated joint venture ( 541 ) ( 798 ) ( 9,973 ) Net cash (used in) provided by investing activities ( 80,840 ) 416,594 148,333 Cash flow from financing activities: Contributions from the General Partner 72 350 76 Repurchases of common shares upon the vesting of restricted shares ( 1,336 ) ( 533 ) ( 350 ) Loan proceeds 325,000 75,000 399,500 Loan transaction costs — — ( 5,208 ) Loan payments ( 302,477 ) ( 470,515 ) ( 551,379 ) Debt extinguishment costs — ( 14,455 ) — Distributions paid – common unitholders ( 38,128 ) ( 133,258 ) ( 106,316 ) Distributions paid – redeemable noncontrolling interests ( 1,533 ) ( 3,838 ) ( 3,716 ) Acquisition of partner's interest in Pan Am Plaza joint venture ( 2,500 ) — — Acquisition of partners' interests in Territory joint venture — — ( 21,993 ) Net cash used in financing activities ( 20,902 ) ( 547,249 ) ( 289,386 ) Net change in cash, cash equivalents, and restricted cash ( 6,227 ) 7,307 13,330 Cash, cash equivalents, and restricted cash beginning of period 52,813 45,506 32,176 Cash, cash equivalents, and restricted cash end of period $ 46,586 $ 52,813 $ 45,506 Supplemental disclosures Cash paid for interest, net of capitalized interest $ 50,387 $ 60,534 $ 67,998 Non-cash investing activities Net investment in sales-type lease $ 4,665 $ — $ — The accompanying notes are an integral part of these consolidated financial statements. F-14 Kite Realty Group Trust and Kite Realty Group, L.P. and subsidiaries Notes to Consolidated Financial Statements December 31, 2020 ($ in thousands, except share, per share, unit and per unit amounts and where indicated in millions or billions.) Note 1. Organization Kite Realty Group Trust (the "Parent Company"), through its majority-owned subsidiary, Kite Realty Group, L.P. (the “Operating Partnership”), owns interests in various operating subsidiaries and joint ventures engaged in the ownership and operation, acquisition, development and redevelopment of high-quality neighborhood and community shopping centers in select markets in the United States. The terms "Company," "we," "us," and "our" refer to the Parent Company and the Operating Partnership, collectively, and those entities owned or controlled by the Parent Company and/or the Operating Partnership. The Operating Partnership was formed on August 16, 2004, when the Parent Company contributed properties and the net proceeds from an initial public offering of shares of its common stock to the Operating Partnership. The Parent Company was organized in Maryland in 2004 to succeed in the development, acquisition, construction and real estate businesses of its predecessor. We believe the Company qualifies as a real estate investment trust (a “REIT”) under provisions of the Internal Revenue Code of 1986, as amended. The Parent Company is the sole general partner of the Operating Partnership, and as of December 31, 2020 owned approximately 97.1 % of the common partnership interests in the Operating Partnership (“General Partner Units”). The remaining 2.9 % of the common partnership interests (“Limited Partner Units” and, together with the General Partner Units, the “Common Units”) were owned by the limited partners. As the sole general partner of the Operating Partnership, the Parent Company has full, exclusive and complete responsibility and discretion in the day-to-day management and control of the Operating Partnership. The Parent Company and the Operating Partnership are operated as one enterprise. The management of the Parent Company consists of the same members as the management of the Operating Partnership. As the sole general partner with control of the Operating Partnership, the Parent Company consolidates the Operating Partnership for financial reporting purposes, and the Parent Company does not have any significant assets other than its investment in the Operating Partnership. At December 31, 2020, we owned interests in 90 operating and redevelopment properties totaling approximately 17.3 million square feet. We also owned two development projects under construction as of this date. Of the 90 properties, 87 are consolidated in these financial statements, and the remaining three are accounted for under the equity method. At December 31, 2019, we owned interests in 90 operating and redevelopment properties totaling approximately 17.4 million square feet. We also owned one development project under construction as of this date. Of the 90 properties, 87 are consolidated in these financial statements and the remaining three are accounted for under the equity method. Note 2. Basis of Presentation and Summary of Significant Accounting Policies The accompanying financial statements have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”). GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements, and revenues and expenses during the reported period. Actual results could differ from these estimates. Components of Investment Properties The Company’s investment properties as of December 31, 2020 and December 31, 2019 were as follows: ($ in thousands) Balance at December 31, 2020 December 31, 2019 Investment properties, at cost: Land, buildings and improvements $ 3,109,122 $ 3,038,412 Furniture, equipment and other 6,979 7,775 Construction in progress 27,860 41,204 $ 3,143,961 $ 3,087,391 F-15 Consolidation and Investments in Joint Ventures The accompanying financial statements are presented on a consolidated basis and include all accounts of the Parent Company, the Operating Partnership, the TRS of the Operating Partnership, subsidiaries of the Operating Partnership that are controlled and any variable interest entities (“VIEs”) in which the Operating Partnership is the primary beneficiary. In general, a VIE is a corporation, partnership, trust or any other legal structure used for business purposes that either (a) has equity investors that do not provide sufficient financial resources for the entity to support its activities, (b) does not have equity investors with voting rights or (c) has equity investors whose votes are disproportionate from their economics and substantially all of the activities are conducted on behalf of the investor with disproportionately fewer voting rights. The Operating Partnership accounts for properties that are owned by joint ventures in accordance with the consolidation guidance. The Operating Partnership evaluates each joint venture and determines first whether to follow the VIE or the voting interest entity ("VOE") model. Once the appropriate consolidation model is identified, the Operating Partnership then evaluates whether it should consolidate the joint venture. Under the VIE model, the Operating Partnership consolidates an entity when it has (i) the power to direct the activities of the VIE that most significantly impact the VIE’s economic performance, and (ii) the obligation to absorb losses or the right to receive benefits that could potentially be significant to the VIE. Under the VOE model, the Operating Partnership consolidates an entity when (i) it controls the entity through ownership of a majority voting interest if the entity is not a limited partnership or (ii) it controls the entity through its ability to remove the other partners or owners in the entity, at its discretion, when the entity is a limited partnership. In determining whether to consolidate a VIE with the Operating Partnership, we consider all relationships between the Operating Partnership and the applicable VIE, including development agreements, management agreements and other contractual arrangements, in determining whether we have the power to direct the activities of the VIE that most significantly affect the VIE's performance. As of December 31, 2020, we owned investments in two consolidated joint ventures that were VIEs in which the partners did not have substantive participating rights and we were the primary beneficiary. As of this date, these VIEs had total debt of $ 55.1 million, which were secured by assets of the VIEs totaling $ 113.3 million. The Operating Partnership guarantees the debt of these VIEs. The Operating Partnership is considered a VIE as the limited partners do not hold kick-out rights or substantive participating rights. The Parent Company consolidates the Operating Partnership as it is the primary beneficiary in accordance with the VIE model. TH Real Estate Joint Venture On June 29, 2018, the Company formed a joint venture involving TH Real Estate (the "TH Real Estate joint venture"). The Company sold three properties to the joint venture valued in the aggregate at $ 99.8 million and, after considering third party debt obtained by the venture upon formation, the Company contributed $ 10.0 million for a 20 % noncontrolling ownership interest in the venture. The Company serves as the operating member responsible for day-to-day management of the properties and receives property management and leasing fees. Both members have substantive participating rights over major decisions that impact the economics and operations of the joint venture. The Company is accounting for the joint venture on the equity method as it has the ability to exercise influence, but not control over operating and financial policies. Embassy Suites at the University of Notre Dame In December 2017, we formed a new joint venture with an unrelated third party to develop and own an Embassy Suites full-service hotel next to our Eddy Street Commons operating property at the University of Notre Dame. We contributed $ 1.4 million of cash to the joint venture in return for a 35 % ownership interest in the venture. The joint venture has entered into a $ 33.8 million construction loan, against which $ 33.6 million was drawn as of December 31, 2020. The joint venture is not considered a VIE. We are accounting for the joint venture under the equity method as both members have substantive participating rights and we do not control the activities of the venture. Glendale Multifamily Joint Venture In May 2020, the Company formed a joint venture for the planned development of a multifamily project adjacent to our Glendale Town Center retail property. The Company contributed land valued at $ 1.6 million to the joint venture and retained a 12 % interest in the joint venture. The Company's partner serves as the operating member responsible for day-to-day management. Both members have substantive participating rights over major decisions that impact the economics and F-16 operations of the joint venture. The Company is accounting for the joint venture on the equity method as it has the ability to exercise influence but not control over operating and financial policies. Acquisition of Real Estate Properties Upon acquisition of real estate operating properties, we estimate the fair value of acquired identifiable tangible assets and identified intangible assets and liabilities, assumed debt, and any noncontrolling interest in the acquiree at the date of acquisition, based on evaluation of information and estimates available at that date. Based on these estimates, we record the estimated fair value to the applicable assets and liabilities. In making estimates of fair values, a number of sources are utilized, including information obtained as a result of pre-acquisition due diligence, marketing and leasing activities. The estimates of fair value were determined to have primarily relied upon Level 2 and Level 3 inputs, as defined below. Fair value is determined for tangible assets and intangibles, including: • the fair value of the building on an as-if-vacant basis and the fair value of land determined either by comparable market data, real estate tax assessments, independent appraisals or other relevant data; • above-market and below-market in-place lease values for acquired properties, which are based on the present value (using an interest rate which reflects the risks associated with the leases acquired) of the difference between (i) the contractual amounts to be paid pursuant to the in-place leases and (ii) management’s estimate of fair market lease rates for the corresponding in-place leases, measured over the remaining non-cancelable term of the leases. Any below-market renewal options are also considered in the in-place lease values. The capitalized above-market and below-market lease values are amortized as a reduction of or addition to rental income over the term of the lease. Should a tenant vacate, terminate its lease, or otherwise notify us of its intent to do so, the unamortized portion of the lease intangibles would be charged or credited to income; • the value of having a lease in place at the acquisition date. We utilize independent and internal sources for our estimates to determine the respective in-place lease values. Our estimates of value are made using methods similar to those used by independent appraisers. Factors we consider in our analysis include an estimate of costs to execute similar leases including tenant improvements, leasing commissions and foregone costs and rent received during the estimated lease-up period as if the space was vacant. The value of in-place leases is amortized to expense over the remaining initial terms of the respective leases; and • the fair value of any assumed financing that is determined to be above or below market terms. We utilize third party and independent sources for our estimates to determine the respective fair value of each mortgage payable. The fair market value of each mortgage payable is amortized to interest expense over the remaining initial terms of the respective loan. We also consider whether there is any value to in-place leases that have a related customer relationship intangible value. Characteristics we consider in determining these values include the nature and extent of existing business relationships with the tenant, growth prospects for developing new business with the tenant, the tenant’s credit quality, and expectations of lease renewals, among other factors. To date, a tenant relationship has not been developed that is considered to have a current intangible value. Investment Properties Capitalization and Depreciation Investment properties are recorded at cost and include costs of land acquisition, development, pre-development, construction, certain allocated overhead, tenant allowances and improvements, and interest and real estate taxes incurred during construction. Significant renovations and improvements are capitalized when they extend the useful life, increase capacity, or improve the efficiency of the asset. If a tenant vacates a space prior to the lease expiration, terminates its lease, or otherwise notifies the Company of its intent to do so, any related unamortized tenant allowances are expensed over the shortened lease period. Maintenance and repairs that do not extend the useful lives of the respective assets are reflected in property operating expense. Pre-development costs are incurred prior to vertical construction and for certain land held for development during the due diligence phase and include contract deposits, legal, engineering, cost of internal resources and other professional fees related to evaluating the feasibility of developing or redeveloping a shopping center or other project. These pre-development F-17 costs are capitalized and included in construction in progress in the accompanying consolidated balance sheets. If we determine that the completion of a development project is no longer probable, all previously incurred pre-development costs are immediately expensed. Land is transferred to construction in progress once construction commences on the related project. We also capitalize costs such as land acquisition, building construction, interest, real estate taxes, and the costs of personnel directly involved with the development of our properties. As a portion of a development property becomes operational, we expense a pro rata amount of related costs. Depreciation on buildings and improvements is provided utilizing the straight-line method over estimated original useful lives ranging from 10 to 35 years. Depreciation on tenant allowances and tenant improvements are provided utilizing the straight-line method over the term of the related lease. Depreciation on equipment and fixtures is provided utilizing the straight-line method over 5 to 10 years. Depreciation may be accelerated for a redevelopment project including partial demolition of existing structure after the asset is assessed for impairment. Impairment Management reviews operational and development projects, land parcels and intangible assets for impairment on a property-by-property basis whenever events or changes in circumstances indicate that the carrying value of the asset may not be recoverable. This review for possible impairment requires certain assumptions, estimates, and significant judgment. Impairment losses for investment properties and intangible assets are measured when the undiscounted cash flows estimated to be generated by the investment properties during the expected holding period are less than the carrying amounts of those assets. The evaluation of impairment is subject to certain management assumptions including projected net operating income, anticipated hold period, expected capital expenditures and the capitalization rate used to estimate the property's residual value. Impairment losses are recorded as the excess of the carrying value over the estimated fair value of the asset. Our impairment review for land and development properties assumes we have the intent and the ability to complete the developments or projected uses for the land parcels. If we determine those plans will not be completed or our assumptions with respect to operating assets are not realized, an impairment loss may be appropriate. Asset Held for Sale and Discontinued Operations Operating properties will be classified as held for sale only when those properties are available for immediate sale in their present condition and for which management believes it is probable that a sale of the property will be completed within one year, among other factors. Operating properties classified as held for sale are carried at the lower of cost or fair value less estimated costs to sell. Depreciation and amortization are suspended during the held-for-sale period. Restricted Cash and Escrow Deposits Escrow deposits consist of cash held for real estate taxes, property maintenance, insurance and other requirements at specific properties as required by lending institutions and certain municipalities. In addition at December 31, 2019, escrow deposits included $ 13.2 million of proceeds from the sale of an operating property to be utilized to acquire a potential asset in a tax-deferred exchange. Cash and Cash Equivalents We consider all highly liquid investments purchased with an original maturity of 90 days or less to be cash and cash equivalents. From time to time, such investments may temporarily be held in accounts that are in excess of FDIC and SIPC insurance limits; however the Company attempts to limit its exposure at any one time. The following is a summary of our cash, cash equivalents, and restricted cash total as presented in our statements of cash flows for the years ended December 31, 2020, 2019, and 2018: 2020 2019 2018 Cash and cash equivalents 43,648 31,336 35,376 Restricted cash and escrow deposits 2,938 21,477 10,130 Total cash, cash equivalents, restricted cash, and escrow deposits $ 46,586 $ 52,813 $ 45,506 F-18 Fair Value Measurements We follow the framework established under accounting standard FASB ASC 820, Fair Value Measurements and Disclosures, for measuring fair value of non-financial assets and liabilities that are not required or permitted to be measured at fair value on a recurring basis but only in certain circumstances, such as a business combination or upon determination of impairment. Assets and liabilities recorded at fair value on the consolidated balance sheets are categorized based on the inputs to the valuation techniques as follows: • Level 1 fair value inputs are quoted prices in active markets for identical instruments to which we have access. • Level 2 fair value inputs are inputs other than quoted prices included in Level 1 that are observable for similar instruments, either directly or indirectly, and appropriately consider counterparty creditworthiness in the valuations. • Level 3 fair value inputs reflect our best estimate of inputs and assumptions market participants would use in pricing an instrument at the measurement date. The inputs are unobservable in the market and significant to the valuation estimate. In instances where the determination of the fair value measurement is based on inputs from different levels of the fair value hierarchy, the level in the fair value hierarchy within which the entire fair value measurement falls is based on the lowest level input that is significant to the fair value measurement in its entirety. Our assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment and considers factors specific to the asset or liability. As discussed in Note 8 to the Financial Statements, we have determined that derivative valuations are classified in Level 2 of the fair value hierarchy. Cash and cash equivalents, accounts receivable, escrows and deposits, and other working capital balances approximate fair value. Note 6 to the Financial Statements includes a discussion of the fair values recorded when we recognized impairment charges in 2019 and 2018. Level 3 inputs to these transactions include our estimations of disposal values. Derivative Financial Instruments The Company accounts for its derivative financial instruments at fair value calculated in accordance with ASC 820, Fair Value Measurements and Disclosures . Gains or losses resulting from changes in the fair values of those derivatives are accounted for depending on the use of the derivative and whether it qualifies for hedge accounting. We use derivative instruments such as interest rate swaps or rate locks to mitigate interest rate risk on related financial instruments. Changes in the fair values of derivatives that qualify as cash flow hedges are recognized in other comprehensive income (“OCI”) while any ineffective portion of a derivative’s change in fair value is recognized immediately in earnings. Gains and losses associated with the transaction are recorded in OCI and amortized over the underlying term of the hedged transaction. As of December 31, 2020 and 2019, all of our derivative instruments qualify for hedge accounting. Revenue Recognition As a lessor of real estate assets, the Company retains substantially all of the risks and benefits of ownership and accounts for its leases as operating leases. Contractual minimum base rent, percentage rent, and expense reimbursements from tenants for common area maintenance costs, insurance and real estate taxes are our principal sources of revenue. Base minimum rents are recognized on a straight-line basis over the terms of the respective leases. Certain lease agreements contain provisions that grant additional rents based on a tenant’s sales volume (contingent overage rent). Overage rent is recognized when tenants achieve the specified sales targets as defined in their lease agreements. Overage rent is included in rental income in the accompanying consolidated statements of operations for the years ended December 31, 2020 and 2019. If we determine that collectibility is probable, we recognize income from rentals based on the methodology described above. We have accounts receivable due from tenants and are subject to the risk of tenant defaults and bankruptcies that may affect the collection of outstanding receivables. These receivables are reduced for credit loss that is recognized as a reduction to rental income. We regularly evaluate the collectibility F-19 of these lease-related receivables by analyzing past due account balances and consider such facts as the credit quality of our customer, historical write-off experience, tenant credit-worthiness and current economic trends when evaluating the collectibility of rental income. Although we estimate uncollectible receivables and provide for them through charges against income, actual experience may differ from those estimates. We recognize the sale of real estate when control transfers to the buyer. As part of our ongoing business strategy, we will, from time to time, sell land parcels and outlots, some of which are ground leased to tenants. Net gains realized on such sales were $ 5.9 million, $ 0.2 million, and $ 3.1 million for the years ended December 31, 2020, 2019, and 2018, respectively, and are classified as other property related revenue in the accompanying consolidated statements of operations. Tenant and Other Receivables and Allowance for Uncollectible Accounts Tenant receivables consist primarily of billed minimum rent, accrued and billed tenant reimbursements, and accrued straight-line rent. The Company generally does not require specific collateral from its tenants other than corporate or personal guarantees. Other receivables consist primarily of amounts due from municipalities and from tenants for non-rental revenue related activities. An allowance for uncollectible accounts is maintained for estimated losses resulting from the inability of certain tenants or others to meet contractual obligations under their lease or other agreements. Accounts are written off when, in the opinion of management, the balance is uncollectible. The provision for revenues deemed uncollectible, represented 6.0 %, 1.1 %, 1.0 % of total revenues in each of the years ended December 31, 2020, 2019 and 2018. Concentration of Credit Risk We may be subject to concentrations of credit risk with regards to our cash and cash equivalents. We place cash and temporary cash investments with high-credit-quality financial institutions. From time to time, such cash and investments may temporarily be in excess of insurance limits. In addition, our accounts receivable from and leases with tenants potentially subjects us to a concentration of credit risk related to our accounts receivable and revenue. Total billed receivables due from tenants leasing space in the states of Florida, Indiana, Texas, North Carolina, and Nevada, consisted of the following as of December 31, 2020: Florida 39 % Indiana 14 % Texas 7 % North Carolina 11 % Nevada 4 % For the year ended December 31, 2020, the Company's revenue recognized from tenants leasing space in the states of Florida, Indiana, Texas, North Carolina, and Nevada, were as follows: Florida 26 % Indiana 15 % Texas 14 % North Carolina 12 % Nevada 11 % F-20 Earnings Per Share Basic earnings per share or unit is calculated based on the weighted average number of common shares or units outstanding during the period. Diluted earnings per share or unit is determined based on the weighted average common number of shares or units outstanding during the period combined with the incremental average common shares or units that would have been outstanding assuming the conversion of all potentially dilutive common shares or units into common shares or units as of the earliest date possible. Potentially dilutive securities include outstanding options to acquire common shares; Limited Partner Units, which may be exchanged for either cash or common shares, at the Parent Company’s option and under certain circumstances; appreciation only LTIP units, and deferred common share units, which may be credited to the personal accounts of non-employee trustees in lieu of the payment of cash compensation or the issuance of common shares to such trustees. Limited Partner Units have been omitted from the Parent Company’s denominator for the purpose of computing diluted earnings per share since the effect of including these amounts in the denominator would have no dilutive impact. Weighted average Limited Partner Units outstanding for the years ended December 31, 2020, 2019 and 2018 were 2.2 million, 2.1 million and 2.0 million, respectively. These potentially dilutive securities are excluded from the computation of diluted earnings per share due to the net loss position in 2018, 2019, and 2020. Segment Reporting Our primary business is the ownership and operation of neighborhood and community shopping centers. We do not distinguish or group our operations on a geographical basis, or any other basis, when measuring and evaluating financial performance. Accordingly, we have one operating segment, which also serves as our reportable segment for disclosure purposes in accordance with GAAP. Income Taxes and REIT Compliance Parent Company The Parent Company has been organized and operated, and intends to continue to operate, in a manner that will enable it to maintain its qualification as a REIT for U.S. federal income tax purposes. As a result, it generally will not be subject to U.S. federal income tax on the earnings that it distributes to the extent it distributes its “REIT taxable income” (determined before the deduction for dividends paid and excluding net capital gains) to shareholders of the Parent Company and meets certain other requirements on a recurring basis. To the extent that it satisfies this distribution requirement, but distributes less than 100% of its taxable income, it will be subject to U.S. federal corporate income tax on its undistributed REIT taxable income. REITs are subject to a number of organizational and operational requirements. If the Parent Company fails to qualify as a REIT in any taxable year, it will be subject to U.S. federal income tax on its taxable income at regular corporate rates for a period of four years following the year in which qualification is lost. We may also be subject to certain U.S. federal, state and local taxes on our income and property and to U.S. federal income and excise taxes on our undistributed taxable income even if the Parent Company does qualify as a REIT. The Operating Partnership intends to continue to make distributions to the Parent Company in amounts sufficient to assist the Parent Company in adhering to REIT requirements and maintaining its REIT status. We have elected to treat Kite Realty Holdings, LLC as a TRS of the Operating Partnership, and we may elect to treat other subsidiaries as TRSs in the future. This election enables us to receive income and provide services that would otherwise be impermissible for a REIT. Deferred tax assets and liabilities are established for temporary differences between the financial reporting bases and the tax bases of assets and liabilities at the tax rates expected to be in effect when the temporary differences reverse. Deferred tax assets are reduced by a valuation allowance if it is more likely than not that some portion or all of the deferred tax asset will not be realized. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. The Company recognizes the effect of income tax positions only if those positions are more likely than not of being sustained. Recognized income tax positions are measured at the largest amount that is greater than 50% likely of being realized. Changes in recognition or measurement are reflected in the period in which the change in judgment occurs. The Company records interest related to unrecognized tax benefits in interest expense and penalties in selling, general, and administrative expenses. F-21 On March 27, 2020 and December 27, 2020, the President of the United States signed and enacted into law the Coronavirus Aid, Relief, and Economic Security Act (CARES Act) and the Consolidated Appropriations Act, 2021 (CAA). Among other provisions, the CARES Act and the CAA provide relief to U.S. federal corporate taxpayers through temporary adjustments to net operating loss rules, changes to limitations on interest expense deductibility, and the acceleration of available refunds for minimum tax credit carryforwards. The CARES Act and the CAA did not have a material effect on the Company’s consolidated financial statements. Our tax return for the year ended December 31, 2020 has not been filed. The taxability information presented for our dividends paid in 2020 is based upon management's estimate. Consequently, the taxability of dividends is subject to change. A summary of the tax characterization of the dividends paid by the Parent Company for the years ended December 31, 2020, 2019, and 2018 is as follows: 2020 2019 2018 Ordinary income 89.3 % 29.7 % 56.0 % Return of capital — % 35.2 % 44.0 % Capital gains 10.7 % 35.1 % — % Balance, end of year 100.0 % 100.0 % 100.0 % Operating Partnership The allocated share of income and loss, other than the operations of our TRS, is included in the income tax returns of the Operating Partnership's partners. Accordingly, the only U.S. federal income taxes included in the accompanying consolidated financial statements are in connection with the TRS. Noncontrolling Interests We report the non-redeemable noncontrolling interests in subsidiaries as equity and the amount of consolidated net income attributable to these noncontrolling interests is set forth separately in the consolidated financial statements. The non-redeemable noncontrolling interests in consolidated properties for the years ended December 31, 2020, 2019, and 2018 were as follows: ($ in thousands) 2020 2019 2018 Noncontrolling interests balance January 1 $ 698 $ 698 $ 698 Net income allocable to noncontrolling interests, excluding redeemable noncontrolling interests — — — Distributions to noncontrolling interests — — — Noncontrolling interests balance at December 31 $ 698 $ 698 $ 698 Redeemable Noncontrolling Interests – Limited Partners Limited Partner Units are redeemable noncontrolling interests in the Operating Partnership. We classify redeemable noncontrolling interests in the Operating Partnership in the accompanying consolidated balance sheets outside of permanent equity because we may be required to pay cash to holders of Limited Partner Units upon redemption of their interests in the Operating Partnership or deliver registered shares upon their conversion. The carrying amount of the redeemable noncontrolling interests in the Operating Partnership is reflected at the greater of historical book value or redemption value with a corresponding adjustment to additional paid-in capital. At December 31, 2020, the redemption value of the redeemable noncontrolling interests in the Operating Partnership did not exceed the historical book value, and the balance was accordingly adjusted to historical book value. At December 31, 2019, the redemption value of the redeemable noncontrolling interests in the Operating Partnership exceeded the historical book value, and the balance was accordingly adjusted to redemption value. F-22 We allocate net operating results of the Operating Partnership after noncontrolling interests in the consolidated properties based on the partners’ respective weighted average ownership interest. We adjust the redeemable noncontrolling interests in the Operating Partnership at the end of each reporting period to reflect their interests in the Operating Partnership or redemption value. This adjustment is reflected in our shareholders’ and Parent Company's equity. For the years ended December 31, 2020, 2019, and 2018, the weighted average interests of the Parent Company and the limited partners in the Operating Partnership were as follows: Year Ended December 31, 2020 2019 2018 Parent Company’s weighted average interest in Operating Partnership 97.4 % 97.6 % 97.6 % Limited partners' weighted average interests in Operating Partnership 2.6 % 2.4 % 2.4 % At December 31, 2020, the Parent Company's interest and the limited partners' redeemable noncontrolling ownership interests in the Operating Partnership were 97.1 % and 2.9 %. At December 31, 2019, the Parent Company's interest and the limited partners' redeemable noncontrolling ownership interests in the Operating Partnership were 97.5 % and 2.5 %. Concurrent with the Parent Company’s initial public offering and related formation transactions, certain individuals received Limited Partner Units of the Operating Partnership in exchange for their interests in certain properties. The limited partners have the right to redeem Limited Partner Units for cash or, at the Parent Company's election, common shares of the Parent Company in an amount equal to the market value of an equivalent number of common shares of the Parent Company at the time of redemption. Such common shares must be registered, which is not fully in the Parent Company’s control. Therefore, the limited partners’ interest is not reflected in permanent equity. The Parent Company also has the right to redeem the Limited Partner Units directly from the limited partner in exchange for either cash in the amount specified above or a number of its common shares equal to the number of Limited Partner Units being redeemed. There were 2,532,861 and 2,110,037 Limited Partner Units outstanding as of December 31, 2020 and 2019, respectively. The increase in Limited Partner Units outstanding from December 31, 2019 is due to non-cash compensation awards made to our executive officers. Redeemable Noncontrolling Interests - Subsidiaries Prior to our merger with Inland Diversified Real Estate Trust, Inc. ("Inland Diversified") in 2014, Inland Diversified formed joint ventures with the previous owners of certain properties and issued Class B units in three joint ventures that indirectly own those properties. The Class B units related to one of these three joint ventures remain outstanding and are accounted for as noncontrolling interests in these properties. The remaining Class B units will become redeemable at our partner's election in October 2022 based on the joint venture agreement and the fulfillment of certain redemption criteria. Beginning in November 2022, with respect to the remaining joint venture, the Class B units can be redeemed at the election of either our partner or us for cash or Limited Partner Units in the Operating Partnership. None of the issued Class B units have a maturity date and none are mandatorily redeemable unless either party has elected for the units to be redeemed. We consolidate this joint venture because we control the decision making and our joint venture partner has limited protective rights. In 2018, certain Class B unit holders exercised their right to redeem their remaining Class B units for cash. We funded $ 10.0 million of the redemption in August 2018 and the remaining $ 12.0 million in November 2018. We classify the remainder of the redeemable noncontrolling interests in a subsidiary in the accompanying consolidated balance sheets outside of permanent equity because, under certain circumstances, we may be required to pay cash to Class B unitholders in specific subsidiaries upon redemption of their interests. The carrying amount of these redeemable noncontrolling interests is required to be reflected at the greater of initial book value or redemption value with a corresponding adjustment to additional paid-in capital. As of December 31, 2020 and 2019, the redemption amounts of these interests did not exceed their fair value, nor did they exceed the initial book value. The redeemable noncontrolling interests in the Operating Partnership and subsidiaries for the years ended December 31, 2020, 2019, and 2018 were as follows: F-23 ($ in thousands) 2020 2019 2018 Redeemable noncontrolling interests balance January 1 $ 52,574 $ 45,743 $ 72,104 Net income allocable to redeemable noncontrolling interests 100 532 116 Distributions declared to redeemable noncontrolling interests ( 1,533 ) ( 3,191 ) ( 3,788 ) Payment for partial redemption of redeemable noncontrolling interests — — ( 22,461 ) Other, net including adjustments to redemption value ( 7,866 ) 9,490 ( 228 ) Total limited partners' interests in Operating Partnership and other redeemable noncontrolling interests balance at December 31 $ 43,275 $ 52,574 $ 45,743 Limited partners' interests in Operating Partnership $ 33,205 $ 42,504 $ 35,673 Other redeemable noncontrolling interests in certain subsidiaries 10,070 10,070 10,070 Total limited partners' interests in Operating Partnership and other redeemable noncontrolling interests balance at December 31 $ 43,275 $ 52,574 $ 45,743 Effects of Accounting Pronouncements Adoption of New Standards Reference Rate Reform In the first quarter of 2020, the Financial Accounting Standards Board issued ASU 2020-04, Reference Rate Reform (Topic 848). ASU 2020-04 contains practical expedients for reference rate reform related activities that impact debt, leases, derivatives and other contracts. The guidance in ASU 2020-04 is optional and may be elected over time as reference rate reform activities occur. During the first quarter of 2020, the Company has elected to apply the hedge accounting expedients related to probability and the assessments of effectiveness for future LIBOR-indexed cash flows to assume that the index upon which future hedged transactions will be based matches the index on the corresponding derivatives. Application of these expedients preserves the presentation of derivatives consistent with past presentation. Financial Instruments - Credit Losses On January 1, 2020, we adopted ASU 2016-13, "Financial Instruments - Credit Losses," which introduced new guidance for an approach based on expected losses to estimate credit losses on certain types of financial instruments. It also modified the impairment model for available-for-sale debt securities and provides a simplified accounting model for purchased financial assets with credit deterioration since their origination. Instruments in scope include loans, held-to-maturity debt securities, and net investments in leases as well as reinsurance and trade receivables. In November 2018, the FASB issued ASU 2018-19, which clarifies that operating lease receivables are outside the scope of the new standard. The adoption of this standard did not have a material impact on the Company's consolidated financial statements. Leases In April 2020, the FASB issued a question-and-answer document focused on the application of lease accounting guidance to lease concessions provided as a result of COVID-19. Under Topic 842, Leases, the Company would have to evaluate, on a lease by lease basis, if a lease concession was the result of a new arrangement reached with the tenant or if a lease concession was under the enforceable rights and obligations within the existing lease agreement. The FASB clarified that entities may elect to not evaluate whether lease-related relief that lessors provide to mitigate the economic effects of COVID-19 is a lease modification. The Company made this election to evaluate COVID-related lease modifications on a disaggregated basis, with such election applied consistently to leases with similar characteristics and similar circumstances. The Company entered into rent deferral agreements during the year ended December 31, 2020 that provided for legally due rent to be paid back over a period of time, typically twelve to eighteen months . The Company has deferred the payment by tenants of $ 6.1 million of contractually due rental income that remains outstanding as of December 31, 2020. The future impact of such modifications is dependent upon the extent of lease concessions granted to tenants as a result of COVID-19 in future periods and the elections made by the Company at the time of entering into such concessions. There was not a material amount of rent abatement provided to tenants as a result of COVID-19 during 2020. F-24 Note 3. Share-Based Compensation Overview The Company's 2013 Equity Incentive Plan (the "Plan"), as amended and restated as of February 28, 2019, authorizes options to acquire common shares and other share-based compensation awards to be granted to employees and trustees for up to an additional 3,000,000 common share equivalents of the Company. The Company accounts for its share-based compensation in accordance with the fair value recognition provisions provided under Topic 718—“Stock Compensation” in the Accounting Standards Codification. The total share-based compensation expense, net of amounts capitalized, included in general and administrative expenses for the years ended December 31, 2020, 2019, and 2018 was $ 5.6 million, $ 5.3 million, and $ 4.9 million, respectively. For the years ended December 31, 2020, 2019, and 2018, total share-based compensation cost capitalized for development activities was $ 1.2 million, $ 1.1 million, and $ 1.7 million, respectively. The Company recognizes forfeitures as they occur. As of December 31, 2020, there were 1,604,930 shares and units available for grant under the Plan. Share Options Pursuant to the Plan, the Company may periodically grant options to purchase common shares at an exercise price equal to the grant date fair value of the Company's common shares. Granted options typically vest over a five year period and expire 10 years from the grant date. The Company issues new common shares upon the exercise of options. A summary of option activity under the Plan as of December 31, 2020, and changes during the year then ended, is presented below: ($ in thousands, except share and per share data) Aggregate Intrinsic Value Weighted-Average Remaining Contractual Term (in years) Options Weighted-Average Exercise Price Outstanding at January 1, 2020 24,067 $ 20.25 Granted — — Exercised ( 2,500 ) 16.60 Expired — — Forfeited — — Outstanding at December 31, 2020 $ — 0.25 21,567 $ 20.67 Exercisable at December 31, 2020 $ — 0.25 21,567 $ 20.67 Exercisable at December 31, 2019 24,067 $ 20.25 There were no options granted in 2020, 2019 or 2018. The aggregate intrinsic value of the 2,500 , 33,375 and 3,125 options exercised during the years ended December 31, 2020, 2019, and 2018 was $ 2,000 , $ 86,000 and $ 23,000 , respectively. Restricted Shares In addition to share option grants, the Plan also authorizes the grant of share-based compensation awards in the form of restricted common shares. Under the terms of the Plan, these restricted shares, which are considered to be outstanding shares from the date of grant, typically vest over a period ranging from three to five years . The Company pays dividends on restricted shares and such dividends are charged directly to shareholders’ equity. The following table summarizes all restricted share activity to employees and non-employee members of the Board of Trustees as of December 31, 2020 and changes during the year then ended: F-25 Number of Restricted Shares Weighted Average Grant Date Fair Value per share Restricted shares outstanding at January 1, 2020 321,006 $ 17.19 Shares granted 211,476 13.21 Shares forfeited ( 16,527 ) 17.46 Shares vested ( 194,364 ) 17.42 Restricted shares outstanding at December 31, 2020 321,591 $ 14.42 The following table summarizes the restricted share grants and vestings during the years ended December 31, 2020, 2019, and 2018: ($ in thousands, except share and per share data) Number of Restricted Shares Granted Weighted Average Grant Date Fair Value per share Fair Value of Restricted Shares Vested 2020 211,476 $ 13.21 $ 2,727 2019 154,440 15.84 2,270 2018 202,043 15.35 2,038 As of December 31, 2020, there was $ 3.0 million of total unrecognized compensation cost related to restricted shares granted under the Plan, which is expected to be recognized in the consolidated statements of operations over a weighted-average period of 0.91 years. We expect to incur $ 1.8 million of this expense in 2021, $ 1.1 million in 2022, and the remainder in 2023. Performance Awards In 2016, the Compensation Committee established overall target values for incentive compensation for each executive officer, with 40 % of the target value being granted in the form of time-based awards and the remaining 60 % being granted in the form of performance awards. In 2018, the Compensation Committee awarded each of the named executive officers a three-year performance award in the form of PSUs. The PSUs may be earned over a three-year performance period from January 1, 2018 to December 31, 2020. The performance criteria will be based 60 % on the relative TSR achieved by the Company measured against a peer group over the three-year measurement period and 40 % on the achievement of a defined funds available for distribution ("FAD"). The total number of PSUs issued to the executive officers was based upon a target value of $ 2.4 million, but may be earned in a range of 0 % to 200 % of the target. Additionally, any PSUs earned based on the achievement of the pre-established FAD goals will be subject to adjustment (either up or down 25 %) based on the Company's absolute TSR over the three-year measurement period. Approximately 172,000 PSU's were earned based upon the Company's performance on the relative TSR measurement. The PSUs were valued at an aggregate value of $ 2.2 million utilizing a Monte Carlo simulation. There is no remaining unrecognized compensation cost related to the 2018 performance awards. Restricted Units Time-based restricted unit awards were made on a discretionary basis in 2018, 2019, and 2020 based on review of each prior year's performance. The following table summarizes the activity for time-based restricted unit awards for the year ended December 31, 2020: F-26 Number of Restricted Units Weighted Average Grant Date Fair Value per unit Restricted units outstanding at January 1, 2020 164,016 $ 15.65 Restricted units granted 431,913 13.10 Restricted units vested ( 104,733 ) 16.07 Restricted units outstanding at December 31, 2020 491,196 $ 13.32 The following table summarizes the time-based restricted unit grants and vestings during the years ended December 31, 2020, 2019, and 2018: ($ in thousands, except unit and per unit data) Number of Restricted Units Granted Weighted Average Grant Date Fair Value per Unit Fair Value of Restricted Units Vested 2020 431,913 $ 13.10 $ 1,784 2019 84,987 14.11 749 2018 92,019 13.16 1,924 As of December 31, 2020, there was $ 5.4 million of total unrecognized compensation cost related to restricted units granted under the Plan, which is expected to be recognized in the consolidated statements of operations over a weighted-average period of 2.15 years. We expect to incur $ 1.7 million of this expense in 2021, $ 1.4 million in 2022, $ 0.8 million in 2023, $ 0.8 million in 2024, and the remainder in 2025. AO LTIP Units - 2019 Awards During 2019, in connection with its annual review of executive compensation and as described in the table below, the Compensation Committee of the Company's Board of Trustees approved an aggregate grant of AO LTIP Units (the “2019 awards”) to the Company’s executive officers under the Plan. Executive Number of AO LTIP Units Participation Threshold per AO LTIP Unit John A. Kite 1,490,683 $ 15.79 Thomas A. McGowan 372,671 $ 15.79 Heath R. Fear 253,416 $ 15.79 The Company entered into an award agreement with each executive officer with respect to his awards, which provide terms of vesting, conversion, distribution, and other terms. AO LTIP Units are designed to have economics similar to stock options and allow the recipient, subject to vesting requirements, to realize value above a threshold level set as of the grant date of the award (the “Participation Threshold”). The value of vested AO LTIP Units is realized through conversion into a number of vested LTIP Units in the Operating Partnership determined on the basis of how much the value of a common share of the Company has increased over the Participation Threshold. The AO LTIP Units are only exercisable and convertible into vested LTIP Units of the Operating Partnership to the extent that they become vested AO LTIP Units. The awards of AO LTIP Units are subject to both time-based and stock price performance-based vesting requirements. Subject to the terms of the award agreement, the AO LTIP Units shall vest and become fully exercisable as of the date that both of the following requirements have been met: (i) the grantee remains in continuous service from the grant date through the third anniversary of the grant date; and (ii) at any time during the five-year period following the grant date, the reported closing price per common share of the Company appreciates at least 20 % over the applicable Participation Threshold per AO LTIP Unit (as set forth in the table above) for a minimum of 20 consecutive trading days. Any AO LTIP Units that do not become vested will be forfeited and become null and void as of the fifth anniversary of the grant date, but AO LTIP Units may also be forfeited earlier in connection with a corporate transaction or with the holder’s termination of service. F-27 The AO LTIP Units were valued using a Monte Carlo simulation, and the resulting compensation expense of is being amortized over three years . We recognized $ 1.1 million of compensation expense in 2020. We expect to incur $ 1.1 million of this expense in 2021 and $ 1.1 million in 2022. AO LTIP Units - 2020 Awards During 2020, in connection with its annual review of executive compensation and as described in the table below, the Compensation Committee of the Company's Board of Trustees approved an aggregate grant of AO LTIP Units (the “2020 awards”) to the Company’s executive officers under the Plan. Executive Number of AO LTIP Units Participation Threshold per AO LTIP Unit John A. Kite 1,729,729 $ 17.76 Thomas A. McGowan 405,405 $ 17.76 Heath R. Fear 275,675 $ 17.76 The Company entered into an award agreement with each executive officer with respect to his awards, which provide terms of vesting, conversion, distribution, and other terms. AO LTIP Units are designed to have economics similar to stock options and allow the recipient, subject to vesting requirements, to realize value above a threshold level set as of the grant date of the award (the “Participation Threshold”). The value of vested AO LTIP Units is realized through conversion into a number of vested LTIP Units in the Operating Partnership determined on the basis of how much the value of a common share of the Company has increased over the Participation Threshold. The AO LTIP Units are only exercisable and convertible into vested LTIP Units of the Operating Partnership to the extent that they become vested AO LTIP Units. The awards of AO LTIP Units are subject to both time-based and stock price performance-based vesting requirements. Subject to the terms of the award agreement, the AO LTIP Units shall vest and become fully exercisable as of the date that both of the following requirements have been met: (i) the grantee remains in continuous service from the grant date through the third anniversary of the grant date; and (ii) at any time during the period beginning in the second year and ending at the end of the fifth year following the grant date, the reported closing price per common share of the Company appreciates at least 15 % over the applicable Participation Threshold per AO LTIP Unit (as set forth in the table above) for a minimum of 20 consecutive trading days. Any AO LTIP Units that do not become vested will be forfeited and become null and void as of the fifth anniversary of the grant date, but AO LTIP Units may also be forfeited earlier in connection with a corporate transaction or with the holder’s termination of service. The AO LTIP Units were valued using a Monte Carlo simulation, and the resulting total compensation expense of $ 3.6 million is being amortized over five years . We recognized $ 0.6 million of compensation expense in 2020. We expect to annually incur $ 0.7 million of this expense in 2021 through 2024 and the remainder in 2025. Note 4. Deferred Costs and Intangibles, net Deferred costs consist primarily of acquired lease intangible assets, broker fees and capitalized salaries and related benefits incurred in connection with lease originations. Deferred leasing costs, lease intangibles and similar costs are amortized on a straight-line basis over the terms of the related leases. At December 31, 2020 and 2019, deferred costs consisted of the following: ($ in thousands) 2020 2019 Acquired lease intangible assets $ 55,352 $ 60,862 Deferred leasing costs and other 57,481 62,109 112,833 122,971 Less—accumulated amortization ( 49,662 ) ( 49,814 ) Total $ 63,171 $ 73,157 The estimated net amounts of amortization from acquired lease intangible assets for each of the next five years and thereafter are as follows: F-28 ($ in thousands) Amortization of above market leases Amortization of acquired lease intangible assets Total 2021 $ 978 $ 4,409 $ 5,387 2022 728 3,590 4,318 2023 676 2,721 3,397 2024 529 2,136 2,665 2025 506 1,756 2,262 Thereafter 1,105 10,487 11,592 Total $ 4,522 $ 25,099 $ 29,621 Amortization of deferred leasing costs, leasing intangibles and other is included in depreciation and amortization expense in the accompanying consolidated statements of operations. The amortization of above market lease intangibles is included as a reduction to revenue. The amounts of such amortization included in the accompanying consolidated statements of operations are as follows: ($ in thousands) For the year ended December 31, 2020 2019 2018 Amortization of deferred leasing costs, lease intangibles and other $ 13,916 $ 14,239 $ 18,648 Amortization of above market lease intangibles 999 1,200 2,553 Note 5. Deferred Revenue, Intangibles, Net and Other Liabilities Deferred revenue and other liabilities consist of the unamortized fair value of below market lease liabilities recorded in connection with purchase accounting, retainage payables for development and redevelopment projects, tenant rent payments received in advance of the month in which they are due, and lease liabilities recorded upon adoption of ASU 2016-02. The amortization of below market lease liabilities is recognized as revenue over the remaining life of the leases (including option periods for leases with below market renewal options) through 2046. Tenant rent payments received in advance are recognized as revenue in the period to which they apply, which is typically the month following their receipt. At December 31, 2020 and 2019, deferred revenue, intangibles, net and other liabilities consisted of the following: ($ in thousands) 2020 2019 Unamortized in-place lease liabilities $ 45,479 $ 50,072 Retainages payable and other 1,943 2,254 Tenant rents received in advance 11,716 10,839 Lease liabilities 26,511 27,015 Total $ 85,649 $ 90,180 The amortization of below market lease intangibles is included as a component of minimum rent in the accompanying consolidated statements was $ 4.8 million, $ 5.0 million and $ 8.9 million for the years ended December 31, 2020, 2019 and 2018, respectively. The estimated net amounts of amortization of in-place lease liabilities and the increasing effect on minimum rent for each of the next five years and thereafter is as follows: F-29 ($ in thousands) 2021 $ 2,523 2022 2,341 2023 2,287 2024 2,290 2025 2,274 Thereafter 33,764 Total $ 45,479 Note 6. Disposals of Operating Properties and Impairment Charges There were no operating properties sold during the year ended December 31, 2020. The Company sold one redevelopment property during the year ended December 31, 2020 for gross proceeds of $ 14.0 million and a net gain of $ 3.1 million. During the year ended December 31, 2019, we sold 23 operating properties for aggregate gross proceeds of $ 543.8 million as part of a program designed to improve the Company's portfolio quality, reduce its leverage, and focus operations on markets where the Company believes it can gain scale and generate attractive risk-adjusted returns. The following summarizes our 2019 operating property dispositions: Property Name MSA Disposition Date Whitehall Pike Bloomington, IN March 2019 Beechwood Promenade Athens, GA April 2019 Village at Bay Park Green Bay, WI May 2019 Lakewood Promenade Jacksonville, FL May 2019 Palm Coast Landing Palm Coast, FL May 2019 Lowe's - Perimeter Woods Charlotte, NC May 2019 Cannery Corner Las Vegas, NV June 2019 Temple Terrace Tampa, FL June 2019 University Town Center Oklahoma City, OK June 2019 Gainesville Plaza Gainesville, FL July 2019 Bolton Plaza Jacksonville, FL July 2019 Eastgate Plaza Las Vegas, NV July 2019 Burnt Store Punta Gorda, FL July 2019 Landstown Commons Virginia Beach, VA August 2019 Lima Marketplace Fort Wayne, IN September 2019 Hitchcock Plaza Aiken, SC September 2019 Merrimack Village Center Manchester, NH September 2019 Publix at Acworth Atlanta, GA October 2019 The Centre at Panola Atlanta, GA October 2019 Beacon Hill Crown Point, IN October 2019 Bell Oaks Centre Evansville, IN November 2019 South Elgin Commons Chicago, IL December 2019 Boulevard Crossing Kokomo, IN December 2019 The Company recorded a net gain of $ 39.0 million as a result of the 2019 disposal activity. During 2019, in connection with the preparation and review of the financial statements for the applicable periods, we evaluated a total of seven operating properties for impairment and recorded a cumulative $ 37.7 million impairment charge due F-30 to changes in facts and circumstances underlying the Company's expected future hold period of these properties. A shortening of the expected future hold period is considered an impairment indicator under applicable accounting rules, and this indicator caused us to further evaluate the carrying value of these properties. We concluded the estimated undiscounted cash flows over the expected holding period did not exceed the carrying value of these assets given the new holding period, leading to the charge. We estimated the fair value using the market approach by utilizing recent sales offers without adjustment. We compared the estimate aggregate fair value of $ 176 million to the carrying values, which resulted in the recording of the non-cash impairment charge of $ 37.7 million for the year ended December 31, 2019. During the year ended December 31, 2018, we sold six operating properties for aggregate gross proceeds of $ 122.2 million. The following summarizes our 2018 operating property dispositions: Property Name MSA Disposition Date Trussville Promenade Birmingham, AL February 2018 Memorial Commons Goldsboro, NC March 2018 Lake Lofts at Deerwood Jacksonville, FL November 2018 Hamilton Crossing Knoxville, TN November 2018 Fox Lake Crossing Chicago, IL December 2018 Lowe's Plaza Las Vegas, NV December 2018 In addition, we entered into a joint venture with TH Real Estate by selling an 80 % interest in three operating assets for an agreed upon value of $ 99.8 million. The properties sold to the joint venture were the following: Property Name MSA Disposition Date Livingston Shopping Center New York/Northern New Jersey June 2018 Plaza Volente Austin, TX June 2018 Tamiami Crossing Naples, FL June 2018 The Company recorded a net gain of $ 3.4 million as a result of the 2018 disposal activity. During 2018, in connection with the preparation and review of the financial statements for the applicable periods, we evaluated a total of seven operating properties and land previously held for development for impairment and recorded a cumulative $ 70.4 million impairment charge due to changes in facts and circumstances underlying the Company's expected future hold period of these properties and decision to not move forward with development of the land. A shortening of an expected future hold period is considered an impairment indicator under applicable accounting rules, and this indicator caused us to further evaluate the carrying value of these properties. We concluded the estimated undiscounted cash flows over the expected holding period did not exceed the carrying value of these assets given the new holding period, leading to the charge. We estimated the fair value using the market approach by utilizing recent sales offers without adjustment. We compared the estimated aggregate fair value of $ 130.2 million to the carrying values, which resulted in the recording of the non-cash impairment charges totaling $ 70.4 million for the year ended December 31, 2018. The results of all the operating properties sold in 2020, 2019, and 2018 are not included in discontinued operations in the accompanying statements of operations as none of the operating properties individually, nor in the aggregate, represent a strategic shift that has had or will have a material effect on our operations or financial results. Note 7. Mortgage and Other Indebtedness Mortgage and other indebtedness consisted of the following as of December 31, 2020 and 2019: F-31 ($ in thousands) As of December 31, 2020 Principal Unamortized Net Premiums Unamortized Debt Issuance Costs Total Senior unsecured notes—fixed rate Maturing at various dates from September 2023 through September 2027; interest rates ranging from 4.00 % to 4.57 % at December 31, 2020 $ 550,000 $ — $ ( 3,595 ) $ 546,405 Unsecured revolving credit facility Matures April 2022 1 ; borrowing level up to $ 523.2 million available at December 31, 2020; interest at LIBOR + 1.15 % or 1.29 % at December 31, 2020 25,000 — ( 1,672 ) 23,328 Unsecured term loan Matures October 2025; interest at LIBOR + 2.00 % or 2.14 % at December 31, 2020 250,000 — ( 1,647 ) 248,353 Mortgage notes payable—fixed rate Generally due in monthly installments of principal and interest; maturing at various dates from April 2022 through June 2030; interest rates ranging from 3.78 % to 5.73 % at December 31, 2020 295,966 1,732 ( 25 ) 297,673 Mortgage note payable—variable rate Due in monthly installments of principal and interest; maturing in February 2022; interest at LIBOR + 1.60 % or 1.74 % at December 31, 2020 55,110 — ( 75 ) 55,035 Total mortgage and other indebtedness $ 1,176,076 $ 1,732 $ ( 7,014 ) $ 1,170,794 ($ in thousands) As of December 31, 2019 Principal Unamortized Net Premiums Unamortized Debt Issuance Costs Total Senior Unsecured Notes—Fixed Rate Maturing at various dates from September 2023 through September 2027; interest rates ranging from 4.00 % to 4.57 % at December 31, 2019 $ 550,000 $ — $ ( 4,231 ) $ 545,769 Unsecured Revolving Credit Facility Matures April 2022 1 ; borrowing level up to $ 583.4 million available at December 31, 2019; interest at LIBOR + 1.15 % 2 or 2.91 % at December 31, 2019 — — ( 2,625 ) ( 2,625 ) Unsecured Term Loans Matures October 2025; interest at LIBOR + 2.00 % or 3.76 % at December 31, 2019 250,000 — ( 1,859 ) 248,141 Mortgage Notes Payable—Fixed Rate Generally due in monthly installments of principal and interest; maturing at various dates from April 2022 through June 2030; interest rates ranging from 3.78 % to 5.73 % at December 31, 2019 297,472 2,176 ( 40 ) 299,608 Mortgage Notes Payable—Variable Rate Due in monthly installments of principal and interest; maturing in February 2022; interest at LIBOR + 1.60 %, or 3.36 % at December 31, 2019 55,830 — ( 143 ) 55,687 Total mortgage and other indebtedness $ 1,153,302 $ 2,176 $ ( 8,898 ) $ 1,146,580 ____________________ 1 The Company can extend the maturity date for two additional periods of six months each, subject to certain conditions. 2 The interest rates on our unsecured revolving credit facility and unsecured term loan varied at certain parts of the year due to provisions in the agreement and the amendment and restatement of the agreement. F-32 The one month LIBOR interest rate was 0.14 % and 1.76 % as of December 31, 2020 and 2019, respectively. Debt Issuance Costs Debt issuance costs are amortized on a straight-line basis over the terms of the respective loan agreements. The accompanying consolidated statements of operations include the following amounts of amortization of debt issuance costs as a component of interest expense: ($ in thousands) For the year ended December 31, 2020 2019 2018 Amortization of debt issuance costs $ 2,135 $ 2,762 $ 3,944 Unsecured Revolving Credit Facility and Unsecured Term Loans On April 24, 2018, the Company and Operating Partnership entered into the First Amendment (the “Amendment”) to the Fifth Amended and Restated Credit Agreement (the “Existing Credit Agreement,” and as amended by the Amendment, the “Amended Credit Agreement”), dated as of July 28, 2016, by and among the Operating Partnership, as borrower, the Company, as guarantor (pursuant to a springing guaranty, dated as of July 28, 2016), KeyBank National Association, as administrative agent, and the other lenders party thereto. The Amendment increases (i) the aggregate principal amount available under the unsecured revolving credit facility (the “Credit Facility”) from $ 500 million to $ 600 million, (ii) the amount of the letter of credit issuances the Operating Partnership may utilize under the Credit Facility from $ 50 million to $ 60 million, and (iii) swingline loan capacity from $ 50 million to $ 60 million in same day borrowings. Under the Amended Credit Agreement, the Operating Partnership has the option to increase the Credit Facility to $ 1.2 billion (increased from $ 1 billion under the Existing Credit Agreement) upon the Operating Partnership’s request, subject to certain conditions, including obtaining commitments from any one or more lenders, whether or not currently party to the Amended Credit Agreement, to provide such increased amounts. The Amendment extends the scheduled maturity date of the Credit Facility from July 28, 2020 to April 22, 2022 (which maturity date may be extended for up to two additional periods of six months at the Operating Partnership’s option subject to certain conditions). Among other things, the Amendment also improves the Operating Partnership’s leverage ratio calculation by changing the definition of capitalization rate to six and one-half percent ( 6.5 %) from six and three-fourths percent ( 6.75 %), which increases the Operating Partnership’s total asset value as calculated under the Amended Credit Agreement On October 25, 2018, the Operating Partnership entered into a Term Loan Agreement (the “Agreement”) with KeyBank National Association, as Administrative Agent (the “Agent”), and the other lenders party thereto, providing for an unsecured term loan facility of up to $ 250 million (the “Term Loan”). The Term Loan ranks pari passu with the Operating Partnership’s existing $ 600 million unsecured revolving credit facility documented in the Operating Partnership’s Fifth Amended and Restated Credit Agreement, dated as of July 28, 2016, as amended (the “Existing Credit Agreement”), and other unsecured indebtedness of the Operating Partnership. The Term Loan has a scheduled maturity date of October 24, 2025, which maturity date may be extended for up to three additional periods of one year at the Operating Partnership’s option subject to certain conditions. The Operating Partnership has the option to increase the Term Loan to $ 300 million, subject to certain conditions, including obtaining commitments from any one or more lenders, whether or not currently party to the Agreement, to provide such increased amounts. The Operating Partnership is permitted to prepay the Term Loan in whole or in part, at any time, subject to a prepayment fee if prepaid on or before October 25, 2023. As of December 31, 2020, there was $ 25 million outstanding under the Credit Facility. Additionally, we had letters of credit outstanding which totaled $ 1.2 million, against which no amounts were advanced as of December 31, 2020. The amount that we may borrow under our Credit Facility is limited by the value of the assets in our unencumbered asset pool. As of December 31, 2020, the value of the assets in our unencumbered asset pool, calculated pursuant to the Credit Facility agreement, was $ 1.3 billion. Taking into account outstanding borrowings on the line of credit, term loans, unsecured F-33 notes and letters of credit, we had $ 523.2 million available under our Credit Facility for future borrowings as of December 31, 2020. Our ability to borrow under the Credit Facility is subject to our compliance with various restrictive and financial covenants, including with respect to liens, indebtedness, investments, dividends, mergers and asset sales. As of December 31, 2020, we were in compliance with all such covenants. Senior Unsecured Notes The Operating Partnership has $ 550 million of senior unsecured notes maturing at various dates through September 2027 (the "Notes"). The Notes contain a number of customary financial and restrictive covenants. As of December 31, 2020, we were in compliance with all such covenants. Mortgage Loans Mortgage loans are secured by certain real estate and in some cases by guarantees from the Operating Partnership, and are generally due in monthly installments of interest and principal and mature over various terms through 2030. Debt Maturities The following table presents maturities of mortgage debt and corporate debt as of December 31, 2020: ($ in thousands) Scheduled Principal Payments Term Maturities Total 2021 $ 2,303 $ — $ 2,303 2022 1,043 203,877 204,920 2023 806 256,517 257,323 2024 854 — 854 2025 904 330,000 330,904 Thereafter 4,672 375,100 379,772 $ 10,582 $ 1,165,494 $ 1,176,076 Unamortized net debt premiums and issuance costs, net ( 5,282 ) Total $ 1,170,794 Other Debt Activity For the year ended December 31, 2020, we had total new borrowings of $ 325.0 million and total repayments of $ 302.2 million. The components of this activity were as follows: • In March 2020, we borrowed $ 300 million on the Credit Facility as a precautionary measure in order to increase our cash position and preserve financial flexibility in light of uncertainty in the global markets resulting from the COVID-19 pandemic. Subsequent to the initial borrowing, we have repaid the $ 300 million of borrowings; • In December 2020, we borrowed $ 25 million on the Credit Facility to fund a portion of the purchase price of Eastgate Crossing; and • We made scheduled principal payments on indebtedness during the year totaling $ 2.2 million. The amount of interest capitalized in 2020, 2019, and 2018 was $ 1.5 million, $ 1.9 million, and $ 1.8 million, respectively. Fair Value of Fixed and Variable Rate Debt As of December 31, 2020, the estimated fair value of fixed rate debt was $ 872.8 million compared to the book value of $ 846.0 million. The fair value was estimated using Level 2 and 3 inputs with cash flows discounted at current borrowing rates for similar instruments, which ranged from 3.37 % to 3.88 %. As of December 31, 2020, the estimated fair value of variable rate F-34 debt was $ 329.1 million compared to the book value of $ 330.1 million. The fair value was estimated using Level 2 and 3 inputs with cash flows discounted at current borrowing rates for similar instruments, which ranged from 1.28 % to 3.62 %. Note 8. Derivative Instruments, Hedging Activities and Other Comprehensive Income In order to manage potential future variable interest rate risk, we enter into interest rate derivative agreements from time to time. We do not use such agreements for trading or speculative purposes nor do we have any that are not designated as cash flow hedges. The agreements with each of our derivative counterparties provide that, in the event of default on any of our indebtedness, we could also be declared in default on our derivative obligations. As of December 31, 2020, we were party to various cash flow derivative agreements with notional amounts totaling $ 250.0 million. These derivative agreements effectively fix the interest rate underlying certain variable rate debt instruments over expiration dates through 2025. Utilizing a weighted average interest rate spread over LIBOR on all variable rate debt resulted in fixing the weighted average interest rate at 4.20 %. These interest rate derivative agreements are the only assets or liabilities that we record at fair value on a recurring basis. The valuation of these assets and liabilities is determined using widely accepted techniques including discounted cash flow analysis. These techniques consider the contractual terms of the derivatives (including the period to maturity) and use observable market-based inputs such as interest rate curves and implied volatilities. We also incorporate credit valuation adjustments into the fair value measurements to reflect nonperformance risk on both our part and that of the respective counterparties. We determined that the majority of the inputs used to value our derivatives fall within Level 2 of the fair value hierarchy, although the credit valuation adjustments associated with our derivatives utilize Level 3 inputs, such as estimates of current credit spreads to evaluate the likelihood of default by us and our counterparties. As of December 31, 2020 and December 31, 2019, we assessed the significance of the impact of the credit valuation adjustments on the overall valuation of our derivative positions and determined the credit valuation adjustments were not significant to the overall valuation of our derivatives. As a result, we determined our derivative valuations were classified within Level 2 of the fair value hierarchy. As of December 31, 2020, the estimated fair value of our interest rate derivatives represented a liability of $ 32.1 million, including accrued interest of $ 0.4 million. As of December 31, 2020, this balance is reflected in accounts payable and accrued expenses on the accompanying consolidated balance sheet. At December 31, 2019 the estimated fair value of our interest rate derivatives was a liability of $ 16.8 million, including accrued interest of $ 0.1 million. As of December 31, 2019, this was reflected in accounts payable and accrued expenses on the accompanying consolidated balance sheet. Amounts reported in accumulated other comprehensive income related to derivatives will be reclassified to earnings over time as the hedged items are recognized in earnings. Approximately $ 4.0 million and $ 0.8 million was reclassified as a reduction to earnings during the years ended December 31, 2020 and 2018, respectively. Approximately $ 0.6 million was reclassified as an increase to earnings during the year ended December 31, 2019. As the interest payments on our derivatives are made over the next 12 months, we estimate the increase to interest expense to be $ 6.4 million, assuming the current LIBOR curve. Unrealized gains and losses on our interest rate derivative agreements are the only components of the change in accumulated other comprehensive loss. Note 9. Lease Information Rental Income The Company receives rental income from the leasing of retail and office space. The leases generally provide for certain increases in base rent, reimbursement for certain operating expenses, and may require tenants to pay contingent rent to the extent their sales exceed a defined threshold. Certain tenants have the option in the lease agreement to extend their lease upon the expiration of their contractual term. Variable lease payments are based upon tenant sales information and are recognized once a tenant's sales volume exceeds a defined threshold. Variable lease payments for reimbursement of operating expenses are based upon the operating expense activity for the period. From a lessor perspective, the new accounting guidance adopted in 2019 remained mostly similar to legacy GAAP as the Company elected the practical expedient to not separate non-lease components from lease components. This election resulted in a change on the Company's consolidated statements of operations as the Company no longer presents minimum rents F-35 and tenant reimbursements as separate amounts because the Company now accounts for these amounts as a single combined lease component, rental income, on the basis of the lease component being the predominant component of the contract. As such, non-lease components, including common area maintenance reimbursements that are of a fixed nature are recognized on a straight-line basis over the term of the lease. Further, bad debt, which has previously been recorded in property operating expenses, has now been classified as a contra-revenue account in rental income in the Company’s consolidated statements of operations and comprehensive income for the years ended December 31, 2020 and 2019. The Company recognized the following lease rental income for the years ended December 31, 2020 and 2019, respectively: ($ in thousands) Year Ended December 31, 2020 2019 Fixed Contractual Lease Payments - Operating Leases $ 218,004 $ 244,666 Variable Lease Payments - Operating Leases 52,128 61,368 Bad Debt Reserve ( 13,259 ) ( 3,620 ) Straight-Line Rent Adjustment 1,155 3,362 Straight-Line Rent Reserve for Uncollectibility ( 4,177 ) ( 1,153 ) Amortization of In-Place Lease Liabilities, net 3,819 3,776 Total $ 257,670 $ 308,399 The weighted average remaining term of the lease agreements is approximately 4.5 years. During the years ended December 31, 2020, 2019, and 2018, the Company earned overage rent of $ 0.2 million, $ 1.3 million, and $ 1.2 million, respectively. As of December 31, 2020, future minimum rentals to be received under non-cancelable operating leases for each of the next five years and thereafter, excluding variable lease payments, are as follows: ($ in thousands) 2021 $ 217,118 2022 196,856 2023 165,849 2024 137,803 2025 111,157 Thereafter 365,042 Total $ 1,193,825 Commitments under Ground Leases As of December 31, 2020, we are obligated under nine ground leases for approximately 47 acres of land. Most of these ground leases require fixed annual rent payments. The expiration dates of the remaining initial terms of these ground leases range from 2023 to 2092 with a weighted-average remaining term of 52.2 years. Certain of these leases have five - to ten-year extension options ranging in total from 20 to 25 years. Upon adoption of the Leases standard, the Company did not recognize value during the option period for the right-of-use assets and lease liabilities as it was not probable the extension options will be exercised. Upon adoption, the Company recorded a right of use asset of $ 27.0 million and corresponding liability of $ 27.3 million. The right of use asset is included in prepaid and other assets and the lease liability is included in deferred revenue and other liabilities. This value was determined utilizing an estimate of our incremental borrowing rate that was specific to each lease based upon the term and underlying asset. These rates ranged from 3.93 % to 6.33 % with a weighted-average incremental borrowing rate of 5.86 %. F-36 Ground lease expense incurred by the Company on these operating leases for the years ended December 31, 2020, 2019, and 2018 was $ 1.9 million, $ 1.8 million, and $ 1.7 million, respectively. The Company made payments of $ 1.8 million and $ 1.7 million for the years ended December 31, 2020 and 2019, respectively, which were included in operating cash flows. Future minimum lease payments due under ground leases for the next five years ending December 31 and thereafter are as follows: ($ in thousands) 2021 $ 1,789 2022 1,815 2023 1,636 2024 1,600 2025 1,582 Thereafter 68,971 Total $ 77,393 Note 10. Shareholders’ Equity Common Equity Our Board of Trustees declared a cash distribution of $ 0.1500 per common share and Common Unit for the fourth quarter of 2020. This distribution was paid on January 15, 2021 to common shareholders and Common Unit holders of record as of January 8, 2021. For the years ended December 31, 2020, 2019 and 2018, we declared cash distributions of $ 0.4495 , $ 1.27 , and $ 1.27 respectively per common share and Common Units. Dividend Reinvestment and Share Purchase Plan We maintain a Dividend Reinvestment and Share Purchase Plan, which offers investors the option to invest all or a portion of their common share dividends in additional common shares. Participants in this plan are also able to make optional cash investments with certain restrictions. Note 11. Commitments and Contingencies Other Commitments and Contingencies We are not subject to any material litigation nor, to management’s knowledge, is any material litigation currently threatened against us. We are parties to routine litigation, claims, and administrative proceedings arising in the ordinary course of business. Management believes that such matters will not have a material adverse impact on our consolidated financial condition, results of operations or cash flows taken as a whole. We are obligated under various completion guarantees with lease agreements with tenants to complete all or portions of a development project and tenant-specific space currently under construction. We believe we currently have sufficient financing in place to fund our investment in any existing or future projects through cash from operations and borrowings on our unsecured revolving credit facility. In 2017, we provided a repayment guaranty on a $ 33.8 million construction loan associated with the development of the Embassy Suites at the University of Notre Dame consistent with our 35 % ownership interest. As of December 31, 2020, the current outstanding loan balance is $ 33.6 million, of which our share is $ 11.8 million. As of December 31, 2020, we had outstanding letters of credit totaling $ 1.2 million. At that date, there were no amounts advanced against these instruments. F-37 Note 12. Related Parties and Related Party Transactions Subsidiaries of the Company provide certain management, construction management and other services to certain entities owned by certain members of the Company’s management. During each of the years ended December 31, 2020, 2019 and 2018, we earned less than $ 0.1 million, from entities owned by certain members of management. We reimburse an entity owned by certain members of our management for certain travel and related services. During the years ended December 31, 2020, 2019 and 2018, we paid $ 0.5 million, $ 0.8 million and $ 0.5 million, respectively, to this related entity. Note 13. Acquisitions In 2020, we acquired one retail operating property for $ 65.3 million. The fair value of the real estate and other assets acquired were primarily determined using the income approach. The income approach required us to make assumptions about market leasing rates, tenant-related costs, discount rates, and disposal rates. The estimates of fair value primarily relied upon Level 2 and Level 3 inputs, as previously defined. The following table summarizes the estimation of the fair value of assets acquired and liabilities assumed for the property acquired in 2020: ($ in thousands) Investment properties, net $ 63,570 Lease-related intangible assets, net 2,254 Total acquired assets 65,824 Accounts payable and accrued expenses 280 Deferred revenue and other liabilities 246 Total assumed liabilities 526 Fair value of acquired net assets $ 65,298 The leases at the acquired property had a weighted average remaining life at acquisition of approximately 3.2 years. The range of the most significant Level 3 assumptions utilized in determining the value of the real estate and related assets acquired are as follows: Low High Net rental rate per square foot - Anchors $ 22.50 $ 27.50 Net rental rate per square foot - Small Shops $ 15.00 $ 65.00 Discount rate 9.0 % 9.0 % In 2019, we acquired one retail operating property for $ 29.0 million and one parking garage for $ 29.5 million. The fair value of the real estate and other assets acquired were primarily determined using the income approach. The income approach required us to make assumptions about market leasing rates, tenant-related costs, discount rates, and disposal values. The estimates of fair value primarily relied upon Level 2 and Level 3 inputs, as previously defined. The following table summarizes the estimation of the fair value of assets acquired and liabilities assumed for the properties acquired in 2019: F-38 ($ in thousands) Investment properties, net $ 56,393 Lease-related intangible assets, net 2,458 Other assets 320 Total acquired assets 59,171 Accounts payable and accrued expenses 595 Deferred revenue and other liabilities 371 Total assumed liabilities 966 Fair value of acquired net assets $ 58,205 The leases at the acquired properties had a weighted average remaining life at acquisition of approximately 5.6 years. The range of the most significant Level 3 assumptions utilized in determining the value of the real estate and related assets acquired are as follows: Low High Net rental rate per square foot - Anchors $ 11.00 $ 12.96 Net rental rate per square foot - Small Shops $ 6.33 $ 32.00 Discount rate 9.0 % 9.0 % The results of operations for each of the properties acquired during the years ended December 31, 2020 and 2019 have been included in operations since their respective dates of acquisition. We did no t acquire any properties in 2018. Note 14. Impact of COVID-19 Since first being reported in December 2019, the novel strain of coronavirus (COVID-19) has spread globally. In March 2020, the World Health Organization declared COVID-19 a pandemic, and subsequently, the United States declared a national emergency with respect to COVID-19. The Company continues to closely monitor the impact of the COVID-19 pandemic on all aspects of its business and how it impacts the Company's tenants and business partners. Certain segments of retailers and the Company experienced disruption during 2020, and, going forward, the potential adverse effect of the COVID-19 pandemic, including possible resurgences and mutations, on the financial condition, results of operations, cash flows and performance of the Company and its tenants, the real estate market, global economy, and financial markets, and the extent of such effects, will depend on future developments, which are highly uncertain and cannot be predicted with confidence. The following operating trends, combined with macroeconomic trends such as a global economic slowdown or recession, reduced consumer spending and increased unemployment, lead us to believe that our operating results for the rest of 2020 and potentially beyond will continue to be significantly affected by COVID-19: • As of December 31, 2020, over 98 % of our tenants have reopened. However, many of these retailers are operating at a lower capacity than normal due to COVID-19. Store closures or the inability to return to full capacity, particularly if for an extended period, increase the risk of business failures and lease defaults. • As of February 11, 2021, we have collected approximately 95 % of rent billings for the three months ended December 31, 2020 and 92 % of rent billings for the period from April 1, 2020 through December 31, 2020. • Many of our tenants have taken on additional debt as a result of COVID-19, including loans administered by the Small Business Administration. To the extent this debt is not forgiven, the increased debt load may hamper their ability to continue to operate and to pay rent, which could cause the Company to realize decreased cash flow and increased vacancies at its properties. F-39 Starting in March and continuing through January 2021, the Company received rent relief requests from a significant proportion of its tenants. Some tenants have asserted various legal arguments that they allege relieve them of the obligation to pay rent during the pandemic; the Company and its legal advisers generally disagree with these legal arguments. The Company has evaluated and will continue to evaluate tenant requests for rent relief based on many factors, including the tenant's financial strength, the tenant's operating history, potential co-tenancy impacts, the tenant's contribution to the shopping center in which it operates, the Company's assessment of the tenant's long-term viability, the difficulty or ease with which the tenant could be replaced, and other factors. As a result of this evaluation, the Company has agreed to defer rent for approximately 375 of its tenants subject to certain conditions. The Company had deferred the collection of $ 6.1 million of rental income that remains outstanding as of December 31, 2020. To the extent the Company agrees to defer rent or is otherwise unable to collect rent for certain periods, the Company will realize decreased cash flow, which could significantly decrease the cash available for the Company's operating and capital uses. F-40 Kite Realty Group Trust and Kite Realty Group, L.P. and subsidiaries Schedule III Consolidated Real Estate and Accumulated Depreciation ($ in thousands) Initial Cost Cost Capitalized Subsequent to Acquisition/Development Gross Carrying Amount Close of Period Building & Building & Building & Accumulated Year Built / Year Name Encumbrances Land Improvements Land Improvements Land Improvements Total Depreciation Renovated Acquired Operating Properties 12th Street Plaza * $ — $ 2,624 $ 12,892 $ — $ 755 $ 2,624 $ 13,647 $ 16,271 $ 4,530 1978/2003 2012 54th & College * — 2,672 — — — 2,672 — 2,672 — 2008 NA Bayonne Crossing 42,113 47,809 43,960 — 917 47,809 44,877 92,686 12,397 2011 2014 Bayport Commons * — 7,005 20,776 — 4,109 7,005 24,886 31,891 8,162 2008 NA Belle Isle * — 9,130 41,167 — 5,968 9,130 47,135 56,265 12,409 2000 2015 Bridgewater Marketplace * — 3,407 8,602 — 1,244 3,407 9,845 13,252 3,708 2008 NA Burlington Coat Factory * — — 2,773 — 29 — 2,802 2,802 2,093 1992/2000 2000 Castleton Crossing * — 9,761 28,052 — 944 9,761 28,996 38,757 8,212 1975 2013 Chapel Hill Shopping Center 18,250 — 35,109 — 1,856 — 36,965 36,965 9,380 2001 2015 City Center * — 20,565 180,007 — 4,690 20,565 184,697 205,262 46,121 2018 2014 Centennial Center 70,455 58,960 72,676 — 4,720 58,960 77,396 136,356 25,247 2002 2014 Centennial Gateway 23,962 5,305 48,739 — 576 5,305 49,315 54,620 12,364 2005 2014 Centre Point Commons 14,410 2,918 22,310 — 132 2,918 22,441 25,359 5,790 2007 2014 Cobblestone Plaza * — 11,221 45,028 — 2,849 11,221 47,877 59,098 13,852 2011 NA Colonial Square * — 7,521 18,696 — 2,138 7,521 20,834 28,355 5,009 2010 2014 Colleyville Downs * — 5,446 38,533 — 2,064 5,446 40,597 46,043 12,875 2014 2015 Cool Creek Commons * — 6,062 13,428 — 3,802 6,062 17,229 23,291 7,192 2005 NA Cool Springs Market * — 12,644 22,870 40 6,449 12,684 29,319 42,003 10,152 1995 2013 Crossing at Killingly Commons * — 21,999 34,968 — ( 5 ) 21,999 34,963 56,962 10,252 2010 2014 Delray Marketplace 55,110 18,750 88,421 1,284 4,960 20,034 93,381 113,415 24,378 2013 NA DePauw University Bookstore & Café — 64 663 — 45 64 708 772 416 2012 NA Draper Crossing * — 9,054 27,241 — 894 9,054 28,134 37,188 8,171 2012 2014 Draper Peaks * — 11,498 47,125 522 4,135 12,020 51,260 63,280 11,529 2012 2014 Eastern Beltway Center 34,100 23,221 45,725 — 4,675 23,221 50,400 73,621 11,620 1998/2006 2014 Eastgate Crossing — 4,244 59,326 — — 4,244 59,326 63,570 — 1958/2007 2020 Eastgate Pavilion * — 8,026 18,763 — 904 8,026 19,667 27,693 9,224 1995 2004 Eddy Street Commons — 1,900 37,051 — 1,154 1,900 38,205 40,105 13,599 2009 NA Estero Town Commons * — 8,973 9,960 — 989 8,973 10,949 19,922 4,077 2006 NA Fishers Station * — 4,008 15,607 — 73 4,008 15,680 19,688 5,215 2018 NA F-41 Initial Cost Cost Capitalized Subsequent to Acquisition/Development Gross Carrying Amount Close of Period Building & Building & Building & Accumulated Year Built / Year Name Encumbrances Land Improvements Land Improvements Land Improvements Total Depreciation Renovated Acquired Operating Properties (continued) Geist Pavilion * $ — $ 1,368 $ 8,280 $ — $ 2,362 $ 1,368 $ 10,642 $ 12,010 $ 4,898 2006 NA Greyhound Commons * — 2,629 794 — 863 2,629 1,657 4,286 942 2005 NA Holly Springs Towne Center * — 12,319 45,904 — 4,783 12,319 50,688 63,007 11,499 2013 NA Holly Springs Towne Center - Phase II * — 11,590 49,006 — 1,455 11,590 50,461 62,051 8,159 2016 NA Hunters Creek Promenade * — 8,335 12,681 179 1,151 8,514 13,831 22,345 3,685 1994 2013 Indian River Square * — 5,100 6,305 1,100 1,924 6,200 8,229 14,429 3,251 1997/2004 2005 International Speedway Square * — 7,424 12,840 — 6,875 7,424 19,715 27,139 11,267 1999 NA King's Lake Square * — 4,519 15,405 — 1,698 4,519 17,103 21,622 8,698 1986/2014 2003 Kingwood Commons * — 5,715 30,668 — 249 5,715 30,916 36,631 11,185 1999 2013 Lake City Commons — 3,415 10,242 — 365 3,415 10,608 14,023 3,415 2008 2014 Lake City Commons - Phase II * — 1,277 2,225 — ( 124 ) 1,277 2,102 3,379 486 2011 2014 Lake Mary Plaza — 1,413 8,706 — 160 1,413 8,866 10,279 2,071 2009 2014 Lithia Crossing * — 3,065 7,611 — 6,248 3,065 13,859 16,924 5,443 1994/2003 2011 Market Street Village * — 9,764 16,360 — 3,052 9,764 19,412 29,176 8,557 1970/2004 2005 Miramar Square 31,625 26,492 30,847 389 11,331 26,880 42,178 69,058 9,986 2008 2014 Mullins Crossing * — 10,582 42,140 — 6,233 10,582 48,373 58,955 14,063 2005 2014 Naperville Marketplace — 5,364 11,475 — 160 5,364 11,634 16,998 4,328 2008 NA Nora Plaza 3,790 21,310 — 2,150 3,790 23,460 27,249 2,077 2004 2019 Northcrest Shopping Center — 4,044 33,684 — 1,284 4,044 34,968 39,012 8,101 2008 2014 Northdale Promenade * — 1,718 27,292 — 161 1,718 27,453 29,171 12,891 2017 NA Oleander Place * — 863 5,935 — 285 863 6,220 7,083 2,522 2012 2011 Parkside Town Commons - Phase I * — 3,108 42,194 ( 60 ) 711 3,047 42,905 45,952 11,279 2015 N/A Parkside Town Commons - Phase II * — 20,722 66,524 — 9,828 20,722 76,352 97,074 15,245 2017 N/A Perimeter Woods * — 8,993 27,277 — 1,937 8,993 29,213 38,206 6,857 2008 2014 Pine Ridge Crossing * — 5,640 16,885 — 3,981 5,640 20,866 26,506 8,278 1994 2006 Plaza at Cedar Hill * — 5,782 36,649 — 11,784 5,782 48,433 54,215 22,537 2000 2004 Pleasant Hill Commons — 3,350 10,116 — 356 3,350 10,472 13,822 3,292 2008 2014 Portofino Shopping Center * — 4,754 75,221 — 19,144 4,754 94,366 99,120 30,615 1999 2013 Publix at Woodruff * — 1,783 6,361 — 869 1,783 7,230 9,013 3,697 1997 2012 Rampart Commons 8,816 1,136 42,726 — 592 1,136 43,318 44,454 11,926 2018 2014 Rangeline Crossing * — 2,006 18,020 — 619 2,006 18,639 20,645 7,580 1986/2013 NA F-42 Initial Cost Cost Capitalized Subsequent to Acquisition/Development Gross Carrying Amount Close of Period Building & Building & Building & Accumulated Year Built / Year Name Encumbrances Land Improvements Land Improvements Land Improvements Total Depreciation Renovated Acquired Operating Properties (continued) Riverchase Plaza * $ — $ 3,889 $ 11,389 $ — $ 1,136 $ 3,889 $ 12,525 $ 16,414 $ 5,351 1991/2001 2006 Rivers Edge * — 5,647 31,347 — 1,938 5,647 33,285 38,932 11,614 2011 2008 Saxon Crossing 11,400 3,764 16,762 — 578 3,764 17,340 21,104 5,069 2009 2014 Shoppes at Plaza Green * — 3,749 23,011 — 2,184 3,749 25,195 28,944 9,554 2000 2012 Shoppes of Eastwood * — 1,688 8,949 — 504 1,688 9,454 11,142 3,691 1997 2013 Shops at Eagle Creek * — 3,668 8,760 — 5,234 3,668 13,994 17,662 6,123 1998 2003 Shops at Julington Creek 4,785 2,372 7,300 — 260 2,372 7,561 9,933 1,537 2011 2014 Shops at Moore 21,300 6,284 23,348 — 1,200 6,284 24,548 30,832 5,451 2010 2014 Silver Springs Pointe — 7,580 4,992 — 321 7,580 5,313 12,893 1,605 2001 2014 Stoney Creek Commons * — 628 3,700 — 5,913 628 9,614 10,242 4,107 2000 NA Sunland Towne Centre * — 14,774 22,528 — 3,540 14,774 26,068 40,842 12,047 1996 2004 Tarpon Bay Plaza * — 4,273 23,001 — 4,452 4,273 27,454 31,727 8,350 2007 NA The Corner 14,750 3,772 24,642 — 28 3,772 24,669 28,441 5,970 2008 2014 The Landing at Tradition * — 18,505 46,210 — 2,980 18,505 49,191 67,696 10,922 2007 2014 Toringdon Market * — 5,448 8,703 — 622 5,448 9,325 14,773 2,734 2004 2013 Traders Point * — 9,443 34,697 — 3,403 9,443 38,100 47,543 20,127 2005 NA Traders Point II * — 2,376 6,363 — 914 2,376 7,277 9,653 3,281 2005 NA Tradition Village Center * — 3,140 14,826 — 632 3,140 15,458 18,598 3,943 2006 2014 Waterford Lakes Village * — 2,317 6,347 — 602 2,317 6,949 9,266 3,138 1997 2004 Waxahachie Crossing — 1,411 15,552 — 100 1,411 15,652 17,063 3,429 2010 2014 Westside Market * — 4,194 17,723 — 427 4,194 18,150 22,344 3,707 2013 2014 Total Operating Properties 351,076 621,773 2,142,304 3,452 200,519 625,225 2,342,823 2,968,048 688,558 F-43 Initial Cost C ost Capitalized Subsequent to Acquisition/Development Gross Carrying Amount Close of Period Building & Building & Building & Accumulated Year Built / Year Name Encumbrances Land Improvements Land Improvements Land Improvements Total Depreciation Renovated Acquired Office Properties Thirty South * $ — $ 1,643 $ 9,536 $ — $ 21,922 $ 1,643 $ 31,457 $ 33,100 $ 14,246 1905/2002 2001 Pan Am Plaza Garage * — — 29,536 — 276 — 29,813 29,813 7,761 1986 2019 Union Station Parking Garage * — 904 2,650 — 1,857 904 4,506 5,410 2,057 1986 2001 Total Office Properties — 2,547 41,722 — 24,055 2,547 65,777 68,324 24,064 Development and Redevelopment Properties Eddy Street Commons - Phase II 4,188 5,642 — — 4,188 5,642 9,830 267 NA NA Glendale Town Center* — 1,307 43,221 — 4,148 1,307 47,369 48,676 32,685 NA NA Hamilton Crossing Centre* — 5,531 10,339 — 63 5,531 10,403 15,934 4,471 NA NA The Corner * — 304 4,145 — — 304 4,145 4,449 — NA NA Total Development and Redevelopment Properties — 11,329 63,347 — 4,211 11,329 67,558 78,888 37,423 Other ** Bridgewater Marketplace * — 1,722 — — — 1,722 — 1,722 — NA NA KRG Development — — 716 — — — 716 716 74 NA NA KRG New Hill * — 1,812 — — — 1,812 — 1,812 — NA NA KRG Peakway — 5,777 — — — 5,777 — 5,777 — NA NA Pan Am Plaza — 11,694 — — — 11,694 — 11,694 — NA NA Total Other — 21,006 716 — — 21,006 716 21,722 74 Line of credit/Term Loan/Unsecured notes 825,000 — — — — — — — — NA NA Grand Total $ 1,176,076 $ 656,655 $ 2,248,089 $ 3,452 $ 228,785 $ 660,107 $ 2,476,874 $ 3,136,982 $ 750,119 ____________________ * This property or a portion of the property is included as an unencumbered asset used in calculating our line of credit borrowing base. ** This category generally includes land held for development. We also have certain additional land parcels at our development and operating properties, which amounts are included elsewhere in this table. F-44 Kite Realty Group Trust and Kite Realty Group, L.P. and subsidiaries Notes to Schedule III Consolidated Real Estate and Accumulated Depreciation ($ in thousands) Note 1. Reconciliation of Investment Properties The changes in investment properties of the Company for the years ended December 31, 2020, 2019, and 2018 are as follows: 2020 2019 2018 Balance, beginning of year $ 3,079,616 $ 3,633,376 $ 3,949,431 Acquisitions 63,570 57,494 — Improvements 39,544 52,713 68,349 Impairment — ( 56,948 ) ( 73,198 ) Disposals ( 45,748 ) ( 607,019 ) ( 311,206 ) Balance, end of year $ 3,136,982 $ 3,079,616 $ 3,633,376 The unaudited aggregate cost of investment properties for U.S. federal tax purposes as of December 31, 2020 was $ 2.3 billion. Note 2. Reconciliation of Accumulated Depreciation The changes in accumulated depreciation of the Company for the years ended December 31, 2020, 2019, and 2018 are as follows: 2020 2019 2018 Balance, beginning of year $ 661,546 $ 695,012 $ 660,276 Depreciation expense 113,973 117,216 132,662 Impairment — ( 19,226 ) ( 2,838 ) Disposals ( 25,400 ) ( 131,456 ) ( 95,088 ) Balance, end of year $ 750,119 $ 661,546 $ 695,012 Depreciation of investment properties reflected in the statements of operations is calculated over the estimated original lives of the assets as follows: Buildings 20 - 35 years Building improvements 10 - 35 years Tenant improvements Term of related lease Furniture and Fixtures 5 - 10 years All other schedules have been omitted because they are inapplicable, not required or the information is included elsewhere in the consolidated financial statements or notes thereto. F-45