KITE REALTY GROUP TRUST 10-Q

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS The following discussion should be read in conjunction with the accompanying historical financial statements and related notes thereto. In this discussion, unless the context suggests otherwise, references to “our Company,” “we,” “us,” and “our” mean Kite Realty Group Trust and its direct and indirect subsidiaries, including Kite Realty Group, L.P. CAUTIONARY NOTE ABOUT FORWARD-LOOKING STATEMENTS This Quarterly Report on Form 10-Q, together with other statements and information publicly disseminated by us, contains certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Such statements are based on assumptions and expectations that may not be realized and are inherently subject to risks, uncertainties and other factors, many of which cannot be predicted with accuracy and some of which might not even be anticipated. Future events and actual results, performance, transactions or achievements, financial or otherwise, may differ materially from the results, performance, transactions or achievements, financial or otherwise, expressed or implied by the forward-looking statements. Risks, uncertainties and other factors that might cause such differences, some of which could be material, include but are not limited to: • economic, business, banking, real estate and other market conditions, particularly in connection with low or negative growth in the U.S. economy as well as economic uncertainty (including from an economic slowdown or recession, federal government shutdown, disruptions related to tariffs and other trade or sanction issues, geopolitical instability, rising interest rates, inflation, unemployment, or limited growth in consumer income or spending); • financing risks, including the availability of, and costs associated with, sources of liquidity, and our ability to use offering proceeds for the anticipated purposes; • our ability to refinance, or extend the maturity dates of, our indebtedness; • the level and volatility of interest rates; • the financial stability of our tenants; • the competitive environment in which we operate, including potential oversupplies of, or a reduction in demand for, rental space; • acquisition, disposition, development and joint venture risks, including the ability to complete them on the terms and timing anticipated; • property ownership and management risks, including the relative illiquidity of real estate investments, and expenses, vacancies or the inability to rent space on favorable terms or at all; • our ability to maintain our status as a real estate investment trust (“REIT”) for U.S. federal income tax purposes; • potential environmental and other liabilities; • impairment in the value of real estate property we own; • the attractiveness of our properties to tenants; • the actual and perceived impact of e-commerce on the value of shopping center assets and changing demographics and customer traffic patterns; • business continuity disruptions and a deterioration in our tenants’ ability to operate in affected areas or delays in the supply of products or services to us or our tenants from vendors that are needed to operate efficiently; • risks related to our current geographical concentration of properties in the states of Texas, Florida, and North Carolina and the metropolitan statistical areas (“MSAs”) of New York, Atlanta, Seattle, Chicago, and Washington, D.C.; 32 • civil unrest, acts of violence, terrorism or war, acts of God, climate change, epidemics, pandemics, natural disasters and severe weather conditions, including such events that may result in underinsured or uninsured losses or other increased costs and expenses; • changes in laws and government regulations, including governmental orders affecting the use of our properties or the ability of our tenants to operate, and the costs of complying with such changed laws and government regulations; • possible changes in consumer behavior due to public health crises and the fear of future pandemics; • our ability to satisfy environmental, social or governance standards set by various constituencies; • insurance costs and coverage, especially in Florida and Texas coastal areas and North Carolina; • risks associated with cyberattacks and the loss of confidential information and other business disruptions; • risks associated with the use of artificial intelligence and related tools; • other factors affecting the real estate industry generally; and • other risks identified in this Quarterly Report on Form 10-Q and, from time to time, in other reports we file with the Securities and Exchange Commission (the “SEC”) or in other documents that we publicly disseminate, including, in particular, the section titled “Risk Factors” in our Annual Report on Form 10-K for the fiscal year ended December 31, 2025. We undertake no obligation to publicly update or revise these forward-looking statements, whether as a result of new information, future events or otherwise. Overview Our Business and Properties Kite Realty Group Trust is a publicly held REIT that, through its majority-owned subsidiary, Kite Realty Group, L.P., owns interests in various operating subsidiaries and joint ventures engaged in the ownership, operation, acquisition, development, and redevelopment of high-quality, open-air, grocery-anchored shopping centers and vibrant mixed-use assets that are primarily located in high-growth Sun Belt markets and select strategic gateway markets in the United States. We derive our revenue primarily from the collection of contractual rents and reimbursement payments from tenants under existing lease agreements at each of our properties. Therefore, our operating results depend materially on, among other things, the ability of our tenants to make required lease payments, the health and resilience of the U.S. retail sector, particularly in light of increased tariffs that were enacted in 2025, interest rate volatility, job growth, the real estate market, and overall economic conditions. As of June 30, 2026, we own interests in a portfolio of 163 operating retail/mixed-use properties, including 155 wholly owned shopping centers and eight properties owned through four unconsolidated joint ventures, totaling approximately 26.0 million square feet, excluding (i) Eastgate Crossing, a 152,682 square foot multi-tenant retail property in the Durham-Chapel Hill MSA that was reclassified from our operating portfolio in September 2025 due to significant disruption caused by severe flooding as a result of Tropical Storm Chantal, and (ii) two standalone office properties with 0.4 million square feet. Of the 163 operating retail/mixed-use properties, 11 contain an office component. We also own interests in one development project under construction as of June 30, 2026 and an additional two properties with future redevelopment opportunities. Inflation and Tariffs We continue to monitor the impact of inflation and tariffs on our operating and financial performance. Although inflation has moderated significantly from peak levels experienced during 2022, inflation may increase in the future as a result of multiple factors, including the tariffs implemented by the U.S. government in 2025 on imported goods from specific countries and inflationary pressures arising from geopolitical instability. These tariffs may lead to higher prices for many of the products that our tenants sell, potentially reducing consumer demand and spending and negatively impacting our tenants’ sales volume and overall health. This, in turn, has and could in the future put downward pricing pressure on rents that we are able to charge to new or renewing tenants, such that rent spreads and, in some cases, our percentage rents could be adversely impacted. Additionally, uncertainty regarding the scope and duration of the current and potential tariffs can lead to significant business uncertainty, affecting our tenants’ strategic planning and store expansion plans. Many of our leases contain provisions designed to mitigate the adverse impact of inflation, including stated rent increases and requirements for tenants to pay a share of 33 operating expenses, including common area maintenance, real estate taxes, insurance, or other operating expenses related to the maintenance of our properties, with escalation clauses in most leases. Over the past few years, we have made significant progress in executing leases that include higher fixed-rent increases while also including consumer price index-based, anti-gouging protection for tenants. However, the stated rent increases or limits on such tenant’s obligation to pay its share of operating expenses could be lower than the increase in inflation at any given time. Inflation may also increase labor or other general and administrative expenses, which cannot be easily reduced. Historically, economic indicators such as GDP growth, consumer confidence, and employment have been correlated with demand for certain of our tenants’ products and services. An economic recession could, among other impacts, increase the number of our tenants that are unable to meet their lease obligations to us and limit the demand from new tenants for space in our properties. Operating Activity During the second quarter of 2026, we executed new and renewal leases on 128 individual spaces totaling approximately 1.0 million square feet (15.9% cash leasing spread on 103 comparable leases). New leases were signed on 44 individual spaces for 329,750 square feet of gross leasable area (“GLA”) (28.4% cash leasing spread on 29 comparable leases), while non-option renewal leases were signed on 47 individual spaces for 188,717 square feet of GLA (17.7% cash leasing spread on 37 comparable leases) and option renewals were signed on 37 individual spaces for 476,194 square feet of GLA (6.6% cash leasing spread). The blended cash spread for comparable new and non-option renewal leases was 24.7%. Comparable new and renewal leases are defined as those for which the space was occupied by a tenant within the last 12 months. As of June 30, 2026, the Company’s operating retail portfolio annualized base rent per square foot was $23.41. New Tax Legislation Effective July 4, 2025, certain changes to U.S. tax law were approved that impact us and our shareholders. Among other changes, this legislation (i) permanently extends the 20% deduction for “qualified REIT dividends” for individuals and other non-corporate taxpayers under Section 199A of the Internal Revenue Code (the “Code”), (ii) increases the percentage limit under the REIT asset test applicable to taxable REIT subsidiaries from 20% to 25% for taxable years beginning after December 31, 2025, and (iii) increases the base on which the 30% interest deduction limit under Section 163(j) of the Code applies by excluding depreciation, amortization, and depletion from the definition of “adjusted taxable income” (i.e., based on EBITDA rather than EBIT) for taxable years beginning after December 31, 2024. Results of Operations Our development, redevelopment, and operating property acquisition and disposition activities during 2025 and 2026 affect the comparability of our results of operations for the three and six months ended June 30, 2026 and 2025. Therefore, we believe it is most useful to review the comparisons of our results of operations for these periods (as set forth below under “Comparison of Operating Results for the Three Months Ended June 30, 2026 to the Three Months Ended June 30, 2025” and “Comparison of Operating Results for the Six Months Ended June 30, 2026 to the Six Months Ended June 30, 2025”) in conjunction with the discussion of our transaction activities during those periods, which is set forth below. Acquisitions The following operating properties were acquired during the period from January 1, 2025 through June 30, 2026: Property Name MSA Acquisition Date Retail GLA Village Commons Miami January 15, 2025 170,976 Legacy West (1) Dallas/Ft. Worth April 28, 2025 342,011 Chastain Market (2) Atlanta May 11, 2026 79,517 Founders Square Naples, FL May 21, 2026 66,360 (1) We acquired a 52% noncontrolling interest in Legacy West in a joint venture for a gross purchase price of $785.0 million, including the assumption of $304.0 million of debt with an interest rate of 3.80%. Our share of the purchase price is $408.2 million. Legacy West also contains 443,553 square feet of office space and 782 multifamily units. (2) Chastain Market also contains 27,699 square feet of office space. 34 Dispositions The following operating properties were sold during the period from January 1, 2025 through June 30, 2026: Property Name MSA Disposition Date GLA Stoney Creek Commons Indianapolis April 4, 2025 84,094 Fullerton Metrocenter Los Angeles June 25, 2025 241,027 Denton Crossing (1) Dallas/Ft. Worth June 27, 2025 343,345 Parkway Towne Crossing (1) Dallas/Ft. Worth June 27, 2025 180,736 The Landing at Tradition (1) Port St. Lucie, FL June 27, 2025 397,199 Humblewood Shopping Center Houston July 21, 2025 85,682 DePauw University Bookstore and Café Indianapolis October 10, 2025 11,974 Paradise Valley Marketplace Phoenix November 20, 2025 80,951 Belle Isle Station Oklahoma City December 8, 2025 196,158 Central Texas Marketplace Waco December 8, 2025 429,653 International Speedway Square Daytona Beach December 8, 2025 240,251 Pavilion at King’s Grant Charlotte December 8, 2025 303,212 Peoria Crossing Phoenix December 8, 2025 238,004 Portofino Shopping Center Houston December 8, 2025 342,863 Shops at Park Place Dallas/Ft. Worth December 8, 2025 137,605 Watauga Pavilion Dallas/Ft. Worth December 8, 2025 205,643 Coram Plaza New York March 5, 2026 138,385 Estero Town Commons – Lowe’s (2) Fort Myers, FL June 5, 2026 — Commons at Temecula Riverside, CA June 10, 2026 292,078 Gateway Station College Station, TX June 10, 2026 125,406 Grapevine Crossing Dallas/Ft. Worth June 10, 2026 125,488 La Plaza Del Norte San Antonio June 10, 2026 320,102 Perimeter Woods Charlotte June 10, 2026 127,067 Winchester Commons Memphis June 10, 2026 93,077 City Center New York June 25, 2026 362,278 (1) We contributed this previously wholly owned property into a joint venture (the “Seed Asset Joint Venture”) in June 2025 and have retained a 52% noncontrolling interest in the property. (2) We sold the ground lease interest in one tenant at this existing multi-tenant operating retail property. The total number of properties in our portfolio was not affected by this transaction. Subsequent to June 30, 2026, we sold Tysons Corner, a 36,942 square foot retail property in the Washington, D.C. MSA. Development and Redevelopment Projects The following properties were under active development or redevelopment at various times during the period from January 1, 2025 through June 30, 2026 and removed from our operating portfolio: Project Name MSA Transition to Development or Redevelopment ( 1) Transition to Operating Portfolio GLA Active Projects One Loudoun Expansion (2) Washington, D.C. September 2024 Pending 119,000 One Loudoun Phase 2 Apartments (3) Washington, D.C. June 2026 Pending — Future Opportunities Hamilton Crossing Centre (4)(5) Indianapolis June 2014 Pending — Edwards Multiplex – Ontario (4) Los Angeles March 2023 Pending 124,614 Completed Projects The Corner – IN (6) Indianapolis December 2015 March 2025 23,852 35 (1) Transition date represents the date the property was transferred from our operating portfolio into redevelopment status. (2) The property is comprised of the development project (which has been excluded from the Company’s same property pool due to the ongoing development) and the remaining retail operating portion of the property (which is included in the Company’s same property pool as of June 30, 2026). (3) The property is comprised of the development project (which has been excluded from the Company’s same property pool due to the ongoing development) and is expected to consist of a second multifamily rental building consisting of 429 apartment units and ground-floor retail space. (4) This property has been identified as a redevelopment property and is not included in the operating portfolio or the same property pool. The redevelopment project at Hamilton Crossing Centre will include the creation of a mixed-use development. (5) In January 2022, we sold approximately half of the Hamilton Crossing site to Republic Airways Inc. and in August 2025, we sold an additional 36,895 square feet to Republic Airways. In addition to the sale, the Company entered into a development and construction management agreement for the development of a corporate campus for Republic Airways. Phase I of the corporate campus was completed in 2023, and the final phase was completed in January 2026. (6) This property is included in the operating portfolio and is not included in the same property pool because it was reclassified from active development into our operating portfolio in March 2025. In addition, in January 2026 and April 2026, the Company disposed of the second and third phases of a land parcel and the rights to develop 14 residential units in each phase at the One Loudoun Expansion in the Washington, D.C. MSA. Subsequent to June 30, 2026, the Company sold the remaining land and the rights to develop an additional 22 residential units at the One Loudoun Expansion. Comparison of Operating Results for the Three Months Ended June 30, 2026 to the Three Months Ended June 30, 2025 The following table reflects changes in the components of our consolidated statements of operations for the three months ended June 30, 2026 and 2025 (in thousands) : Three Months Ended June 30, 2026 2025 Change Revenue: Rental income $ 193,314 $ 211,182 $ (17,868) Other property-related revenue 1,566 1,355 211 Fee income 1,378 853 525 Total revenue 196,258 213,390 (17,132) Expenses: Property operating 28,495 28,881 (386) Real estate taxes 24,478 26,651 (2,173) General, administrative and other 14,543 13,390 1,153 Depreciation and amortization 81,604 97,887 (16,283) Impairment charges 980 — 980 Total expenses 150,100 166,809 (16,709) Other (expense) income: Interest expense (31,743) (34,052) 2,309 Income tax expense of taxable REIT subsidiaries (426) (199) (227) Gain on sales of operating properties, net 87,727 103,022 (15,295) Net gains from outlot sales 1,364 — 1,364 Gain on deconsolidation of joint venture 60,625 — 60,625 Equity in loss of unconsolidated joint ventures (1,344) (3,238) 1,894 Other income, net 3,169 485 2,684 Net income 165,530 112,599 52,931 Net income attributable to noncontrolling interests (4,226) (2,281) (1,945) Net income attributable to common shareholders $ 161,304 $ 110,318 $ 50,986 Property operating expense to total revenue ratio 14.5 % 13.5 % 36 Rental income (including tenant reimbursements) decreased $17.9 million, or 8.5%, due to the following (in thousands) : Net Change Three Months Ended June 30, 2025 to 2026 Properties or components of properties sold or held for sale during 2025 and/or 2026 $ (22,908) Properties under redevelopment or acquired during 2025 and/or 2026 1,503 Properties fully operational during 2025 and 2026 and other 3,537 Total $ (17,868) The net increase of $3.5 million in rental income for properties that were fully operational during 2025 and 2026 is primarily due to increases in base minimum rent of $4.3 million from contractual rent changes and an increase in leasing spreads and tenant reimbursements of $1.4 million from higher recoverable common area maintenance expenses and real estate taxes. These variances were partially offset by a decrease in lease termination income of $2.2 million. The occupancy of the fully operational properties decreased from 91.0% for the three months ended June 30, 2025 to 90.9% for the three months ended June 30, 2026. Other property-related revenue primarily consists of parking revenues and other miscellaneous activity. This revenue increased by $0.2 million primarily due to an increase in parking revenue. We recorded fee income of $1.4 million and $0.9 million during the three months ended June 30, 2026 and 2025, respectively, from property management and development services provided to third parties and unconsolidated joint ventures. The increase in fee income is primarily due to management fees earned during the three months ended June 30, 2026 related to the Legacy West Joint Venture and the Seed Asset Joint Venture. Property operating expenses decreased $0.4 million, or 1.3%, due to the following (in thousands) : Net Change Three Months Ended June 30, 2025 to 2026 Properties or components of properties sold or held for sale during 2025 and/or 2026 $ (2,935) Properties under redevelopment or acquired during 2025 and/or 2026 293 Properties fully operational during 2025 and 2026 and other 2,256 Total $ (386) The net increase of $2.3 million in property operating expenses for properties that were fully operational during 2025 and 2026 is primarily due to increases in the following: (i) $0.8 million in insurance expenses; (ii) $0.6 million in repairs and maintenance expenses; (iii) $0.4 million increase in landscaping and parking lot expenses; and (iv) $0.4 million in nonrecoverable expenses. As a percentage of revenue, property operating expenses increased from 13.5% to 14.5% due to an increase in expenses in 2026. Real estate taxes decreased $2.2 million, or 8.2%, due to the following (in thousands) : Net Change Three Months Ended June 30, 2025 to 2026 Properties or components of properties sold or held for sale during 2025 and/or 2026 $ (3,360) Properties under redevelopment or acquired during 2025 and/or 2026 296 Properties fully operational during 2025 and 2026 and other 891 Total $ (2,173) The net increase of $0.9 million in real estate taxes for properties that were fully operational during 2025 and 2026 is primarily due to higher real estate tax assessments at certain properties in the portfolio in 2026 and lower real estate tax refunds received during the three months ended June 30, 2026. The majority of real estate tax expenses are recoverable from tenants, and such recovery is reflected within “Rental income” in the accompanying consolidated statements of operations and comprehensive income. 37 General, administrative and other expenses increased $1.2 million, or 8.6%, primarily due to an increase in payroll expenses and share-based compensation in 2026. Depreciation and amortization expense decreased $16.3 million, or 16.6%, due to the following (in thousands) : Net Change Three Months Ended June 30, 2025 to 2026 Properties or components of properties sold or held for sale during 2025 and/or 2026 $ (10,950) Properties under redevelopment or acquired during 2025 and/or 2026 878 Properties fully operational during 2025 and 2026 and other (6,211) Total $ (16,283) The net decrease of $6.2 million in depreciation and amortization at properties that were fully operational during 2025 and 2026 is primarily due to the timing of placing assets in service and writing off tenant-related assets as a result of tenant move-outs. During the three months ended June 30, 2026, we recorded a $1.0 million impairment charge related to the write-off of capitalized costs associated with an abandoned project. No impairment charges were recorded during the three months ended June 30, 2025. Interest expense decreased $2.3 million, or 6.8%, primarily due to the payoffs of the $150.0 million unsecured term loan in June 2025 and the $80.0 million principal balance of the 4.47% senior unsecured notes that matured in September 2025, as well as a decrease in borrowings on the unsecured revolving line of credit, partially offset by interest incurred on the $300.0 million aggregate principal amount of the 5.20% senior unsecured notes issued in June 2025. We recorded a net gain on sales of operating properties of $87.7 million for the three months ended June 30, 2026 on the sales of seven operating retail properties and the ground lease interest in Lowe’s at Estero Town Commons compared to a net gain on sales of operating properties of $103.0 million on the sales of Stoney Creek Commons and Fullerton Metrocenter and the contribution of three previously wholly owned properties to the Seed Asset Joint Venture for the three months ended June 30, 2025. We recorded a net gain from outlot sales of $1.4 million for the three months ended June 30, 2026 on the sale of a land parcel and the rights to develop 14 residential units at the One Loudoun Expansion in the Washington, D.C. MSA. We did not sell any land parcels during the three months ended June 30, 2025. During the three months ended June 30, 2026, we recognized a $60.6 million gain on the deconsolidation of our multifamily joint venture at One Loudoun Downtown (the “One Loudoun Residential Joint Venture”) related to adjusting our retained interest to fair value. No such gain was recognized during the three months ended June 30, 2025. Equity in loss of unconsolidated joint ventures decreased $1.9 million, or 58.5%, primarily due to improved operating performance at certain joint venture properties during the three months ended June 30, 2026 compared to the prior year. Other income, net increased $2.7 million, or 553.4%, primarily due to the receipt of insurance proceeds in excess of replacement cost during the three months ended June 30, 2026 related to the July 2025 severe flooding at Eastgate Crossing in the Durham-Chapel Hill MSA and an increase in interest income earned from Code Section 1031 tax-deferred exchanges compared to the prior year. 38 Comparison of Operating Results for the Six Months Ended June 30, 2026 to the Six Months Ended June 30, 2025 The following table reflects changes in the components of our consolidated statements of operations for the six months ended June 30, 2026 and 2025 (in thousands) : Six Months Ended June 30, 2026 2025 Change Revenue: Rental income $ 391,356 $ 430,354 $ (38,998) Other property-related revenue 2,925 2,835 90 Fee income 2,674 1,278 1,396 Total revenue 396,955 434,467 (37,512) Expenses: Property operating 59,611 58,707 904 Real estate taxes 49,302 54,412 (5,110) General, administrative and other 28,493 25,648 2,845 Depreciation and amortization 164,095 196,118 (32,023) Impairment charges 6,868 — 6,868 Total expenses 308,369 334,885 (26,516) Other (expense) income: Interest expense (63,439) (67,006) 3,567 Income tax expense of taxable REIT subsidiaries (821) (209) (612) Gain on sales of operating properties, net 87,727 103,113 (15,386) Net gains from outlot sales 2,403 — 2,403 Gain on deconsolidation of joint venture 60,625 — 60,625 Equity in loss of unconsolidated joint ventures (3,560) (3,845) 285 Other income, net 5,741 5,228 513 Net income 177,262 136,863 40,399 Net income attributable to noncontrolling interests (4,564) (2,815) (1,749) Net income attributable to common shareholders $ 172,698 $ 134,048 $ 38,650 Property operating expense to total revenue ratio 15.0 % 13.5 % Rental income (including tenant reimbursements) decreased $39.0 million, or 9.1%, due to the following (in thousands) : Net Change Six Months Ended June 30, 2025 to 2026 Properties or components of properties sold or held for sale during 2025 and/or 2026 $ (50,876) Properties under redevelopment or acquired during 2025 and/or 2026 727 Properties fully operational during 2025 and 2026 and other 11,151 Total $ (38,998) The net increase of $11.2 million in rental income for properties that were fully operational during 2025 and 2026 is primarily due to increases in the following: (i) base minimum rent of $4.8 million from contractual rent changes and an increase in leasing spreads; (ii) tenant reimbursements of $4.7 million from higher recoverable common area maintenance expenses and real estate taxes; and (iii) lease termination income of $0.5 million, lower bad debt expense of $0.5 million, and increases of $0.3 million in overage rent and ancillary income. Other property-related revenue primarily consists of parking revenues and other miscellaneous activity. This revenue increased by $0.1 million primarily due to an increase in parking revenue. We recorded fee income of $2.7 million and $1.3 million during the six months ended June 30, 2026 and 2025, respectively, from property management and development services provided to third parties and unconsolidated joint ventures. 39 The increase in fee income is primarily due to management fees earned during the six months ended June 30, 2026 related to the Legacy West Joint Venture and the Seed Asset Joint Venture. Property operating expenses increased $0.9 million, or 1.5%, due to the following (in thousands) : Net Change Six Months Ended June 30, 2025 to 2026 Properties or components of properties sold or held for sale during 2025 and/or 2026 $ (4,777) Properties under redevelopment or acquired during 2025 and/or 2026 491 Properties fully operational during 2025 and 2026 and other 5,190 Total $ 904 The net increase of $5.2 million in property operating expenses for properties that were fully operational during 2025 and 2026 is primarily due to increases in the following: (i) insurance expenses of $1.3 million; (ii) repairs and maintenance expenses of $1.3 million; (iii) non-recoverable operating expenses of $0.8 million; (iv) snow removal expenses of $0.7 million; (v) landscaping and parking lot expenses of $0.7 million; and (vi) security expenses of $0.2 million. As a percentage of revenue, property operating expenses increased from 13.5% to 15.0% due to an increase in expenses in 2026. Real estate taxes decreased $5.1 million, or 9.4%, due to the following (in thousands) : Net Change Six Months Ended June 30, 2025 to 2026 Properties or components of properties sold or held for sale during 2025 and/or 2026 $ (6,585) Properties under redevelopment or acquired during 2025 and/or 2026 327 Properties fully operational during 2025 and 2026 and other 1,148 Total $ (5,110) The net increase of $1.1 million in real estate taxes for properties that were fully operational during 2025 and 2026 is primarily due to higher real estate tax assessments at certain properties in the portfolio in 2026, partially offset by an increase in real estate tax refunds received during the six months ended June 30, 2026 and capitalized real estate taxes at certain properties in the portfolio. The majority of real estate tax expenses are recoverable from tenants, and such recovery is reflected within “Rental income” in the accompanying consolidated statements of operations and comprehensive income. General, administrative and other expenses increased $2.8 million, or 11.1%, primarily due to an increase in payroll expenses and share-based compensation in 2026. Depreciation and amortization expense decreased $32.0 million, or 16.3%, due to the following (in thousands) : Net Change Six Months Ended June 30, 2025 to 2026 Properties or components of properties sold or held for sale during 2025 and/or 2026 $ (23,190) Properties under redevelopment or acquired during 2025 and/or 2026 524 Properties fully operational during 2025 and 2026 and other (9,357) Total $ (32,023) The net decrease of $9.4 million in depreciation and amortization at properties that were fully operational during 2025 and 2026 is primarily due to the timing of placing assets in service and writing off tenant-related assets as a result of tenant move-outs. Based on the results of our evaluations for impairment (see Note 4 to the accompanying consolidated financial statements), we recorded a $5.9 million impairment charge on City Center during the six months ended June 30, 2026. In addition, we recorded a $1.0 million impairment charge related to the write-off of capitalized costs associated with an abandoned project. No impairment charges were recorded during the six months ended June 30, 2025. 40 Interest expense decreased $3.6 million, or 5.3%, primarily due to the payoffs of the following in 2025: (i) $350.0 million aggregate principal balance of the 4.00% senior unsecured notes that matured in March 2025, (ii) $150.0 million unsecured term loan in June 2025, and (iii) $80.0 million principal balance of the 4.47% senior unsecured notes that matured in September 2025, partially offset by interest incurred on the $300.0 million aggregate principal amount of the 5.20% senior unsecured notes issued in June 2025. We recorded a net gain on sales of operating properties of $87.7 million for the six months ended June 30, 2026 on the sales of eight operating retail properties and the ground lease interest in Lowe’s at Estero Town Commons compared to a net gain on sales of operating properties of $103.1 million on the sales of Stoney Creek Commons and Fullerton Metrocenter and the contribution of three previously wholly owned properties to the Seed Asset Joint Venture for the six months ended June 30, 2025. We recorded a net gain from outlot sales of $2.4 million for the six months ended June 30, 2026 primarily on the sale of a land parcel and the rights to develop 28 residential units at the One Loudoun Expansion in the Washington, D.C. MSA. We did not sell any land parcels during the six months ended June 30, 2025. During the six months ended June 30, 2026, we recognized a $60.6 million gain on the deconsolidation of the One Loudoun Residential Joint Venture related to adjusting our retained interest to fair value. No such gain was recognized during the three months ended June 30, 2025. Equity in loss of unconsolidated joint ventures decreased $0.3 million, or 7.4%, primarily due to improved operating performance at certain joint venture properties during the six months ended June 30, 2026 compared to the prior year. Other income, net increased $0.5 million, or 9.8%, primarily due to the receipt of insurance proceeds in excess of replacement cost during the six months ended June 30, 2026 related to the July 2025 severe flooding at Eastgate Crossing in the Durham-Chapel Hill MSA and an increase in interest income earned from 1031 Exchanges, partially offset by a decrease in interest income earned on bank accounts compared to the prior year. Net Operating Income and Same Property Net Operating Income We use net operating income (“NOI”), a non-GAAP financial measure, to evaluate the performance of our properties. We also use total property NOI, which is defined as NOI plus net gains from outlot sales. We define NOI as income from our real estate, including lease termination fees received from tenants, less our property operating expenses. NOI excludes amortization of capitalized tenant improvement costs and leasing commissions and certain corporate-level expenses, including merger and acquisition costs. We believe that NOI is helpful to investors as a measure of our operating performance because it excludes various items included in net income that do not relate to or are not indicative of our operating performance, such as depreciation and amortization, interest expense, and impairment, if any. We also use same property NOI (“Same Property NOI”), a non-GAAP financial measure, to evaluate the performance of our properties. Same Property NOI is net income excluding properties that have not been owned for the full periods presented. Beginning in 2026, we revised our Same Property NOI definition to exclude the results of the Company’s insurance captive to more clearly reflect the performance of our core real estate portfolio. Same Property NOI also excludes (i) net gains from outlot sales, (ii) straight-line rent revenue, (iii) lease termination income in excess of lost rent, (iv) amortization of lease intangibles, (v) significant prior period expense recoveries and adjustments, if any, and (vi) income or expense associated with the Company’s captive insurance company. When we receive payments in excess of any accounts receivable for terminating a lease, Same Property NOI will include such excess payments as monthly rent until the earlier of the expiration of 12 months or the start date of a replacement tenant. We believe that Same Property NOI is helpful to investors as a measure of our operating performance because it includes only the NOI of properties that have been owned for the full periods presented. We believe such presentation eliminates disparities in net income due to the acquisition or disposition of properties during the particular periods presented and thus provides a more consistent metric for the comparison of our properties. Additionally, because results from the Company’s insurance captive are driven by insurance underwriting, loss experience, and actuarial assumptions and therefore do not reflect the operating performance of our real estate properties, we believe excluding the impacts of the insurance captive improves transparency and comparability for our investors. Same Property NOI includes the results of properties that have been owned for the entire current and prior year reporting periods. Same Property NOI for all periods presented includes (i) 52% of the NOI from three previously wholly owned properties that were contributed to the Seed Asset Joint Venture in June 2025 and (ii) 55% of the NOI from the One Loudoun Phase 1 Apartments (which 55% represents the Company’s expected final ownership percentage) and excludes the results of the Company’s insurance captive. 41 NOI and Same Property NOI should not, however, be considered as an alternative to net income (calculated in accordance with GAAP) as an indicator of our financial performance. Our computation of NOI and Same Property NOI may differ from the methodology used by other REITs and, therefore, may not be comparable to such other REITs. When evaluating the properties that are included in the Same Property Pool, we have established specific criteria for determining the inclusion of properties acquired or those recently under development. An acquired property is included in the Same Property Pool when there is a full quarter of operations in both years subsequent to the acquisition date. Development and redevelopment properties are included in the Same Property Pool four full quarters after the properties have been transferred to the operating portfolio. A redevelopment property is first excluded from the Same Property Pool when the execution of a redevelopment plan is likely, and we (a) begin recapturing space from tenants or (b) the contemplated plan significantly impacts the operations of the property. For the three and six months ended June 30, 2026, the Same Property Pool excludes the following: • Chastain Market and Founders Square, which were acquired in May 2026, and Village Commons and Legacy West, which were acquired in January and April 2025, respectively; • The Corner – IN, which was reclassified from active development into our operating portfolio in March 2025; • Eastgate Crossing, which was reclassified from our operating portfolio in September 2025 due to significant disruption caused by severe flooding as a result of Tropical Storm Chantal; • our active development projects at One Loudoun; • Hamilton Crossing Centre and Edwards Multiplex – Ontario, which were reclassified from our operating portfolio into redevelopment in June 2014 and March 2023, respectively; • properties sold or classified as held for sale during 2025 and 2026; and • standalone office properties, including the Carillon medical office building. 42 The following table presents Same Property NOI and a reconciliation to net income attributable to common shareholders for the three and six months ended June 30, 2026 and 2025 (dollars in thousands) : Three Months Ended June 30, Six Months Ended June 30, 2026 2025 Change 2026 2025 Change Number of properties in Same Property Pool for the period (1) 158 158 158 158 Leased percentage at period end 94.7 % 93.8 % 94.7 % 93.8 % Economic occupancy percentage at period end 91.2 % 90.9 % 91.2 % 90.9 % Economic occupancy percentage (2) 90.9 % 91.0 % 91.0 % 91.5 % Same Property NOI (3) $ 131,660 $ 126,943 3.7 % $ 262,984 $ 253,632 3.7 % Reconciliation of Same Property NOI to most directly comparable GAAP measure: Net operating income – same properties $ 131,660 $ 126,943 $ 262,984 $ 253,632 Net operating income – sold properties 7,563 23,414 14,388 54,531 Net operating income – non-same activity (4) 5,294 7,078 13,234 12,641 Less: KRG share of unconsolidated joint ventures included in Same Property NOI above (2,610) (430) (5,238) (734) Net gains from outlot sales 1,364 — 2,403 — Total property NOI 143,271 157,005 (8.7 %) 287,771 320,070 (10.1 %) Other income (expense), net 2,777 (2,099) 4,034 2,452 General, administrative and other (14,543) (13,390) (28,493) (25,648) Impairment charges (980) — (6,868) — Depreciation and amortization (81,604) (97,887) (164,095) (196,118) Interest expense (31,743) (34,052) (63,439) (67,006) Gain on sales of operating properties, net 87,727 103,022 87,727 103,113 Gain on deconsolidation of joint venture 60,625 — 60,625 — Net income attributable to noncontrolling interests (4,226) (2,281) (4,564) (2,815) Net income attributable to common shareholders $ 161,304 $ 110,318 $ 172,698 $ 134,048 (1) Same Property NOI excludes the following: (i) Chastain Market and Founders Square, which were acquired in May 2026, and Village Commons and Legacy West, which were acquired in January and April 2025, respectively; (ii) The Corner – IN, which was reclassified from active development into our operating portfolio in March 2025; (iii) Eastgate Crossing, which was reclassified from our operating portfolio in September 2025 due to significant disruption caused by severe flooding as a result of Tropical Storm Chantal; (iv) our active development projects at One Loudoun; (v) Hamilton Crossing Centre and Edwards Multiplex – Ontario, which were reclassified from our operating portfolio into redevelopment in June 2014 and March 2023, respectively; (vi) properties sold or classified as held for sale during 2025 and 2026; and (vii) standalone office properties, including the Carillon medical office building. (2) Excludes leases that are signed but for which tenants have not yet commenced the payment of cash rent; calculated as a weighted average based on the timing of cash rent commencement and expiration during the period. (3) Same Property NOI for all periods presented includes (i) 52% of the NOI from three previously wholly owned properties that were contributed to the Seed Asset Joint Venture in June 2025 and (ii) 55% of the NOI from the One Loudoun Phase 1 Apartments (which 55% represents the Company’s expected final ownership percentage) and excludes the results of the Company’s insurance captive. (4) Includes non-cash activity as well as NOI from properties not included in the Same Property Pool. Our Same Property NOI increased 3.7% for the three months ended June 30, 2026 compared to the same period of the prior year primarily due to contractual rent growth and higher base rent driven by positive new and renewal leasing spreads. NAREIT Funds From Operations NAREIT Funds From Operations (“FFO”) is a widely used performance measure for real estate companies and is provided here as a supplemental measure of our operating performance. We calculate FFO, a non-GAAP financial measure, in accordance with the best practices described in the April 2002 National Policy Bulletin of the National Association of Real Estate Investment Trusts (“NAREIT”), as restated in 2018. The NAREIT white paper defines FFO as net income (calculated in accordance with GAAP), excluding (i) depreciation and amortization related to real estate, (ii) gains and losses from the sale of certain real estate assets, (iii) gains and losses from change in control, and (iv) impairment write-downs of certain real estate 43 assets and investments in entities when the impairment is directly attributable to decreases in the value of depreciable real estate held by the entity. Considering the nature of our business as a real estate owner and operator, we believe that FFO is helpful to investors in measuring our operational performance because it excludes various items included in net income that do not relate to or are not indicative of our operating performance, such as gains or losses from sales of depreciated property and depreciation and amortization, which can make periodic and peer analyses of operating performance more difficult. FFO (a) should not be considered as an alternative to net income (calculated in accordance with GAAP) for the purpose of measuring our financial performance, (b) is not an alternative to cash flows from operating activities (calculated in accordance with GAAP) as a measure of our liquidity, and (c) is not indicative of funds available to satisfy our cash needs, including our ability to make distributions. Our computation of FFO may not be comparable to FFO reported by other REITs that do not define the term in accordance with the current NAREIT definition or that interpret the current NAREIT definition differently than we do. From time to time, we may report or provide guidance with respect to “FFO, as adjusted,” which removes the impact of certain non-recurring and non-operating transactions or other items the Company does not consider to be representative of its core operating results, including, without limitation, (i) gains or losses associated with the early extinguishment of debt, (ii) gains or losses associated with litigation involving the Company that is not in the normal course of business, (iii) merger and acquisition costs, (iv) the impact on earnings from significant and non-recurring employee severance costs and recruiting expenses, including sign-on bonuses and search fees, (v) the excess of redemption value over carrying value of preferred stock redemption, and (vi) the impact of prior period bad debt or the collection of accounts receivable previously written off (“prior period collection impact”), which are not otherwise adjusted in our calculation of FFO. Core Funds From Operations (“Core FFO”) is a non-GAAP financial measure of operating performance that modifies FFO for certain non-cash transactions that result in recording income or expense and impact our period-over-period performance, including (i) amortization of deferred financing costs, (ii) non-cash compensation expense and other, (iii) straight-line rent related to minimum rent and common area maintenance, (iv) market rent amortization income, and (v) amortization of debt discounts, premiums and hedge instruments, and includes adjustments related to our pro rata share from unconsolidated joint ventures for these categories as applicable. We believe that Core FFO is useful to investors in evaluating our core cash flow-generating operations by adjusting for items that we do not consider to be part of our core business operations, allowing for comparison of our core operating performance between periods. Core FFO should not be considered as an alternative to net income as an indicator of our performance or as an alternative to cash flow as a measure of liquidity or our ability to make distributions. Our computation of Core FFO may differ from the methodology for calculating Core FFO used by other REITs and, therefore, may not be comparable to such other REITs. 44 Our calculations of FFO and reconciliation to net income and Core FFO for the three and six months ended June 30, 2026 and 2025 (unaudited) are as follows (dollars in thousands) : Three Months Ended June 30, Six Months Ended June 30, 2026 2025 2026 2025 Net income $ 165,530 $ 112,599 $ 177,262 $ 136,863 Less: net income attributable to noncontrolling interests in properties (56) (81) (126) (151) Less: gain on sales of operating properties, net (87,727) (103,022) (87,727) (103,113) Less: gain on deconsolidation of joint venture (60,625) — (60,625) — Add: impairment charges 980 — 6,868 — Add: depreciation and amortization of consolidated and unconsolidated entities, net of noncontrolling interests 90,996 104,469 182,820 203,146 NAREIT FFO of the Operating Partnership (1) 109,098 113,965 218,472 236,745 Less: Limited Partners’ interests in FFO (2,789) (2,466) (5,412) (4,929) FFO attributable to common shareholders (1) $ 106,309 $ 111,499 $ 213,060 $ 231,816 NAREIT FFO per share of the Operating Partnership – diluted $ 0.53 $ 0.51 $ 1.04 $ 1.05 Reconciliation of NAREIT FFO to Core FFO (2) NAREIT FFO of the Operating Partnership (1) $ 109,098 $ 113,965 $ 218,472 $ 236,745 Add: Amortization of deferred financing costs 1,850 1,751 3,657 3,395 Non-cash compensation expense and other 3,674 3,221 6,889 5,881 Less: Straight-line rent – minimum rent and common area maintenance 2,979 2,835 5,120 5,413 Market rent amortization income 2,253 1,879 4,342 5,421 Amortization of debt discounts, premiums and hedge instruments 1,030 890 2,059 3,646 Core FFO of the Operating Partnership $ 108,360 $ 113,333 $ 217,497 $ 231,541 Core FFO per share of the Operating Partnership – diluted $ 0.52 $ 0.50 $ 1.04 $ 1.03 (1) “NAREIT FFO of the Operating Partnership” measures 100% of the operating performance of the Operating Partnership’s real estate properties. “FFO attributable to common shareholders” reflects a reduction for the redeemable noncontrolling weighted average diluted interest in the Operating Partnership. (2) Includes the Company’s pro rata share from unconsolidated joint ventures. Earnings before Interest, Taxes, Depreciation and Amortization (“EBITDA”) We define EBITDA, a non-GAAP financial measure, as net income before interest expense, income tax expense of the taxable REIT subsidiaries, and depreciation and amortization. For informational purposes, we also provide Adjusted EBITDA, which we define as EBITDA less (i) EBITDA from unconsolidated entities, as adjusted, (ii) gains on sales of operating properties or impairment charges, (iii) merger and acquisition costs, (iv) other income and expense, (v) noncontrolling interest Adjusted EBITDA, and (vi) other non-recurring activity or items impacting comparability from period to period. Annualized Adjusted EBITDA is Adjusted EBITDA for the most recent quarter multiplied by four. Net Debt to Adjusted EBITDA is our share of net debt divided by Annualized Adjusted EBITDA. EBITDA, Adjusted EBITDA, Annualized Adjusted EBITDA, and Net Debt to Adjusted EBITDA, as calculated by us, are not comparable to EBITDA and EBITDA-related measures reported by other REITs that do not define EBITDA and EBITDA-related measures exactly as we do. EBITDA, Adjusted EBITDA, and Annualized Adjusted EBITDA do not represent cash generated from operating activities in accordance with GAAP and should not be considered alternatives to net income as an indicator of performance or as alternatives to cash flows from operating activities as an indicator of liquidity. Considering the nature of our business as a real estate owner and operator, we believe that EBITDA, Adjusted EBITDA, and the ratio of Net Debt to Adjusted EBITDA are helpful to investors in measuring our operational performance because they exclude various items included in net income that do not relate to or are not indicative of our operating performance, such as gains or losses from sales of depreciated property and depreciation and amortization, which can make periodic and peer analyses of operating performance more difficult. For informational purposes, we also provide Annualized Adjusted EBITDA, adjusted as described above. We believe this supplemental information provides a meaningful measure of our operating 45 performance. We believe presenting EBITDA and the related measures in this manner allows investors and other interested parties to form a more meaningful assessment of our operating results. The following table presents a reconciliation of our EBITDA, Adjusted EBITDA, and Annualized Adjusted EBITDA to net income (the most directly comparable GAAP measure) and a calculation of Net Debt to Adjusted EBITDA (in thousands) : Three Months Ended June 30, 2026 Net income $ 165,530 Depreciation and amortization 81,604 Interest expense 31,743 Income tax expense of taxable REIT subsidiaries 426 EBITDA 279,303 Unconsolidated EBITDA, as adjusted 11,005 Impairment charges 980 Gain on sales of operating properties, net (87,727) Gain on deconsolidation of joint venture (60,625) Other income and expense, net (1,825) Adjustments for acquisitions and dispositions (1) (4,068) Adjusted EBITDA $ 137,043 Annualized Adjusted EBITDA (2) $ 548,172 Company share of Net Debt: Mortgage and other indebtedness, net $ 2,842,758 Add: Company share of unconsolidated joint venture debt 276,348 Add: debt discounts, premiums and issuance costs, net 2,411 Less: Partner share of consolidated joint venture debt (3) (220) Company’s consolidated debt and share of unconsolidated debt 3,121,297 Less: cash and cash equivalents (144,578) Less: restricted cash and escrow deposits (176,831) Less: Company share of unconsolidated joint venture cash and cash equivalents (15,676) Company share of Net Debt $ 2,784,212 Net Debt to Adjusted EBITDA 5.1x (1) Relates to current quarter GAAP operating income for the acquisitions of Chastain Market and Founders Square and the sale of seven properties during the three months ended June 30, 2026 during the period of ownership. (2) Represents Adjusted EBITDA for the three months ended June 30, 2026 (as shown in the table above) multiplied by four. (3) Partner share of consolidated joint venture debt is calculated based upon the partner’s pro rata ownership of the joint venture, multiplied by the related secured debt balance. Liquidity and Capital Resources Overview Our primary finance and capital strategy is to maintain a strong balance sheet with sufficient flexibility to fund our operating and investment activities in a cost-effective manner. We consider a number of factors when evaluating our level of indebtedness and making decisions regarding additional borrowings or equity offerings, including the interest or dividend rate, the maturity date and the Company’s debt maturity ladder, the impact of financial metrics such as overall Company leverage levels and coverage ratios, and the Company’s ability to generate cash flow to cover debt service. We continuously monitor the capital markets and may consider raising additional capital through the issuance of our common or preferred shares, unsecured debt securities, or other securities. As of June 30, 2026, we had approximately $144.6 million in cash and cash equivalents on hand, $176.8 million in restricted cash and escrow deposits, and $1.1 billion of remaining availability under the $1.1 billion unsecured revolving credit facility (the “Revolving Facility”) compared to $606.6 million of total debt maturing over the next 12 months. Subsequent to 46 June 30, 2026, we issued $345.0 million aggregate principal amount of 3.25% exchangeable senior notes due 2032 (the “2026 Exchangeable Notes”), and a portion of such proceeds, together with the proceeds from our recent asset dispositions, were used or will be used to (i) repurchase approximately $30.0 million of the Company’s common shares concurrently with the pricing of the 2026 Exchangeable Notes in privately negotiated transactions through one of the initial purchasers of the 2026 Exchangeable Notes or its affiliates, as the Operating Partnership’s agent, and (ii) repay or redeem the $300.0 million aggregate principal balance of the 4.00% senior unsecured notes due October 2026 at or prior to maturity. We believe we will have adequate liquidity over the next 12 months and beyond to operate our business and meet our cash requirements. We derive the majority of our revenue from tenants who lease space from us under existing lease agreements at each of our properties. Therefore, our ability to generate cash from operations is dependent upon the rents that we are able to charge and collect from our tenants. While we believe that the nature of the properties in which we typically invest—primarily neighborhood and community shopping centers—provides a relatively stable revenue flow, an economic downturn, tenant bankruptcies, inflation, tariffs, labor shortages, supply chain constraints, severe weather events, and/or increasing energy prices and interest rates, among other events, could adversely affect the ability of some of our tenants to meet their lease obligations. Our Principal Capital Resources For a discussion of cash generated from operations, see “Cash Flows” beginning on page 50. In addition to cash generated from operations, our other principal capital resources are discussed below. Over the last several years, we have made substantial progress in enhancing our liquidity position and reducing our leverage and borrowing costs. We continue to focus on a balanced approach to growth and staggering debt maturities to retain our financial flexibility. As of June 30, 2026, we had approximately $1.1 billion available under the Revolving Facility for future borrowings. We also had $144.6 million in cash and cash equivalents as of June 30, 2026. We were in compliance with all applicable financial covenants under the Revolving Facility, unsecured term loans, and senior unsecured notes as of June 30, 2026. On June 7, 2024, the Company filed a shelf registration statement with the SEC on Form S-3, which is effective for a term of three years, relating to the offer and sale, from time to time, of an indeterminate amount of equity and debt securities. Equity securities may be offered and sold by the Parent Company, and the net proceeds of any such offerings would be contributed to the Operating Partnership in exchange for additional General Partner Units. Debt securities may be offered and sold by the Operating Partnership with the Operating Partnership receiving the proceeds. From time to time, we may issue securities under this shelf registration statement for general corporate purposes, which may include acquisitions of additional properties, repayment of outstanding indebtedness, capital expenditures, the expansion, redevelopment, and/or improvement of properties in our portfolio, working capital, and other general purposes. In the future, we will continue to monitor the capital markets and may consider raising additional capital through the issuance of our common shares, preferred shares, or other securities. We may also raise capital by disposing of properties, land parcels, or other assets that are no longer core components of our growth strategy. The sales price may differ from our carrying value at the time of sale. Our Principal Liquidity Needs Short-Term Liquidity Needs Near-Term Debt Maturities . As of June 30, 2026, we have $30.5 million of secured debt, excluding scheduled monthly principal payments, and $575.0 million of unsecured debt scheduled to mature over the next 12 months. We believe we have sufficient liquidity to repay these obligations through a combination of proceeds from the 2026 Exchangeable Notes, asset sales, cash flows generated from operations, capital markets transactions, and borrowings on the Revolving Facility. Other Short-Term Liquidity Needs. The requirements for qualifying as a REIT and for a tax deduction for some or all of the dividends paid to shareholders necessitate that we distribute at least 90% of our taxable income on an annual basis. Such requirements cause us to have substantial liquidity needs over both the short and long term. Our short-term liquidity needs consist primarily of funds necessary to pay operating expenses associated with our operating properties, scheduled interest and principal payments on our debt of approximately $62.5 million and $1.9 million, respectively, for the remainder of 2026, expected dividend payments to our common shareholders and common unit holders, and recurring capital expenditures. 47 In April 2026, our Board of Trustees declared a cash distribution of $0.29 per common share and Common Unit for the second quarter of 2026. This distribution was paid on July 16, 2026 to common shareholders and common unit holders of record as of July 9, 2026. Future distributions, if any, are at the discretion of the Board of Trustees, who will continue to evaluate our sources and uses of capital, liquidity position, operating fundamentals, maintenance of our REIT qualification, and other factors they may deem relevant. We believe we have sufficient liquidity to pay any dividend from available cash on hand and borrowings on the Revolving Facility. Other short-term liquidity needs include expenditures for tenant improvements, external leasing commissions, and recurring capital expenditures. During the six months ended June 30, 2026, we incurred $14.6 million for recurring capital expenditures on operating properties and $49.5 million for tenant improvements and external leasing commissions, which includes costs to re-lease anchor space at our operating properties related to tenants open and operating as of June 30, 2026 (excluding development and redevelopment properties). We currently anticipate incurring approximately $175 million of additional major tenant improvement costs related to executed leases for tenants not yet open at a number of our operating properties over the next 12 to 24 months. We believe we have the ability to fund these costs through cash flows generated from operations or borrowings on the Revolving Facility. During the three months ended June 30, 2026, we began development activities on the One Loudoun Phase 2 Apartments in the Washington, D.C. MSA, which we estimate will incur net project costs of approximately $93.5 million to $103.5 million. Our share of the expected funding requirement is approximately $27.5 million to $37.5 million, and as of June 30, 2026, we have incurred $2.0 million of these costs. In addition, as of June 30, 2026, the retail and office portions of the One Loudoun Expansion in the Washington, D.C. MSA were under construction. Our share of the total estimated costs for this project is approximately $87.0 million to $94.0 million, of which our share of the expected funding requirement is approximately $72.0 million to $79.0 million. As of June 30, 2026, we have incurred $27.0 million of these costs. We anticipate incurring the majority of the remaining costs for these projects over the next 12 to 24 months and believe we can fund these projects through cash flows generated from operations or borrowings on the Revolving Facility. Share Repurchase Program In February 2021, our Board of Trustees approved a share repurchase program under which the Company may repurchase, from time to time, up to an aggregate of $150.0 million of our common shares. In April 2022, our Board of Trustees increased the size of the program from $150.0 million to $300.0 million of our common shares, and in February 2026, further increased the size of the program from $300.0 million to $600.0 million of our common shares (the “Share Repurchase Program”). The Company intends to fund any future repurchases under the Share Repurchase Program with available cash on hand or availability under the Revolving Facility, subject to any applicable restrictions. The timing of share repurchases and the number of common shares to be repurchased under the Share Repurchase Program will depend upon prevailing market conditions, regulatory requirements, and other factors. In November 2025, the Company extended the Share Repurchase Program for an additional year to February 28, 2027, if not terminated or extended prior to that date. During the six months ended June 30, 2026 , the Company repurchased approximately 8.8 million common shares at an average price per share of $25.91 for a total of $228.0 million, excluding commissions. The common shares repurchased during the six months ended June 30, 2026 include approximately 1.0 million common shares repurchased in conjunction with the pricing of the 2026 Exchangeable Notes on June 29, 2026, at a price of $28.90 per share, for a total of approximately $30.0 million. As of June 30, 2026, $124.3 million remained available for repurchases of common shares under the Company’s Share Repurchase Program. Long-Term Liquidity Needs Our long-term liquidity needs consist primarily of funds necessary to pay for any new development projects, redevelopment of existing properties, non-recurring capital expenditures, property acquisitions, payment of indebtedness at maturity, and obligations under ground leases. Selective Acquisitions, Developments and Joint Ventures . We may selectively pursue the acquisition, development, and redevelopment of other properties, which would require additional capital. It is unlikely that we would have sufficient funds on hand to meet these long-term capital requirements; therefore, we would have to satisfy these needs through additional borrowings, sales of common or preferred shares, issuance of Operating Partnership units, cash generated through property dispositions, and/or participation in joint venture arrangements. We cannot be certain that we would have access to these sources of capital on satisfactory terms, if at all, to fund our long-term liquidity requirements. We evaluate all future opportunities against pre-established criteria, including, but not limited to, location, demographics, expected return, tenant 48 credit quality, tenant relationships, and the amount of existing retail space. Our ability to access the capital markets will depend on a number of factors, including general capital market conditions. Potential Debt Repurchases. We may, from time to time, depending on market conditions and prices, contractual restrictions, our financial liquidity, and other factors, seek to repurchase our senior unsecured notes maturing at various dates through March 2034 in open market transactions, by tender offer, or otherwise, as market conditions warrant. Commitments under Ground Leases. We are obligated under 11 ground leases for approximately 98 acres of land as of June 30, 2026. Most of these ground leases require fixed annual rent payments, and the expiration dates of the remaining initial terms of these ground leases range from 2028 to 2092. Assuming we exercise all available options to extend the terms of our ground leases, they will expire between 2045 and 2115. Capital Expenditures on Consolidated Properties The following table summarizes cash capital expenditures for our development and redevelopment projects and other capital expenditures for the six months ended June 30, 2026 (in thousands) : Six Months Ended June 30, 2026 Active development and redevelopment projects $ 14,493 Recurring operating capital expenditures (primarily tenant improvements) and other 52,264 Total $ 66,757 We capitalize certain indirect costs such as interest, payroll, and other general and administrative costs related to these development activities. If we had experienced a 10% reduction in development and redevelopment activities without a corresponding decrease in indirect project costs, we would have recorded additional expense of $0.2 million for the six months ended June 30, 2026. Debt Maturities The following table summarizes the scheduled maturities and principal amortization of the Company’s consolidated indebtedness as of June 30, 2026, presented on a calendar year basis (in thousands) : Secured Debt Scheduled Principal Payments Term Maturities Unsecured Debt Total 2026 $ 1,908 $ 10,600 $ 400,000 $ 412,508 2027 2,662 19,906 500,000 522,568 2028 2,453 — 100,000 102,453 2029 2,568 — 400,000 402,568 2030 1,980 100 400,000 402,080 Thereafter 751 2,241 1,000,000 1,002,992 $ 12,322 $ 32,847 $ 2,800,000 $ 2,845,169 Debt discounts, premiums and issuance costs, net (2,411) Mortgage and other indebtedness, net $ 2,842,758 Failure to comply with the obligations under our debt agreements, including payment obligations, could cause an event of default under such debt, which, among other things, could result in the loss of title to the assets securing the debt, acceleration of the payment of all principal and interest and/or termination of the agreements, or exposure to the risk of foreclosure. In addition, certain of our variable rate loans contain cross-default provisions whereby a violation by the Company of any financial covenant set forth in the Revolving Facility will constitute an “Event of Default” under the loans, which could allow the lenders to accelerate the amounts due under our debt agreements if we fail to satisfy these financial covenants. See Item 1A. “Risk Factors – Risks Related to Our Operations” in our Annual Report on Form 10-K for the year ended December 31, 2025 for more information related to the risks associated with our indebtedness. 49 Impact of Changes in Credit Ratings on Our Liquidity We have received investment-grade corporate credit ratings from three nationally recognized credit rating agencies. These ratings did not change as of June 30, 2026. In the future, these ratings could change based upon, among other things, the impact that prevailing economic conditions may have on our results of operations and financial condition. Credit rating reductions by one or more rating agencies could also adversely affect our access to funding sources, the cost and other terms of obtaining funding, as well as our overall financial condition, operating results and cash flow. Cash Flows As of June 30, 2026, we had cash, cash equivalents and restricted cash of $321.4 million. We may be subject to concentrations of credit risk with regard to our cash and cash equivalents. We place our cash and short-term investments with highly rated financial institutions. While we attempt to limit our exposure at any point in time, occasionally such cash and investments may temporarily exceed the Federal Deposit Insurance Corporation and the Securities Investor Protection Corporation insurance limits. We also maintain certain compensating balances in several financial institutions in support of borrowings from those institutions. Such compensating balances were not material to the accompanying consolidated balance sheets. Comparison of the Six Months Ended June 30, 2026 to the Six Months Ended June 30, 2025 The following table summarizes our cash flow activities (in thousands) : Six Months Ended June 30, 2026 2025 Change Net cash provided by operating activities $ 176,543 $ 206,894 $ (30,351) Net cash provided by investing activities 107,236 178,030 (70,794) Net cash used in financing activities (440,761) (330,641) (110,120) (Decrease) increase in cash, cash equivalents and restricted cash (156,982) 54,283 (211,265) Cash, cash equivalents and restricted cash, at beginning of period 478,391 133,552 Cash, cash equivalents and restricted cash, at end of period $ 321,409 $ 187,835 Cash provided by operating activities was $176.5 million for the six months ended June 30, 2026 and $206.9 million for the same period of 2025. The cash flows were negatively impacted by a decrease in net operating income and changes to other working capital accounts. Cash provided by investing activities was $107.2 million for the six months ended June 30, 2026 and $178.0 million for the same period of 2025. Highlights of significant cash sources and uses in investing activities are as follows: • We acquired Chastain Market, Founders Square, a vacant land parcel in the Indianapolis MSA, and made acquisition deposits totaling $143.2 million during the six months ended June 30, 2026 compared to the acquisition of Village Commons for $67.9 million during the six months ended June 30, 2025; • Capital expenditures decreased by $13.0 million primarily related to the timing of capital projects; • We received net proceeds of $322.7 million from the sale of eight operating retail properties, the ground lease interest in one tenant at an existing property, and a land parcel and the rights to develop 28 residential units at the One Loudoun Expansion during the six months ended June 30, 2026 compared to net proceeds of $232.5 million from the sale of Stoney Creek Commons and Fullerton Metrocenter and the contribution of three previously wholly owned properties to the Seed Asset Joint Venture during the six months ended June 30, 2025; • We invested $253.9 million in the Legacy West Joint Venture during the six months ended June 30, 2025; • We received $350.0 million in principal upon maturity of the short-term certificates of deposit in February 2025; • We received a distribution of $0.4 million from an unconsolidated joint venture during the six months ended June 30, 2026 compared to the receipt of distributions totaling $2.8 million from unconsolidated joint ventures during the six months ended June 30, 2025; and 50 • We contributed $0.3 million to an unconsolidated joint venture during the six months ended June 30, 2026 related to our share of debt service on the construction loan at The Corner – IN, of which we own a 50% interest, compared to contributions totaling $2.2 million to The Corner – IN Joint Venture during the six months ended June 30, 2025 related to our share of a developer fee and debt service on the construction loan. Cash used in financing activities was $440.8 million for the six months ended June 30, 2026 and $330.6 million for the same period of 2025. Highlights of significant cash sources and uses in financing activities are as follows: • We paid $198.1 million, including commissions, to repurchase common shares through our Share Repurchase Program during the six months ended June 30, 2026. We did not repurchase any shares during the six months ended June 30, 2025; • We borrowed $319.0 million on the Revolving Facility during the six months ended June 30, 2026 compared to borrowings of $398.0 million on the Revolving Facility and the receipt of $298.5 million of proceeds from the public offering of $300.0 million aggregate principal amount of 5.20% senior unsecured notes due 2032 during the six months ended June 30, 2025; • We repaid the following during the six months ended June 30, 2026: (i) $404.0 million of borrowings on the Revolving Facility and (ii) $2.7 million of mortgages payable compared to the following repayments during the six months ended June 30, 2025: (i) $398.0 million of borrowings on the Revolving Facility, (ii) $350.0 million principal balance of the 4.00% senior unsecured notes that matured on March 15, 2025, (iii) $150.0 million unsecured term loan that was scheduled to mature on July 17, 2026, and (iv) $2.6 million of mortgages payable; and • We made distributions to common shareholders and holders of common partnership interests in the Operating Partnership of $153.2 million during the six months ended June 30, 2026 compared to distributions of $122.4 million during the six months ended June 30, 2025. Critical Accounting Estimates We based the discussion and analysis of our financial condition and results of operations upon our consolidated financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States. The preparation of these financial statements requires management to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses. There were no changes made by management to the critical accounting policies in the three months ended June 30, 2026. We discuss the most critical estimates in our Annual Report on Form 10-K for the year ended December 31, 2025 filed with the SEC on February 17, 2026.