What changed in this filing

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Item 7. Management’s Discussion and Analysis

2024-02-26 compared with 2023-02-24 · 184 added, 237 removed, 251 unchanged (63% of the section changed)

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The Company is the sole general partner of, and owns a majority of the ownership interests in, the Operating Partnership.

As of December 31, 2022, the Operating Partnership owned or had an ownership interest in 44 Regional Town Centers (including office, hotel and residential space adjacent to these shopping centers), five community/power shopping centers, one office property and one redevelopment property.

These 51 Regional Town Centers, community/power shopping centers, office and redevelopment properties consist of approximately 47 million square feet of gross leasable area (“GLA”) and are referred to herein as the “Centers”.

As of December 31, 2023, the Operating Partnership owned or had an ownership interest in 43 Regional Town Centers (including office, hotel and residential space adjacent to these shopping centers), three community/power shopping centers and one redevelopment property.

These 47 Regional Town Centers, community/power shopping centers and one redevelopment property consist of approximately 46 million square feet of gross leasable area (“GLA”) and are referred to herein as the “Centers”.

The Centers consist of consolidated Centers (“Consolidated Centers”) and unconsolidated joint venture Centers (“Unconsolidated Joint Venture Centers”) as set forth in “Item 2.

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This information should be read in conjunction with the accompanying consolidated financial statements and notes thereto.

The financial statements reflect the following acquisitions, dispositions and changes in ownership subsequent to the occurrence of each transaction.

Acquisitions:

On August 2, 2022, the Company acquired the remaining 50% ownership interest in two former Sears parcels (Deptford Mall and Vintage Faire Mall) in the MS Portfolio LLC joint venture that it did not previously own for a total purchase price of $24.5 million.

On August 2, 2022, the Company acquired the remaining 50% ownership interest in two former Sears parcels (Deptford Mall and Vintage Faire Mall) in MS Portfolio LLC, the Company's joint venture with Seritage for a total purchase price of $24.5 million.

Effective as of August 2, 2022, the Company now owns and has consolidated its 100% interest in these two former Sears parcels in its consolidated financial statements (See Note 15—Acquisitions in the Notes to the Consolidated Financial Statements).

On May 18, 2023, the Company acquired Seritage’s remaining 50% ownership interest in the MS Portfolio LLC joint venture that owns five former Sears parcels, for a total purchase price of approximately $46.7 million.

These parcels are located at Chandler Fashion Center, Danbury Fair Mall, Freehold Raceway Mall, Los Cerritos Center and Washington Square.

Effective as of May 18, 2023, the Company now owns and has consolidated its 100% interest in these five former Sears parcels in its consolidated financial statements (See Note 15—Acquisitions in the Notes to the Consolidated Financial Statements).

On November 16, 2023, the Company acquired its joint venture partner’s 49.9% ownership interest in Freehold Raceway Mall for $5.6 million and the assumption of its joint venture partner’s share of debt.

The Company now owns 100% of Freehold Raceway Mall.

Prior to November 16, 2023, the Company accounted for its investment in Freehold Raceway Mall as part of a financing arrangement (See Note 12 – Financing Arrangement and Note 15 – Acquisitions in the Notes to the Consolidated Financial Statements).

On December 9, 2023, the Company acquired its joint venture partner’s 50% interest in Fashion District Philadelphia for no consideration, and the Company now owns 100% of this property.

Prior to December 9, 2023, due to the Company’s joint venture partner having no substantive participation rights, the Company accounted for this joint venture as a VIE in its consolidated financial statements (See Note 2 – Summary of Significant Accounting Policies and Note 15 – Acquisitions in the Notes to the Consolidated Financial Statements).

Dispositions:

The financial statements reflect the following dispositions and changes in ownership subsequent to the occurrence of each transaction.

On March 29, 2021, the Company sold Paradise Valley Mall in Phoenix, Arizona to a newly formed joint venture for $100.0 million, resulting in a gain on sale of assets of approximately $5.6 million.

Concurrent with the sale, the Company elected to reinvest into the new joint venture at a 5% ownership interest.

The Company used the $95.3 million of net proceeds from the sale to pay down its line of credit (See "Liquidity and Capital Resources").

The Company used the $95.3 million of net proceeds from the sale to pay down its line of credit.

On September 17, 2021, the Company sold Tucson La Encantada in Tucson, Arizona for $165.3 million, resulting in a gain on sale of assets of approximately $117.2 million.

The Company used the net cash proceeds of approximately $100.1 million to pay down debt (See "Liquidity and Capital Resources").

The Company used the net cash proceeds of approximately $100.1 million to pay down debt.

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.

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The Company used its share of the proceeds from these sales of $60.3 million to pay down debt and for other general corporate purposes.

On May 2, 2023, the Company sold The Marketplace at Flagstaff, a 268,000 square foot power center in Flagstaff, Arizona, for $23.5 million, which resulted in a gain on sale of assets of $10.3 million.

The Company used the net proceeds to pay down debt.

(See "Liquidity and Capital Resources").

On July 17, 2023, the Company sold Superstition Springs Power Center, a 204,000 square foot power center in Mesa, Arizona, for $5.6 million, which resulted in a gain on sale of assets of $1.9 million.

The Company used the net proceeds to pay down debt.

(See "Liquidity and Capital Resources").

The Company did not repay the loan on Towne Mall on its maturity date of November 1, 2022, and completed transition of the property to a receiver.

On December 4, 2023, Towne Mall was sold by the receiver for $9.5 million, resulting in a gain on extinguishment of debt of $8.2 million.

On December 27, 2023, the Company’s joint venture in One Westside sold the property, a 680,000 square foot office property in Los Angeles, California, for $700 million.

The existing $325 million loan on the property was repaid, and $77.6 million of net proceeds were generated at the Company’s 25% ownership share, which were used to reduce the Company’s revolving loan facility.

As a result of this transaction, the Company recognized its share of gain on sale of assets of $8.1 million.

For the twelve months ended December 31, 2023, the Company and certain joint venture partners sold various land parcels in separate transactions, resulting in the Company’s share of the gain on sale of land of $10.8 million.

The Company used its share of the proceeds from these sales of $16.4 million to pay down debt and for other general corporate purposes.

Financing Activities:

On September 15, 2020, the Company closed on a loan extension agreement for the $191.0 million loan on 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 were 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 $10.0 million of the outstanding loan balance at closing.

As discussed below, the Company further extended this loan.

On November 17, 2020, the Company’s joint venture in Tysons VITA, the residential tower at Tysons Corner Center, placed a new $95.0 million 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 $90.0 million with future advance potential of up to $5.0 million.

The Company used its share of the initial proceeds of $45.0 million 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 $100.0 million repayment to reduce the mortgage loan on Fashion District Philadelphia from $301.0 million to $201.0 million.

As discussed below, this mortgage loan matures on January 22, 2024, and bears interest at SOFR plus 3.6%.

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 (See Note 15–Consolidated Joint Venture and Acquisitions of the Company’s Consolidated Financial Statements).

On December 15, 2020, the Company closed on a loan extension agreement for the $101.5 million loan on 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 were unchanged following the extension.

On December 29, 2020, the Company’s joint venture closed on a one-year maturity date extension for the FlatIron Crossing loan to January 5, 2022.

The interest rate increased from 3.85% to 4.10%, and the Company’s joint venture repaid $15.0 million, $7.6 million at the Company's pro rata share, of the outstanding loan balance at closing.

As discussed below, the Company's joint venture replaced this loan with a new loan prior to its maturity date that was further extended to February 2022.

On January 22, 2021, the Company closed on a one-year extension for the Green Acres Mall $258.2 million loan to February 3, 2022, which also included a one-year extension option to February 3, 2023 that has been exercised.

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The Company drew the $175 million term loan facility in its entirety simultaneously with entering into the new credit agreement in April 2021 and subsequently paid off the remaining balance outstanding on the term loan facility with proceeds from the sale of Tucson La Encantada in September 2021.

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 million 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 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 million loan that bears interest at a floating rate of LIBOR plus 4.15% (converted to SOFR plus 4.26% on April 7, 2023) and matures on November 9, 2026, including extension options.

The loan was covered by an interest rate cap

agreement that effectively prevented LIBOR/SOFR from exceeding 3.0% through November 7, 2023.

The interest rate cap has since been extended and effectively prevents SOFR from exceeding 5.76% through November 7, 2024.

During the year ended December 31, 2021, the Company repaid $1.7 billion of debt then outstanding, including the $985 million repaid in connection with entering into the new credit agreement in April 2021.

These repaid amounts represented an approximately 20% reduction in the debt outstanding, at the Company’s share, since December 31, 2020.

On February 2, 2022, the Company’s joint venture in FlatIron Crossing replaced the existing $197 million loan on the property with a new $175 million loan that bears interest at SOFR plus 3.70% and matures on February 9, 2025, 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.

The loan is covered by an interest rate cap agreement that effectively prevents SOFR from exceeding 4.0% through February 15, 2024 and 5.0% through February 9, 2025.

On April 29, 2022, the Company replaced the existing $110.6 million loan on Pacific View with a new $72.0 million loan that bears interest at a fixed rate of 5.29% and matures on May 6, 2032.

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The interest rate remained unchanged at 5.5%, and the Company repaid $10.0 million of the outstanding loan balance at closing.

The Company did not repay the loan on Towne Mall on its maturity date of November 1, 2022, and has begun the process of transitioning the property to a loan receiver.

On November 14, 2022, the Company’s joint venture in Washington Square extended the maturity date on the $503.0 million loan on the property to November 1, 2026, including extension options.

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On December 9, 2022, the Company extended the maturity date on the $300.0 million loan on Santa Monica Place to December 9, 2025, including extension options.

The loan bears interest at a floating interest rate of LIBOR plus 1.48%.

The loan previously bore interest at a floating interest rate of LIBOR plus 1.48% and converted to 1-month Term SOFR plus 1.52% effective July 9, 2023.

On January 3, 2023, the Company replaced the existing $363.0 million of combined loans on Green Acres Mall and Green Acres Commons, both of which were scheduled to mature during the first quarter of 2023, with a $370.0 million loan that bears interest at a fixed rate of 5.90%, is interest only during the entire loan term and matures on January 6, 2028.

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The interest rate is SOFR plus 3.60% and the Company repaid $26.1 million of the outstanding loan balance at closing.

The Company’s joint venture that owns Scottsdale Fashion Square expects to replace the existing $406 million mortgage loan on the property with a $700 million, five-year, fixed-rate loan.

The Company expects the joint venture to close this refinancing during the first quarter of 2023, subject to negotiating final documentation and customary closing conditions.

On March 3, 2023, the Company’s joint venture in Scottsdale Fashion Square replaced the existing $403.9 million mortgage loan on the property with a new $700.0 million loan that bears interest at a fixed rate of 6.21%, is interest only during the entire loan term and matures on March 6, 2028.

On March 22, 2023, the Company executed the one-year extension option on its credit facility to April 14, 2024.

Effective March 13, 2023, the credit facility converted from LIBOR to 1-month Term SOFR.

On April 25, 2023, the Company's joint venture in Deptford Mall closed on a three-year maturity date extension for the existing loan of $159.9 million to April 3, 2026, including extension options.

The Company's joint venture repaid $10.0 million ($5.1 million at the Company's pro rata share) of the outstanding loan balance at closing.

The interest rate on the loan remains unchanged at 3.73%.

Effective May 9, 2023, the Company’s joint venture in Country Club Plaza defaulted on the $295.2 million ($147.6 million at the Company's pro rata share) non-recourse loan on the property.

The Company’s joint venture is in negotiations with the lender on the terms of this non-recourse loan.

On June 27, 2023, the Company closed on a one-year extension on the $133.5 million loan on Danbury Fair Mall to July 1, 2024.

The Company repaid $10.0 million of the outstanding loan balance at closing and the amended interest rate was 7.5% as of July 1, 2023 and incrementally increased to 8.0% as of October 1, 2023, 8.5% as of January 1, 2024 and 9.0% as of April 1, 2024.

On September 11, 2023, the Company and Operating Partnership entered into an amended and restated credit agreement, which amended and restated their prior $525 million credit agreement, and provides for an aggregate $650 million revolving loan facility that matures on February 1, 2027, with a one-year extension option.

Concurrently with the entry into the amended and restated credit agreement, the Company drew $152 million of the amount available under the revolving loan facility and

used the proceeds to repay in full amounts outstanding under the Company’s prior credit facility.

(See “Liquidity and Capital Resources”).

Effective October 6, 2023, the Company's $86.5 million loan on Fashion Outlets of Niagara Falls is in default.

The Company is in negotiations with the lender on the terms of this non-recourse loan.

On December 4, 2023, the Company's joint venture in Tysons Corner Center replaced the existing $666.5 million mortgage loan on the property with a new $710.0 million loan that bears interest at a fixed rate of 6.60%, is interest only during the entire loan term and matures on December 6, 2028.

On January 10, 2024, the Company's joint venture in Boulevard Shops replaced the existing $23.0 million mortgage loan on the property with a new $24.0 million loan that bears interest at a variable rate of SOFR plus 2.50%, is interest only during the entire loan term and matures on December 5, 2028.

The new loan has a required interest rate cap throughout the term of the loan at a strike rate of 7.5%.

On January 22, 2024, the Company repaid the majority of the mortgage loan on Fashion District Philadelphia.

The remaining $8.2 million matures on April 21, 2024.

On January 25, 2024, the Company replaced the existing $116.9 million mortgage loan on Danbury Fair Mall with a new $155.0 million loan that bears interest at a fixed rate of 6.39%, is interest only during the majority of the loan term and matures on February 6, 2034.

Redevelopment and Development Activities:

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The Company has funded $39.5 million of the total $78.9 million incurred by the joint venture as of December 31, 2023.

The Company is redeveloping an approximately 150,000 square foot, three-level space (formerly occupied by Bloomingdale’s and Arclight Theatre) at Santa Monica Place, a 527,000 square foot regional town center in Santa Monica, California, with an entertainment destination use, high-end fitness, and co-working space.

The Company is redeveloping an approximately 150,000 square foot, three-level space (formerly occupied by Bloomingdale’s and Arclight Theatre) at Santa Monica Place, a 534,000 square foot regional town center in Santa Monica, California, with an entertainment destination use, high-end fitness, and other retail uses.

The total cost of the project is estimated to be between $35.0 million and $40.0 million.

The Company has incurred approximately $5.2 million as of December 31, 2023.

The anticipated opening is in 2024.

The Company’s joint venture in Scottsdale Fashion Square, a 1,884,000 square foot regional town center in Scottsdale, Arizona, is redeveloping a two-level Nordstrom wing with luxury-focused retail and restaurant uses.

The anticipated opening will happen in phases beginning in 2024 through 2025.

The Company’s joint venture in Scottsdale Fashion Square, an approximately 1,871,000 square foot regional town center in Scottsdale, Arizona, is redeveloping a two-level Nordstrom wing with luxury-focused retail and restaurant uses.

The total cost of the project is estimated to be between $80.0 million and $86.0 million, with $40.0 million and $43.0 million estimated to be the Company’s pro rata share.

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Other Transactions and Events:

The Company declared a cash dividend of $0.15 per share of its common stock for each of the first three quarters of 2022 and a cash dividend of $0.17 per share of its common stock for the fourth quarter of 2022.

On January 27, 2023, the Company announced a first quarter cash dividend of $0.17 per share of its common stock, which will be paid on March 3, 2023 to stockholders of record on February 17, 2023.

The Company declared a cash dividend of $0.17 per share of its common stock for each quarter in the year ended December 31, 2023.

On February 2, 2024, the Company announced a first quarter cash dividend of $0.17 per share of its common stock, which will be paid on March 4, 2024 to stockholders of record on February 16, 2024.

The dividend amount will be reviewed by the Board on a quarterly basis.

See “Liquidity and Capital Resources” for a further discussion of the Company’s anticipated liquidity needs, and the measures taken by the Company to meet those needs.

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 million under each of the February 2021 ATM Program and the March 2021 ATM Program, or a total of $1 billion under the ATM Programs.

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 million under each of the February 2021 ATM Program and the March 2021 ATM Program, or a total of $1 billion under the ATM Programs.

As of December 31, 2023, the Company had approximately $151.7 million of gross sales of its common stock available under the March 2021 ATM Program.

The February 2021 ATM Program was fully utilized as of June 30, 2021 and is no longer active.

See “Outlook” in Results of Operations for a further discussion of the forward-looking impact of COVID-19 and the Company’s strategic plan to mitigate the anticipated negative impact on its financial condition and results of operations.

Management’s Discussion and Analysis of Financial Condition and Results of Operations—Liquidity and Capital Resources” for a further discussion of the Company’s anticipated liquidity needs, and the measures taken by the Company to meet those needs.

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These rent increases are either in fixed increments or based on using an annual multiple of increases in the Consumer Price Index.

In addition, the routine expiration of leases for spaces 10,000 square feet and under each year (See "Item I.

In addition, the routine expiration of leases for spaces 10,000 square feet and under each year (See "Item 1.

Business of the Company—Lease Expirations"), enables the Company to replace existing leases with new leases at higher base rents if the rents of the existing leases are below the then existing market rate.

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The value of in-place leases are 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.

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.

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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 or a contracted sales price, with the carrying value of the related assets.

Such factors include projected rental revenue, operating costs and capital expenditures as well as capitalization rates and estimated holding periods.

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.

Changes in events or changes in circumstances may alter the expected hold period of an asset or asset group, which may result in an impairment loss and such loss could be material to the Company's financial condition or operating performance.

If the carrying value of the property exceeds the estimated undiscounted cash flows, an impairment loss is recognized equal to the excess of carrying value over its estimated fair value.

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 estimated fair value of a property is typically determined through a discounted cash flow analysis or based upon a contracted sales price.

The discounted cash flow method includes significant unobservable inputs including the discount rate, terminal capitalization rate and market rents.

Cash flow projections and rates are subject to management’s judgment and changes in those assumptions could impact the estimation of fair value.

The Company’s investments in unconsolidated joint ventures apply the same accounting model for property level impairment as described above.

Further, 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.

The Company records any such impairment up to the extent of its investment.

Fair Value of Financial Instruments:

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When the fair value reasonably approximates the carrying value, no additional disclosure is made.

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 Company records its financing arrangement (See Note 12—Financing Arrangement in the Company's Notes to the Consolidated Financial Statements) 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 discount rate, terminal capitalization rate, and market rents.

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For purposes of the discussion below, the Company defines "Same Centers" as those Centers that are substantially complete and in operation for the entirety of both periods of the comparison.

Non-Same Centers for comparison purposes include those Centers or properties that are going through a substantial redevelopment often resulting in the closing of a portion of the Center (“Redevelopment Properties”), those properties that have recently transitioned to or from equity method joint ventures to or from consolidated assets ("JV Transition Centers") and properties that have been disposed of ("Disposition Properties").

Properties").

The Company moves a Center in and out of Same Centers based on whether the Center is substantially complete and in operation for the entirety of both periods of the comparison.

Accordingly, the Same Centers consist of all consolidated Centers, excluding the Redevelopment Properties, the JV Transition Centers and the Disposition Properties for the periods of comparison.

For the comparison of the year ended December 31, 2021 to the year ended December 31, 2020, the Redevelopment Properties are Paradise Valley Mall and certain ground up developments.

For the comparison of the year ended December 31, 2022 to the year ended December 31, 2021, the JV Transition Centers are the two former Sears parcels at Deptford Mall and Vintage Faire Mall (See "Acquisitions" in Management's Overview and Summary), and for the comparison of the year ended December 31, 2021 to the year ended December 31, 2020, the JV Transition Centers are Fashion District Philadelphia and Sears South Plains.

The change in revenues and expenses at the JV Transition Centers is primarily due to the conversion of Fashion District Philadelphia from an Unconsolidated Joint Venture Center to a Consolidated Center (See Note 15–Consolidated Joint Venture and Acquisitions in the Company's Notes to the Consolidated Financial Statements).

For the comparison of the year ended December 31, 2022 to the year ended December 31, 2021 and the comparison of the year ended December 31, 2021 to the year ended December 31, 2020, the Disposition Properties are Paradise Valley Mall and Tucson La Encantada.

For the comparison of the year ended December 31, 2023 to the year ended December 31, 2022 and the comparison of the year ended December 31, 2022 to the year ended December 31, 2021, there are no Redevelopment Properties.

For the comparison of the year ended December 31, 2023 to the year ended December 31, 2022, the JV Transition Centers are the two former Sears parcels at Deptford Mall and Vintage Faire Mall, the five former Sears parcels at Chandler Fashion Center, Danbury Fair Mall, Freehold Raceway Mall, Los Cerritos Center and Washington Square (See "Acquisitions" in Management's Overview and Summary), and for the comparison of the year ended December 31, 2022 to the year ended December 31, 2021, the JV Transition Centers are the two former Sears parcels at Deptford Mall and Vintage Faire Mall.

For the comparison of the year ended December 31, 2023 to the year ended December 31, 2022, the Disposition Properties are The Marketplace at Flagstaff, Superstition Springs Power Center and Towne Mall (See "Dispositions" in Management's Overview and Summary), and for the comparison of the year ended December 31, 2022 to the year ended December 31, 2021, the Disposition Properties are Paradise Valley Mall and Tucson La Encantada.

Unconsolidated joint ventures are reflected using the equity method of accounting.

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a comparison of initial average base rent per square foot on leases executed during the trailing twelve months to average base rent per square foot at expiration for the leases expiring during the trailing twelve months based on the spaces 10,000 square feet and under) to be key performance indicators of the Company's internal growth.

During the trailing twelve months ended December 31, 2022, comparable tenant sales for spaces less than 10,000 square feet across the portfolio increased by 2.8% compared to the time frame in 2021.

During the trailing twelve months ended December 31, 2023, comparable tenant sales for spaces less than 10,000 square feet across the portfolio decreased by 1.8% compared to the time frame in 2022.

The leased occupancy rate of 93.5% at December 31, 2023 represented a 0.9% increase from 92.6% at December 31, 2022 and a 0.1% sequential increase compared to the 93.4% occupancy rate at September 30, 2023.

Releasing spreads increased as the Company executed leases at an average rent of $61.00 for new and renewal leases executed compared to $52.04 on leases expiring, resulting in a releasing spread increase of $8.96 per square foot, or 17%, for the trailing twelve months ended December 31, 2023.

The Company continues to renew or replace leases that are scheduled to expire in 2023, however, for a variety of factors, the Company cannot be certain of its ability to sign, renew or replace leases expiring in 2023 or beyond.

The Company continues to renew or replace leases that are scheduled to expire in 2024, however, due to a variety of factors, the Company cannot be certain of its ability to sign, renew or replace leases expiring in 2024 or beyond.

These leases that are scheduled to expire represent approximately 1.3 million square feet of the Centers, accounting for 21.32% of the GLA of mall stores and freestanding stores, for spaces 10,000 square feet and under, as of December 31, 2023.

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2024 lease expirations continue to be an important focal point for the Company.

As of December 31, 2022, the Company has executed leases or commitments from retailers that are in lease documentation for 52% of the leased space expiring in 2023, and another 27% of such expiring space is in the letter of intent stage.

As of December 31, 2023, the Company has executed renewal leases or commitments on 41% of its square footage expiring in 2024, which leases are expected to commence throughout 2024 and 2025 and another 33% of such expiring space is in the letter of intent stage.

Excluding those leases, the remaining leases expiring in 2024, which represent approximately 200,000 square feet of the Centers, are in the prospecting stage.

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The average tenant allowance was $22.38 per square foot.

On February 5, 2024, the Company announced that Jackson Hsieh will be appointed to the role of Chief Executive Officer (“CEO”) and President of the Company, effective as of March 1, 2024, following the retirement of Thomas E.

O’Hern, the Company’s current CEO, and Edward C.

Coppola, the Company’s current President, each of whom will be retiring effective as of February 29, 2024.

The Company has a long-term four-pronged business strategy that focuses on the acquisition, leasing and management, redevelopment and development of Regional Town Centers.

During 2022, the Company leased 3.8 million square feet, which represents the strongest year of leasing volume for the Company when measured on a comparable center basis since before the 2009 Global Financial Crisis.

The Company’s portfolio also experienced the smallest volume of tenant bankruptcies since 2013.

As of December 31, 2022, the Company’s portfolio leased occupancy was 92.6%, which has increased 4.1% in the past seven quarters since the pandemic-driven low of 88.5% as of March 31, 2021.

During 2023, the Company leased 4.2 million square feet, representing the strongest year of leasing volume based on square footage for the Company since its inception.

The Company’s portfolio also experienced one of the lowest volumes of tenant bankruptcies in the last decade.

As of December 31, 2023, the Company’s portfolio leased occupancy was 93.5%, which has increased 5.0% in the past eleven quarters since the pandemic-driven low of 88.5% as of March 31, 2021.

The Company continues to make progress addressing the near-term maturities of its non-recourse mortgage debt, as further described below.

Although fundamentals at the Centers continued to improve during 2022, operating results in 2023 could be negatively impacted by certain macro-economic factors, including any continued increase in inflation and interest rates or an economic slowdown or recession.

The Company experienced a positive impact to its leasing revenue during the three and twelve months ended December 31, 2022.

Leasing revenue increased by approximately 1.9% and 5.2%, compared to the three and twelve months ended December 31, 2021, respectively.

This increase includes the joint ventures at the Company’s share and excludes the Disposition Properties and The Shops at Northbridge, at the Company’s share.

Among other factors, the increase for the year was primarily due to increases in occupancy and from decreases in retroactive rent abatements incurred in 2022 compared to 2021.

Traffic levels during the fourth quarter of 2022 continued to range in the mid 90%’s relative to the pre-pandemic fourth quarter of 2019.

Similar traffic trends were generally consistent throughout all of 2022 when compared to pre-pandemic 2019.

Comparable tenant sales from spaces less than 10,000 square feet across the portfolio for the trailing twelve months ended December 31, 2022 increased by 2.8% compared to the same period in 2021.

Portfolio tenant sales per square foot for spaces less than 10,000 square feet for the trailing twelve months ended December 31, 2022 were $869 compared to $801 for the pre-pandemic trailing twelve months ended December 31, 2019.

Although the majority of the key performance indicators at the Centers continued to improve during 2023, operating results in 2024 could be negatively impacted by certain macro-economic factors, including any continued increase in inflation and elevated interest rates or an economic slowdown or recession.

Traffic levels at the Company’s Centers for 2023 were approximately 94% of 2022 levels.

Comparable tenant sales from spaces less than 10,000 square feet across the portfolio for the trailing twelve months ended December 31, 2023 decreased by 1.8% compared to the same period in 2022.

Portfolio tenant sales per square foot for spaces less than 10,000 square feet for the trailing twelve months ended December 31, 2023 were $836 compared to $869 for the twelve months ended December 31, 2022.

During 2023, the Company signed 839 new and renewal leases for approximately 4.2 million square feet, compared to 963 leases and 3.8 million square feet signed during 2022.

This leasing volume represented a 19% increase in the number of leases and a 10% increase in the amount of square footage leased compared to the same period in 2021 on a comparable basis.

The Company believes that diversity of use within its tenant base will be a prominent internal growth catalyst at its Centers going forward, as new uses enhance the productivity and diversity of the tenant mix and have the potential to significantly increase customer traffic at the applicable Centers.

This leasing volume represented a 13% decrease in the number of leases and a 12% increase in the amount of square footage leased compared to the same period in 2022 on a comparable basis.

The Company believes that diversity of use within its tenant base has been, and will continue to be, a prominent internal growth catalyst at its Centers going forward, as new uses enhance the productivity and diversity of the tenant mix and have the potential to significantly increase customer traffic at the applicable Centers.

During the year ended December 31, 2023, the Company signed deals for new stores with new-to-Macerich portfolio uses for over 600,000 square feet, with another 140,000 square feet of such new-to-Macerich portfolio leases currently in negotiation as of the date of this Annual Report on Form 10-K.

As of December 31, 2023, the leased occupancy rate increased to 93.5%, a 0.9% increase compared to the leased occupancy rate of 92.6% at December 31, 2022 and a 0.1% sequential increase compared to the leased occupancy rate of 93.4% at September 30, 2023.

The Company’s rent collections through the year ended December 31, 2022 have been comparable to pre-COVID-19 levels for the year ended December 31, 2019.

Prior to 2022, the Company completed the majority of its pandemic-driven negotiations with national and local tenants to secure rental payments.

Those negotiations resulted in the Company entering into lease amendments that granted significant rental assistance in the form of rent deferral and/or rent reduction.

Many of the Company’s leases contain co-tenancy clauses.

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The Company does not anticipate that the negative impact of such clauses on lease revenue will be significant.

During the year ended December 31, 2021, the Company incurred $47.6 million of rent abatements at the Company’s share, relating primarily to 2020 rents as a result of COVID-19 and negotiated $4.6 million of rent deferrals during the year ended December 31, 2021 at the Company’s share.

During the year ended December 31, 2022, the Company incurred $1.4 million of rent abatements at the Company’s share.

The Company negotiated $1.1 million of rent deferrals during the year ended December 31, 2022.

As of December 31, 2022, $2.6 million of the rent deferrals remain outstanding, with $1.4 million scheduled to be repaid during 2023 and the balance scheduled for repayment thereafter.

During 2022, the pace of bankruptcy filings involving the Company’s tenants decreased substantially as compared to 2021, with only two bankruptcy filings involving three of the Company's tenants representing approximately 111,000 square feet of leased space and $2.2 million of annual leasing revenue at the Company’s share.

The Company continues to expect that the pace of bankruptcy filings in 2023 will be low.

Year-to-date in 2023, there have been two bankruptcy filings involving the Company’s tenants totaling seven leases and representing approximately 39,000 square feet of leased space and $1.9 million of annual leasing revenue.

The pace of bankruptcy filings involving the Company’s tenants decreased substantially in 2023 and in 2022 compared to 2021.

For the year ended December 31, 2023, there were ten bankruptcy filings involving the Company’s tenants totaling fifteen leases and representing approximately 111,000 square feet of leased space and $3.6 million of annual leasing revenue at the Company’s share.

Based on current information and market data, the Company expects that the pace of bankruptcy filings in 2024 will continue to be lower than the average bankruptcy rate over the last decade.

During 2024, the Company expects to generate positive cash flow from operations after recurring operating capital expenditures, leasing capital expenditures and payment of dividends.

This assumption does not include any potential capital generated from dispositions, refinancings or issuances of common equity.

This expected surplus will be used to de-lever the Company’s balance sheet as well as to fund the Company’s development and redevelopment pipeline (See "—Redevelopment and Development Activities" in Management's Overview and Summary).

On April 29, 2022, the Company closed on a new $72 million loan at Pacific View with a fixed rate of 5.29% that matures on May 6, 2032.

On May 6, 2022, the Company closed on a two-year extension of the loan on The Oaks to June 5, 2024.

The loan will now bear a fixed interest rate of 5.25%, and the Company repaid $5.0 million of the outstanding loan balance at closing.

On July 1, 2022, the Company extended the loan maturity on Danbury Fair Mall to July 1, 2023.

The interest rate remained unchanged at 5.5%, and the Company repaid $10.0 million of the outstanding loan balance at closing.

On November 14, 2022, the Company’s joint venture closed a four-year extension on the $503 million loan on Washington Square.

$15 million of the loan was repaid at closing by the joint venture ($9 million at the Company’s share).

The extended loan bears interest at a floating rate of SOFR plus 4.0%, subject to an interest rate cap agreement, and matures on November 1, 2026, including extension options.

On December 9, 2022, the Company closed a three-year extension on the $300 million loan on Santa Monica Place.

None of the loan amount was repaid at closing.

The extended loan bears interest at a floating rate of LIBOR plus 1.48% and matures on December 9, 2025, including extension options.

In addition, on January 3, 2023, the Company closed on a five-year $370.0 million combined refinance of Green Acres Mall and Green Acres Commons.

The new interest only loan bears a fixed interest rate of 5.90% and matures on January 6, 2028.

On January 20, 2023, the Company exercised its one-year extension option of the loan on Fashion District Philadelphia to January 22, 2024.

The interest rate is SOFR plus 3.60% and the Company repaid $26.1 million of the outstanding loan balance at closing.

The Company’s joint venture in Scottsdale Fashion Square expects to replace the existing $406.0 million mortgage loan on the property with a $700.0 million, five-year, fixed-rate loan.

The Company expects the joint venture to close this refinancing during the first quarter of 2023, subject to negotiating final documentation and customary closing conditions.

The Company did not repay the loan on Towne Mall on its maturity date of November 1, 2022, and has begun the process of transitioning the property to a loan receiver.

(See “—Financing Activities” in Management’s Overview and Summary).

Rising interest rates are increasing the cost of the Company’s borrowings due to its outstanding floating-rate debt and have led to higher interest rates on new fixed-rate debt.

This expected surplus will be used to fund the Company's development and redevelopment pipeline and to the extent available, de-lever the Company’s balance sheet.

The Company continues to make progress addressing its near-term, non-recourse loan maturities, with seven completed transactions since the beginning of 2023.

Since January 1, 2023, the Company has refinanced or extended seven loans totaling approximately $2.8 billion, or approximately $2.0 billion at the Company’s pro rata share.

This includes the September 2023 entry into an amended and restated credit agreement, which provided for an aggregate $650 million revolving loan facility, an increase from the prior $525 million credit agreement, that matures on February 1, 2027, with a one-year extension option.

For additional information on the Company’s financing transactions in the year 2023 through the date of this Annual Report on Form 10-K, see “Financing Activities” and "Liquidity and Capital Resources".

Elevated interest rates are increasing the cost of the Company’s borrowings due to its outstanding floating-rate debt and have led to higher interest rates on new fixed-rate debt.

The Company expects to incur increased interest expense from the refinancing or extension of loans that may currently carry below-market interest rates.

In certain cases, the Company may limit its exposure to interest rate fluctuations related to a portion of its floating-rate debt by using interest rate cap and swap agreements.

Such agreements, subject to current market conditions, allow the Company to replace floating-rate debt with fixed-rate debt in order to achieve its desired ratio of floating-rate to fixed-rate debt.

In certain cases, the Company has limited, and may continue to limit, its exposure to interest rate fluctuations related to a portion of its floating-rate debt by using interest rate cap and swap agreements.

Such agreements, subject to current market conditions, allow the Company to replace

floating-rate debt with fixed-rate debt in order to achieve its desired ratio of floating-rate to fixed-rate debt.

However, any interest rate cap or swap agreements that the Company enters into may not be effective in reducing its exposure to interest rate changes.

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The increase in leasing revenue is attributed to increases of $5.0 million from the Same Centers and $6.4 million from the JV Transition Centers offset in part by $2.9 million from the Disposition Properties.

Leasing revenue includes the amortization of above and below-market leases, the amortization of straight-line rents, lease termination income and the provision for bad debts.

Leasing revenue includes the amortization of above and below-market leases, the amortization of straight-line rents, lease termination income, percentage rent and the recovery of bad debts.

The amortization of above and below-market leases increased from $2.2 million in 2022 to $3.1 million in 2023.

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Lease termination income decreased from $13.0 million in 2022 to $10.5 million in 2023.

Percentage rent decreased from $58.8 million in 2021 to $49.5 million in 2022.

Recovery of bad debts decreased from $6.4 million in 2021 to $0.7 million in 2022.

Other income decreased from $33.9 million in 2021 to $30.1 million in 2022.

This decrease is primarily due to income related to the Disposition Properties.

Management Companies' revenue increased from $26.0 million in 2021 to $28.5 million in 2022 due to an increase in management and leasing fees.

Percentage rent decreased from $49.5 million in 2022 to $38.2 million in 2023 primarily from conversions from variable rent to fixed rent structures on lease renewals of expiring space.

Recovery of bad debts increased from $0.7 million in 2022 to $2.7 million in 2023.

Other income increased from $30.1 million in 2022 to $44.9 million in 2023.

This increase is primarily due to parking, interest and other income related to the Same Centers.

Management Companies' revenue increased from $28.5 million in 2022 to $30.2 million in 2023 due to an increase in leasing and development fees.

Shopping Center and Operating Expenses:

Shopping center and operating expenses decreased $1.5 million, or 0.5%, from 2022 to 2023.

The decrease in shopping center and operating expenses is attributed to decreases of $1.2 million from the Same Centers and $4.6 million from the Disposition Properties, offset in part by an increase of $0.7 million from the JV Transition Centers.

The decrease in shopping center and operating expenses is attributed to a decrease of $4.5 million from the Same Centers offset in part by increases of $1.4 million from the Disposition Properties and $1.6 million from the JV Transition Centers.

The decrease at the Same Centers is primarily due to a decrease in real estate tax expense in 2023 compared to 2022.

Leasing Expenses:

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Management Companies' operating expenses increased $2.3 million from 2022 to 2023 due to an increase in compensation expense.

Depreciation and Amortization:

Depreciation and amortization decreased $19.5 million from 2021 to 2022.

The decrease in depreciation and amortization is primarily attributed to a decrease of $10.9 million from the Same Centers and $9.7 million from the Disposition Properties offset in part by an increase of $1.1 million from the JV Transition Centers.

Interest Expense (Income):

Interest expense (income) increased $24.2 million from 2021 to 2022.

The increase in interest expense (income) is attributed to an increase of $38.5 million from the financing arrangement (See Note 12–Financing Arrangement in the Company's Notes to the Consolidated Financial Statements) and $4.3 million from the Same Centers offset in part by decreases of $16.5 million from borrowings under the line of credit and $2.1 million from the Disposition Properties.

The increase in interest expense from the financing arrangement is primarily due to the change in fair value of the underlying properties and the mortgage notes payable on the underlying properties.

The above interest expense items are net of capitalized interest, which increased from $9.5 million in 2021 to $10.5 million in 2022.

Equity in (Loss) Income of Unconsolidated Joint Ventures:

Equity in (loss) income of unconsolidated joint ventures decreased $20.9 million from 2021 to 2022.

The decrease in equity in (loss) income of unconsolidated joint ventures is primarily due to the write-down of assets as a result of the reduction in the estimated holding periods of certain properties.

Gain (Loss) on Sale or Write Down of Assets, net:

Gain (loss) on sale or write down of assets, net decreased from $75.7 million in 2021 to $7.7 million in 2022.

The decrease is primarily due to $11.1 million of impairments in 2022 and the $117.2 million gain on sale of Tucson La Encantada in 2021 offset in part by the sale and impairment loss of $41.6 million on Estrella Falls in 2021.

Net (Loss) Income:

Net income decreased $81.2 million from 2021 to 2022.

The decrease in net income is primarily due to the variances noted above.

Funds From Operations ("FFO"):

Primarily as a result of the factors mentioned above, FFO attributable to common stockholders and unit holders—diluted, excluding financing expense in connection with Chandler Freehold and loss on extinguishment of debt increased 3.4% from $423.2 million in 2021 to $437.5 million in 2022.

For a reconciliation of net (loss) income attributable to the Company, the most directly comparable GAAP financial measure, to FFO attributable to common stockholders and unit holders, excluding financing expense in connection with Chandler Freehold and loss on extinguishment of debt and FFO attributable to common stockholders and unit holders—diluted, excluding financing expense in connection with Chandler Freehold and loss on extinguishment of debt , see "Funds From Operations ("FFO")" below.

Operating Activities:

Cash provided by operating activities increased $51.1 million from 2021 to 2022.

The increase is primarily due to the changes in assets and liabilities and the results, as discussed above.

Investing Activities:

Cash used in investing activities increased $236.4 million from 2021 to 2022.

The increase in cash used in investing activities is primarily attributed to a decrease in proceeds from the sale of assets of $287.1 million offset in part by an increase of $37.4 million in distributions from unconsolidated joint ventures and $21.0 million in proceeds from collection of receivable in connection with sale of joint venture property.

Financing Activities:

Cash used in financing activities decreased $0.5 billion from 2021 to 2022.

The decrease in cash used in financing activities is primarily due to the decrease in payments on mortgages, bank and other notes payable of $1.7 billion offset by a reduction in the amounts of net proceeds received from sales of common shares under the ATM Programs of $830.4 million and proceeds from mortgages, bank and other notes payable of $315.0 million.

Comparison of Years Ended December 31, 2021 and 2020

Leasing revenue increased by $47.2 million, or 6.4%, from 2020 to 2021.

The increase in leasing revenue is attributed to increases of $23.2 million from the Same Centers and $31.8 million from the JV Transition Centers offset in part by $7.8 million from the Disposition Properties.

Leasing revenue includes the amortization of above and below-market leases, the amortization of straight-line rents, lease termination income and the provision for bad debts.

The amortization of above and below-market leases decreased from $2.1 million in 2020 to $1.9 million in 2021.

The amortization of straight-line rents decreased from $24.8 million in 2020 to $5.9 million in 2021.

Lease termination income increased from $8.3 million in 2020 to $19.1 million in 2021.

Percentage rent increased from $15.5 million in 2020 to $58.8 million in 2021.

Provision for bad debts decreased from $44.3 million in 2020 to a recovery of $(6.4) million in 2021.

The increase in leasing revenue and decrease in bad debt at the Same Centers is primarily the result of all Centers being open in 2021 compared to the majority of Centers being closed for portions of 2020 and an increase in tenant sales to pre-COVID 2019 levels (See "Other Transactions and Events" in Management's Overview and Summary).

Other income increased from $22.2 million in 2020 to $33.9 million in 2021.

This is primarily due to increased parking garage income resulting from increased traffic at the Centers (See "Other Transactions and Events" in Management's Overview and Summary).

Management Companies' revenue increased from $23.5 million in 2020 to $26.0 million in 2021.

The increase is primarily the result of increased management fees in 2021 due to all Centers being open in 2021 compared to Centers being closed for portions of 2020.

Shopping Center and Operating Expenses:

Shopping center and operating expenses increased $37.8 million, or 14.7%, from 2020 to 2021.

The increase in shopping center and operating expenses is attributed to increases of $21.4 million from the Same Centers, $19.6 million from the JV Transition Centers and $0.2 million from the Redevelopment Properties offset in part by $3.4 million from the Disposition Properties.

The increase in shopping center and operating expenses at the Same Centers is primarily the result of all Centers being opened in 2021 compared to the majority of Centers being closed for portions of 2020 (See "Other Transactions and Events" in Management's Overview and Summary).

Management Companies' Operating Expenses:

Management Companies' operating expenses decreased $4.5 million from 2020 to 2021 due to a decrease in compensation expense.

REIT General and Administrative Expenses:

REIT general and administrative expenses increased by $2.1 million due to an increase in compensation and consulting expense.

Depreciation and Amortization:

Depreciation and amortization decreased $9.3 million from 2022 to 2023.

The decrease in depreciation and amortization is primarily attributed to a decrease of $18.0 million from the Same Centers and $4.7 million from the Disposition Properties offset in part by increases of $13.7 million from the JV Transition Centers and $0.5 million from the Redevelopment Properties.

Interest (Income) Expense:

Interest (income) expense increased $117.1 million from 2020 to 2021.

The increase in interest (income) expense is attributed to an increase of $131.6 million from the Financing Arrangement (See Note 12–Financing Arrangement in the Company's Notes to the Consolidated Financial Statements) and $5.9 million from the JV Transition Centers offset in part by decreases of $7.9 million from the Same Centers, $11.7 million from borrowings under the line of credit and $0.8 million from the Disposition Properties.

The increase in interest expense from the Financing Arrangement is primarily due to the change in fair value of the underlying properties and the mortgage notes payable on the underlying properties.

The decrease in depreciation and amortization is attributed to decreases of $10.3 million from the Same Centers and $2.0 million from the Disposition Properties offset in part by an increase of $3.0 million from the JV Transition Centers.

Interest Expense:

Interest expense decreased $43.9 million from 2022 to 2023.

The decrease in interest expense is attributed to decreases of $58.9 million from the financing arrangement, $0.1 million from the Disposition Properties and $1.9 million from the JV Transition Centers offset in part by increases of $12.2 million from the Same Centers and $4.8 million from higher interest rates and outstanding balances on the Company's revolving line of credit.

Effective November 16, 2023, the Company acquired its partner's interest in Freehold Raceway Mall and, as a result, Freehold Raceway Mall is no longer part of the financing arrangement and is 100% owned by the Company.

The decrease in interest expense from the financing arrangement is primarily due to the change in fair value of the underlying properties and the mortgage notes payable on the underlying properties (See Note 12–Financing Arrangement in the Company's Notes to the Consolidated Financial Statements).

The above interest expense items are net of capitalized interest, which increased from $10.5 million in 2022 to $20.5 million in 2023.

Equity in Income (Loss) of Unconsolidated Joint Ventures:

Equity in income (loss) of unconsolidated joint ventures increased $42.7 million from 2020 to 2021.

The increase in equity in income (loss) of unconsolidated joint ventures is primarily due to a decrease in the provision for bad debts and an increase in percentage rent in 2021 compared to 2020.

Loss on Remeasurement of Assets:

Loss on remeasurement of assets of $163.3 million in 2020 relates to Fashion District Philadelphia (See Note 15–Consolidated Joint Venture and Acquisitions in the Company's Notes to the Consolidated Financial Statements).

Gain (Loss) on Sale or Write Down of Assets, net:

Gain (loss) on sale or write down of assets, net increased from a loss of $68.1 million in 2020 to a gain of $75.7 million in 2021.

The increase is primarily due to the $36.7 million of impairment losses on Wilton Mall and Paradise Valley Mall, $4.2 million write-down of non-real estate assets and $36.7 million write-down of development costs in 2020 and $117.2 million gain on the sale of Tucson La Encantada and $29.4 million gain on land sales in 2021 offset in part by the sale and impairment loss of $41.6 million on Estrella Falls and $28.3 million loss related to North Bridge in 2021 (See "Dispositions" in Management's Overview and Summary).

The impairment losses were due to the reduction in the estimated holding periods of the properties.

Net Income (Loss):

Net income increased $261.6 million from 2020 to 2021.

The increase in net income is primarily due to the variances noted above.

Equity in Loss of Unconsolidated Joint Ventures:

Equity in loss of unconsolidated joint ventures increased $151.7 million from 2022 to 2023.

The increase in equity in loss of unconsolidated joint ventures is primarily due to the impairment losses in 2023 at Country Club Plaza of $101.0 million and the JV Transition Centers of $51.4 million, as a result of the reduction in the estimated holding periods (See Note 4–Investments in Unconsolidated Joint Ventures in the Company's Notes to the Consolidated Financial Statements).

(Loss) Gain on Sale or Write Down of Assets, net:

(Loss) gain on sale or write down of assets, net increased $142.2 million from 2022 to 2023.

The increase is primarily due to the impairment loss of $144.7 million at Fashion Outlets of Niagara Falls, as a result of the reduction in the estimated holding period of the property.

Net loss increased $213.0 million from 2022 to 2023.

The increase in net loss is primarily due to the impairment losses at Fashion Outlets of Niagara Falls, Country Club Plaza and the JV Transition Centers, along with the other variances noted above.

Funds From Operations ("FFO"):

Primarily as a result of the factors mentioned above, FFO attributable to common stockholders and unit holders—diluted, excluding financing expense in connection with Chandler Freehold and loss on extinguishment of debt increased 24.7% from $339.5 million in 2020 to $423.2 million in 2021.

For a reconciliation of net income (loss) attributable to the Company, the most directly comparable GAAP financial measure, to FFO attributable to common stockholders and unit holders, excluding financing expense in connection with Chandler Freehold and loss on extinguishment of debt and FFO attributable to common stockholders and unit holders—diluted, excluding financing expense in connection with Chandler Freehold and loss on extinguishment of debt, see "Funds From Operations ("FFO")" below.

Operating Activities:

Cash provided by operating activities increased $161.5 million from 2020 to 2021.

The increase is primarily due to the changes in assets and liabilities and the results, as discussed above.

Investing Activities:

Primarily as a result of the factors mentioned above, FFO attributable to common stockholders and unit holders—diluted, excluding financing expense in connection with Chandler Freehold, gain on extinguishment of debt and accrued default interest expense decreased 7.9% from $437.5 million in 2022 to $403.0 million in 2023.

For a reconciliation of net loss attributable to the Company, the most directly comparable GAAP financial measure, to FFO attributable to common stockholders and unit holders–diluted, and FFO attributable to common stockholders and unit holders—diluted, excluding financing expense in connection with Chandler Freehold, gain on extinguishment of debt and accrued default interest expense–diluted, see "Funds From Operations ("FFO")" below.

Cash Flows from Operating Activities:

Cash provided by operating activities decreased $42.0 million from 2022 to 2023.

The decrease is primarily due to the changes in assets and liabilities and the results, as discussed above.

Cash Flows from Investing Activities:

Cash provided by investing activities increased $53.9 million from 2022 to 2023.

The increase in cash provided by investing activities is primarily attributed to an increase in proceeds from the sale of assets of $320.6 million, proceeds from notes receivable of $1.3 million, a decrease in contributions to unconsolidated joint ventures of $45.6 million and an increase of $15.5 million in distributions from unconsolidated joint ventures.

Financing Activities:

Cash provided by financing activities decreased $1.3 billion from 2020 to 2021.

The decrease in cash provided by financing activities is primarily due to decreases in proceeds from mortgages, bank and other notes payable of $140.0 million and an increase in payments on mortgages, bank and other notes payable of $2.0 billion offset in part by net proceeds from sales of common shares under the ATM Programs of $830.2 million and a decrease in dividends and distributions of $36.4 million.

The increase in cash provided by investing activities is primarily attributed to an increase in distributions from unconsolidated joint ventures of $169.6 offset in part by decreases in proceeds from the sale of assets of $14.9 million, $21.0 million in proceeds from collection of receivable in connection with sale of joint venture property, increases in acquisitions of property of $22.1 million, development, redevelopment and renovation of $35.8 million and property improvements of $21.9 million.

The increase in distributions from unconsolidated joint ventures is primarily due to the distribution of net loan proceeds from the Scottsdale Fashion Square refinance (See " —Financing Activities" in Management's Overview and Summary) and the distribution of net sales proceeds on One Westside (See " —Dispositions" in Management's Overview and Summary).

Cash Flows from Financing Activities:

Cash used in financing activities increased $16.9 million from 2022 to 2023.

The increase in cash used in financing activities is primarily due to increases in payments on mortgages, bank and other notes payable of $457.2 million, deferred financing costs of $22.5 million and payment on finance arrangement obligation of $5.6 million offset in part by an increase in proceeds from mortgages, bank and other notes payable of $442.0 million and a decrease in dividends and distributions of $27.0 million.

The decrease in dividends and distributions is primarily due to a decrease in distributions to consolidated joint ventures offset in part by an increase in dividends to common stockholders.

Comparison of Years Ended December 31, 2022 and 2021

Discussion of the year ended December 31, 2022 compared to the year ended December 31, 2021 was included in the Company's Annual Report on Form 10-K for the year ended December 31, 2022 on page 47 under Part II, Item 7, "Management's Discussion and Analysis of Financial Condition and Results of Operations", which was filed with the SEC on February 24, 2023.

Liquidity and Capital Resources

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The Company expects amounts to be incurred during the next twelve months for tenant allowances and deferred leasing charges to be comparable to 2023.

The Company expects to incur approximately $150.0 million during 2023 for development, redevelopment, expansion and renovations.

The Company expects to incur approximately $160 million to $180 million during 2024 for development, redevelopment, expansion and renovations.

Capital for these expenditures, developments and/or redevelopments has been, and is expected to continue to be, obtained from a combination of cash on hand, debt or equity financings, which are expected to include borrowings under the Company's line of credit, from property financings and construction loans, each to the extent available.

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The Company has also generated liquidity in the past, and may continue to do so in the future, through equity offerings and issuances, property refinancings, joint venture transactions and the sale of non-core assets.

For example, the Company sold Paradise Valley Mall in Phoenix, Arizona and Tucson La Encantada in Tucson, Arizona during the year ended December 31, 2021 and used the proceeds to pay down its line of credit and other debt obligations.

For example, the Company sold The Marketplace at Flagstaff in Flagstaff, Arizona on May 2, 2023, Superstition Springs Power Center in Mesa, Arizona on July 17, 2023, and the Company’s joint venture sold One Westside in Los Angeles, California on December 27, 2023.

The Company used its share of proceeds from these transactions to pay down its line of credit and other debt obligations.

During the year ended December 31, 2023, the Company and certain joint venture partners sold various land parcels in separate transactions for aggregate proceeds of $16.4 million (at the Company's share), which the Company used to pay down debt and for other general corporate purposes.

Furthermore, the Company has filed a shelf registration statement, which registered an unspecified amount of common stock, preferred stock, depositary shares, debt securities, warrants, rights, stock purchase contracts and units that may be sold from time to time by the Company.

On each of February 1, 2021 and March 26, 2021, the Company registered a separate "at the market" offering program, pursuant to which the Company may issue and sell shares of its common stock having an aggregate offering price of up to $500 million under each ATM Program, or a total of $1.0 billion under the ATM Programs, in amounts and at times to be determined by the Company.

During the twelve months ended December 31, 2021, the Company issued approximately 62.0 million shares of common stock under the ATM Programs for net proceeds of $830.2 million.

During the twelve months ended December 31, 2022, no shares were issued under the March 2021 ATM Program.

As of December 31, 2022, the Company had approximately $151.7 million of gross sales of its common stock available under the March 2021 ATM Program.

On March 26, 2021, the Company registered an "at the market" offering program, pursuant to which the Company may issue and sell shares of its common stock having an aggregate offering price of up to $500 million under the ATM Program, in amounts and at times to be determined by the Company.

During both the twelve months ended December 31, 2022 and 2023, no shares were issued under the ATM Program.

As of December 31, 2023, the Company had approximately $151.7 million of gross sales of its common stock available under the ATM Program.

The capital and credit markets can fluctuate and, at times, limit access to debt and equity financing for companies.

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Many factors impact the Company's ability to access capital, such as its overall debt level, interest rates, interest coverage ratios and prevailing market conditions, including periods of economic slowdown or recession.

The Company expects to incur increased interest expense from the refinancing or extension of loans that may currently carry below-market interest rates.

For example, the credit markets have experienced and may continue to experience a slowdown stemming from broader market issues pertaining to various factors, including among others, the health of regional banks, prevailing market sentiment regarding various commercial real estate sectors and interest rate increases imposed by the Federal Reserve.

The Company expects to incur increased interest expense from the refinancing or extension of loans that may carry below-market interest

In addition, increases in the Company's proportion of floating rate debt will cause it to be subject to interest rate fluctuations in the future.

1 unchanged sentence

The majority of the Company's debt consists of fixed-rate conventional mortgage notes collateralized by individual properties.

The Company expects that all of the maturities during the next twelve months will be refinanced, restructured, extended and/or paid off from the Company's line of credit or cash on hand, with the exception of the loan on Towne Mall.

The Company believes that the pro rata debt provides useful information to investors regarding its financial condition because it includes the Company’s share of debt from unconsolidated joint ventures and, for consolidated debt, excludes the Company’s partners’ share from consolidated joint ventures, in each case presented on the same basis.

5 unchanged sentences

The Company does not believe that these letters of credit will result in a liability to the Company.