MACERICH CO 10-K

ITEM 9A. CONTROLS AND PROCEDURES Conclusion Regarding Effectiveness of Disclosure Controls and Procedures As required by Rule 13a-15(b) under the Securities and Exchange Act of 1934, as amended (the "Exchange Act"), management carried out an evaluation, under the supervision and with the participation of the Company's Chief Executive Officer and Chief Financial Officer, of the effectiveness of the Company's disclosure controls and procedures as of the end of the period covered by this Annual Report on Form 10-K. Based on their evaluation as of December 31, 2021, the Company's Chief Executive Officer and Chief Financial Officer have concluded that the Company's disclosure controls and procedures (as defined in Rule 13a-15(e) and 15d-15(e) under the Exchange Act) were effective to ensure that the information required to be disclosed by the Company in the reports that it files or submits under the Exchange Act is (a) recorded, processed, summarized, 58 and reported within the time periods specified in the SEC's rules and forms and (b) accumulated and communicated to the Company's management, including its Chief Executive Officer and Chief Financial Officer, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure. Management's Report on Internal Control Over Financial Reporting The Company's management is responsible for establishing and maintaining adequate internal control over financial reporting (as defined in Rule 13a-15(f) under the Exchange Act). The Company's management assessed the effectiveness of the Company's internal control over financial reporting as of December 31, 2021. In making this assessment, the Company's management used the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission in Internal Control—Integrated Framework (2013). The Company's management concluded that, as of December 31, 2021, its internal control over financial reporting was effective based on this assessment. KPMG LLP, the independent registered public accounting firm that audited the Company's 2021 consolidated financial statements included in this Annual Report on Form 10-K, has issued a report on the Company's internal control over financial reporting which follows below. Changes in Internal Control over Financial Reporting There were no changes in the Company's internal control over financial reporting during the quarter ended December 31, 2021 that have materially affected, or are reasonably likely to materially affect, the Company's internal control over financial reporting. 59 Report of Independent Registered Public Accounting Firm To the Stockholders and Board of Directors of The Macerich Company: Opinion on Internal Control Over Financial Reporting We have audited The Macerich Company and subsidiaries' (the Company) internal control over financial reporting as of December 31, 2021, 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, 2021, 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 sheets of the Company as of December 31, 2021 and 2020, the related consolidated statements of operations, comprehensive income (loss), equity, and cash flows for each of the years in the three-year period ended December 31, 2021, and the related notes and financial statement Schedule III - Real Estate and Accumulated Depreciation (collectively, the consolidated financial statements), and our report dated February 25, 2022 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's 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 Los Angeles, California February 25, 2022 60 ITEM 9B. OTHER INFORMATION None ITEM 9C. DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS Not Applicable PART III ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE The information required by Item 10 will be included in the Company’s definitive proxy statement to be filed for its 2022 Annual Meeting of Stockholders and is incorporated by reference herein. The Company has adopted a Code of Business Conduct and Ethics that provides principles of conduct and ethics for its directors, officers and employees. This Code complies with the requirements of the Sarbanes-Oxley Act of 2002 and applicable rules of the Securities and Exchange Commission and the New York Stock Exchange. In addition, the Company has adopted a Code of Ethics for CEO and Senior Financial Officers which supplements the Code of Business Conduct and Ethics applicable to all employees and complies with the additional requirements of the Sarbanes-Oxley Act of 2002 and applicable rules of the Securities and Exchange Commission for those officers. To the extent required by applicable rules of the Securities and Exchange Commission and the New York Stock Exchange, the Company intends to promptly disclose future amendments to certain provisions of these Codes or waivers of such provisions granted to directors and executive officers, including the Company’s principal executive officer, principal financial officer, principal accounting officer or persons performing similar functions, on the Company’s website at www.macerich.com under "Investors—Corporate Governance—Code of Ethics." Each of these Codes of Conduct is available on the Company’s website at www.macerich.com under "Investors—Corporate Governance." During 2021, there were no material changes to the procedures described in the Company's proxy statement relating to the 2021 Annual Meeting of Stockholders by which stockholders may recommend director nominees to the Company. ITEM 11. EXECUTIVE COMPENSATION The information required by Item 11 will be included in the Company’s definitive proxy statement to be filed for its 2022 Annual Meeting of Stockholders and is incorporated by reference herein. ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS The information required by Item 12 will be included in the Company’s definitive proxy statement to be filed for its 2022 Annual Meeting of Stockholders and is incorporated by reference herein. ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE The information required by Item 13 will be included in the Company’s definitive proxy statement to be filed for its 2022 Annual Meeting of Stockholders and is incorporated by reference herein. ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES The information required by Item 14 will be included in the Company’s definitive proxy statement to be filed for its 2022 Annual Meeting of Stockholders and is incorporated by reference herein. 61 PART IV ITEM 15. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES Page (a) and (c) 1 Financial Statements Report of Independent Registered Public Accounting Firm (KPMG LLP, Los Angeles, CA, PCAOB Auditor Firm ID: 185 ) 63 Consolidated balance sheets as of December 31, 2021 and 202 0 65 Consolidated statements of operations for the years ended December 31, 2021, 2020 and 2019 66 Consolidated statements of comprehensive income (loss) for the years ended December 31, 2021, 2020 and 2019 67 Consolidated statements of equity for the years ended December 31, 2021, 2020 and 2019 68 Consolidated statements of cash flows for the years ended December 31, 2021, 2020 and 2019 71 Notes to consolidated financial statements 73 2 Financial Statement Schedule Schedule III—Real estate and accumulated depreciation 106 (b) Exhibit Index 109 ITEM 16. FORM 10-K SUMMARY Not applicable. 62 Report of Independent Registered Public Accounting Firm To the Stockholders and Board of Directors of The Macerich Company: Opinion on the Consolidated Financial Statements We have audited the accompanying consolidated balance sheets of The Macerich Company and subsidiaries (the Company) as of December 31, 2021 and 2020, the related consolidated statements of operations, comprehensive income (loss), equity, and cash flows for each of the years in the three-year period ended December 31, 2021, and the related notes and financial statement Schedule III - 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, 2021 and 2020, and the results of its operations and its cash flows for each of the years in the three-year period ended December 31, 2021, 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, 2021, 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 25, 2022 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 Matters The critical audit matters communicated below are matters arising from the current period audit of the consolidated financial statements that were communicated or required to be communicated to the audit committee and that: (1) relate 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 critical audit matters 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 matters below, providing separate opinions on the critical audit matters or on the accounts or disclosures to which they relate. Assessment of the Company’s evaluation of the expected holding period for operating properties As discussed in Notes 2 and 6 to the consolidated financial statements, the Company assesses whether an indicator of impairment in the carrying value of its properties exists by considering property operating performance, holding periods, capitalization rates, and other market factors. Property, net as of December 31, 2021 was $6,284 million, or 75% of total assets. We identified the assessment of the Company’s evaluation of the expected holding period for operating properties as a critical audit matter. Subjective auditor judgment was required to assess the relevant events or changes in circumstances that the Company used to evaluate its expected holding period. A shortening of the expected 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 certain internal controls over the Company’s property impairment process, including controls over the Company’s evaluation of the expected holding period. We evaluated the relevant events or 63 changes in circumstances and the current economic environment that the Company used to evaluate its expected holding period by: • reading minutes of the meetings of the Company’s Board of Directors • reading external communications with investors and analysts • analyzing documents prepared by the Company regarding proposed real estate transactions • considering properties with current encumbrances that are set to mature within one year. Evaluation of the fair value of the Chandler Freehold financing arrangement obligation As discussed in Notes 2 and 12 to the consolidated financial statements, the Company reports the Chandler Freehold consolidated joint venture as a financing arrangement with the related deferred gain recorded as a liability at fair value. The fair value of the financing arrangement obligation is determined primarily based upon the fair value of the underlying shopping centers, Chandler Fashion Center and Freehold Raceway Mall, owned by the Chandler Freehold consolidated joint venture. The fair value of the shopping centers is estimated using a discounted cash flow model. Subsequent changes in fair value of the financing arrangement obligation are recorded as interest expense. The financing arrangement obligation as of December 31, 2021 was $119 million, or 2% of total liabilities. The adjustment to fair value of the financing arrangement obligation was $15 million, or 108% of net income. We identified the evaluation of the fair value of the Chandler Freehold financing arrangement obligation as a critical audit matter. A high degree of subjectivity was required in evaluating the discounted cash flow model used to fair value the shopping centers. Specifically, the model was sensitive to reasonably possible changes to significant assumptions, which have a significant effect on the determination of fair value of the financing arrangement obligation. The significant assumptions include market rental rates, discount rates, and terminal capitalization rates. The following are the primary procedures we performed to address this critical audit matter. We evaluated the design and tested the operating effectiveness of certain internal controls over the Company’s fair value determination process for the financing arrangement obligation and specifically the development of the significant assumptions. We involved valuation professionals with specialized skills and knowledge who assisted in evaluating the Company’s significant assumptions used in the discounted cash flow model. The valuation professionals independently developed a range of the market rental rates, discount rates, and terminal capitalization rates using publicly available market data for comparable properties and geographic regions in which Chandler Fashion Center and Freehold Raceway Mall are located and compared the rates to those used by the Company. /s/ KPMG LLP We have served as the Company’s auditor since 2010 Los Angeles, California February 25, 2022 64 THE MACERICH COMPANY CONSOLIDATED BALANCE SHEETS (Dollars in thousands, except par value) December 31, 2021 2020 ASSETS: Property, net $ 6,284,206 $ 6,694,579 Cash and cash equivalents 112,454 465,297 Restricted cash 54,517 17,362 Tenant and other receivables, net 211,361 239,194 Right-of-use assets, net 110,638 118,355 Deferred charges and other assets, net 254,908 306,959 Due from affiliates — 1,612 Investments in unconsolidated joint ventures 1,317,571 1,340,647 Total assets $ 8,345,655 $ 9,184,005 LIABILITIES AND EQUITY: Mortgage notes payable $ 4,423,554 $ 4,560,810 Bank and other notes payable 104,811 1,477,540 Accounts payable and accrued expenses 59,228 68,825 Due to affiliates 327 — Lease liabilities 80,711 90,216 Other accrued liabilities 254,279 298,594 Distributions in excess of investments in unconsolidated joint ventures 127,608 108,381 Financing arrangement obligation 118,988 134,379 Total liabilities 5,169,506 6,738,745 Commitments and contingencies Equity: Stockholders' equity: Common stock, $ 0.01 par value, 500,000,000 and 250,000,000 shares authorized at December 31, 2021 and 2020, respectively, 214,797,057 and 149,770,575 shares issued and outstanding at December 31, 2021 and 2020, respectively 2,147 1,498 Additional paid-in capital 5,488,440 4,603,378 Accumulated deficit ( 2,443,696 ) ( 2,339,619 ) Accumulated other comprehensive loss ( 24 ) ( 8,208 ) Total stockholders' equity 3,046,867 2,257,049 Noncontrolling interests 129,282 188,211 Total equity 3,176,149 2,445,260 Total liabilities and equity $ 8,345,655 $ 9,184,005 The accompanying notes are an integral part of these consolidated financial statements. 65 THE MACERICH COMPANY CONSOLIDATED STATEMENTS OF OPERATIONS (Dollars in thousands, except per share amounts) For The Years Ended December 31, 2021 2020 2019 Revenues: Leasing revenue $ 787,547 $ 740,323 $ 858,874 Other 33,867 22,242 27,879 Management Companies 26,023 23,461 40,709 Total revenues 847,437 786,026 927,462 Expenses: Shopping center and operating expenses 295,016 257,212 271,547 Leasing expense 24,838 25,191 29,611 Management Companies' operating expenses 61,030 65,576 66,795 REIT general and administrative expenses 30,056 30,339 22,634 Depreciation and amortization 311,129 319,619 330,726 722,069 697,937 721,313 Interest (income) expense: Related parties ( 3,718 ) ( 135,281 ) ( 62,517 ) Other 196,397 210,831 200,771 192,679 75,550 138,254 Loss on extinguishment of debt 1,007 — 351 Total expenses 915,755 773,487 859,918 Equity in income (loss) of unconsolidated joint ventures 15,689 ( 27,038 ) 48,508 Income tax (expense) benefit ( 6,948 ) 447 ( 1,589 ) Loss on remeasurement of assets — ( 163,298 ) — Gain (loss) on sale or write down of assets, net 75,740 ( 68,112 ) ( 11,909 ) Net income (loss) 16,163 ( 245,462 ) 102,554 Less net income (loss) attributable to noncontrolling interests 1,900 ( 15,259 ) 5,734 Net income (loss) attributable to the Company $ 14,263 $ ( 230,203 ) $ 96,820 Earnings per common share attributable to common stockholders: Basic $ 0.07 $ ( 1.58 ) $ 0.68 Diluted $ 0.07 $ ( 1.58 ) $ 0.68 Weighted average number of common shares outstanding: Basic 198,070,000 146,232,000 141,340,000 Diluted 198,070,000 146,232,000 141,340,000 The accompanying notes are an integral part of these consolidated financial statements. 66 THE MACERICH COMPANY CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) (Dollars in thousands) For The Years Ended December 31, 2021 2020 2019 Net income (loss) $ 16,163 $ ( 245,462 ) $ 102,554 Other comprehensive income (loss): Interest rate cap/swap agreements 8,184 843 ( 4,585 ) Comprehensive income (loss) 24,347 ( 244,619 ) 97,969 Less net income (loss) attributable to noncontrolling interests 1,900 ( 15,259 ) 5,734 Comprehensive income (loss) attributable to the Company $ 22,447 $ ( 229,360 ) $ 92,235 The accompanying notes are an integral part of these consolidated financial statements. 67 THE MACERICH COMPANY CONSOLIDATED STATEMENTS OF EQUITY (Dollars in thousands, except per share data) Stockholders' Equity Common Stock Additional Paid-in Capital Accumulated Deficit Accumulated Other Comprehensive Loss Total Stockholders' Equity Shares Par Value Noncontrolling Interests Total Equity Balance at January 1, 2019 141,221,712 $ 1,412 $ 4,567,643 $ ( 1,614,357 ) $ ( 4,466 ) $ 2,950,232 $ 238,200 $ 3,188,432 Net income — — — 96,820 — 96,820 5,734 102,554 Cumulative effect of adoption of ASC 842 — — — ( 2,203 ) — ( 2,203 ) — ( 2,203 ) Interest rate cap/swap agreements — — — — ( 4,585 ) ( 4,585 ) — ( 4,585 ) Amortization of share and unit-based plans 106,747 1 16,722 — — 16,723 — 16,723 Employee stock purchases 58,191 1 1,518 — — 1,519 — 1,519 Distributions declared ($ 3.00 ) per share — — — ( 424,272 ) — ( 424,272 ) — ( 424,272 ) Distributions to noncontrolling interests — — — — — — ( 50,262 ) ( 50,262 ) Contributions from noncontrolling interests — — — — — — 3,131 3,131 Conversion of noncontrolling interests to common shares 21,000 — 1,005 — — 1,005 ( 1,005 ) — Redemption of noncontrolling interests — — ( 31 ) — — ( 31 ) ( 36 ) ( 67 ) Adjustment of noncontrolling interests in Operating Partnership — — ( 2,946 ) — — ( 2,946 ) 2,946 — Balance at December 31, 2019 141,407,650 $ 1,414 $ 4,583,911 $ ( 1,944,012 ) $ ( 9,051 ) $ 2,632,262 $ 198,708 $ 2,830,970 The accompanying notes are an integral part of these consolidated financial statements. 68 THE MACERICH COMPANY CONSOLIDATED STATEMENTS OF EQUITY (Continued) (Dollars in thousands, except per share data) Stockholders' Equity Common Stock Additional Paid-in Capital Accumulated Deficit Accumulated Other Comprehensive Loss Total Stockholders' Equity Shares Par Value Noncontrolling Interests Total Equity Balance at December 31, 2019 141,407,650 $ 1,414 $ 4,583,911 $ ( 1,944,012 ) $ ( 9,051 ) $ 2,632,262 $ 198,708 $ 2,830,970 Net loss — — — ( 230,203 ) — ( 230,203 ) ( 15,259 ) ( 245,462 ) Interest rate cap/swap agreements — — — — 843 843 — 843 Amortization of share and unit-based plans 151,468 1 18,065 — — 18,066 — 18,066 Employee stock purchases 265,386 3 1,528 — — 1,531 — 1,531 Distributions declared ($ 1.55 ) per share — — — ( 165,404 ) — ( 165,404 ) — ( 165,404 ) Stock dividend 7,759,280 78 ( 78 ) — — — — — Distributions to noncontrolling interests — — — — — — ( 14,458 ) ( 14,458 ) Contributions from noncontrolling interests — — — — — — 19,203 19,203 Conversion of noncontrolling interests to common shares 186,791 2 12,084 — — 12,086 ( 12,086 ) — Redemption of noncontrolling interests — — 25 — — 25 ( 54 ) ( 29 ) Adjustment of noncontrolling interests in Operating Partnership — — ( 12,157 ) — — ( 12,157 ) 12,157 — Balance at December 31, 2020 149,770,575 $ 1,498 $ 4,603,378 $ ( 2,339,619 ) $ ( 8,208 ) $ 2,257,049 $ 188,211 $ 2,445,260 The accompanying notes are an integral part of these consolidated financial statements. 69 THE MACERICH COMPANY CONSOLIDATED STATEMENTS OF EQUITY (Continued) (Dollars in thousands, except per share data) Stockholders' Equity Common Stock Additional Paid-in Capital Accumulated Deficit Accumulated Other Comprehensive Loss Total Stockholders' Equity Shares Par Value Noncontrolling Interests Total Equity Balance at December 31, 2020 149,770,575 $ 1,498 $ 4,603,378 $ ( 2,339,619 ) $ ( 8,208 ) $ 2,257,049 $ 188,211 $ 2,445,260 Net income — — — 14,263 — 14,263 1,900 16,163 Interest rate cap/swap agreements — — — — 8,184 8,184 — 8,184 Amortization of share and unit-based plans 248,264 2 17,996 — — 17,998 — 17,998 Employee stock purchases 143,191 1 1,347 — — 1,348 — 1,348 Stock offerings, net 62,049,131 620 829,621 — 830,241 — 830,241 Distributions declared ($ 0.60 ) per share — — — ( 118,340 ) — ( 118,340 ) — ( 118,340 ) Distributions to noncontrolling interests — — — — — — ( 25,107 ) ( 25,107 ) Contributions from noncontrolling interests — — — — — — 580 580 Conversion of noncontrolling interests to common shares 2,585,896 26 48,781 — — 48,807 ( 48,807 ) — Redemption of noncontrolling interests — — ( 17 ) — — ( 17 ) ( 161 ) ( 178 ) Adjustment of noncontrolling interests in Operating Partnership — — ( 12,666 ) — — ( 12,666 ) 12,666 — Balance at December 31, 2021 214,797,057 $ 2,147 $ 5,488,440 $ ( 2,443,696 ) $ ( 24 ) $ 3,046,867 $ 129,282 $ 3,176,149 The accompanying notes are an integral part of these consolidated financial statements. 70 THE MACERICH COMPANY CONSOLIDATED STATEMENTS OF CASH FLOWS (Dollars in thousands) For the Years Ended December 31, 2021 2020 2019 Cash flows from operating activities: Net income (loss) $ 16,163 $ ( 245,462 ) $ 102,554 Adjustments to reconcile net income (loss) to net cash provided by operating activities: Loss on extinguishment of debt 1,007 — 351 Loss on remeasurement of assets — 163,298 — (Gain) loss on sale or write down of assets, net ( 75,740 ) 68,112 11,909 Depreciation and amortization 324,403 326,058 337,667 Amortization of net premium on mortgage notes payable — ( 773 ) ( 929 ) Amortization of share and unit-based plans 14,273 13,843 12,032 Straight-line rent and amortization of above and below market leases ( 7,691 ) ( 23,707 ) ( 14,009 ) (Recovery of) provision for doubtful accounts ( 6,390 ) 44,250 7,682 Income tax expense (benefit) 6,948 ( 447 ) 1,589 Equity in (income) loss of unconsolidated joint ventures ( 15,689 ) 27,038 ( 48,508 ) Change in fair value of financing arrangement obligation ( 15,390 ) ( 139,522 ) ( 76,640 ) Distributions of income from unconsolidated joint ventures 48 — 934 Changes in assets and liabilities, net of acquisitions and dispositions: Tenant and other receivables 62,421 ( 105,947 ) ( 9,929 ) Other assets 14,876 810 ( 9,553 ) Due to/from affiliates 1,939 3,385 13,894 Accounts payable and accrued expenses ( 6,746 ) 15,479 ( 237 ) Other accrued liabilities ( 28,064 ) ( 21,578 ) 26,350 Net cash provided by operating activities 286,368 124,837 355,157 Cash flows from investing activities: Development, redevelopment, expansion and renovation of properties ( 77,686 ) ( 45,161 ) ( 166,791 ) Property improvements ( 30,521 ) ( 23,143 ) ( 21,114 ) Proceeds from collection of notes receivable 1,300 — 68,819 Deferred leasing costs ( 2,720 ) ( 3,212 ) ( 11,906 ) Distributions from unconsolidated joint ventures 93,927 78,427 266,349 Contributions to unconsolidated joint ventures ( 86,846 ) ( 132,466 ) ( 252,903 ) Cash and restricted cash acquired from acquisition of previously unconsolidated joint venture — 5,811 — Loan to previously unconsolidated joint venture — ( 100,000 ) — Proceeds from sale of assets 337,514 16,896 5,520 Net cash provided by (used in) investing activities 234,968 ( 202,848 ) ( 112,026 ) The accompanying notes are an integral part of these consolidated financial statements. 71 THE MACERICH COMPANY CONSOLIDATED STATEMENTS OF CASH FLOWS (Continued) (Dollars in thousands) For the Years Ended December 31, 2021 2020 2019 Cash flows from financing activities: Proceeds from mortgages, bank and other notes payable 520,000 660,000 1,796,000 Payments on mortgages, bank and other notes payable ( 2,020,395 ) ( 33,972 ) ( 1,567,089 ) Deferred financing costs ( 22,872 ) ( 4,320 ) ( 7,759 ) Payment on finance arrangement obligation — — ( 27,945 ) Proceeds from finance lease — 4,115 — Payments on finance leases ( 1,849 ) ( 1,534 ) ( 1,472 ) Proceeds from share and unit-based plans 1,348 1,531 1,519 Proceeds from stock offerings, net 830,241 — — Redemption of noncontrolling interests ( 178 ) ( 29 ) ( 67 ) Contributions from noncontrolling interests 128 525 3,131 Dividends and distributions ( 143,447 ) ( 179,862 ) ( 474,534 ) Net cash (used in) provided by financing activities ( 837,024 ) 446,454 ( 278,216 ) Net (decrease) increase in cash, cash equivalents and restricted cash ( 315,688 ) 368,443 ( 35,085 ) Cash and cash equivalents and restricted cash at beginning of year 482,659 114,216 149,301 Cash and cash equivalents and restricted cash at end of year $ 166,971 $ 482,659 $ 114,216 Supplemental cash flow information: Cash payments for interest, net of amounts capitalized $ 204,221 $ 199,147 $ 210,026 Non-cash investing and financing activities: Accrued development costs included in accounts payable and accrued expenses and other accrued liabilities $ 18,279 $ 29,376 $ 32,452 Conversion of Operating Partnership Units to common stock $ 48,807 $ 12,086 $ 1,005 Receivable in connection with sale of joint venture property $ 21,000 $ — $ — Lease liabilities recorded in connection with right-of-use assets $ — $ — $ 109,299 Assets acquired from previously unconsolidated joint venture $ — $ 395,844 $ — Liabilities assumed from previously unconsolidated joint venture $ — $ 263,393 $ — Property distribution from unconsolidated joint venture $ — $ 19,300 $ — The accompanying notes are an integral part of these consolidated financial statements. 72 Table of Contents THE MACERICH COMPANY NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Dollars in thousands, except per share amounts) 1. Organization: The Macerich Company (the "Company") is involved in the acquisition, ownership, development, redevelopment, management and leasing of regional and community/power shopping centers (the "Centers") located throughout the United States. The Company commenced operations effective with the completion of its initial public offering on March 16, 1994. As of December 31, 2021, the Company was the sole general partner of and held a 96 % ownership interest in The Macerich Partnership, L.P. (the "Operating Partnership"). The Company was organized to qualify as a real estate investment trust ("REIT") under the Internal Revenue Code of 1986, as amended (the "Code"). The property management, leasing and redevelopment of the Company's portfolio is provided by the Company's management companies, Macerich Property Management Company, LLC, a single member Delaware limited liability company, Macerich Management Company, a California corporation, Macerich Arizona Partners LLC, a single member Arizona limited liability company, Macerich Arizona Management LLC, a single member Delaware limited liability company, Macerich Partners of Colorado LLC, a single member Colorado limited liability company, MACW Mall Management, Inc., a New York corporation, and MACW Property Management, LLC, a single member New York limited liability company. All seven of the management companies are owned by the Company and are collectively referred to herein as the "Management Companies." 2. Summary of Significant Accounting Policies: Basis of Presentation: These consolidated financial statements have been prepared in accordance with generally accepted accounting principles ("GAAP") in the United States of America. The accompanying consolidated financial statements include the accounts of the Company. Investments in entities in which the Company has a controlling financial interest or entities that meet the definition of a variable interest entity ("VIE") in which the Company has, as a result of ownership, contractual or other financial interests, both the power to direct activities that most significantly impact the economic performance of the VIE and the obligation to absorb losses or the right to receive benefits that could potentially be significant to the VIE are consolidated; otherwise they are accounted for under the equity method of accounting and are reflected as investments in unconsolidated joint ventures. The Company's sole significant asset is its investment in the Operating Partnership and as a result, substantially all of the Company's assets and liabilities represent the assets and liabilities of the Operating Partnership. In addition, the Operating Partnership has investments in a number of VIEs, including Fashion District Philadelphia and SanTan Village Regional Center. The Operating Partnership's VIEs included the following assets and liabilities: December 31, 2021 2020 Assets: Property, net $ 458,964 $ 551,062 Other assets 83,685 97,713 Total assets $ 542,649 $ 648,775 Liabilities: Mortgage notes payable $ 413,925 $ 420,233 Other liabilities 56,947 81,266 Total liabilities $ 470,872 $ 501,499 All intercompany accounts and transactions have been eliminated in the consolidated financial statements. 73 Table of Contents THE MACERICH COMPANY NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) (Dollars in thousands, except per share amounts) 2. Summary of Significant Accounting Policies: (Continued) Basis of Presentation: (Continued) The following table presents a reconciliation of the beginning of period and end of period cash and cash equivalents and restricted cash reported on the Company's consolidated balance sheets to the totals shown on its consolidated statements of cash flows: 2021 2020 2019 Beginning of period Cash and cash equivalents $ 465,297 $ 100,005 $ 102,711 Restricted cash 17,362 14,211 46,590 Cash and cash equivalents and restricted cash $ 482,659 $ 114,216 $ 149,301 End of period Cash and cash equivalents $ 112,454 $ 465,297 $ 100,005 Restricted cash 54,517 17,362 14,211 Cash and cash equivalents and restricted cash $ 166,971 $ 482,659 $ 114,216 COVID-19 Pandemic: In March 2020, the COVID-19 outbreak was declared a pandemic by the World Health Organization. As a result, all of the markets that the Company operates in were subject to stay-at-home orders, and the majority of its properties were temporarily closed in part or completely. Following staggered re-openings during 2020, all Centers have been open and operating since October 7, 2020 and government-imposed capacity restrictions resulting from COVID-19 have been essentially eliminated across the Company’s markets. COVID-19 Lease Accounting: In April 2020, the Financial Accounting Standards Board issued a Staff Question-and-Answer (“Q&A”) to clarify whether lease concessions related to the effects of COVID-19 require the application of the lease modification guidance under Accounting Standards Codification ("ASC") 842, "Leases" ("the lease modification accounting framework"). Under ASC 842, the Company would have to determine, on a lease-by-lease basis, if a lease concession was the result of a new arrangement reached with the tenant or an enforceable right and obligation within the existing lease. The Q&A allows for the bypass of a lease-by-lease analysis, and allows the Company to elect to either apply the lease modification accounting framework or not to all of its lease concessions with similar characteristics and circumstances. The Company has elected to apply the lease modification accounting framework to lease concessions that include the abatement of rent in its consolidated financial statements for the twelve months ended December 31, 2021 and 2020. Cash and Cash Equivalents and Restricted Cash: The Company considers all highly liquid investments with an original maturity of three months or less when purchased to be cash equivalents, for which cost approximates fair value. Restricted cash includes impounds of property taxes and other capital reserves required under loan and other agreements. 74 Table of Contents THE MACERICH COMPANY NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) (Dollars in thousands, except per share amounts) 2. Summary of Significant Accounting Policies: (Continued) Revenues: Leasing revenue includes minimum rents, percentage rents, tenant recoveries and other leasing income. Minimum rental revenues are recognized on a straight-line basis over the terms of the related leases. The difference between the amount of rent due in a year and the amount recorded as rental income is referred to as the "straight-line rent adjustment." Minimum rents were increased by $ 5,873 , $ 24,789 and $ 10,533 due to the straight-line rent adjustment during the years ended December 31, 2021, 2020 and 2019, respectively. Percentage rents are recognized and accrued when tenants' specified sales targets have been met. Estimated recoveries from certain tenants for their pro rata share of real estate taxes, insurance and other shopping center operating expenses are recognized as revenues in the period the applicable expenses are incurred. Other tenants pay a fixed rate and these tenant recoveries are recognized as revenues on a straight-line basis over the term of the related leases. The Management Companies provide property management, leasing, corporate, development, redevelopment and acquisition services to affiliated and non-affiliated shopping centers. In consideration for these services, the Management Companies receive monthly management fees generally ranging from 1.5 % to 4 % of the gross monthly rental revenue of the properties managed. Property: Maintenance and repair expenses are charged to operations as incurred. Costs for major replacements and betterments, which includes HVAC equipment, roofs, parking lots, etc., are capitalized and depreciated over their estimated useful lives. Gains and losses are recognized upon disposal or retirement of the related assets and are reflected in earnings. Property is recorded at cost and is depreciated using a straight-line method over the estimated useful lives of the assets as follows: Buildings and improvements 5 - 40 years Tenant improvements 5 - 7 years Equipment and furnishings 5 - 7 years Capitalization of Costs: The Company capitalizes costs incurred in redevelopment, development, renovation and improvement of properties. The capitalized costs include pre-construction costs essential to the development of the property, development costs, construction costs, interest costs, real estate taxes, salaries and related costs and other costs incurred during the period of development. These capitalized costs include direct and certain indirect costs clearly associated with the project. Indirect costs include real estate taxes, insurance and certain shared administrative costs. In assessing the amounts of direct and indirect costs to be capitalized, allocations are made to projects based on estimates of the actual amount of time spent on each activity. Indirect costs not clearly associated with specific projects are expensed as period costs. Capitalized indirect costs are allocated to development and redevelopment activities based on the square footage of the portion of the building not held available for immediate occupancy. If costs and activities incurred to ready the vacant space cease, then cost capitalization is also discontinued until such activities are resumed. Once work has been completed on a vacant space, project costs are no longer capitalized. For projects with extended lease-up periods, the Company ends the capitalization when significant activities have ceased, which does not exceed the shorter of a one-year period after the completion of the building shell or when the construction is substantially complete. 75 Table of Contents THE MACERICH COMPANY NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) (Dollars in thousands, except per share amounts) 2. Summary of Significant Accounting Policies: (Continued) Investment in Unconsolidated Joint Ventures: The Company accounts for its investments in joint ventures using the equity method of accounting unless the Company has a controlling financial interest in the joint venture or the joint venture meets the definition of a variable interest entity in which the Company is the primary beneficiary through both its power to direct activities that most significantly impact the economic performance of the variable interest entity and the obligation to absorb losses or the right to receive benefits that could potentially be significant to the variable interest entity. Although the Company has a greater than 50 % interest in Corte Madera Village, LLC, Macerich HHF Centers LLC, New River Associates LLC and Pacific Premier Retail LLC, the Company does not have controlling financial interests in these joint ventures due to the substantive participation rights of the outside partners in these joint ventures and, therefore, accounts for its investments in these joint ventures using the equity method of accounting. Equity method investments are initially recorded on the balance sheet at cost and are subsequently adjusted to reflect the Company’s proportionate share of net earnings and losses, distributions received, additional contributions and certain other adjustments, as appropriate. The Company separately reports investments in joint ventures when accumulated distributions have exceeded the Company’s investment, as distributions in excess of investments in unconsolidated joint ventures. The net investment of certain joint ventures is less than zero because of financing or operating distributions that are usually greater than net income, as net income includes charges for depreciation and amortization. Acquisitions: Upon the acquisition of real estate properties, the Company evaluates whether the acquisition is a business combination or asset acquisition. For both business combinations and asset acquisitions, the Company allocates the purchase price of properties to acquired tangible assets and intangible assets and liabilities. For asset acquisitions, the Company capitalizes transaction costs and allocates the purchase price using a relative fair value method allocating all accumulated costs. For business combinations, the Company expenses transaction costs incurred and allocates purchase price based on the estimated fair value of each separately identified asset and liability. The Company allocates the estimated fair value of acquisitions to land, building, tenant improvements and identified intangible assets and liabilities, based on their estimated fair values. In addition, any assumed mortgage notes payable are recorded at their estimated fair values. The estimated fair value of the land and buildings is determined utilizing an “as if vacant” methodology. Tenant improvements represent the tangible assets associated with the existing leases valued on a fair value basis at the acquisition date prorated over the remaining lease terms. The tenant improvements are classified as an asset under property and are depreciated over the remaining lease terms. Identifiable intangible assets and liabilities relate to the value of in-place operating leases which come in three forms: (i) leasing commissions and legal costs, which represent the value associated with “cost avoidance” of acquiring in-place leases, such as lease commissions paid under terms generally experienced in the Company's markets; (ii) value of in-place leases, which represents the estimated loss of revenue and of costs incurred for the period required to lease the “assumed vacant” property to the occupancy level when purchased; and (iii) above or below-market value of in-place leases, which represents the difference between the contractual rents and market rents at the time of the acquisition, discounted for tenant credit risks. Leasing commissions and legal costs are recorded in deferred charges and other assets and are amortized over the remaining lease terms. The value of in-place leases is recorded in deferred charges and other assets and amortized over the remaining lease terms plus any below-market fixed rate renewal options. Above or below-market leases are classified in deferred charges and other assets or in other accrued liabilities, depending on whether the contractual terms are above or below-market, and the asset or liability is amortized to minimum rents over the remaining terms of the leases. The remaining lease terms of below-market leases may include certain below-market fixed-rate renewal periods. In considering whether or not a lessee will execute a below-market fixed-rate lease renewal option, the Company evaluates economic factors and certain qualitative factors at the time of acquisition such as tenant mix in the Center, the Company's relationship with the tenant and the availability of competing tenant space. Remeasurement gains and losses are recognized when the Company becomes the primary beneficiary of an existing equity method investment that is a VIE to the extent that the fair value of the existing equity investment exceeds the carrying value of the investment, and remeasurement losses to the extent the carrying value of the investment exceeds the fair value. The fair value is determined based on a discounted cash flow model, with the significant unobservable inputs including discount rate, terminal capitalization rate and market rents. 76 Table of Contents THE MACERICH COMPANY NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) (Dollars in thousands, except per share amounts) 2. Summary of Significant Accounting Policies: (Continued) Deferred Charges: Costs relating to obtaining tenant leases are deferred and amortized over the initial term of the lease agreement using the straight-line method. As these deferred leasing costs represent productive assets incurred in connection with the Company's leasing arrangements at the Centers, the related cash flows are classified as investing activities within the accompanying Consolidated Statements of Cash Flows. Costs relating to financing of shopping center properties are deferred and amortized over the life of the related loan using the straight-line method, which approximates the effective interest method. The range of the terms of the agreements is as follows: Deferred leasing costs 1 - 15 years Deferred financing costs 1 - 15 years Accounting for Impairment: The Company assesses whether an indicator of impairment in the value of its properties exists by considering expected future operating income, trends and prospects, as well as the effects of demand, competition and other economic factors. Such factors include projected rental revenue, operating costs and capital expenditures as well as estimated holding periods and capitalization rates. If an impairment indicator exists, the determination of recoverability is made based upon the estimated undiscounted future net cash flows, excluding interest expense. The amount of impairment loss, if any, is determined by comparing the fair value, as determined by a discounted cash flows analysis, with the carrying value of the related assets. The Company generally holds and operates its properties long-term, which decreases the likelihood of their carrying values not being recoverable. A shortened holding period increases the risk that the carrying value of a long-lived asset is not recoverable. Properties classified as held for sale are measured at the lower of the carrying amount or fair value less cost to sell. The Company reviews its investments in unconsolidated joint ventures for a series of operating losses and other factors that may indicate that a decrease in the value of its investments has occurred which is other-than-temporary. The investment in each unconsolidated joint venture is evaluated periodically, and as deemed necessary, for recoverability and valuation declines that are other-than-temporary. Share and Unit-based Compensation Plans: The cost of share and unit-based compensation awards is measured at the grant date based on the calculated fair value of the awards and is recognized on a straight-line basis over the requisite service period, which is generally the vesting period of the awards. Derivative Instruments and Hedging Activities: The Company recognizes all derivatives in the consolidated financial statements and measures the derivatives at fair value. The Company uses interest rate swap and cap agreements (collectively, "interest rate agreements") in the normal course of business to manage or reduce its exposure to adverse fluctuations in interest rates. The Company designs its hedges to be effective in reducing the risk exposure that they are designated to hedge. Any instrument that meets the cash flow hedging criteria is formally designated as a cash flow hedge at the inception of the derivative contract. On an ongoing quarterly basis, the Company adjusts its balance sheet to reflect the current fair value of its derivatives. To the extent they are effective, changes in fair value are recorded in comprehensive income. Amounts paid (received) as a result of interest rate agreements are recorded as an addition (reduction) to (of) interest expense. If any derivative instrument used for risk management does not meet the hedging criteria, it is marked-to-market each period with the change in value included in the consolidated statements of operations. 77 Table of Contents THE MACERICH COMPANY NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) (Dollars in thousands, except per share amounts) 2. Summary of Significant Accounting Policies: (Continued) Income Taxes: The Company elected to be taxed as a REIT under the Code commencing with its taxable year ended December 31, 1994. To qualify as a REIT, the Company must meet a number of organizational and operational requirements, including a requirement that it distribute at least 90% of its taxable income to its stockholders. It is management's current intention to adhere to these requirements and maintain the Company's REIT status. As a REIT, the Company generally will not be subject to corporate level federal income tax on taxable income it distributes currently to its stockholders. If the Company fails to qualify as a REIT in any taxable year, then it will be subject to federal income taxes at regular corporate rates and may not be able to qualify as a REIT for four subsequent taxable years. Even if the Company qualifies for taxation as a REIT, the Company may be subject to certain state and local taxes on its income and property and to federal income and excise taxes on its undistributed taxable income, if any. Each partner is taxed individually on its share of partnership income or loss, and accordingly, no provision for federal and state income tax is provided for the Operating Partnership in the consolidated financial statements. The Company's taxable REIT subsidiaries ("TRSs") are subject to corporate level income taxes, which are provided for in the Company's consolidated financial statements. Deferred tax assets and liabilities are recognized for the expected future tax consequences of events that have been included in the financial statements or tax returns. Under this method, deferred tax assets and liabilities are determined based on the differences between the financial reporting and tax bases of assets and liabilities using enacted tax rates in effect for the year in which the differences are expected to reverse. The deferred tax assets and liabilities of the TRSs relate primarily to differences in the book and tax bases of property and to operating loss carryforwards for federal and state income tax purposes. A valuation allowance for deferred tax assets is provided if the Company believes it is more likely than not that all or some portion of the deferred tax assets will not be realized. Realization of deferred tax assets is dependent on the Company generating sufficient taxable income in future periods. Segment Information: The Company currently operates in one business segment, the acquisition, ownership, development, redevelopment, management and leasing of regional and community shopping centers. Additionally, the Company operates in one geographic area, the United States. Fair Value of Financial Instruments: The fair value hierarchy distinguishes between market participant assumptions based on market data obtained from sources independent of the reporting entity and the reporting entity's own assumptions about market participant assumptions. Level 1 inputs utilize quoted prices in active markets for identical assets or liabilities that the Company has the ability to access. Level 2 inputs are inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly or indirectly. Level 2 inputs may include quoted prices for similar assets and liabilities in active markets, as well as inputs that are observable for the asset or liability (other than quoted prices), such as interest rates, foreign exchange rates and yield curves that are observable at commonly quoted intervals. Level 3 inputs are unobservable inputs for the asset or liability, which are typically based on an entity's own assumptions, as there is little, if any, related market activity. 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. The Company's 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. The Company calculates the fair value of financial instruments and includes this additional information in the notes to consolidated financial statements when the fair value is different than the carrying value of those financial instruments. When the fair value reasonably approximates the carrying value, no additional disclosure is made. The fair values of interest rate agreements are determined using the market standard methodology of discounting the future expected cash receipts that would occur if variable interest rates fell below or rose above the strike rate of the interest rate agreements. The variable interest rates used in the calculation of projected receipts on the interest rate agreements are based on 78 Table of Contents THE MACERICH COMPANY NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) (Dollars in thousands, except per share amounts) 2. Summary of Significant Accounting Policies: (Continued) an expectation of future interest rates derived from observable market interest rate curves and volatilities. The Company incorporates credit valuation adjustments to appropriately reflect both its own nonperformance risk and the respective counterparty's nonperformance risk in the fair value measurements. In adjusting the fair value of its derivative contracts for the effect of nonperformance risk, the Company has considered the impact of netting and any applicable credit enhancements, such as collateral postings, thresholds, mutual puts and guarantees. The Company records its financing arrangement obligation at fair value on a recurring basis with changes in fair value being recorded as interest expense in the Company’s consolidated statements of operations. The fair value is determined based on a discounted cash flow model, with the significant unobservable inputs including the discount rate, terminal capitalization rate and market rents. The fair value of the financing arrangement obligation is sensitive to these significant unobservable inputs and a change in these inputs may result in a significantly higher or lower fair value measurement. Concentration of Risk: The Company maintains its cash accounts in a number of commercial banks. Accounts at these banks are guaranteed by the Federal Deposit Insurance Corporation ("FDIC") up to $250. At various times during the year, the Company had deposits in excess of the FDIC insurance limit. No Center or tenant generated more than 10% of total revenues during the years ended December 31, 2021, 2020 or 2019. Management Estimates: The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Recent Accounting Pronouncements: On January 1, 2019, the Company adopted Accounting Standards Codification ("ASC") 842, "Leases", under the modified retrospective method. The new standard amended the principles for the recognition, measurement, presentation and disclosure of leases for both parties to a contract (i.e. lessees and lessors). In connection with the adoption of the new lease standard, the Company elected to use the transition packages of practical expedients for implementation provided by the FASB, which included (i) relief from re-assessing whether an expired or existing contract meets the definition of a lease, (ii) relief from re-assessing the classification of expired or existing leases at the adoption date, (iii) allowing previously capitalized initial direct leasing costs to continue to be amortized, and (iv) application of the standard as of the adoption date rather than to all periods presented. The new standard requires the Company to reduce leasing revenue for credit losses associated with lease receivables. In addition, straight-line rent receivables are written off when the Company believes there is uncertainty regarding a tenant's ability to complete the term of the lease. As a result, the Company recognized a cumulative effect adjustment of $ 2,203 upon adoption for the write off of straight-line rent receivables of tenants that were in litigation or bankruptcy. The standard also requires that the provision for bad debts relating to leases be presented as a reduction of leasing revenue. The standard requires that lessors expense, on an as-incurred basis, certain initial direct costs that are not incremental in negotiating a lease. Initial direct costs include the salaries and related costs for employees directly working on leasing activities. Prior to January 1, 2019, these costs were capitalizable and therefore the new lease standard resulted in certain of these costs being expensed as incurred. Upon the adoption of the new standard, the Company elected the practical expedient to not separate non-lease components, most significantly certain common area maintenance recoveries, from the associated lease components, resulting in the Company presenting all revenues associated with leases as leasing revenue on its consolidated statements of operations. In August 2017, the FASB issued ASU 2017-12, “Targeted Improvements to Accounting for Hedging Activities,” which aims to (i) improve the transparency and understandability of information conveyed to financial statement users about an entity’s risk management activities by better aligning the entity’s financial reporting for hedging relationships with those risk management activities and (ii) reduce the complexity of and simplify the application of hedge accounting by preparers. The 79 Table of Contents THE MACERICH COMPANY NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) (Dollars in thousands, except per share amounts) 2. Summary of Significant Accounting Policies: (Continued) standard was effective for the Company beginning January 1, 2019. The Company's adoption of this standard did not have a significant impact on its consolidated financial statements. In March 2020, the FASB issued guidance codified in ASU 2020-04, “Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting,” which provides optional expedients for a limited period of time to ease the potential burden in accounting for (or recognizing the effects of) reference rate reform on financial reporting. ASU 2020-04 provides optional expedients and exceptions for applying GAAP to contracts, hedging relationships, and other transactions affected by reference rate reform if certain criteria are met. The standard is effective for the Company as of March 12, 2020 through December 31, 2022. An entity can elect to apply the amendments as of any date from the beginning of an interim period that includes or is subsequent to March 12, 2020, or prospectively from a date within an interim period that includes or is subsequent to March 12, 2020, up to that date that the financial statements are available to be issued. The Company is currently evaluating the optional expedients and exceptions provided by ASU 2020-04 to determine the impact on its consolidated financial statements. 3. Earnings Per Share ("EPS"): The following table reconciles the numerator and denominator used in the computation of earnings per share for the years ended December 31 (shares in thousands): 2021 2020 2019 Numerator Net income (loss) $ 16,163 $ ( 245,462 ) $ 102,554 Less: net income (loss) attributable to noncontrolling interests 1,900 ( 15,259 ) 5,734 Net income (loss) attributable to the Company 14,263 ( 230,203 ) 96,820 Allocation of earnings to participating securities ( 853 ) ( 1,048 ) ( 1,190 ) Numerator for basic and diluted EPS—net income (loss) attributable to common stockholders $ 13,410 $ ( 231,251 ) $ 95,630 Denominator Denominator for basic and diluted EPS—weighted average number of common shares outstanding(1) 198,070 146,232 141,340 EPS—net income (loss) attributable to common stockholders: Basic and diluted $ 0.07 $ ( 1.58 ) $ 0.68 ____________________________________ (1) Diluted EPS excludes 101,948 , 97,926 and 90,619 convertible preferred units for the years ended December 31, 2021, 2020 and 2019, respectively, as their impact was antidilutive. Diluted EPS excludes 9,920,654 , 10,688,179 and 10,415,291 Operating Partnership units ("OP Units") for the years ended December 31, 2021, 2020 and 2019, respectively, as their effect was antidilutive. 80 Table of Contents THE MACERICH COMPANY NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) (Dollars in thousands, except per share amounts) 4. Investments in Unconsolidated Joint Ventures: The following are the Company's operating properties in various unconsolidated joint ventures with third parties. The Company's direct or indirect ownership interest in each joint venture as of December 31, 2021 was as follows: Joint Venture Ownership %(1) AM Tysons LLC 50.0 % Biltmore Shopping Center Partners LLC 50.0 % Corte Madera Village, LLC 50.1 % Country Club Plaza KC Partners LLC 50.0 % HPP-MAC WSP, LLC—One Westside 25.0 % Kierland Commons Investment LLC 50.0 % Macerich HHF Broadway Plaza LLC—Broadway Plaza 50.0 % Macerich HHF Centers LLC—Various Properties 51.0 % MS Portfolio LLC 50.0 % New River Associates LLC—Arrowhead Towne Center 60.0 % Pacific Premier Retail LLC—Various Properties 60.0 % Propcor II Associates, LLC—Boulevard Shops 50.0 % PV Land SPE, LLC 5.0 % Scottsdale Fashion Square Partnership 50.0 % TM TRS Holding Company LLC 50.0 % Tysons Corner LLC 50.0 % Tysons Corner Hotel I LLC 50.0 % Tysons Corner Property Holdings II LLC 50.0 % Tysons Corner Property LLC 50.0 % West Acres Development, LLP 19.0 % WMAP, L.L.C.—Atlas Park, The Shops at 50.0 % _______________________________________________________________________________ (1) The Company's ownership interest in this table reflects its direct or indirect legal ownership interest. Legal ownership may, at times, not equal the Company’s economic interest in the listed entities because of various provisions in certain joint venture agreements regarding distributions of cash flow based on capital account balances, allocations of profits and losses and payments of preferred returns. As a result, the Company’s actual economic interest (as distinct from its legal ownership interest) in certain of the properties could fluctuate from time to time and may not wholly align with its legal ownership interests. Substantially all of the Company’s joint venture agreements contain rights of first refusal, buy-sell provisions, exit rights, default dilution remedies and/or other break up provisions or remedies which are customary in real estate joint venture agreements and which may, positively or negatively, affect the ultimate realization of cash flow and/or capital or liquidation proceeds. 81 Table of Contents THE MACERICH COMPANY NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) (Dollars in thousands, except per share amounts) 4. Investments in Unconsolidated Joint Ventures: (Continued) The Company has made the following investments, dispositions and financings in unconsolidated joint ventures during the years ended December 31, 2021, 2020 and 2019 and events subsequent to December 31, 2021: On February 22, 2019, the Company’s joint venture in The Shops at Atlas Park entered into an agreement to increase the total borrowing capacity of the existing loan on the property from $ 57,751 to $ 80,000 , and to extend the maturity date to October 28, 2021, including extension options. Concurrent with the loan modification, the joint venture borrowed an additional $ 18,379 . The Company used its $ 9,189 share of the additional proceeds to pay down its line of credit and for general corporate purposes. On July 25, 2019, the Company's previously unconsolidated joint venture in Fashion District Philadelphia amended the existing term loan on the joint venture to allow for additional borrowings up to $ 100,000 at LIBOR plus 2 %. Concurrent with the amendment, the joint venture borrowed an additional $ 26,000 . On August 16, 2019, the joint venture borrowed an additional $ 25,000 . The Company used its share of the additional proceeds to pay down its line of credit and for general corporate purposes. On September 12, 2019, the Company’s joint venture in Tysons Tower placed a new $ 190,000 loan on the property that bears interest at an effective rate of 3.38 % and matures on October 11, 2029. The Company used its share of the proceeds to pay down its line of credit and for general corporate purposes. On October 17, 2019, the Company’s joint venture in West Acres placed a construction loan on the property that allows for borrowing of up to $ 6,500 , bears interest at an effective rate of 3.72 % and matures on October 10, 2029. The joint venture intends to use the proceeds from the loan to fund the expansion of the property. On December 18, 2019, the Company’s joint venture in One Westside placed a $ 414,600 construction loan on the redevelopment project. The loan bears interest at LIBOR plus 1.70 %, which can be reduced to LIBOR plus 1.50 % upon the completion of certain conditions, and matures on December 18, 2024. This loan is being used to fund the joint venture's remaining cost to complete the project. On November 17, 2020, the Company’s joint venture in Tysons VITA, the residential tower at Tysons Corner Center, placed a new $ 95,000 loan on the property that bears interest at an effective rate of 3.43 % and matures on December 1, 2030. Initial loan funding for the Company’s joint venture was $ 90,000 with future advance potential of up to $ 5,000 . The Company used its share of the initial proceeds of $ 45,000 for general corporate purposes. On December 10, 2020, the Company made a loan (the “Partnership Loan”) to the Company’s previously unconsolidated joint venture in Fashion District Philadelphia to fund the entirety of a $ 100,000 repayment to reduce the mortgage loan on Fashion District Philadelphia from $ 301,000 to $ 201,000 . This mortgage loan now matures on January 22, 2024, including a one-year extension option, and bears interest at LIBOR plus 3.5 %, with a LIBOR floor of 0.50 %. The partnership agreement for the joint venture was amended in connection with the Partnership Loan, and pursuant to the amended agreement, the Partnership Loan plus 15 % accrued interest must be repaid prior to the resumption of 50 /50 cash distributions to the Company and its joint venture partner. As a result of the substantive participation rights of the Company’s joint venture partner being terminated in the amended agreement, the Company determined that the joint venture is a VIE and the Company is the primary beneficiary. Effective December 10, 2020, the Company has consolidated the results of the joint venture into the consolidated financial statements of the Company (See Note 15–Consolidated Joint Venture and Acquisitions). On December 29, 2020, the Company’s joint venture in FlatIron Crossing closed on a one-year maturity date extension for the existing loan to January 5, 2022. The interest rate increased from 3.85 % to 4.10 %, and the Company’s joint venture repaid $ 15,000 , $ 7,650 at the Company's pro rata share, of the outstanding loan balance at closing. On December 31, 2020, the Company and its joint venture partner in MS Portfolio LLC entered into a distribution agreement. The joint venture owned nine properties, including the former Sears parcels at the South Plains Mall and the Arrowhead Towne Center. The joint venture distributed the former Sears parcel at South Plains Mall to the Company and the former Sears parcel at Arrowhead Towne Center to the joint venture partner. The joint venture partners agreed that the distributed properties were of equal value. The Company now owns 100 % of the former Sears parcel at South Plains Mall. Effective December 31, 2020, the Company consolidates its 100 % interest in the Sears parcel at South Plains Mall in its consolidated financial statements (See Note 15 – Consolidated Joint Venture and Acquisitions). 82 Table of Contents THE MACERICH COMPANY NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) (Dollars in thousands, except per share amounts) 4. Investments in Unconsolidated Joint Ventures: (Continued) On March 29, 2021, concurrent with the sale of Paradise Valley Mall (see Note 16 – Dispositions), the Company elected to reinvest into the newly formed joint venture at a 5 % ownership interest for $ 3,819 in cash that is accounted for under the equity method of accounting. On October 26, 2021, the Company's joint venture in The Shops at Atlas Park replaced the existing loan on the property with a new $ 65,000 loan that bears interest at a floating rate of LIBOR plus 4.15 % and matures on November 9, 2026, including extension options. The loan is covered by an interest rate cap agreement that effectively prevents LIBOR from exceeding 3.0 % through November 7, 2023. On December 31, 2021, the Company assigned its joint venture interest in The Shops at North Bridge in Chicago, Illinois to its partner in the joint venture. The assignment included the assumption by the joint venture partner of the Company’s share of the debt owed by the joint venture and no cash consideration was received by the Company. The Company recognized a loss of approximately $ 28,276 in connection with the assignment. On December 31, 2021, the Company sold its joint venture interest in the undeveloped property at 443 North Wabash Avenue in Chicago, Illinois to its partner in the joint venture for $ 21,000 . The Company recognized an immaterial gain in connection with the sale. On February 2, 2022, the Company’s joint venture in FlatIron Crossing replaced the existing $ 197,011 loan on the property with a new $ 175,000 loan that bears interest at the Secured Overnight Financing Rate ("SOFR") plus 3.45 % and matures on February 9, 2027, including extension options. The loan is covered by an interest rate cap agreement that effectively prevents SOFR from exceeding 4.0 % through February 15, 2024. 83 Table of Contents THE MACERICH COMPANY NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) (Dollars in thousands, except per share amounts) 4. Investments in Unconsolidated Joint Ventures: (Continued) Combined and condensed balance sheets and statements of operations are presented below for all unconsolidated joint ventures. Combined and Condensed Balance Sheets of Unconsolidated Joint Ventures as of December 31: 2021 2020 Assets(1): Property, net $ 8,289,412 $ 8,721,551 Other assets 750,629 774,583 Total assets $ 9,040,041 $ 9,496,134 Liabilities and partners' capital(1): Mortgage and other notes payable $ 5,686,500 $ 5,942,478 Other liabilities 325,115 397,483 Company's capital 1,638,112 1,711,944 Outside partners' capital 1,390,314 1,444,229 Total liabilities and partners' capital $ 9,040,041 $ 9,496,134 Investment in unconsolidated joint ventures: Company's capital $ 1,638,112 $ 1,711,944 Basis adjustment(2) ( 448,149 ) ( 479,678 ) $ 1,189,963 $ 1,232,266 Assets—Investments in unconsolidated joint ventures 1,317,571 $ 1,340,647 Liabilities—Distributions in excess of investments in unconsolidated joint ventures ( 127,608 ) ( 108,381 ) $ 1,189,963 $ 1,232,266 _______________________________________________________________________________ (1) These amounts include the assets of $ 2,789,568 and $ 2,857,757 of Pacific Premier Retail LLC (the "PPR Portfolio") as of December 31, 2021 and 2020, respectively, and liabilities of $ 1,661,110 and $ 1,687,042 of the PPR Portfolio as of December 31, 2021 and 2020, respectively. (2) The Company amortizes the difference between the cost of its investments in unconsolidated joint ventures and the book value of the underlying equity into income on a straight-line basis consistent with the lives of the underlying assets. The amortization of this difference was $ 10,276 , $ 13,168 and $ 18,834 for the years ended December 31, 2021, 2020 and 2019, respectively. 84 Table of Contents THE MACERICH COMPANY NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) (Dollars in thousands, except per share amounts) 4. Investments in Unconsolidated Joint Ventures: (Continued) Combined and Condensed Statements of Operations of Unconsolidated Joint Ventures: PPR Portfolio Other Joint Ventures Total Year Ended December 31, 2021 Revenues: Leasing revenue $ 168,842 $ 631,139 $ 799,981 Other 62 57,083 57,145 Total revenues 168,904 688,222 857,126 Expenses: Shopping center and operating expenses 40,298 246,692 286,990 Leasing expense 1,286 4,392 5,678 Interest expense 63,072 147,545 210,617 Depreciation and amortization 97,494 253,561 351,055 Total operating expenses 202,150 652,190 854,340 Loss on sale of assets — ( 9,178 ) ( 9,178 ) Net (loss) income $ ( 33,246 ) $ 26,854 $ ( 6,392 ) Company's equity in net (loss) income $ ( 10,866 ) $ 26,555 $ 15,689 Year Ended December 31, 2020 Revenues: Leasing revenue 171,505 633,357 804,862 Other 614 18,439 19,053 Total revenues 172,119 651,796 823,915 Expenses: Shopping center and operating expenses 37,018 240,139 277,157 Leasing expense 1,325 4,173 5,498 Interest expense 64,460 151,857 216,317 Depreciation and amortization 102,788 285,948 388,736 Total operating expenses 205,591 682,117 887,708 (Loss) gain on sale of assets ( 120 ) 157 37 Net loss $ ( 33,592 ) $ ( 30,164 ) $ ( 63,756 ) Company's equity in net loss $ ( 10,371 ) $ ( 16,667 ) $ ( 27,038 ) 85 Table of Contents THE MACERICH COMPANY NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) (Dollars in thousands, except per share amounts) 4. Investments in Unconsolidated Joint Ventures: (Continued) PPR Portfolio Other Joint Ventures Total Year Ended December 31, 2019 Revenues: Leasing revenue $ 187,789 $ 712,860 $ 900,649 Other 1,598 49,184 50,782 Total revenues 189,387 762,044 951,431 Expenses: Shopping center and operating expenses 37,528 250,598 288,126 Leasing expense 1,598 6,695 8,293 Interest expense 67,354 150,111 217,465 Depreciation and amortization 100,490 273,565 374,055 Total operating expenses 206,970 680,969 887,939 Loss on sale of assets ( 452 ) ( 380 ) ( 832 ) Net (loss) income $ ( 18,035 ) $ 80,695 $ 62,660 Company's equity in net (loss) income $ ( 590 ) $ 49,098 $ 48,508 Significant accounting policies used by the unconsolidated joint ventures are similar to those used by the Company. 5. Derivative Instruments and Hedging Activities: The Company uses an interest rate cap and four interest rate swap agreements to manage the interest rate risk of its floating rate debt. The Company recorded other comprehensive income (loss) related to the marking-to-market of derivative instruments of $ 8,184 , $ 843 and $( 4,585 ) during the years ended December 31, 2021, 2020 and 2019, respectively. The fair value of the Company's derivatives was $ 6 and $( 8,208 ) at December 31, 2021 and 2020, respectively. The following derivatives were outstanding at December 31, 2021 and December 31, 2020: Fair Value Property Notional Amount Product LIBOR Rate Maturity December 31, 2021 December 31, 2020 Santa Monica Place(1) $ 300,000 Cap 4.00 % 12/9/2022 $ 6 $ — The Macerich Partnership, L.P.(1) $ 400,000 Swaps 2.85 % 9/30/2021 $ — $ ( 8,208 ) (1) On April 14, 2021, the Company entered into a new credit facility to replace the existing credit facility (See Note 11 - Bank and Other Notes Payable). Concurrent with entering into the new credit facility, the Company de-designated the Santa Monica Place $ 300,000 interest rate cap. As a result of the new credit facility and the Santa Monica Place cap de-designation, the notional amounts of the swaps that were previously hedged against the Company’s prior revolving line of credit were hedged against the Santa Monica Place floating rate debt and a portion of the Green Acres Commons floating rate debt effectively converting the Santa Monica Place loan and a majority of the Green Acres Commons loan to fixed rate debt through September 30, 2021. The Company did not renew the swaps that expired on September 30, 2021 and, as a result, on October 1, 2021, these loans reverted back to floating interest rate loans. Effective December 9, 2021, the Company entered into a new $ 300,000 interest rate cap for Santa Monica Place that was designated as a hedging instrument. The above derivative instruments were designated as hedging instruments with an aggregate fair value (Level 2 measurement) and were included in other accrued liabilities. The fair value of the Company's interest rate derivatives was determined using discounted cash flow analysis on the expected cash flows of each derivative. This analysis reflects the contractual terms of the derivatives, including the period to maturity, and uses observable market-based inputs, including interest rate curves and implied volatilities. The Company incorporates credit valuation adjustments to appropriately reflect both its own nonperformance risk and the respective counterparty's nonperformance risk in the fair value measurements. 86 Table of Contents THE MACERICH COMPANY NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) (Dollars in thousands, except per share amounts) 5. Derivative Instruments and Hedging Activities: (Continued) Although the Company has determined that the majority of the inputs used to value its derivatives fall within Level 2 of the fair value hierarchy, the credit valuation adjustments associated with its derivatives utilize Level 3 inputs, such as estimates of current credit spreads, to evaluate the likelihood of default by the Company and its counterparties. The Company has assessed the significance of the impact of the credit valuation adjustments on the overall valuation of its derivative positions and has determined that the credit valuation adjustments are not significant to the overall valuation of its interest rate swap. As a result, the Company determined that its interest rate cap and swap valuations in their entirety are classified in Level 2 of the fair value hierarchy. 6. Property, net: Property, net at December 31, 2021 and 2020 consists of the following: 2021 2020 Land $ 1,441,858 $ 1,538,270 Buildings and improvements 6,306,764 6,620,708 Tenant improvements 685,242 750,250 Equipment and furnishings(1) 191,266 194,231 Construction in progress 222,420 153,253 8,847,550 9,256,712 Less accumulated depreciation(1) ( 2,563,344 ) ( 2,562,133 ) $ 6,284,206 $ 6,694,579 (1) Equipment and furnishings and accumulated depreciation include the cost and accumulated amortization of ROU assets in connection with finance leases at December 31, 2021 and 2020 (See Note 8—Leases). Depreciation expense for the years ended December 31, 2021, 2020 and 2019 was $ 282,158 , $ 287,925 and $ 287,846 , respectively. The gain (loss) on sale or write down of assets, net for the years ended December 31, 2021, 2020 and 2019 consist of the following: 2021 2020 2019 Property sales(1) $ 113,657 $ — $ — Write-down of assets(2) ( 67,344 ) ( 76,705 ) ( 16,285 ) Land sales(3) 29,427 8,593 4,376 $ 75,740 $ ( 68,112 ) $ ( 11,909 ) _______________________________________________________________________________ (1) Includes gains related to the sale of La Encantada and Paradise Valley Mall (See Note 16-Dispositions). (2) Includes a loss of $ 28,276 in 2021 in connection with the assignment of the Company's partnership interest in The Shops at North Bridge (See Note 4—Investments in Unconsolidated Joint Ventures). Includes impairment loss of $ 27,281 on Estrella Falls during the year ended December 31, 2021 and impairment losses of $ 30,063 on Wilton Mall and $ 6,640 on Paradise Valley Mall during the year ended December 31, 2020. The impairment losses were due to the reduction of the estimated holding periods of the properties. The remaining amounts for the years ended December 31, 2021, 2020 and 2019 mainly pertain to the write off of development costs. (3) Includes $ 1,334 related to the sale of Paradise Valley Mall (See Note 16-Dispositions). 87 Table of Contents THE MACERICH COMPANY NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) (Dollars in thousands, except per share amounts) 6. Property, net: (Continued) The following table summarizes certain of the Company's assets that were measured on a nonrecurring basis as a result of impairment charges recorded for the years ended December 31, 2021 and 2020 as described above: Years ended December 31, Total Fair Value Measurement Quoted Prices in Active Markets for Identical Assets Significant Other Observable Inputs Significant Unobservable Inputs (Level 1) (Level 2) (Level 3) 2021 $ 4,720 $ — $ 4,720 $ — 2020 $ 151,875 $ — 151,875 $ — The fair value relating to the 2020 impairments and the 2021 impairments were based on sales contracts and are classified within Level 2 of the fair value hierarchy. 7. Tenant and Other Receivables, net: Included in tenant and other receivables, net is an allowance for doubtful accounts of $ 14,917 and $ 37,545 at December 31, 2021 and 2020, respectively. Also included in tenant and other receivables, net are accrued percentage rents of $ 19,907 and $ 4,673 at December 31, 2021 and 2020, respectively, and a deferred rent receivable due to straight-line rent adjustments of $ 110,969 and $ 107,003 at December 31, 2021 and 2020, respectively. 8. Leases: Lessor Leases: The Company leases its Centers under agreements that are classified as operating leases. These leases generally include minimum rents, percentage rents and recoveries of real estate taxes, insurance and other shopping center operating expenses. Minimum rental revenues are recognized on a straight-line basis over the terms of the related leases. Percentage rents are recognized and accrued when tenants' specified sales targets have been met. Estimated recoveries from certain tenants for their pro rata share of real estate taxes, insurance and other shopping center operating expenses are recognized as revenues in the period the applicable expenses are incurred. Other tenants pay a fixed rate and these tenant recoveries are recognized as revenues on a straight-line basis over the term of the related leases. For leasing revenues in which collectability of substantially all of the rents is not considered probable, lease income is recognized on a cash basis and all previously recognized tenant accounts receivables, including straight-line rent, are fully reserved in the period in which the lease income is determined not to be probable of collection. The following table summarizes the components of leasing revenue for the years ended December 31, 2021, 2020 and 2019: 2021 2020 2019 Leasing revenue - fixed payments $ 529,227 $ 592,858 $ 647,876 Leasing revenue - variable payments 251,930 191,715 218,680 Recovery of (provision for) doubtful accounts 6,390 ( 44,250 ) ( 7,682 ) $ 787,547 $ 740,323 $ 858,874 88 Table of Contents THE MACERICH COMPANY NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) (Dollars in thousands, except per share amounts) 8. Leases: (Continued) The following table summarizes the future rental payments to the Company: 2022 $ 373,164 2023 329,071 2024 272,035 2025 223,412 2026 176,352 Thereafter 502,336 $ 1,876,370 Lessee Leases: The Company has certain properties that are subject to non-cancelable operating leases. The leases expire at various times through 2098, subject in some cases to options to extend the terms of the lease. Certain leases provide for contingent rent payments based on a percentage of base rental income, as defined in the lease. In addition, the Company has five finance leases that expire at various times through 2024. The following table summarizes the lease costs for the year ended December 31, 2021: Operating lease costs $ 14,611 Finance lease costs: Amortization of ROU assets 1,917 Interest on lease liabilities 574 $ 17,102 The following table summarizes the future rental payments required under the leases as of December 31, 2021: Year ending Operating Leases Finance Leases 2022 $ 14,302 $ 4,461 2023 8,452 2,043 2024 6,471 9,072 2025 6,513 — 2026 6,470 — Thereafter 109,358 — Total undiscounted rental payments 151,566 15,576 Less imputed interest ( 85,383 ) ( 1,048 ) Total lease liabilities $ 66,183 $ 14,528 The Company's weighted average remaining lease term of its operating and finance leases at December 31, 2021 was 36.3 years and 2.1 years, respectively. The Company's weighted average incremental borrowing rate of its operating and finance leases at December 31, 2021 was 7.8 % and 3.7 %, respectively. 89 Table of Contents THE MACERICH COMPANY NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) (Dollars in thousands, except per share amounts) 9. Deferred Charges and Other Assets, net: Deferred charges and other assets, net at December 31, 2021 and 2020 consist of the following: 2021 2020 Leasing $ 134,887 $ 162,652 Intangible assets: In-place lease values(1) 62,826 74,298 Leasing commissions and legal costs(1) 16,710 21,096 Above-market leases 72,289 80,120 Deferred tax assets 23,406 30,767 Deferred compensation plan assets 68,807 62,874 Other assets 46,319 61,553 425,244 493,360 Less accumulated amortization(2) ( 170,336 ) ( 186,401 ) $ 254,908 $ 306,959 _______________________________ (1) The amortization of these intangible assets for the next five years and thereafter is as follows: Year Ending December 31, 2022 $ 6,617 2023 5,430 2024 4,369 2025 3,395 2026 3,437 Thereafter 12,310 $ 35,558 (2) Accumulated amortization includes $ 43,978 and $ 47,249 relating to in-place lease values, leasing commissions and legal costs at December 31, 2021 and 2020, respectively. Amortization expense for in-place lease values, leasing commissions and legal costs was $ 11,233 , $ 9,412 and $ 13,821 for the years ended December 31, 2021, 2020 and 2019, respectively. 90 Table of Contents THE MACERICH COMPANY NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) (Dollars in thousands, except per share amounts) 9. Deferred Charges and Other Assets, net: (Continued) The allocated values of above-market leases and below-market leases consist of the following: 2021 2020 Above-Market Leases Original allocated value $ 72,289 $ 80,120 Less accumulated amortization ( 32,484 ) ( 33,271 ) $ 39,805 $ 46,849 Below-Market Leases(1) Original allocated value $ 99,332 $ 114,790 Less accumulated amortization ( 37,122 ) ( 43,656 ) $ 62,210 $ 71,134 _______________________________ (1) Below-market leases are included in other accrued liabilities. The allocated values of above and below-market leases will be amortized into minimum rents on a straight-line basis over the individual remaining lease terms. The amortization of these values for the next five years and thereafter is as follows: Year Ending December 31, Above Market Below Market 2022 $ 6,201 $ 8,454 2023 5,724 7,766 2024 5,212 7,650 2025 3,821 6,071 2026 3,629 4,745 Thereafter 15,218 27,524 $ 39,805 $ 62,210 91 Table of Contents THE MACERICH COMPANY NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) (Dollars in thousands, except per share amounts) 10. Mortgage Notes Payable: Mortgage notes payable at December 31, 2021 and 2020 consist of the following: Carrying Amounts of Mortgage Notes(1) Effective Interest Rate(2) Monthly Debt Service(3) Maturity Date(4) Property Pledged as Collateral 2021 2020 Chandler Fashion Center(5) $ 255,548 $ 255,361 4.18 % $ 875 2024 Danbury Fair Mall(6) 168,037 186,741 5.71 % 1,538 2022 Fashion District Philadelphia(7) 194,602 201,000 4.00 % 649 2024 Fashion Outlets of Chicago 299,274 299,193 4.61 % 1,145 2031 Fashion Outlets of Niagara Falls USA(8) 95,329 101,463 6.45 % 727 2023 Freehold Raceway Mall(5) 398,711 398,545 3.94 % 1,300 2029 Fresno Fashion Fair 324,056 323,857 3.67 % 971 2026 Green Acres Commons(9) 124,875 129,847 3.12 % 298 2023 Green Acres Mall(10) 246,061 270,570 3.94 % 1,447 2023 Kings Plaza Shopping Center 535,928 535,413 3.71 % 1,629 2030 Oaks, The 176,721 183,108 4.14 % 1,064 2022 Pacific View 111,481 114,909 4.08 % 668 2022 Queens Center 600,000 600,000 3.49 % 1,744 2025 Santa Monica Place(11) 299,314 298,566 1.84 % 396 2022 SanTan Village Regional Center 219,323 219,233 4.34 % 788 2029 Towne Mall 19,320 19,815 4.48 % 117 2022 Tucson La Encantada(12) — 62,018 4.23 % — — Victor Valley, Mall of 114,850 114,791 4.00 % 380 2024 Vintage Faire Mall 240,124 246,380 3.55 % 1,256 2026 $ 4,423,554 $ 4,560,810 (1) The mortgage notes payable balances also include unamortized deferred finance costs that are amortized into interest expense over the remaining term of the related debt in a manner that approximates the effective interest method. Unamortized deferred finance costs were $ 11,946 and $ 14,085 at December 31, 2021 and 2020, respectively. (2) The interest rate disclosed represents the effective interest rate, including the impact of debt premium and deferred finance costs. (3) The monthly debt service represents the payment of principal and interest. (4) The maturity date assumes that all extension options are fully exercised and that the Company does not opt to refinance the debt prior to these dates. These extension options are at the Company's discretion, subject to certain conditions, which the Company believes will be met. (5) A 49.9 % interest in the loan has been assumed by a third party in connection with the Company's joint venture in Chandler Freehold (See Note 12—Financing Arrangement). (6) On September 15, 2020, the Company closed on a loan extension agreement for Danbury Fair Mall. Under the extension agreement, the original loan maturity date of October 1, 2020 was extended to April 1, 2021 and subsequently to October 1, 2021. The loan amount and interest rate remained unchanged following these extensions. On September 15, 2021, the Company further extended the loan maturity to July 1, 2022. The interest rate remained unchanged, and the Company repaid $ 10,000 of the outstanding loan balance at closing. (7) Effective December 10, 2020, the Company began consolidating this joint venture and assumed this debt (See Note 15—Consolidated Joint Venture and Acquisitions). (8) On December 15, 2020, the Company closed on a loan extension agreement for the Fashion Outlets of Niagara. Under the extension agreement the original loan maturity date of October 6, 2020 was extended to October 6, 2023. The loan amount and interest rate are unchanged following the extension. (9) On March 25, 2021, the Company closed on a two-year extension of the loan to March 29, 2023. The interest rate is LIBOR plus 2.75 % and the Company repaid $ 4,680 of the outstanding loan balance at closing. 92 Table of Contents THE MACERICH COMPANY NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) (Dollars in thousands, except per share amounts) 10. Mortgage Notes Payable: (continued) (10) On January 22, 2021, the Company closed on a one-year extension of the loan to February 3, 2022, which also included a one-year extension option to February 3, 2023 which has been exercised. The interest rate remained unchanged, and the Company repaid $ 9,000 of the outstanding loan balance at closing. (11) The loan bears interest at LIBOR plus 1.48 %. The loan is covered by an interest rate cap agreement that effectively prevents LIBOR from exceeding 4.0 % during the period ending December 9, 2022. (12) On September 17, 2021, the Company sold Tucson La Encantada and the mortgage payable was paid in full (See Note 16—Dispositions). Most of the mortgage loan agreements contain a prepayment penalty provision for the early extinguishment of the debt. As of December 31, 2021, all of the Company's mortgage notes payable are secured by the properties on which they are placed and are non-recourse to the Company. During the second quarter of 2020 and in July 2020, the Company secured agreements with its mortgage lenders on nine property mortgage loans to defer approximately $ 28,683 of both second and third quarter of 2020 debt service payments. Of the deferred payments, $ 15,208 and $ 20,195 was repaid in the three months and twelve months ended December 31, 2020, respectively, and the remaining balance was fully repaid during the first quarter of 2021. The Company expects all loan maturities during the next twelve months will be refinanced, restructured, extended and/or paid off from the Company's line of credit or with cash on hand. Total interest expense capitalized during the years ended December 31, 2021, 2020 and 2019 was $ 9,504 , $ 5,247 and $ 9,614 , respectively. The estimated fair value (Level 2 measurement) of mortgage notes payable at December 31, 2021 and 2020 was $ 4,261,429 and $ 4,459,797 , respectively, based on current interest rates for comparable loans. Fair value was determined using a present value model and an interest rate that included a credit value adjustment based on the estimated value of the property that serves as collateral for the underlying debt. The future maturities of mortgage notes payable are as follows: Year Ending December 31, 2022 $ 794,526 2023 473,111 2024 562,722 2025 607,399 2026 537,742 Thereafter 1,460,000 4,435,500 Deferred finance cost, net ( 11,946 ) $ 4,423,554 The future maturities reflected above reflect the extension options that the Company believes will be exercised. 11. Bank and Other Notes Payable: Bank and other notes payable at December 31, 2021 and 2020 consist of the following: Line of Credit: On April 14, 2021, the Company terminated its existing credit facility and entered into a new credit agreement, which provides for an aggregate $ 700,000 facility, including a $ 525,000 revolving loan facility that matures on April 14, 2023, with a one-year extension option, and a $ 175,000 term loan facility that matures on April 14, 2024. The revolving loan facility can be expanded up to $ 800,000 , subject to receipt of lender commitments and other conditions. Concurrently with entering into the new credit agreement, the Company drew the $ 175,000 term loan facility in its entirety and drew $ 320,000 of the amount 93 Table of Contents THE MACERICH COMPANY NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) (Dollars in thousands, except per share amounts) 11. Bank and Other Notes Payable: (Continued) available under the revolving loan facility. Simultaneously with entering into the new credit agreement, the Company repaid $ 985,000 of debt, which included terminating and repaying all amounts outstanding under its prior revolving line of credit facility. All obligations under the facility are guaranteed unconditionally by the Company and are secured in the form of mortgages on certain wholly-owned assets and pledges of equity interests held by certain of the Company’s subsidiaries. The new credit facility bears interest at LIBOR plus a spread of 2.25 % to 3.25 % depending on the Company’s overall leverage level. As of December 31, 2021, the borrowing rate was LIBOR plus 2.25 %. As of December 31, 2021, borrowings under the facility were $ 119,000 , less unamortized deferred finance costs of $ 14,189 , for the revolving loan facility at a total interest rate of 3.86 %. As of December 31, 2021, the Company's availability under the revolving loan facility for additional borrowings was $ 405,719 . On September 20, 2021, the Company paid off the remaining balance outstanding on the term loan facility with proceeds from the sale of Tucson La Encantada (See Note 16—Dispositions). The estimated fair value (Level 2 measurement) of borrowings under the credit facility at December 31, 2021 was $ 118,198 for the revolving loan facility based on a present value model using a credit interest rate spread offered to the Company for comparable debt. The Company had a $ 1,500,000 revolving line of credit that bore interest at LIBOR plus a spread of 1.30 % to 1.90 %, depending on the Company's overall leverage level, and was to mature on July 6, 2020. On April 8, 2020, the Company exercised its option to extend the maturity of the facility to July 6, 2021. The line of credit could have been expanded, depending on certain conditions, up to a total facility of $ 2,000,000 . Based on the Company's leverage level as of December 31, 2020, the borrowing rate on the facility was LIBOR plus 1.65 %. On April 14, 2021, the Company repaid the $ 985,000 of outstanding debt and terminated this credit facility. The Company had four interest rate swap agreements that effectively converted a total of $ 400,000 of the outstanding balance from floating rate debt of LIBOR plus 1.65 % to fixed rate debt of 4.50 % until September 30, 2021. These swaps were hedged against the Santa Monica Place floating rate loan and a portion of the Green Acres Commons floating rate loan effectively converting these loans to fixed rate debt through September 30, 2021. The Company did not renew the swaps that expired on September 30, 2021 and, as a result, on October 1, 2021, these loans reverted back to floating interest rate loans (See Note 5 – Derivative Instruments and Hedging Activities and Note 10 – Mortgage Notes Payable). As of December 31, 2020, borrowings under the prior line of credit was $ 1,480,000 less unamortized deferred finance costs of $ 2,460 at a total interest rate of 2.73 %. As of December 31, 2020, the Company's availability under the prior line of credit for additional borrowings was $ 19,719 . The estimated fair value (Level 2 measurement) of borrowings under the line of credit at December 31, 2020 was $ 1,485,598 based on a present value model using a credit interest rate spread offered to the Company for comparable debt. As of December 31, 2021 and 2020, the Company was in compliance with all applicable financial loan covenants. 12. Financing Arrangement: On September 30, 2009, the Company formed a joint venture, whereby a third party acquired a 49.9 % interest in Chandler Fashion Center, a 1,319,000 square foot regional town center in Chandler, Arizona, and Freehold Raceway Mall, a 1,553,000 square foot regional town center in Freehold, New Jersey, referred to herein as Chandler Freehold. As a result of the Company having certain rights under the agreement to repurchase the assets of Chandler Freehold, the transaction did not qualify for sale treatment. The Company, however, is not obligated to repurchase the assets. The transaction was initially accounted for as a co-venture arrangement, and accordingly the assets, liabilities and operations of the properties remain on the books of the Company and a co-venture obligation was established for the net cash proceeds received from the third party less costs allocated to a warrant. Upon adoption of ASC 606 on January 1, 2018, the Company changed its accounting for Chandler Freehold from a co-venture arrangement to a financing arrangement. Under the Financing Arrangement, the Company recognizes interest expense on (i) the changes in fair value of the Financing Arrangement obligation, (ii) any payments to the joint venture partner equal to their pro rata share of net (loss) income and (iii) any payments to the joint venture partner less than or in excess of their pro rata share of net income. 94 Table of Contents THE MACERICH COMPANY NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) (Dollars in thousands, except per share amounts) 12. Financing Arrangement: (Continued) During the years ended December 31, 2021, 2020 and 2019 the Company incurred interest (income) expense in connection with the financing arrangement as follows: 2021 2020 2019 Distributions of the partner's share of net (loss) income $ ( 2,763 ) $ 1,144 $ 7,184 Distributions in excess of the partner's share of net income 14,435 3,097 6,939 Adjustment to fair value of financing arrangement obligation ( 15,390 ) ( 139,522 ) ( 76,640 ) $ ( 3,718 ) $ ( 135,281 ) $ ( 62,517 ) The fair value (Level 3 measurement) of the financing arrangement obligation at December 31, 2021 and 2020 was based upon a terminal capitalization rate of approximately 5.75 % and 5.5 %, respectively, a discount rate of approximately 7.25 % and 7.0 %, respectively, and market rents per square foot ranging from $ 35 to $ 105 . The fair value of the financing arrangement obligation is sensitive to these significant unobservable inputs and a change in these inputs may result in a significantly higher or lower fair value measurement. Distributions to the partner, excluding distributions of excess loan proceeds, and changes in fair value of the financing arrangement obligation are recognized as interest (income) expense in the Company's consolidated statements of operations. On June 27, 2019, the Company replaced the existing mortgage note payable on Chandler Fashion Center with a new $ 256,000 loan (See Note 10—Mortgage Notes Payable). In connection with the refinancing transaction, the Company distributed $ 27,945 of the excess loan proceeds to its joint venture partner, which was recorded as a reduction to the financing arrangement obligation. 13. Noncontrolling Interests: The Company allocates net income of the Operating Partnership based on the weighted-average ownership interest during the period. The net income of the Operating Partnership that is not attributable to the Company is reflected in the consolidated statements of operations as noncontrolling interests. The Company adjusts the noncontrolling interests in the Operating Partnership periodically to reflect its ownership interest in the Company. The Company had a 96 % and 93 % ownership interest in the Operating Partnership as of December 31, 2021 and 2020, respectively. The remaining 4 % and 7 % limited partnership interest as of December 31, 2021 and 2020, respectively, was owned by certain of the Company's executive officers and directors, certain of their affiliates, and other third party investors in the form of OP Units. The OP Units may be redeemed for shares of registered or unregistered stock or cash, at the Company's option. The redemption value for each OP Unit as of any balance sheet date is the amount equal to the average of the closing price per share of the Company's common stock, par value $ 0.01 per share, as reported on the New York Stock Exchange for the ten trading days ending on the respective balance sheet date. Accordingly, as of December 31, 2021 and 2020, the aggregate redemption value of the then-outstanding OP Units not owned by the Company was $ 147,259 and $ 117,602 , respectively. The Company issued common and cumulative preferred units of MACWH, LP in April 2005 in connection with the acquisition of the Wilmorite portfolio. The common and preferred units of MACWH, LP are redeemable at the election of the holder, the Company may redeem them for cash or shares of the Company's stock at the Company's option, and they are classified as permanent equity. Included in permanent equity are outside ownership interests in various consolidated joint ventures. The joint ventures do not have rights that require the Company to redeem the ownership interests in either cash or stock. 95 Table of Contents THE MACERICH COMPANY NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) (Dollars in thousands, except per share amounts) 14. Stockholders' Equity: Stock Dividend: On June 3, 2020, the Company issued 7,759,280 common shares to its common stockholders in connection with the quarterly dividend of $ 0.50 per share of common stock declared on March 16, 2020. The dividend consisted of a combination of cash and shares of the Company's common stock. The cash component of the dividend (not including cash paid in lieu of fractional shares) was 20 % in the aggregate, or $ 0.10 per share, with the balance paid in shares of the Company's common stock. In accordance with the provisions of Internal Revenue Service Revenue Procedure 2017-45, stockholders were asked to make an election to receive the dividend all in cash or all in shares. To the extent that more than 20 % of cash was elected in the aggregate, the cash portion was prorated. Stockholders who elected to receive the dividend in cash received a cash payment of at least $ 0.10 per share. Stockholders who did not make an election received 20 % in cash and 80 % in shares of common stock. The number of shares issued as a result of the dividend was calculated based on the volume weighted average trading price of the Company's common stock on the New York Stock Exchange on May 20, May 21 and May 22, 2020 of $ 7.2956 . The Company accounted for the stock portion of its distribution as a stock issuance as opposed to a stock dividend. Accordingly, the impact of the shares issued is reflected in the Company's earnings per share calculation on a prospective basis. The issuance of the stock dividend resulted in a reduction of $ 0.05 on both basic and diluted earnings per share for the year ended December 31, 2020. Stock Offerings: In connection with the commencement of separate “at the market” offering programs, on each of February 1, 2021 and March 26, 2021, which are referred to as the “February 2021 ATM Program” and the “March 2021 ATM Program,” respectively, and collectively as the “ATM Programs,” the Company entered into separate equity distribution agreements with certain sales agents pursuant to which the Company may issue and sell shares of its common stock having an aggregate offering price of up to $ 500,000 under each of the February 2021 ATM Program and the March 2021 ATM Program, or a total of $ 1,000,000 under the ATM Programs. During the twelve months ended December 31, 2021, the Company issued 62,049,131 shares of common stock under the ATM Programs for aggregate gross proceeds of $ 848,301 and net proceeds of $ 830,241 after commissions and other transaction costs. The proceeds from the sales under the ATM Programs were used to pay down the Company’s line of credit (See Note 11 – Bank and Other Notes Payable). As of December 31, 2021, $ 151,699 remained available to be sold under the March 2021 ATM Program. The February 2021 ATM Program was fully utilized as of June 30, 2021 and is no longer active. Actual future sales will depend upon a variety of factors including, but not limited to, market conditions, the trading price of the Company’s common stock and the Company’s capital needs. The Company has no obligation to sell the remaining shares available for sale under the ATM Programs. Stock Buyback Program: On February 12, 2017, the Company's Board of Directors authorized the repurchase of up to $ 500,000 of its outstanding common shares as market conditions and the Company’s liquidity warrant. Repurchases may be made through open market purchases, privately negotiated transactions, structured or derivative transactions, including accelerated share repurchase transactions, or other methods of acquiring shares, from time to time as permitted by securities laws and other legal requirements. The program is referred to herein as the "Stock Buyback Program". There were no repurchases under the Stock Buyback Program during the years ended December 31, 2021, 2020 and 2019. 96 Table of Contents THE MACERICH COMPANY NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) (Dollars in thousands, except per share amounts) 15. Consolidated Joint Venture and Acquisitions: Fashion District Philadelphia: Effective December 10, 2020, the Company made the Partnership Loan to the Company’s previously unconsolidated joint venture in Fashion District Philadelphia, pursuant to the joint venture’s amended and restated partnership agreement, to fund a $ 100,000 repayment to reduce the mortgage notes payable on Fashion District Philadelphia from $ 301,000 to $ 201,000 . The Partnership Loan plus 15 % accrued interest must be repaid prior to the resumption of 50 /50 cash distributions to the Company and its joint venture partner. Prior to the restructuring, the Company had accounted for its investment in Fashion District Philadelphia under the equity method of accounting due to substantive participation rights held by the Company’s joint venture partner. Pursuant to the amended and restated partnership agreement, the substantive participation rights of the Company’s joint venture partner were terminated and as a result, the joint venture is treated as a VIE. The Company became the primary beneficiary of the VIE and commenced consolidating Fashion District Philadelphia in its consolidated financial statements effective December 10, 2020. Prior to December 10, 2020, the Company’s share of the joint venture’s net (loss) income was included in its consolidated statements of operations in equity in (loss) income of unconsolidated joint ventures. The consolidation of the joint venture required the Company to recognize the joint venture’s identifiable assets and liabilities at fair value in the Company’s consolidated financial statements, along with the fair value of the non-controlling interest. The fair value of the joint venture’s assets and liabilities upon initial consolidation were measured using estimates of expected future cash flows and other valuation techniques. The fair value of the joint venture property was determined by using income and market or sales comparison valuation approaches which included, but are not limited to estimates of rental rates, comparable sales, revenue and expense growth rates, capitalization rates and discount rates. The allocation of fair value to assets was estimated by the market or sales comparison, cost and income approaches. Assumed debt was recorded at fair value based upon the present value of the expected future payments and current interest rates. Other acquired assets, including cash, and assumed liabilities were recorded at cost due to the short-term nature of the balances. The following is a summary of the allocation of the fair value of Fashion District Philadelphia: Property $ 331,514 Deferred charges 25,272 Cash and cash equivalents 4,492 Restricted cash 1,319 Tenant receivables 8,476 Other assets 30,582 Total assets acquired 401,655 Mortgage note payable 201,000 Partnership loan(1) 100,000 Accounts payable 6,673 Due to affiliates 3 Other accrued liabilities 55,717 Total liabilities assumed 363,393 Fair value of acquired net assets (at 100 % ownership) $ 38,262 (1) The Partnership Loan is eliminated in the Company's consolidated financial statements. 97 Table of Contents THE MACERICH COMPANY NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) (Dollars in thousands, except per share amounts) 15. Consolidated Joint Venture and Acquisitions: (Continued) The Company recognized a remeasurement loss to adjust the carrying value of its existing investment in the joint venture to its estimated fair value in the Company’s consolidated financial statements. The remeasurement loss was determined by taking the difference between the fair value of assets less its liabilities and the sum of the carrying value of the Company’s existing investment in the joint venture and the fair value of the noncontrolling interest. The Company recognized the following remeasurement loss on the Fashion District Philadelphia restructuring: Fair value of acquired net assets (at 100 % ownership) $ 38,262 Fair value of the noncontrolling interest ( 19,131 ) Carrying value of existing investment in the joint venture ( 182,429 ) Loss on remeasurement of asset $ ( 163,298 ) Sears South Plains: On December 31, 2020, the Company and its joint venture partner in MS Portfolio LLC entered into a distribution agreement. The joint venture owned nine properties, including the former Sears parcels at the South Plains Mall and the Arrowhead Towne Center. The joint venture distributed the former Sears parcel at South Plains Mall to the Company and the former Sears parcel at Arrowhead Towne Center to the joint venture partner. The joint venture partners agreed that the distributed properties were of equal value. The Company now owns 100 % of the former Sears parcel at South Plains Mall. Effective December 31, 2020, the Company consolidates its 100 % interest in the Sears parcel at South Plains Mall in its consolidated financial statements. The following is a summary of the allocation of the fair value of Sears South Plains: Land $ 8,170 Building and improvements 11,130 Fair value of acquired net assets (at 100 % ownership) $ 19,300 16. Dispositions: On March 29, 2021, the Company sold Paradise Valley Mall in Phoenix, Arizona to a newly formed joint venture for $ 100,000 resulting in a gain on sale of assets and land of $ 5,563 . Concurrent with the sale, the Company elected to reinvest into the new joint venture at a 5 % ownership interest (see Note 4 – Investments in Unconsolidated Joint Ventures). The Company used the proceeds from the sale to pay down its line of credit and for other general corporate purposes. On September 17, 2021, the Company sold Tucson La Encantada in Tucson, Arizona for $ 165,250 , resulting in a gain on sale of assets of approximately $ 117,242 . The Company used the net cash proceeds of $ 100,142 to pay down debt. For the twelve months ended December 31, 2021, the Company sold various land parcels in separate transactions, resulting in gains on sale of land of $ 29,427 . The Company used its share of the proceeds from these sales to pay down debt and for other general corporate purposes. 17. Commitments and Contingencies: As of December 31, 2021, the Company was contingently liable for $ 40,997 in letters of credit guaranteeing performance by the Company of certain obligations relating to the Centers. The Company does not believe that these letters of credit will result in a liability to the Company. The Company has entered into a number of construction agreements related to its redevelopment and development activities. Obligations under these agreements are contingent upon the completion of the services within the guidelines specified 98 Table of Contents THE MACERICH COMPANY NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) (Dollars in thousands, except per share amounts) 17. Commitments and Contingencies: (Continued) in the relevant agreement. At December 31, 2021, the Company had $ 12,785 in outstanding obligations, which it believes will be settled in the next twelve months. 18. Related Party Transactions: Certain unconsolidated joint ventures have engaged the Management Companies to manage the operations of the Centers. Under these arrangements, the Management Companies are reimbursed for compensation paid to on-site employees, leasing agents and project managers at the Centers, as well as insurance costs and other administrative expenses. The following are fees charged to unconsolidated joint ventures for the years ended December 31: 2021 2020 2019 Management fees $ 17,872 $ 15,297 $ 18,748 Development and leasing fees 5,958 6,951 16,056 $ 23,830 $ 22,248 $ 34,804 Interest (income) expense from related party transactions also includes $( 3,718 ), $( 135,281 ) and $( 62,517 ) for the years ended December 31, 2021, 2020 and 2019, respectively, in connection with the Financing Arrangement (See Note 12—Financing Arrangement). Due (to) from affiliates includes $( 327 ) and $ 1,612 of (prepaid) unreimbursed costs and fees due (to) from unconsolidated joint ventures under management agreements at December 31, 2021 and 2020, respectively. In addition, due from affiliates included a note receivable from RED/303 LLC ("RED") that bore interest at 5.25 % and was to mature on May 30, 2021. Interest income earned on this note was $ 0 , $ 0 and $ 141 for the years ended December 31, 2021, 2020 and 2019, respectively. On October 7, 2019, the note was collected in full. RED was considered a related party because it was a partner in a joint venture development project. The note was collateralized by RED's membership interest in the development project. Also included in due from affiliates was a note receivable from Lennar Corporation that bore interest at LIBOR plus 2 % and was to mature upon the completion of certain milestones in connection with the planned development of Fashion Outlets of San Francisco. As a result of those milestones not being completed, the Company elected to terminate the development agreement and the note was collected in full on February 13, 2019. Interest income earned on this note was $ 0 , $ 0 and $ 1,112 for the years ended December 31, 2021, 2020 and 2019, respectively. Lennar Corporation was considered a related party because it was a joint venture partner in the project. 19. Share and Unit-based Plans: The Company has established share and unit-based compensation plans for the purpose of attracting and retaining executive officers, directors and key employees. 2003 Equity Incentive Plan: The 2003 Equity Incentive Plan ("2003 Plan") authorizes the grant of stock awards, stock options, stock appreciation rights, stock units, stock bonuses, performance-based awards, dividend equivalent rights and OP Units or other convertible or exchangeable units. As of December 31, 2021, stock awards, stock units, LTIP Units (as defined below), stock appreciation rights ("SARs") and stock options have been granted under the 2003 Plan. All stock options or other rights to acquire common stock granted under the 2003 Plan have a term of 10 years or less. These awards were generally granted based on the performance of the Company and the employees. None of the awards have performance requirements other than a service condition of continued employment unless otherwise provided. All awards are subject to restrictions determined by the Company's compensation committee. The aggregate number of shares of common stock that may be issued under the 2003 Plan is 20,912,331 shares. As of December 31, 2021, there were 5,112,831 shares available for issuance under the 2003 Plan. 99 Table of Contents THE MACERICH COMPANY NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) (Dollars in thousands, except per share amounts) 19. Share and Unit-based Plans: (Continued) Stock Units: The stock units represent the right to receive upon vesting one share of the Company's common stock for one stock unit. The value of the stock units was determined by the market price of the Company's common stock on the date of the grant. The following table summarizes the activity of non-vested stock units during the years ended December 31, 2021, 2020 and 2019: 2021 2020 2019 Units Weighted Average Grant Date Fair Value Units Weighted Average Grant Date Fair Value Units Weighted Average Grant Date Fair Value Balance at beginning of year 309,845 $ 21.47 199,987 $ 43.59 129,457 $ 64.21 Granted 169,112 14.61 253,184 14.14 160,932 37.44 Vested ( 211,465 ) 19.03 ( 140,224 ) 39.53 ( 85,157 ) 62.84 Forfeited ( 987 ) 22.12 ( 3,102 ) 32.62 ( 5,245 ) 51.48 Balance at end of year 266,505 $ 19.05 309,845 $ 21.47 199,987 $ 43.59 Long-Term Incentive Plan Units: Under the Long-Term Incentive Plan ("LTIP"), each award recipient is issued a form of operating partnership units ("LTIP Units") in the Operating Partnership. Upon the occurrence of specified events and subject to the satisfaction of applicable vesting conditions, LTIP Units (after conversion into OP Units) are ultimately redeemable for common stock of the Company, or cash at the Company's option, on a one -unit for one -share basis. LTIP Units receive cash dividends based on the dividend amount paid on the common stock of the Company. The LTIP may include market-indexed awards, performance-based awards and service-based awards. The market-indexed LTIP Units vest over the service period of the award based on the percentile ranking of the Company in terms of total return to stockholders (the "Total Return") per common stock share relative to the Total Return of a group of peer REITs, as measured at the end of the measurement period. The performance-based LTIP Units vest over a specified period based on the Company's operational performance over that period. The fair value of the service-based LTIP Units was determined by the market price of the Company's common stock on the date of the grant. The fair value of the market-indexed LTIP Units and performance-based LTIP Units are estimated on the date of grant using a Monte Carlo Simulation model. The stock price of the Company, along with the stock prices of the group of peer REITs (for market-indexed awards), is assumed to follow the Multivariate Geometric Brownian Motion Process. Multivariate Geometric Brownian Motion is a common assumption when modeling in financial markets, as it allows the modeled quantity (in this case, the stock price) to vary randomly from its current value and take any value greater than zero. The volatilities of the returns on the share price of the Company and the peer group REITs were estimated based on a look-back period. The expected growth rate of the stock prices over the "derived service period" is determined with consideration of the risk free rate as of the grant date. 100 Table of Contents THE MACERICH COMPANY NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) (Dollars in thousands, except per share amounts) 19. Share and Unit-based Plans: (Continued) The Company has granted the following LTIP units during the years ended December 31, 2021, 2020 and 2019: Grant Date Units Type Fair Value per LTIP Unit Vest Date 1/1/2019 81,732 Service-based $ 43.28 12/31/2021 1/1/2019 250,852 Market-indexed $ 29.25 12/31/2021 9/1/2019 4,393 Service-based $ 28.53 8/31/2022 9/1/2019 6,454 Market-indexed $ 19.42 8/31/2022 343,431 1/1/2020 154,158 Service-based $ 26.92 12/31/2022 1/1/2020 321,940 Market-indexed $ 27.80 12/31/2022 3/1/2020 39,176 Service-based $ 20.42 2/28/2023 3/1/2020 37,592 Market-indexed $ 21.28 2/28/2023 552,866 1/1/2021 576,378 Service-based $ 10.67 12/31/2023 1/1/2021 1,005,073 Performance-based $ 9.85 12/31/2023 1,581,451 The fair value of the market-indexed LTIP Units and performance-based LTIP Units (Level 3) were estimated on the date of grant using a Monte Carlo Simulation model that based on the following assumptions: Grant Date Risk Free Interest Rate Expected Volatility 1/1/2019 2.46 % 23.52 % 9/1/2019 1.42 % 24.91 % 1/1/2020 1.62 % 26.08 % 3/1/2020 0.85 % 28.34 % 1/1/2021 0.17 % 62.82 % 101 Table of Contents THE MACERICH COMPANY NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) (Dollars in thousands, except per share amounts) 19. Share and Unit-based Plans: (Continued) The following table summarizes the activity of the non-vested LTIP Units during the years ended December 31, 2021, 2020 and 2019: 2021 2020 2019 Units Weighted Average Grant Date Fair Value Units Weighted Average Grant Date Fair Value Units Weighted Average Grant Date Fair Value Balance at beginning of year 784,052 $ 28.11 616,219 $ 39.04 661,578 $ 48.38 Granted 1,581,451 10.15 552,866 26.59 343,431 32.40 Vested ( 286,373 ) 17.62 ( 102,884 ) 40.19 ( 76,306 ) 59.27 Forfeited ( 241,439 ) 29.25 ( 282,149 ) 44.28 ( 312,484 ) 46.55 Balance at end of year 1,837,691 $ 14.14 784,052 $ 28.11 616,219 $ 39.04 Stock Options: On May 30, 2017, the Company granted 25,000 non-qualified stock options with a grant date fair value of $ 10.02 that vested on May 30, 2019. The Company measured the value of each option awarded using the Black-Scholes Option Pricing Model based upon the following assumptions: volatility of 30.19 %, dividend yield of 4.93 %, risk free rate of 2.08 %, current value of $ 57.55 and an expected term of 8 years. The following table summarizes the activity of stock options for the years ended December 31, 2021, 2020 and 2019: 2021 2020 2019 Options Weighted Average Exercise Price Options Weighted Average Exercise Price Options Weighted Average Exercise Price Balance at beginning of year 37,515 $ 54.34 35,565 $ 57.32 35,565 $ 57.32 Granted(1) — — 1,950 — — — Balance at end of year 37,515 $ 54.34 37,515 $ 54.34 35,565 $ 57.32 (1) Pursuant to the terms of the Company's equity plan, the exercise price and number of options were adjusted so that the stock dividend paid on June 3, 2020 had no negative impact on the outstanding stock options (See Note 14–Stockholders' Equity). Directors' Phantom Stock Plan: The Directors' Phantom Stock Plan offers non-employee members of the board of directors ("Directors") the opportunity to defer their cash compensation and to receive that compensation in common stock rather than in cash after termination of service or a predetermined period. Compensation generally includes the annual retainers payable by the Company to the Directors. Deferred amounts are generally credited as units of phantom stock at the beginning of each three-year deferral period by dividing the present value of the deferred compensation by the average fair market value of the Company's common stock at the date of award. Compensation expense related to the phantom stock awards was determined by the amortization of the value of the stock units on a straight-line basis over the applicable service period. The stock units (including dividend equivalents) vest as the Directors' services (to which the fees relate) are rendered. Vested phantom stock units are ultimately paid out in common stock on a one -unit for one -share basis. To the extent elected by a Director, stock units receive dividend equivalents in the form of additional stock units based on the dividend amount paid on the common stock. The aggregate number of phantom stock units that may be granted under the Directors' Phantom Stock Plan is 500,000 . As of December 31, 2021, there were 92,508 stock units available for grant under the Directors' Phantom Stock Plan. 102 Table of Contents THE MACERICH COMPANY NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) (Dollars in thousands, except per share amounts) 19. Share and Unit-based Plans: (Continued) The following table summarizes the activity of the non-vested phantom stock units for the years ended December 31, 2021, 2020 and 2019: 2021 2020 2019 Stock Units Weighted Average Grant Date Fair Value Stock Units Weighted Average Grant Date Fair Value Stock Units Weighted Average Grant Date Fair Value Balance at beginning of year 4,662 $ 35.35 7,216 $ 43.29 — $ — Granted 17,554 12.09 24,576 17.11 23,690 40.26 Vested ( 22,216 ) 16.97 ( 27,130 ) 20.94 ( 16,474 ) 38.94 Forfeited — — — — — — Balance at end of year — $ — 4,662 $ 35.35 7,216 $ 43.29 Employee Stock Purchase Plan ("ESPP"): The ESPP authorizes eligible employees to purchase the Company's common stock through voluntary payroll deductions made during periodic offering periods. Under the ESPP, common stock is purchased at a 15 % discount from the lesser of the fair value of common stock at the beginning and end of the offering period. A maximum of 1,291,117 shares of common stock is available for purchase under the ESPP. The number of shares available for future purchase under the plan at December 31, 2021 was 489,362 . Compensation: The following summarizes the compensation cost under the share and unit-based plans for the years ended December 31, 2021, 2020 and 2019: 2021 2020 2019 Stock units $ 3,173 $ 4,159 $ 4,598 LTIP units 14,448 13,339 11,372 Stock options — — 51 Phantom stock units 377 568 702 $ 17,998 $ 18,066 $ 16,723 The Company capitalized share and unit-based compensation costs of $ 3,725 , $ 4,223 and $ 4,691 for the years ended December 31, 2021, 2020 and 2019, respectively. The fair value of the stock awards and stock units that vested during the years ended December 31, 2021, 2020 and 2019 was $ 3,408 , $ 1,376 and $ 3,577 , respectively. Unrecognized compensation costs of share and unit-based plans at December 31, 2021 consisted of $ 4,610 from LTIP Units and $ 1,533 from stock units. 103 Table of Contents THE MACERICH COMPANY NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) (Dollars in thousands, except per share amounts) 20. Employee Benefit Plans: 401(k) Plan: The Company has a defined contribution retirement plan that covers its eligible employees (the "Plan"). The Plan is a defined contribution retirement plan covering eligible employees of the Macerich Property Management Company, LLC and participating affiliates. This Plan includes The Macerich Company Common Stock Fund as a new investment alternative under the Plan with 650,000 shares of common stock reserved for issuance under the Plan. In accordance with the Plan, the Company makes matching contributions equal to 100 percent of the first three percent of compensation deferred by a participant and 50 percent of the next two percent of compensation deferred by a participant. During the years ended December 31, 2021, 2020 and 2019, these matching contributions made by the Company were $ 3,144 , $ 3,455 and $ 3,346 , respectively. Contributions and matching contributions to the Plan by the plan sponsor and/or participating affiliates are recognized as an expense of the Company in the period that they are made. Deferred Compensation Plans: The Company has established deferred compensation plans under which executives and key employees of the Company may elect to defer receiving a portion of their cash compensation otherwise payable in one calendar year until a later year. The Company may, as determined by the Board of Directors in its sole discretion prior to the beginning of the plan year, credit a participant's account with a matching amount equal to a percentage of the participant's deferral. The Company contributed $ 325 , $ 695 and $ 814 to the plans during the years ended December 31, 2021, 2020 and 2019, respectively. Contributions are recognized as compensation in the periods they are made. 21. Income Taxes: For income tax purposes, distributions paid to common stockholders consist of ordinary income, capital gains, unrecaptured Section 1250 gain and return of capital or a combination thereof. The following table details the components of the distributions, on a per share basis, for the years ended December 31, 2021, 2020 and 2019: 2021(1) 2020(1) 2019(1) Ordinary income $ 0.04 6.0 % $ 0.08 5.2 % $ 1.32 44.2 % Capital gains 0.15 24.9 % 0.02 1.3 % 0.64 21.2 % Return of capital 0.41 69.1 % 1.45 93.5 % 1.04 34.6 % Dividends paid $ 0.60 100.0 % $ 1.55 100.0 % $ 3.00 100.0 % _______________________________________________________________________________ (1) The 2021, 2020 and 2019 taxable ordinary dividends are treated as "qualified REIT dividends" for purposes of Internal Revenue Code Section 199A. The Company has made Taxable REIT Subsidiary elections for all of its corporate subsidiaries other than its Qualified REIT Subsidiaries. The elections, effective for the year beginning January 1, 2001 and future years, were made pursuant to Section 856(l) of the Code. The income tax provision of the TRSs for the years ended December 31, 2021, 2020 and 2019 are as follows: 2021 2020 2019 Current $ — $ 439 $ ( 150 ) Deferred ( 6,948 ) 8 ( 1,439 ) Income tax (expense) benefit $ ( 6,948 ) $ 447 $ ( 1,589 ) 104 Table of Contents THE MACERICH COMPANY NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) (Dollars in thousands, except per share amounts) 21. Income Taxes: (Continued) The income tax provision of the TRSs for the years ended December 31, 2021, 2020 and 2019 are reconciled to the amount computed by applying the Federal Corporate tax rate as follows: 2021 2020 2019 Book loss (income) for TRSs $ ( 23,205 ) $ 6,058 $ ( 2,062 ) Tax at statutory rate on earnings from continuing operations before income taxes $ ( 4,873 ) $ 1,272 $ ( 433 ) State taxes ( 1,261 ) ( 31 ) ( 280 ) Other ( 814 ) ( 794 ) ( 876 ) Income tax (expense) benefit $ ( 6,948 ) $ 447 $ ( 1,589 ) The tax effects of temporary differences and carryforwards of the TRSs included in the net deferred tax assets at December 31, 2021 and 2020 are summarized as follows: 2021 2020 Net operating loss carryforwards $ 23,944 $ 27,196 Property, primarily differences in depreciation and amortization, the tax basis of land assets and treatment of certain other costs ( 1,013 ) 2,927 Other 475 644 Net deferred tax assets $ 23,406 $ 30,767 The net operating loss ("NOL") carryforwards for NOLs generated through the 2017 tax year are scheduled to expire through 2037, beginning in 2025. Pursuant to the Tax Cuts and Jobs Act of 2017, NOLs generated in 2018 and subsequent tax years are carried forward indefinitely. The Coronavirus Aid, Relief and Economic Security Act removed the 80% of taxable income limitation, imposed by the Tax Cuts and Jobs Act, for NOLs generated in 2018, 2019 and 2020. For the years ended December 31, 2021, 2020 and 2019 there were no unrecognized tax benefits. The Company is required to establish a valuation allowance for any portion of the deferred tax asset that the Company concludes is more likely than not to be unrealizable. The Company’s assessment considers all evidence, both positive and negative, including the nature, frequency and severity of any current and cumulative losses, taxable income in carry back years, the scheduled reversal of deferred tax liabilities, tax planning strategies and projected future taxable income in making this assessment. As of December 31, 2021, the Company had no valuation allowance recorded. The tax years 2018 through 2020 remain open to examination by the taxing jurisdictions to which the Company is subject. The Company does not expect that the total amount of unrecognized tax benefit will materially change within the next 12 months. 22. Subsequent Events: On January 27, 2022, the Company announced a dividend/distribution of $ 0.15 per share for common stockholders and OP Unit holders of record on February 18, 2022. All dividends/distributions will be paid 100% in cash on March 3, 2022. 105 Table of Contents THE MACERICH COMPANY Schedule III—Real Estate and Accumulated Depreciation December 31, 2021 (Dollars in thousands) Initial Cost to Company Gross Amount at Which Carried at Close of Period Shopping Centers/Entities Land Building and Improvements Equipment and Furnishings Cost Capitalized Subsequent to Acquisition Land Building and Improvements Equipment and Furnishings Construction in Progress Total Accumulated Depreciation Total Cost Net of Accumulated Depreciation Chandler Fashion Center $ 24,188 $ 223,143 $ — $ 32,631 $ 24,188 $ 246,967 $ 5,205 $ 3,602 $ 279,962 $ 132,622 $ 147,340 Danbury Fair Mall 130,367 316,951 — 113,156 141,479 390,915 10,124 17,956 560,474 171,291 389,183 Desert Sky Mall 9,447 37,245 12 6,543 9,082 41,232 2,933 — 53,247 16,496 36,751 Eastland Mall 22,050 151,605 — 11,990 20,810 162,693 2,130 12 185,645 49,685 135,960 Fashion District Philadelphia 38,402 293,112 — 6,262 39,962 296,775 235 804 337,776 9,505 328,271 Fashion Outlets of Chicago — — — 275,149 40,575 228,900 4,550 1,124 275,149 80,811 194,338 Fashion Outlets of Niagara Falls USA 18,581 210,139 — 105,795 23,762 308,480 2,183 90 334,515 108,446 226,069 The Marketplace at Flagstaff — — — 45,855 — 45,855 — — 45,855 28,944 16,911 Freehold Raceway Mall 164,986 362,841 — 126,120 168,098 476,181 9,258 410 653,947 236,094 417,853 Fresno Fashion Fair 17,966 72,194 — 56,980 17,966 125,844 3,091 239 147,140 69,798 77,342 Green Acres Mall 156,640 321,034 — 190,705 177,378 458,349 10,886 21,766 668,379 155,232 513,147 Inland Center 8,321 83,550 — 36,548 10,291 117,704 380 44 128,419 34,449 93,970 Kings Plaza Shopping Center 209,041 485,548 20,000 277,854 205,012 676,363 60,084 50,984 992,443 178,069 814,374 La Cumbre Plaza 18,122 21,492 — 19,436 13,856 45,004 190 — 59,050 26,776 32,274 Macerich Management Co. 1,150 10,475 26,562 27,857 3,878 17,942 43,270 954 66,044 29,453 36,591 MACWH, LP — 25,771 — 12,461 10,777 27,455 — — 38,232 11,964 26,268 NorthPark Mall 7,746 74,661 — 11,350 7,076 85,985 696 — 93,757 31,363 62,394 Oaks, The 32,300 117,156 — 268,973 56,387 357,987 3,558 497 418,429 194,018 224,411 Pacific View 8,697 8,696 — 137,922 7,854 145,911 1,550 — 155,315 84,979 70,336 Prasada 6,615 — — 23,373 3,114 26,445 — 429 29,988 2,337 27,651 Queens Center 251,474 1,039,922 — 54,263 256,786 1,082,404 5,892 577 1,345,659 212,717 1,132,942 Santa Monica Place 26,400 105,600 — 317,936 42,513 316,488 6,624 84,311 449,936 124,540 325,396 SanTan Adjacent Land 29,414 — — 10,276 26,902 — — 12,788 39,690 — 39,690 SanTan Village Regional Center 7,827 — — 219,174 5,921 219,354 1,713 13 227,001 115,796 111,205 Sears South Plains 8,170 11,130 — 1,057 — — — 20,357 20,357 — 20,357 SouthPark Mall 7,035 38,215 — ( 7,985 ) 2,899 33,932 434 — 37,265 17,796 19,469 Southridge Center 6,764 — — 6,973 1,963 11,659 115 — 13,737 7,788 5,949 Stonewood Center 4,948 302,527 — 13,158 4,935 315,115 583 — 320,633 69,719 250,914 Superstition Springs Center 10,928 112,718 — 11,687 10,928 123,344 1,061 — 135,333 32,155 103,178 Superstition Springs Power Center 1,618 4,420 — ( 98 ) 1,194 4,709 37 — 5,940 2,415 3,525 The Macerich Partnership, L.P. — 2,534 — 5,969 — 1,138 7,365 — 8,503 1,827 6,676 Towne Mall 6,652 31,184 — 5,110 6,877 35,620 350 99 42,946 18,746 24,200 See accompanying report of independent registered public accounting firm. Table of Contents THE MACERICH COMPANY Schedule III—Real Estate and Accumulated Depreciation (Continued) December 31, 2021 (Dollars in thousands) Initial Cost to Company Gross Amount at Which Carried at Close of Period Shopping Centers/Entities Land Building and Improvements Equipment and Furnishings Cost Capitalized Subsequent to Acquisition Land Building and Improvements Equipment and Furnishings Construction in Progress Total Accumulated Depreciation Total Cost Net of Accumulated Depreciation Valley Mall 16,045 26,098 — 12,675 14,506 40,064 248 — 54,818 16,513 38,305 Valley River Center 24,854 147,715 — 35,224 24,854 180,766 1,896 277 207,793 79,922 127,871 Victor Valley, Mall of 15,700 75,230 — 54,907 20,080 124,161 1,596 — 145,837 66,260 79,577 Vintage Faire Mall 14,902 60,532 — 59,758 17,417 114,524 1,580 1,671 135,192 80,686 54,506 Wilton Mall 19,743 67,855 — ( 3,052 ) 11,310 72,044 1,155 37 84,546 48,449 36,097 Other freestanding stores 5,926 31,785 — ( 5,369 ) 4,906 27,142 294 — 32,342 14,584 17,758 Other land and development properties 37,850 — — ( 21,594 ) 6,322 6,555 — 3,379 16,256 1,099 15,157 $ 1,370,869 $ 4,873,078 $ 46,574 $ 2,557,029 $ 1,441,858 $ 6,992,006 $ 191,266 $ 222,420 $ 8,847,550 $ 2,563,344 $ 6,284,206 See accompanying report of independent registered public accounting firm. Table of Contents THE MACERICH COMPANY Schedule III—Real Estate and Accumulated Depreciation (Continued) December 31, 2021 (Dollars in thousands) Depreciation of the Company's investment in buildings and improvements reflected in the consolidated statements of operations are calculated over the estimated useful lives of the asset as follows: Buildings and improvements 5 - 40 years Tenant improvements 5 - 7 years Equipment and furnishings 5 - 7 years The changes in total real estate assets for the three years ended December 31, 2021 are as follows: 2021 2020 2019 Balances, beginning of year $ 9,256,712 $ 8,993,049 $ 8,878,820 Additions 100,616 419,369 176,690 Dispositions and retirements ( 509,778 ) ( 155,706 ) ( 62,461 ) Balances, end of year $ 8,847,550 $ 9,256,712 $ 8,993,049 The aggregate cost of the property included in the table above for federal income tax purposes was $ 8,877,859 (unaudited) at December 31, 2021. The changes in accumulated depreciation for the three years ended December 31, 2021 are as follows: 2021 2020 2019 Balances, beginning of year $ 2,562,133 $ 2,349,536 $ 2,093,044 Additions 282,158 287,925 287,846 Dispositions and retirements ( 280,947 ) ( 75,328 ) ( 31,354 ) Balances, end of year $ 2,563,344 $ 2,562,133 $ 2,349,536 See accompanying report of independent registered public accounting firm. 108 EXHIBIT INDEX Exhibit Number Description 2.1 Master Agreement, dated November 14, 2014, by and among Pacific Premier Retail LLC, MACPT LLC, Macerich PPR GP LLC, Queens JV LP, Macerich Queens JV LP, Queens JV GP LLC, 1700480 Ontario Inc. and the Company (incorporated by reference as an exhibit to the Company’s Current Report on Form 8-K, event date November 14, 2014). 3.1 Articles of Amendment and Restatement of the Company (incorporated by reference as an exhibit to the Company's Registration Statement on Form S-11, as amended (No. 33-68964)) (Filed in paper - hyperlink is not required pursuant to Rule 105 of Regulation S-T). 3.1.1 Articles Supplementary of the Company (incorporated by reference as an exhibit to the Company's Current Report on Form 8-K, event date May 30, 1995) (Filed in paper - hyperlink is not required pursuant to Rule 105 of Regulation S-T). 3.1.2 Articles Supplementary of the Company (with respect to the first paragraph) (incorporated by reference as an exhibit to the Company's 1998 Form 10-K). 3.1.3 Articles Supplementary of the Company (Series D Preferred Stock) (incorporated by reference as an exhibit to the Company's Current Report on Form 8-K, event date July 26, 2002). 3.1.4 Articles Supplementary of the Company (incorporated by reference as an exhibit to the Company's Registration Statement on Form S-3, as amended (No. 333-88718)). 3.1.5 Articles of Amendment of the Company (declassification of Board) (incorporated by reference as an exhibit to the Company's 2008 Form 10-K). 3.1.6 Articles Supplementary of the Company (incorporated by reference as an exhibit to the Company's Current Report on Form 8-K, event date February 5, 2009). 3.1.7 Articles of Amendment of the Company (increased authorized shares) (incorporated by reference as an exhibit to the Company's Quarterly Report on Form 10-Q for the quarter ended June 30, 2009). 3.1.8 Articles of Amendment of the Company (to eliminate the supermajority vote requirement to amend the charter and to clarify a reference in Article NINTH) (incorporated by reference as an exhibit to the Company’s Current Report on Form 8-K, event date May 30, 2014). 3.1.9 Articles Supplementary (election to be subject to Section 3-803 of the Maryland General Corporation Law) (incorporated by reference as an exhibit to the Company's Current Report on Form 8-K, event date March 17, 2015). 3.1.10 Articles Supplementary (designation of Series E Preferred Stock) (incorporated by reference as an exhibit to the Company's Current Report on Form 8-K, event date March 18, 2015). 3.1.11 Articles Supplementary (reclassification of Series E Preferred Stock to preferred stock) (incorporated by reference as an exhibit to the Company's Current Report on Form 8-K, event date May 7, 2015). 3.1.12 Articles Supplementary (repeal of election to be subject to Section 3-803 of the Maryland General Corporation Law (incorporated by reference as an exhibit to the Company's Current Report on Form 8-K, event date May 28, 2015). 3.1.13 Articles Supplementary (opting out of provisions of Subtitle 8 of Title 3 of the Maryland General Corporate Law (MUTA Provisions)) (incorporated by reference as an exhibit to the Company’s Current Report on Form 8-K, event date April 24, 2019). 109 Exhibit Number Description 3.1.14 Articles of Amendment of the Company (increased authorized shares) (incorporated by reference as an exhibit to the Company’s Current Report on Form 8-K, event date May 28, 2021). 3.2 Amended and Restated Bylaws of the Company (incorporated by reference as an exhibit to the Company's Current Report on Form 8-K, event date April 24, 2019). 4.1 Description of the Company's Securities 4. 2 Form of Common Stock Certificate (incorporated by reference as an exhibit to the Company's Current Report on Form 8-K, as amended, event date November 10, 1998). 4. 3 Form of Preferred Stock Certificate (Series D Preferred Stock) (incorporated by reference as an exhibit to the Company's Registration Statement on Form S-3 (No. 333-107063)). 10.1 Amended and Restated Limited Partnership Agreement for the Operating Partnership dated as of March 16, 1994 (incorporated by reference as an exhibit to the Company's 1996 Form 10-K). 10.1.1 Amendment to Amended and Restated Limited Partnership Agreement for the Operating Partnership dated June 27, 1997 (incorporated by reference as an exhibit to the Company's Current Report on Form 8-K, event date June 20, 1997). 10.1.2 Amendment to Amended and Restated Limited Partnership Agreement for the Operating Partnership dated November 16, 1997 (incorporated by reference as an exhibit to the Company's 1997 Form 10-K). 10.1.3 Fourth Amendment to Amended and Restated Limited Partnership Agreement for the Operating Partnership dated February 25, 1998 (incorporated by reference as an exhibit to the Company's 1997 Form 10-K). 10.1.4 Fifth Amendment to Amended and Restated Limited Partnership Agreement for the Operating Partnership dated February 26, 1998 (incorporated by reference as an exhibit to the Company's 1997 Form 10-K). 10.1.5 Sixth Amendment to Amended and Restated Limited Partnership Agreement for the Operating Partnership dated June 17, 1998 (incorporated by reference as an exhibit to the Company's 1998 Form 10-K). 10.1.6 Seventh Amendment to Amended and Restated Limited Partnership Agreement for the Operating Partnership dated December 23, 1998 (incorporated by reference as an exhibit to the Company's 1998 Form 10-K). 10.1.7 Eighth Amendment to Amended and Restated Limited Partnership Agreement for the Operating Partnership dated November 9, 2000 (incorporated by reference as an exhibit to the Company's 2000 Form 10-K). 10.1.8 Ninth Amendment to Amended and Restated Limited Partnership Agreement for the Operating Partnership dated July 26, 2002 (incorporated by reference as an exhibit to the Company's Current Report on Form 8-K, event date July 26, 2002). 10.1.9 Tenth Amendment to Amended and Restated Limited Partnership Agreement for the Operating Partnership dated October 26, 2006 (incorporated by reference as an exhibit to the Company's 2006 Form 10-K). 10.1.10 Eleventh Amendment to Amended and Restated Limited Partnership Agreement for the Operating Partnership dated as of March 16, 2007 (incorporated by reference as an exhibit to the Company's Current Report on Form 8-K, event date March 16, 2007). 110 Exhibit Number Description 10.1.11 Twelfth Amendment to the Amended and Restated Limited Partnership Agreement of the Operating Partnership dated as of April 30, 2009 (incorporated by reference as an exhibit to the Company's Quarterly Report on Form 10-Q for the quarter ended June 30, 2009). 10.1.12 Thirteenth Amendment to the Amended and Restated Limited Partnership Agreement of the Operating Partnership dated as of October 29, 2009 (incorporated by reference as an exhibit to the Company's 2009 Form 10-K). 10.1.13 Fourteenth Amendment to Amended and Restated Limited Partnership Agreement of the Operating Partnership dated as of April 14, 2021. 10.1.14 Form of Fifteenth Amendment to Amended and Restated Limited Partnership Agreement for the Operating Partnership (incorporated by reference as an exhibit to the Company's Current Report on Form 8-K, event date April 25, 2005). 10.2 * Amended and Restated Deferred Compensation Plan for Executives (2003) (incorporated by reference as an exhibit to the Company's 2003 Form 10-K). 10.2.1 * Amendment Number 1 to Amended and Restated Deferred Compensation Plan for Executives (October 30, 2008) (incorporated by reference as an exhibit to the Company's 2008 Form 10-K). 10.2.2 * Amendment Number 2 to Amended and Restated Deferred Compensation Plan for Executives (May 1, 2011) (incorporated by reference as an exhibit to the Company's Quarterly Report on Form 10-Q for the quarter ended June 30, 2011). 10.2.3 * Amendment Number 3 to Amended and Restated Deferred Compensation Plan for Executives (September 27, 2012) (incorporated by reference as an exhibit to the Company's Quarterly Report on Form 10-Q for the quarter ended September 30, 2012). 10.3 * Amended and Restated Deferred Compensation Plan for Senior Executives (2003) (incorporated by reference as an exhibit to the Company's 2003 Form 10-K). 10.3.1 * Amendment Number 1 to Amended and Restated Deferred Compensation Plan for Senior Executives (October 30, 2008) (incorporated by reference as an exhibit to the Company's 2008 Form 10-K). 10.3.2 * Amendment Number 2 to Amended and Restated Deferred Compensation Plan for Senior Executives (May 1, 2011) (incorporated by reference as an exhibit to the Company's Quarterly Report on Form 10 - Q for the quarter ended June 30, 2011). 10.3.3 * Amendment Number 3 to Amended and Restated Deferred Compensation Plan for Senior Executives (September 27, 2012) (incorporated by reference as an exhibit to the Company's Quarterly Report on Form 10-Q for the quarter ended September 30, 2012). 10.4 * Eligible Directors' Deferred Compensation/Phantom Stock Plan (as amended and restated as of January 1, 2013) (incorporated by reference as an exhibit to the Company's Quarterly Report on Form 10-Q for the quarter ended June 30, 2013). 10.5 * Amended and Restated 2013 Deferred Compensation Plan for Executives effective (January 1, 2016) (incorporated by reference as an exhibit to the Company's 2015 Form 10-K). 111 Exhibit Number Description 10.6 Deferred Compensation Plan Amended and Restated Trust Agreement between the Company and Wells Fargo Bank, National Association, effective as of June 17, 2019 (incorporated by reference as an exhibit to the Company’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2019). 10.7 Registration Rights Agreement, dated as of March 16, 1994, among the Company and Mace Siegel, Dana K. Anderson, Arthur M. Coppola and Edward C. Coppola (incorporated by reference as an exhibit to the Company's 1994 Form 10-K) (Filed in paper - hyperlink is not required pursuant to Rule 105 of Regulation S-T). 10.8 Registration Rights Agreement dated as of December 18, 2003 by the Operating Partnership, the Company and Taubman Realty Group Limited Partnership (Registration rights assigned by Taubman to three assignees) (incorporated by reference as an exhibit to the Company's 2003 Form 10-K). 10.9 Incidental Registration Rights Agreement dated March 16, 1994 (incorporated by reference as an exhibit to the Company's 1994 Form 10-K) (Filed in paper - hyperlink is not required pursuant to Rule 105 of Regulation S-T). 10.10 Incidental Registration Rights Agreement dated as of July 21, 1994 (incorporated by reference as an exhibit to the Company's 1997 Form 10-K). 10.11 Incidental Registration Rights Agreement dated as of August 15, 1995 (incorporated by reference as an exhibit to the Company's 1997 Form 10-K). 10.12 Incidental Registration Rights Agreement dated as of December 21, 1995 (incorporated by reference as an exhibit to the Company's 1997 Form 10-K). 10.13 List of Omitted Incidental/Demand Registration Rights Agreements (incorporated by reference as an exhibit to the Company's 1997 Form 10-K). 10.14 Redemption, Registration Rights and Lock-Up Agreement dated as of July 24, 1998 between the Company and Harry S. Newman, Jr. and LeRoy H. Brettin (incorporated by reference as an exhibit to the Company's 1998 Form 10-K). 10.15 Form of Indemnification Agreement between the Company and its executive officers and directors (incorporated by reference as an exhibit to the Company's 2008 Form 10-K). 10.16 Form of Registration Rights Agreement with Series D Preferred Unit Holders (incorporated by reference as an exhibit to the Company's Current Report on Form 8-K, event date July 26, 2002). 10.16.1 List of Omitted Registration Rights Agreements (incorporated by reference as an exhibit to the Company's Current Report on Form 8-K, event date July 26, 2002). 10.17 Credit Agreement, dated as of April 14 , 20 21 , by and among the Company, as a guarantor, the Partnership, as borrower, certain subsidiary guarantors , Deutsche Bank AG New York Branch, as administrative agent and collateral agent, Deutsche Bank Securities Inc., JPMorgan Chase Bank, N.A. and Goldman Sachs Bank USA , as joint lead arrangers and joint bookrunning managers , Deutsche Bank Securities Inc. and JPMorgan Chase Bank, N.A. as co-syndication agents , Goldman Sachs Bank USA , as documentation agent, and various lenders party thereto (incorporated by reference as an exhibit to the Company's Current Report on Form 8-K, event date April 14 , 20 21 ). 112 Exhibit Number Description 10. 17.1 First Amendment to Credit Agreement , dated as of July 27 , 20 21 , by and among the Company, as guarantor , the Partnership, as borrower, certain subsidiary guarantors, and Deutsche Bank AG New York Branch, as administrative agent for the lenders (incorporated by reference as an exhibit to the Company's Quarterly Report on Form 10 - Q for the quarter ended Ju ne 30 , 20 21 ). 10.18 Unconditional Guaranty, dated as of April 14, 2021, by the Company in favor of Deutsche Bank AG New York Branch, as administrative agent (incorporated by reference as an exhibit to the Company’s Current Report on Form 8-K, event date April 14, 2021). 10.19 Tax Matters Agreement (Wilmorite) (incorporated by reference as an exhibit to the Company's Current Report on Form 8-K, event date April 25, 2005). 10.20 * 2003 Equity Incentive Plan, as amended and restated as of May 26, 2016 (incorporated by reference as an exhibit to the Company's Current Report on Form 8-K, event date May 26, 2016). 10.20.1 * Amended and Restated Cash Bonus/Restricted Stock/Stock Unit and LTIP Unit Award Program under the 2003 Equity Incentive Plan (incorporated by reference as an exhibit to the Company's 2010 Form 10-K). 10.20.2 * Form of Restricted Stock Award Agreement under 2003 Equity Incentive Plan (incorporated by reference as an exhibit to the Company's 2008 Form 10-K). 10.20.3 * Form of Stock Unit Award Agreement under 2003 Equity Incentive Plan (incorporated by reference as an exhibit to the Company's 2014 Form 10-K). 10.20.4 * Form of Employee Stock Option Agreement under 2003 Equity Incentive Plan (incorporated by reference as an exhibit to the Company's 2008 Form 10-K). 10.20.5 * Form of Non-Qualified Stock Option Grant under 2003 Equity Incentive Plan (incorporated by reference as an exhibit to the Company's 2008 Form 10-K). 10.20.6 * Form of Restricted Stock Award Agreement for Non-Management Directors (incorporated by reference as an exhibit to the Company's 2008 Form 10-K). 10.20.7 * Form of Stock Unit Award Agreement under 2003 Equity Incentive Plan for Non-Employee Directors (incorporated by reference as an exhibit to the Company's 2015 Form 10-K). 10.20.8 * Form of Stock Appreciation Right under 2003 Equity Incentive Plan (incorporated by reference as an exhibit to the Company's 2008 Form 10-K). 10.20.9 * Form of LTIP Unit Award Agreement under 2003 Equity Incentive Plan (service-based) (incorporated by reference as an exhibit to the Company's Quarterly Report on Form 10-Q for the quarter ended March 31, 2019). 10.20.10 * Form of LTIP Unit Award Agreement under 2003 Equity Incentive Plan ( p erformance-based ) (incorporated by reference as an exhibit to the Company’s Quarterly Report on Form 10-Q for the quarter ended June 3 0 , 20 21 ). 10.20.11 * Form of LTIP Unit Award Agreement under 2003 Equity Incentive Plan (fully-vested) (incorporated by reference as an exhibit to the Company's Quarterly Report on Form 10-Q for the quarter ended March 3 1 , 201 4 ). 113 Exhibit Number Description 10.21 * The Macerich Company Employee Stock Purchase Plan (as amended and restated effective June 1, 2021) (incorporated by reference as an exhibit to the Company’s Current Report on 8-K, event date May 28, 2021). 10.22 * Change in Control Severance Pay Plan for Executive Vice Presidents (incorporated by reference as an exhibit to the Company’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2019). 10.23 * Change in Control Severance Pay Plan for Senior Executives (incorporated by reference as an exhibit to the Company's Quarterly Report on Form 10-Q for the quarter ended September 30, 2017). 10.24 * Employment Agreement Renewal between the Company and Thomas E. O’Hern, effective June 8, 2021 (incorporated by reference as an exhibit to the Company’s Current Report on Form 8-K, event date June 11, 2021). 10.25 * Employment Agreement between the Company and William P. Voegele, effective September 1, 2019 (incorporated by reference as an exhibit to the Company’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2019). 10.26 2005 Amended and Restated Agreement of Limited Partnership of MACWH, LP dated as of April 25, 2005 (incorporated by reference as an exhibit to the Company's Current Report on Form 8-K, event date April 25, 2005). 10.27 Registration Rights Agreement dated as of April 25, 2005 among the Company and the persons names on Exhibit A thereto (incorporated by reference as an exhibit to the Company's Current Report on Form 8-K, event date April 25, 2005). 21.1 List of Subsidiaries 23.1 Consent of Independent Registered Public Accounting Firm (KPMG LLP) 31.1 Section 302 Certification of Thomas E. O'Hern, Chief Executive Officer and Director 31.2 Section 302 Certification of Scott W. Kingsmore, Chief Financial Officer 32.1 ** Section 906 Certifications of Thomas E. O'Hern and Scott W. Kingsmore 101.SCH Inline XBRL Taxonomy Extension Schema Document 101.CAL Inline XBRL Taxonomy Extension Calculation Linkbase Document 101.LAB Inline XBRL Taxonomy Extension Label Linkbase Document 101.PRE Inline XBRL Taxonomy Extension Presentation Linkbase Document 101.DEF Inline XBRL Taxonomy Extension Definition Linkbase Document 104 Cover Page Interactive Data File (formatted as Inline XBRL with applicable taxonomy extension information contained in Exhibits 101.*). * Represents a management contract, or compensatory plan, contract or arrangement required to be filed pursuant to Regulation S-K. ** Furnished herewith. 114 SIGNATURES Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized, on February 25, 2022. THE MACERICH COMPANY /s/ THOMAS E. O'HERN By Thomas E. O'Hern Chief Executive Officer and Director 115 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. Signature Capacity Date /s/ THOMAS E. O'HERN Chief Executive Officer and Director February 25, 2022 Thomas E. O'Hern (Principal Executive Officer) /s/ EDWARD C. COPPOLA President and Director February 25, 2022 Edward C. Coppola /s/ PEGGY ALFORD Director February 25, 2022 Peggy Alford /s/ JOHN H. ALSCHULER Director February 25, 2022 John H. Alschuler /s/ ERIC K. BRANDT Director February 25, 2022 Eric K. Brandt /s/ STEVEN R. HASH Chairman of Board of Directors February 25, 2022 Steven R. Hash /s/ DANIEL J. HIRSCH Director February 25, 2022 Daniel J. Hirsch /s/ DIANA M. LAING Director February 25, 2022 Diana M. Laing /s/ STEVEN L. SOBOROFF Director February 25, 2022 Steven L. Soboroff /s/ ANDREA M. STEPHEN Director February 25, 2022 Andrea M. Stephen /s/ SCOTT W. KINGSMORE Senior Executive Vice President, Treasurer and Chief Financial Officer (Principal Financial Officer) February 25, 2022 Scott W. Kingsmore /s/ CHRISTOPHER J. ZECCHINI Senior Vice President and Chief Accounting Officer (Principal Accounting Officer) February 25, 2022 Christopher J. Zecchini 116