SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
☒
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 2026
or
☐
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from to
Commission File Number 001-12002
ACADIA REALTY TRUST
(Exact name of registrant as specified in its charter)
Maryland
(State or other jurisdiction of
incorporation or organization)
23-2715194
(I.R.S. Employer
Identification No.)
411 THEODORE FREMD AVENUE, SUITE 300, RYE, NY
(Address of principal executive offices)
10580
(Zip Code)
(914) 288-8100
(Registrant’s telephone number, including area code)
Securities registered pursuant to Section 12(b) of the Act:
Title of class of registered securities
Trading symbol
Name of exchange on which registered
Common shares of beneficial interest, par value $0.001 per share
AKR
The New York Stock Exchange
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
Yes ☒
No ☐
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
Large Accelerated Filer
Accelerated Filer
Emerging Growth Company
Non-accelerated Filer
Smaller Reporting Company
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate by checkmark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act) Yes ☐ No ☒
As of April 24, 2026, there were 133,517,141 common shares of beneficial interest, par value $0.001 per share (“Common Shares”), outstanding.
ACADIA REALTY TRUST AND SUBSIDIARIES
INDEX
Item No.
Description
Page
PART I - FINANCIAL INFORMATION
1.
Financial Statements
4
Condensed Consolidated Balance Sheets (Unaudited) as of March 31, 2026 and December 31, 2025
Condensed Consolidated Statements of Operations (Unaudited) for the Three Months Ended March 31, 2026 and 2025
5
Condensed Consolidated Statements of Comprehensive Income (Loss) (Unaudited) for the Three Months Ended March 31, 2026 and 2025
6
Condensed Consolidated Statements of Changes in Equity (Unaudited) for the Three Months Ended March 31, 2026 and 2025
7
Condensed Consolidated Statements of Cash Flows (Unaudited) for the Three Months Ended March 31, 2026 and 2025
8
Notes to Condensed Consolidated Financial Statements (Unaudited)
10
2.
Management’s Discussion and Analysis of Financial Condition and Results of Operations
37
3.
Quantitative and Qualitative Disclosures about Market Risk
48
4.
Controls and Procedures
50
PART II - OTHER INFORMATION
Legal Proceedings
51
1A.
Risk Factors
Unregistered Sales of Equity Securities and Use of Proceeds
Defaults Upon Senior Securities
Mine Safety Disclosures
5.
Other Information
6.
Exhibits
52
Signatures
53
SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS
Certain statements contained in this Quarterly Report on Form 10-Q (this “Report”) of Acadia Realty Trust, a Maryland real estate investment trust, (the “Company”), may contain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). We intend these forward-looking statements to be covered by the safe harbor provisions for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995, and we are including this statement for the purposes of complying with those safe harbor provisions, in each case, to the extent applicable. Forward-looking statements, which are based on certain assumptions and describe our future plans, strategies and expectations, are generally identifiable by the use of words such as “may,” “will,” “should,” “expect,” “anticipate,” “estimate,” “believe,” “intend” or “project,” or the negative thereof, or other variations thereon or comparable terminology. Forward-looking statements involve known and unknown risks, uncertainties and other factors that could cause our actual results and financial performance to be materially different from future results and financial performance expressed or implied by such forward-looking statements, including, but not limited to: (i) macroeconomic conditions, including due to geopolitical instability, contemplated tariff increases and other trade restrictions, which may lead to a disruption of or lack of access to the capital markets, disruptions and instability in the banking and financial services industries and rising inflation; (ii) our success in implementing our business strategy and our ability to identify, underwrite, finance, consummate and integrate diversifying acquisitions and investments; (iii) changes in general economic conditions or economic conditions in the markets in which we may, from time to time, compete, and their effect on our revenues, earnings and funding sources and those of our tenants; (iv) increases in our borrowing costs as a result of rising inflation, changes in interest rates and other factors; (v) our ability to pay down, refinance, restructure or extend our indebtedness as it becomes due; (vi) our investments in joint ventures and unconsolidated entities, including our lack of sole decision-making authority and our reliance on our joint venture partners’ financial condition; (vii) our ability to obtain the financial results expected from our development and redevelopment projects; (viii) our tenants’ ability and willingness to renew their leases with us upon expiration, our ability to re-lease our properties on the same or better terms in the event of nonrenewal or in the event we exercise our right to replace an existing tenant, and obligations we may incur in connection with the replacement of an existing tenant; (ix) our potential liability for environmental matters; (x) damage to our properties from catastrophic weather and other natural events, and the physical effects of climate change; (xi) the economic, political and social impact of, and uncertainty surrounding, any future public health crisis, which may adversely affect us and our tenants’ business, financial condition, results of operations and liquidity; (xii) uninsured losses; (xiii) our ability and willingness to maintain our qualification as a real estate investment trust (“REIT”) in light of economic, market, legal, tax and other considerations; (xiv) information technology (“IT”) security breaches, including increased cybersecurity risks relating to the use of remote technology and artificial intelligence (“AI”); (xv) risks associated with our use of AI tools, which could result in reputational harm, and legal or regulatory liability; (xvi) the loss of key executives; and (xvii) the accuracy of our methodologies and estimates regarding corporate responsibility metrics, goals and targets, tenant willingness and ability to collaborate towards reporting such metrics and meeting such goals and targets, and the impact of governmental regulation on our corporate responsibility efforts.
The factors described above are not exhaustive and additional factors could adversely affect the Company’s future results and financial performance, including the risk factors discussed under the section captioned “Risk Factors” in the Company’s Annual Report on Form 10-K for the year ended December 31, 2025 and other periodic or current reports the Company files with the Securities and Exchange Commission (the “SEC”), including those set forth under the headings “Item 1A. Risk Factors” and “Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations” in this Report. These risks and uncertainties should be considered in evaluating any forward-looking statements contained or incorporated by reference herein. Any forward-looking statements speak only as of the date hereof. The Company expressly disclaims any obligation or undertaking to release publicly any updates or revisions to any forward-looking statements to reflect any changes in the Company’s expectations with regard thereto or changes in the events, conditions or circumstances on which such forward-looking statements are based.
SPECIAL NOTE REGARDING CERTAIN REFERENCES
All references to “Notes” throughout the document refer to the Notes to the Condensed Consolidated Financial Statements of the registrant referenced in Part I, Item 1. Financial Statements.
3
PART I – FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS.
CONDENSED CONSOLIDATED BALANCE SHEETS
March 31,
December 31,
(in thousands, except share and per share data)
2026
2025
ASSETS
(Unaudited)
Investments in real estate
Operating real estate, net
$
3,587,728
3,983,754
Real estate under development
178,050
167,051
Net investments in real estate
3,765,778
4,150,805
Notes receivable, net ($2,176 and $1,638 of allowance for credit losses as of March 31, 2026 and December 31, 2025, respectively)(a)
154,430
154,892
Investments in and advances to unconsolidated affiliates
275,770
161,955
Other assets, net
190,101
223,980
Right-of-use assets - operating leases, net
22,596
23,594
Cash and cash equivalents
31,415
38,818
Restricted cash
17,374
18,081
Rents receivable, net
56,259
65,027
Assets of property held for sale
18,932
—
Total assets (b)
4,532,655
4,837,152
LIABILITIES, REDEEMABLE NONCONTROLLING INTERESTS AND EQUITY
Liabilities:
Mortgage and other notes payable, net
624,764
893,944
Unsecured notes payable, net
880,012
879,462
Unsecured line of credit
91,500
89,500
Accounts payable and other liabilities
222,654
273,479
Lease liabilities - operating leases
24,918
25,972
Dividends and distributions payable
28,421
28,526
Distributions in excess of income from, and investments in, unconsolidated affiliates
16,241
16,838
Liabilities of property held for sale
161
Total liabilities (b)
1,888,671
2,207,721
Commitments and contingencies (Note 9)
Redeemable noncontrolling interests (Note 10)
8,457
9,113
Equity:
Acadia Shareholders' Equity
Common shares, $0.001 par value per share, authorized 200,000,000 shares, issued and outstanding 133,513,864 and 131,036,560 shares as of March 31, 2026 and December 31, 2025, respectively
134
131
Additional paid-in capital
2,755,574
2,710,651
Accumulated other comprehensive income
20,057
15,585
Distributions in excess of accumulated earnings
(498,735
)
(500,720
Total Acadia shareholders’ equity
2,277,030
2,225,647
Noncontrolling interests
358,497
394,671
Total equity
2,635,527
2,620,318
Total liabilities, redeemable noncontrolling interests, and equity
The accompanying notes are an integral part of these Condensed Consolidated Financial Statements (unaudited).
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
Three Months Ended March 31,
(in thousands, except per share amounts)
Revenues
Rental
98,568
102,640
Other
4,424
1,754
Total revenues
102,992
104,394
Expenses
Depreciation and amortization
40,155
39,440
General and administrative
15,303
11,597
Real estate taxes
12,922
13,303
Property operating
18,249
18,280
Impairment charges
6,450
Total expenses
86,629
89,070
Gain on disposition of properties
142,148
Operating income
158,511
15,324
Equity in losses of unconsolidated affiliates
(1,508
(1,713
Interest income (a)
4,788
6,096
Realized and unrealized holding (losses) gains on investments and other
(616
1,621
Interest expense
(22,052
(23,247
Loss on change in control
(9,622
Income (loss) from continuing operations before income taxes
139,123
(11,541
Income tax provision
(12
(116
Net income (loss)
139,111
(11,657
Net loss attributable to redeemable noncontrolling interests
698
1,669
Net (income) loss attributable to noncontrolling interests
(109,332
11,596
Net income attributable to Acadia shareholders
30,477
1,608
Basic income per share
0.22
0.01
Diluted income per share
Weighted average shares for basic income per share
131,247
121,329
Weighted average shares for diluted income per share
131,332
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) (UNAUDITED)
(in thousands)
Other comprehensive income (loss):
Unrealized gain (loss) on valuation of swap agreements
7,885
(10,269
Reclassification of realized interest on swap agreements
(1,785
(3,920
Other comprehensive income (loss)
6,100
(14,189
Comprehensive income (loss)
145,211
(25,846
Comprehensive loss attributable to redeemable noncontrolling interests
Comprehensive (income) loss attributable to noncontrolling interests
(110,960
14,199
Comprehensive income (loss) attributable to Acadia shareholders
34,949
(9,978
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY (UNAUDITED)
Three Months Ended March 31, 2026 and 2025
Acadia Shareholders
CommonShares
ShareAmount
AdditionalPaid-inCapital
AccumulatedOtherComprehensiveIncome (Loss)
Distributionsin Excess ofAccumulatedEarnings
TotalCommonShareholders’Equity
NoncontrollingInterests
TotalEquity
Redeemable NoncontrollingInterests
Balance as of January 1, 2026
131,037
Issuance of Common Shares, net
2,445
55,836
55,839
Conversion of OP Units to Common Shares by limited partners of the Operating Partnership
18
300
(300
Dividends/distributions declared ($0.20 per Common Share/OP Unit)
(26,699
(1,621
(28,320
Adjustment of redeemable non-controlling interest to estimated redemption value (Note 10)
(1,793
1,793
City Point Loan accrued interest (Note 10)
(1,746
Employee and trustee stock compensation, net
14
116
6,293
6,409
Noncontrolling interest distributions
(162,841
(5
Noncontrolling interest contributions
4,472
110,960
145,909
(698
Reallocation of noncontrolling interests
(11,329
11,329
Balance as of March 31, 2026
133,514
Balance as of January 1, 2025
119,658
120
2,436,285
38,650
(409,383
2,065,672
436,017
2,501,689
30,583
113
1,718
(1,718
11,173
11
277,495
277,506
(26,191
(1,444
(27,635
City Point Loan accrued interest
(3,017
12
137
2,462
2,599
(4,799
7,990
Consolidation of previously unconsolidated investment
29,573
Comprehensive (loss) income
(11,586
(14,199
(24,177
(1,669
(10,904
10,904
Balance as of March 31, 2025
130,956
2,704,731
27,064
(433,966
2,297,960
464,786
2,762,746
25,897
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
CASH FLOWS FROM OPERATING ACTIVITIES
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Gain on disposition of properties and other investments
(142,148
Net unrealized holding losses (gains) on investments
(1,768
Stock compensation expense
6,358
Straight-line rents
(1,127
(307
1,508
1,713
Distributions of operating income from unconsolidated affiliates
884
1,044
Amortization of financing costs
1,741
2,094
Non-cash lease expense
997
960
9,622
Other, net
(3,194
(2,277
Changes in assets and liabilities:
Accounts receivable
5,266
(904
Other liabilities
(12,921
(9,285
Accounts payable and accrued expenses
(9,050
(8,268
Prepaid expenses and other assets
4,834
(2,492
(1,055
(1,071
Net cash provided by operating activities
31,359
25,893
CASH FLOWS FROM INVESTING ACTIVITIES
Acquisitions of properties
(77,833
(192,222
Proceeds from the disposition of properties and other investments, net
548,644
Investments and advances in unconsolidated affiliates
(66,249
(3,456
Development, construction and property improvement costs
(32,216
(19,610
Refund of deposits for properties under purchase contract
11,650
Payment of deposits for properties under sales contract
(4,868
Increase in cash upon change of control
6,777
Return of capital from unconsolidated affiliates
2,764
2,427
Payment of deferred leasing costs
(2,567
(2,349
Proceeds from repayment of note receivable
807
Issuance of note receivable
(76
(47
Net cash provided by (used in) investing activities
367,599
(196,023
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from unsecured notes payable and line of credit
182,500
300,200
Principal payments on unsecured debt and line of credit
(180,500
(314,200
Proceeds from issuances of Common Shares and settlement of forward equity contracts
277,519
Contributions from noncontrolling interests
Principal payments on mortgages payable
(271,106
(55,779
Distributions to noncontrolling interests
(165,068
(6,484
Dividends paid to Common Shareholders
(26,207
(22,735
Payment of deferred financing and other costs
(34
(26
Prepayment penalty on early debt extinguishment
(2,150
Payments of finance lease obligations
(348
246
Net cash (used in) provided by financing activities
(407,068
186,731
(Decrease) increase in cash and cash equivalents and restricted cash
(8,110
16,601
Cash and cash equivalents of $38,818 and $16,806 and restricted cash of $18,081 and $22,897, respectively, beginning of period
56,899
39,703
Cash and cash equivalents of $31,415 and $31,984 and restricted cash of $17,374 and $24,320, respectively, end of period
48,789
56,304
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) (Continued)
Supplemental disclosure of cash flow information
Cash paid during the period for interest, net of capitalized interest of $2,160 and $2,289 respectively (a)
26,882
27,899
Cash paid for income taxes, net of refunds
Supplemental disclosure of non-cash investing and financing activities
Dividends/Distributions declared and payable
28,320
27,635
Assumption of accounts payable and accrued expenses through acquisition of real estate
853
Conversion of Common and Preferred OP Units to Common Shares
Accrued interest on note receivable recorded to redeemable noncontrolling interest
1,752
3,014
Adjustment of redeemable non-controlling interest to estimated redemption value
Accrued development, construction and property improvement costs included in Accounts payable and other liabilities
11,319
Properties contributed to unconsolidated affiliates
55,438
Increase (decrease) in assets and liabilities resulting from the consolidation of previously unconsolidated investment:
Operating real estate
201,700
Mortgage and other notes payable
156,117
(28,516
Rents receivable and other assets
654
4,548
29,572
9
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
1. Organization, Basis of Presentation and Summary of Significant Accounting Policies
Organization
Acadia Realty Trust, (the “Trust”, collectively with its consolidated subsidiaries, the “Company”), a Maryland real estate investment trust (“REIT”), is a fully-integrated equity real estate investment trust focused on the ownership, acquisition, development, and management of retail properties located primarily in high-barrier-to-entry, supply-constrained, densely populated metropolitan areas in the United States.
All of the Company’s assets are held by, and its operations are conducted through, Acadia Realty Limited Partnership (the “Operating Partnership”) and entities in which the Operating Partnership owns an interest. At March 31, 2026 and December 31, 2025, the Trust controlled approximately 96% of the Operating Partnership as the sole general partner and is entitled to share in the cash distributions and profits and losses of the Operating Partnership in proportion to its percentage interest.
The limited partners primarily consist of entities or individuals that contributed interests in certain properties or entities to the Operating Partnership in exchange for common or preferred units of limited partnership interest (“Common OP Units” or “Preferred OP Units”), as well as employees who have been granted restricted Common OP Units (“LTIP Units”) as long-term incentive compensation (Note 13). Limited partners holding Common OP and LTIP Units generally have the right to exchange their units on a one-for-one basis for common shares of beneficial interest, par value $0.001 per share, of the Company (“Common Shares”). This structure is referred to as an umbrella partnership REIT or “UPREIT.”
The Company owns and operates a high-quality core real estate portfolio, primarily comprised of open-air street retail assets in the nation’s most dynamic retail corridors (“REIT Portfolio”). This portfolio is complemented by an investment management platform that leverages institutional capital relationships to pursue opportunistic, high-yield, and/or value-add investments (“Investment Management”). As of March 31, 2026, the Company held ownership interests in 180 properties (including properties in various stages of development and redevelopment) within its REIT Portfolio, which includes properties either wholly owned or partially owned through joint ventures by the Operating Partnership or subsidiaries, excluding properties owned through the Investment Management platform.
The Company also held ownership interests in 51 properties through its Investment Management platform, which facilitates investments in primarily opportunistic and value-add retail real estate alongside institutional partners. As of March 31, 2026, active investments are held through seven unconsolidated co-investment vehicles (Note 4) and through the following opportunity funds, including: Acadia Strategic Opportunity Fund II, LLC (“Fund II”), Acadia Strategic Opportunity Fund III LLC (“Fund III”), Acadia Strategic Opportunity Fund IV LLC (“Fund IV”), and Acadia Strategic Opportunity Fund V LLC (“Fund V” and, collectively with Fund II, Fund III and Fund IV, the “Funds”). The Company consolidates the Funds as variable interest entities (“VIE”) as it is the primary beneficiary, having (i) the power to direct the activities that most significantly impact the Funds’ economic performance, (ii) the obligation to absorb the Funds’ losses, and (iii) the right to receive benefits from the Funds that could potentially be significant to the Funds.
The Operating Partnership serves as the sole general partner or managing member of the Funds and earns fees or priority distributions for asset management, property management, construction, development, leasing, and legal services. Cash flows from the Funds are distributed pro-rata to partners and members (including the Operating Partnership) until each receives a cumulative preferred return (“Preferred Return”) and full return of capital. Thereafter, remaining cash flows are distributed 20% to the Operating Partnership (“Promote”) and 80% to the partners or members (including the Operating Partnership). All intercompany transactions between the Funds and the Operating Partnership are eliminated in consolidation.
The following table summarizes the general terms and Operating Partnership’s equity interests in the Funds (dollars in millions):
Entity
FormationDate
OperatingPartnershipShare ofCapital
Capital Called as of March 31, 2026 (a)
UnfundedCommitment (a)
Equity InterestHeld ByOperatingPartnership (b)
PreferredReturn
Total Distributions as of March 31, 2026 (a)
Fund II
6/2004
80.00
%
559.4
0.0
172.9
Fund III
5/2007
24.54
449.2
0.8
39.63
616.3
Fund IV
5/2012
23.12
506.0
24.0
221.4
Fund V
8/2016
20.10
491.3
28.7
391.1
Also, within Investment Management, as of March 31, 2026, we had equity method investments in seven unconsolidated co-investment vehicles with large institutional investors. Our equity ownership interests range from 5% to 20% in each venture. These investments are individually negotiated and may result in varying economic terms.
The 231 REIT Portfolio and Investment Management properties primarily consist of street and urban retail properties, and suburban shopping centers.
Basis of Presentation
The interim Condensed Consolidated Financial Statements have been prepared in accordance with accounting principles generally accepted in the United States GAAP for interim financial information and the rules and regulations of the U.S. Securities and Exchange Commission (“SEC”). Accordingly, they do not include all of the information and footnotes required for complete annual financial statements. Operating results for interim periods are not necessarily indicative of results for the full fiscal year. In the opinion of management, all adjustments necessary for a fair presentation of interim Condensed Consolidated Financial Statements have been included. These adjustments are of normal recurring nature.
The preparation of financial statements in conformity with generally accepted accounting principles (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts in the interim Condensed Consolidated Financial Statements and accompanying notes. The most significant assumptions and estimates include those related to the valuation of real estate, depreciable lives, revenue recognition and the collectability of notes receivable and rents receivable. Application of these estimates and assumptions requires the exercise of judgment as to future uncertainties and, as a result, actual results could differ from these estimates.
These interim Condensed Consolidated Financial Statements should be read in conjunction with the Company’s 2025 audited consolidated financial statements and notes thereto included in the Annual Report on Form 10-K for the year ended December 31, 2025.
Segments
We define our reportable segments based on the manner in which our chief operating decision maker makes key operating decisions, evaluates financial performance, allocates resources and manages our business. This approach aligns with our internal reporting structure and reflects the economic characteristics and nature of our operations. Accordingly, we have identified three reportable operating segments: REIT Portfolio, Investment Management and Structured Financing. Refer to Note 12.
Recent Accounting Pronouncements
In November 2024, the FASB issued ASU 2024-03, “Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses” (“ASU 2024-03”) which requires disaggregated disclosure of income statement expenses for public business entities (PBEs). Additionally, in January 2025, the FASB issued ASU 2025-01 to clarify the effective date of ASU 2024-03. The ASU does not change the expense captions an entity presents on the face of the income statement; rather, it requires disaggregation of certain expense captions into specified categories in disclosures within the footnotes to the financial statements. This guidance applies to all PBEs and is effective for annual reporting periods beginning after December 15, 2026 and interim reporting periods beginning after December 15, 2027, with early adoption permitted. The Company has elected not to early adopt and the requirements will be applied prospectively with the option for retrospective application. The Company is currently evaluating the expected impact of the adoption of ASU 2024-03 on disclosures within the Company’s Condensed Consolidated Financial Statements.
In November 2025, the FASB issued ASU 2025-09, “Derivatives and Hedging (Topic 815): Hedge Accounting Improvements” (“ASU 2025-09”) that more closely aligns hedge accounting with the economics of an entity’s risk management activities. ASU 2025-09 is effective for fiscal years beginning after December 15, 2026, including interim periods within those fiscal years with early adoption permitted. The Company expects to early adopt the requirements in the second quarter of 2026. The adoption of ASU 2025-09 is not expected to have a significant impact on the Company’s Condensed Consolidated Financial Statements.
Any other recently issued accounting standards or pronouncements not disclosed above have been excluded as they are not relevant to the Company, or they are not expected to have a material impact on the Condensed Consolidated Financial Statements.
2. Real Estate
The Company’s consolidated real estate is comprised of the following for the periods presented (in thousands):
March 31,2026
December 31,2025
Buildings and improvements
3,057,952
3,421,366
Tenant improvements
321,489
339,414
Land
1,100,492
1,147,236
Construction in progress
26,266
32,969
Right-of-use assets - finance leases (Note 11)
61,366
Total
4,567,565
5,002,351
Less: Accumulated depreciation and amortization
(979,837
(1,018,597
Acquisitions
During the three months ended March 31, 2026, the Company acquired the following consolidated REIT Portfolio retail properties (dollars in thousands):
Property and Location
PercentAcquired
Date ofAcquisition
PurchasePrice (a)
1045 and 1165 Madison Avenue - New York, NY
100%
January 29, 2026
21,313
Rhode Island Place - Washington, D.C.
March 4, 2026
9,464
846 W. Armitage Avenue - Chicago, IL
March 5, 2026
4,440
225 Worth Avenue - Palm Beach, FL
March 27, 2026
43,469
Total 2026 Acquisitions
78,686
Purchase Price Allocations
The purchase price for properties acquired during the period were allocated to the acquired assets and assumed liabilities based on their relative fair values as of the respective acquisition dates. Identifiable intangible assets acquired primarily relate to in-place leases, tenant origination costs, and above-market leases, while assumed intangible liabilities relate to below-market leases.
For acquisitions completed during the period, the Company recorded identifiable intangible assets and intangible liabilities in the aggregate of approximately $10.0 million and $8.1 million, respectively. These intangibles are amortized over the remaining non-cancelable lease terms of the related leases, which ranged from approximately 1 to 50 years as of the respective acquisition dates. Refer to Note 6 for additional detail on the Company’s amortization of intangible assets and liabilities.
The Company determines the fair value of the individual components of real estate asset acquisitions primarily through calculating the “as-if vacant” value of a building, using an income approach, which relies significantly upon internally determined assumptions. The Company has determined that these estimates primarily rely on Level 3 inputs, which are unobservable inputs based on our own assumptions. The most significant assumptions used in calculating the “as-if vacant” value for acquisition activity during 2026 are as follows:
Low
High
Exit Capitalization Rate
5.00
6.75
Discount Rate
6.25
8.50
Annual net rental rate per square foot on acquired buildings
15.00
500.00
Annual net rental rate per square foot on acquired master lease
4.71
23.83
13
Dispositions
During the three months ended March 31, 2026, the Company disposed of the following consolidated retail properties (dollars in thousands):
Segment
Date Sold
Sale Price
Gainon Sale
Landstown Commons - Virginia Beach, VA
IM (Fund V)
January 16, 2026
102,000
25,612
Fund V Assets - Various
February 25, 2026
372,096
110,534
Avenue West Cobb - Marietta, GA
IM
63,725
1,802
1964 Union Street - San Francisco, CA
IM (Fund IV)
March 24, 2026
2,605
81
Pinewood Square - Lake Worth, FL
March 26, 2026
68,400
4,119
Total 2026 Dispositions
608,826
In February 2026, the Company completed the sale of a seven-property open-air retail portfolio, including six Fund V properties and one wholly owned asset, to newly formed unconsolidated joint ventures in which the Company retained a 20% ownership interest, which was fair-valued at $87.1 million. Upon deconsolidation, the Company recognized a gain on disposition at the transaction level of $112.3 million, of which the Company’s proportionate share was $22.1 million. The Company repaid $210.5 million of consolidated Investment Management property mortgage loans using proceeds from the recapitalization (Note 7).
In March 2026, the Company completed the sale of the Pinewood Square property, an open-air retail center located in Lake Worth, Florida, to a newly formed unconsolidated joint venture for $68.4 million and retained a 20% ownership interest, which was fair-valued at $13.6 million (Note 4). Upon deconsolidation, the Company recognized a gain on disposition of $4.1 million.
Properties Held for Sale
As of March 31, 2026, the Company classified New Towne Center, a consolidated Fund V Investment Management property as held for sale. The Company did not have any properties classified as held for sale as of December 31, 2025.
The assets and liabilities of the property held for sale are presented separately in the accompanying condensed consolidated balance sheets and are summarized as follows:
Assets
Building and improvements
17,529
995
4,719
(4,845
534
Liabilities
Real Estate Under Development
Real estate under development represents the Company’s consolidated properties that have not yet been placed into service and are undergoing substantial development or construction.
Development activity for these properties during the periods presented is summarized below (dollars in thousands):
January 1, 2026
Three Months Ended March 31, 2026
March 31, 2026
Number ofProperties
CarryingValue
Transfers In
CapitalizedCosts (a)
Transfers Out
REIT Portfolio
10,999
The number of properties in the table above refers to full-property development projects; however, certain projects represent only a portion of a property, and the capitalized costs and carrying value of these projects are included in the table above. As of March 31, 2026, consolidated development projects included 13 properties in the Henderson Avenue Portfolio (REIT Portfolio).
3. Notes Receivable, Net
Interest income from notes and mortgages receivable is reported within the Company’s Structured Financing segment (Note 12). Interest receivable is included in Other assets, net (Note 5). The Company’s notes receivable, net, are generally collateralized by either the underlying real estate or the borrowers’ equity interests in the entities that own the properties. The balances were as follows (dollars in thousands):
Number
Maturity Date
Interest Rate
Notes receivable
156,606
156,530
Apr 2020 - Dec 2027
6.00% - 13.75%
Allowance for credit losses
(2,176
(1,638
Notes receivable, net
The following table presents the activity in the allowance for credit losses for the three months ended March 31, 2026 and year ended December 31, 2025 (dollars in thousands):
December 31, 2025
Allowance for credit losses as of beginning of periods
1,638
2,004
Provision (recovery) of loan losses
538
(366
Total credit allowance
2,176
As of March 31, 2026, the Company had six performing notes with a total amortized cost of $143.2 million, including accrued interest of $4.4 million. Each note was evaluated individually due to the lack of comparability across the Structured Financing Portfolio.
One note receivable with a principal balance of $17.8 million had matured and was in default as of March 31, 2026 and December 31, 2025. The Company applied the collateral-dependent practical expedient in accordance with ASC Topic 326: Financial Instruments - Credit Losses (“ASC 326”) as the note is expected to be settled through foreclosure or possession of the underlying collateral. Based on the estimated fair value of the collateral at the expected realization date, no allowance for credit losses was recorded.
15
4. Investments in and Advances to Unconsolidated Affiliates
The Company accounts for its investments in and advances to unconsolidated affiliates primarily under the equity method of accounting. The Company’s investments in and advances to unconsolidated affiliates consist of the following (dollars in thousands):
Ownership Interest
Portfolio
Property
REIT:
Gotham Plaza
49%
28,161
Georgetown Portfolio (a)
50%
3,777
3,744
1238 Wisconsin Avenue (a, b)
80%
17,826
18,025
840 N. Michigan Avenue (c, d)
94.35%
35,826
34,631
85,328
84,561
Investment Management:
Fund IV: (e)
Fund IV Other Portfolio (f)
90%
358
375
650 Bald Hill Road (g)
5,730
5,789
6,088
6,164
Fund V: (e)
Family Center at Riverdale (c)
89.42%
441
521
Tri-City Plaza
5,807
6,120
Frederick County Acquisitions (h)
3,703
3,872
Wood Ridge Plaza
8,080
7,962
La Frontera Village
9,243
9,746
Shoppes at South Hills
8,616
9,151
Mohawk Commons
8,007
9,023
43,897
46,395
Other:
Shops at Grand
5%
2,310
2,363
Walk at Highwoods Preserve
20%
1,755
1,805
LINQ Promenade
15%
16,011
15,918
Shops at Skyview (i)
63,624
Atlantic Portfolio (j)
43,422
Avenue West Cobb
4,114
Pinewood Square
4,929
136,165
20,086
Various:
Due from Related Parties
1,525
1,366
Other (k)
2,767
3,383
Investments in and advances tounconsolidated affiliates
Crossroads (l)
Distributions in excess of income from,and investments in, unconsolidated affiliates
16
In January 2026, the Company acquired a 20% non-controlling equity interest in a joint venture that acquired the Shops at Skyview, a retail shopping center located in Queens, NY, for $424.1 million. At closing, the joint venture secured a mortgage loan with a total commitment of $290.0 million, of which $277.0 million was funded at closing. Additionally, the Company provided a preferred equity investment of approximately $41.7 million. The preferred equity is accounted for as a held-to-maturity debt instrument given its stated maturity date in January 2029, and bears interest at 7.5%.
In February 2026, the Company acquired a 20% non-controlling equity interest in two newly formed joint ventures, Atlantic Portfolio and Avenue at West Cobb, that, as part of a recapitalization, acquired a seven-property open-air retail portfolio. Six of the properties were previously held in Fund V, while one property (Avenue at West Cobb) was previously held in the Company’s wholly owned portfolio. The Company’s retained interest in the joint ventures was fair-valued at $87.1 million. At closing, the joint venture obtained a mortgage loan with a total commitment of $317 million, of which $298 million was funded at closing. Additionally, the Company provided seller financing to the Atlantic Portfolio joint venture in the form of a $27.5 million preferred equity investment. The preferred equity is accounted for as a held-to-maturity debt instrument given its stated maturity date in February 2029, is secured by the equity interests in the entity that owns the Atlantic Portfolio properties, and bears interest at a stated rate of 6.0%. The preferred equity investment was determined to be issued at below-market terms, as the prevailing market rate for a comparable instrument at the time of origination exceeded the stated rate. Accordingly, the Company recorded the instrument at fair value at origination, resulting in a $2.4 million discount, which is presented as a reduction to the preferred equity investment balance within Investments in and advances to unconsolidated affiliates on the Condensed Consolidated Balance Sheets, with a corresponding reduction to the gain on disposition recognized in connection with the recapitalization (Note 2). The discount will be accreted into interest income over the term of the instrument using the effective interest method.
In March 2026, the Company retained a 20% non-controlling equity interest in a newly formed joint venture that acquired Pinewood Square, which was fair-valued at $13.6 million. At closing, the joint venture obtained a mortgage loan of $45.0 million.
840 N. Michigan Avenue
In December 2023, an unconsolidated venture holding an interest in a property on North Michigan Avenue modified its $73.5 million nonrecourse mortgage loan. The modification reduced the principal balance by $18.5 million, required a $17.5 million principal paydown, increased the interest rate from 4.4% to 6.5%, and extended the maturity from February 2025 to December 2026. Under the modification, the venture may be required to make contingent payments of up to $17.5 million upon a sale or secured refinancing prior to maturity (“Contingent Payment”). The Contingent Payment amortizes on a straight‑line basis over the remaining loan term and is reduced over time in accordance with the modification agreement. The modification was accounted for as a troubled debt restructuring under ASC 470, resulting in an initial gain of approximately $0.4 million recognized in equity in earnings of unconsolidated affiliates. Future cash payments under the modified loan, including any Contingent Payment, are treated as reductions of the mortgage carrying amount, and no interest expense is recognized through the revised maturity. As the Contingent Payment amortizes, additional gains are recognized in equity in earnings, of which $5.5 million and $5.4 million were recognized during the years ended December 31, 2025 and 2024, respectively. As part of the modification, the Operating Partnership provided a recourse guarantee equal to 50% of the unpaid principal balance of the mortgage.
17
Fees earned from and paid to Unconsolidated Affiliates
The Company earned fees for asset management, property management, construction, development, legal and leasing fees from its investments in unconsolidated affiliates totaling $3.4 million and $0.7 million for the three months ended March 31, 2026 and 2025, respectively, which are included in Other revenues in the Condensed Consolidated Statements of Operations.
In addition, the Company’s unconsolidated joint ventures paid fees to the Company’s unaffiliated joint venture partners of $1.1 million and $0.8 million for the three months ended March 31, 2026 and 2025, respectively, for leasing commissions, development, management, construction and overhead fees.
Summarized Financial Information of Unconsolidated Affiliates
The following Combined and Condensed Balance Sheets and Statements of Operations, in each period, summarized the financial information of the Company’s investments in unconsolidated affiliates that were held as of March 31, 2026 and 2025 (in thousands):
Combined and Condensed Balance Sheets
Assets:
Rental property, net
1,681,953
902,016
Other assets
347,318
119,689
Assets of property held for sale (a)
19,363
Total assets
2,048,634
1,021,705
Liabilities and partners’ equity:
Mortgage notes payable
1,304,427
630,077
232,494
127,164
Partners’ equity
511,713
264,464
Total liabilities and partners’ equity
Company's share of accumulated equity
245,004
127,079
Basis differential
8,762
8,860
Deferred fees, net of portion related to the Company's interest
1,521
4,452
Amounts receivable/payable by the Company
Investments in and advances to unconsolidated affiliates, net of Company's share of distributions in excess of income from and investments in unconsolidated affiliates
256,812
141,757
Investments carried at cost
2,717
3,360
Company's share of distributions in excess of income from and investments in unconsolidated affiliates
Combined and Condensed Statements of Operations
44,025
32,126
Operating and other expenses
(15,312
(12,249
(15,871
(11,450
(20,051
(12,852
Gain on extinguishment of debt (a)
971
Net (loss) income attributable to unconsolidated affiliates
(6,238
(3,454
Company’s share of equity in net (losses) earnings of unconsolidated affiliates
(1,410
(1,615
Basis differential amortization
(98
Company’s equity in losses of unconsolidated affiliates
5. Other Assets, Net and Accounts Payable and Other Liabilities
Other assets, net and accounts payable and other liabilities are comprised of the following for the periods presented:
Other Assets, Net:
Lease intangibles, net (Note 6)
96,652
128,239
Derivative financial instruments (Note 8)
12,905
9,738
Deferred charges, net (A)
40,517
44,133
Accrued interest receivable (Note 3)
9,028
8,916
Prepaid expenses
13,020
17,327
Due from seller
1,654
1,768
Income taxes receivable
1,273
1,180
Deposits
10,577
5,774
Corporate assets, net
550
430
Other receivables
3,925
6,475
(A) Deferred Charges, Net:
Deferred leasing and other costs
91,288
94,957
Deferred financing costs related to line of credit
13,939
105,227
108,896
Accumulated amortization
(64,710
(64,763
Deferred charges, net
Accounts Payable and Other Liabilities:
79,768
95,991
68,407
88,139
Deferred income
24,663
34,102
Tenant security deposits, escrow and other
16,841
19,939
Lease liability - finance leases, net (Note 11)
32,287
32,112
688
3,196
19
6. Lease Intangibles
Upon acquisitions of real estate (Note 2), the Company assesses the relative fair value of acquired assets (including land, buildings and improvements, and identified intangibles such as above- and below-market leases, including below-market options and acquired in-place leases) and assumed liabilities. The lease intangibles are amortized over the remaining terms of the respective leases, including option periods where applicable.
Intangible assets and liabilities are included in Other assets, net and Accounts payable and other liabilities (Note 5) on the Condensed Consolidated Balance Sheets and summarized as follows (in thousands):
Gross CarryingAmount
AccumulatedAmortization
Net CarryingAmount
Amortizable Intangible Assets
In-place lease intangible assets
330,333
(237,092
93,241
408,015
(289,643
118,372
Above-market rent
20,821
(17,410
3,411
32,608
(22,741
9,867
351,154
(254,502
440,623
(312,384
Amortizable Intangible Liabilities
Below-market rent
(200,117
120,505
(79,612
(223,893
128,072
(95,821
Above-market ground lease
(671
515
(156
501
(170
(200,788
121,020
(79,768
(224,564
128,573
(95,991
During the three months ended March 31, 2026, the Company
Amortization of in-place lease intangible assets is recorded in depreciation and amortization expense in the Condensed Consolidated Statements of Operations. Amortization of above-market rent and below-market rent is recorded as a reduction to and increase to rental revenue, respectively, in the Condensed Consolidated Statements of Operations. Amortization of above-market ground leases is recorded as a reduction to property operating expense on the Condensed Consolidated Statements of Operations.
The following table summarizes the scheduled amortization of acquired lease intangible assets and assumed liabilities as of March 31, 2026 (in thousands):
Years Ending December 31,
Net Increase inRental Revenues
Increase toAmortization Expense
Reduction ofProperty Operating Expense
2026 (Remainder)
5,846
(18,389
44
2027
7,269
(18,684
58
2028
7,202
(13,649
54
2029
6,976
(10,295
2030
6,472
(7,828
Thereafter
42,436
(24,396
76,201
(93,241
156
20
7. Debt
A summary of the Company’s consolidated indebtedness is as follows (dollars in thousands):
Carrying Value as of
Interest Rate as of
Maturity Date as of
Mortgages Payable
3.99% - 6.05%
Nov 2026 - Apr 2035
$227,092
$227,684
Fund II (a)
SOFR+1.90%
Aug 2028
137,500
5.62%
Jun 2028
25,939
27,249
SOFR+2.10% - SOFR+3.10%
May 2026 - Dec 2027
235,979
505,184
Net unamortized debt issuance costs
(2,446)
(4,599)
Unamortized premium
700
926
Total Mortgages Payable
$624,764
$893,944
Unsecured Notes Payable
Term Loans (b, c)
SOFR+1.20% - SOFR+1.40%
Apr 2028 - Jul 2030
$725,000
Senior Notes
5.86% - 5.94%
Aug 2027 - Aug 2029
100,000
Fund IV Term Loan
SOFR+1.20%
Dec 2028
61,250
(6,238)
(6,788)
Total Unsecured Notes Payable
$880,012
$879,462
Unsecured Line of Credit
Revolving Credit Facility (c, d)
SOFR+1.25%
Apr 2028
$91,500
$89,500
Total Debt (e)(f)
$1,604,260
$1,873,367
(8,684)
(11,387)
Total Indebtedness
$1,596,276
$1,862,906
At March 31, 2026 and December 31, 2025, the Company’s property mortgage loans were collateralized by 37 and 45 properties, respectively, as well as the related tenant leases. Certain loans are cross-collateralized and contain cross-default provisions. The loan agreements contain customary representations, covenants and events of default. Certain loan agreements require the Company to comply with affirmative and negative covenants, including the maintenance of debt service coverage and leverage ratios. The Company was in compliance with its debt covenants as of March 31, 2026.
Investment Management
During the three months ended March 31, 2026, the Company, through its Investment Management platform, repaid $269.5 million of consolidated Investment Management property mortgage loans, using proceeds from the assets sales and the recapitalization transactions (Note 2).
21
Unsecured Notes Payable and Unsecured Line of Credit
The Company was in compliance with its unsecured notes payable and unsecured line of credit debt covenant requirements as of March 31, 2026.
Scheduled Debt Principal Payments
The following table summarizes the scheduled principal repayments, without regard to available extension options (described further below), of the Company’s consolidated indebtedness, as of March 31, 2026 (in thousands):
Year Ending December 31,
Principal Repayments
235,898
153,772
788,385
98,291
326,850
1,064
1,604,260
(8,684
Total indebtedness
1,596,276
The table above does not reflect available extension options (subject to customary conditions) on consolidated debt with balances as of March 31, 2026. The Company has the option to extend the following debt maturities by up to 12-months, and for some an additional 12-months thereafter, including $134.2 million contractually due in the remainder of 2026, $96.3 million in 2027, and $684.0 million due in 2028. Execution of these extension options is subject to customary conditions, and there can be no assurance that the Company will meet such conditions or elect to exercise the options.
8. Financial Instruments and Fair Value Measurements
The Company measures certain financial assets and liabilities at fair value on a recurring and nonrecurring basis in accordance with ASC Topic: 820, Fair Value Measurement. The following disclosure summarizes the valuation methodologies and classification within the fair value hierarchy for these instruments.
Items Measured at Fair Value on a Recurring Basis
The Company’s recurring fair value measurements include derivative financial instruments. The Company utilizes interest rate swaps and caps to manage interest rate risk on variable-rate debt. These derivatives are over-the-counter instruments valued using observable market inputs, such as interest rate curves, and are classified as Level 2. Derivative assets are included in Other assets, net, and derivative liabilities are included in Accounts payable and other liabilities on the Condensed Consolidated Balance Sheets.
The following table presents the Company’s fair value hierarchy for those assets and liabilities measured at fair value on a recurring basis (in thousands):
Level 1
Level 2
Level 3
Derivative financial instruments
(688
(3,196
There were no transfers between levels of the fair value hierarchy during the three months ended March 31, 2026, and 2025.
22
Items Measured at Fair Value on a Nonrecurring Basis
Redeemable Noncontrolling Interests
During the three months ended March 31, 2026, the Company recorded an adjustment of redeemable noncontrolling interest to its estimated redemption value. Refer to Note 10 for further discussion regarding these interests.
Derivative Financial Instruments
The Company had the following interest rate swaps and caps for the periods presented (information is as of March 31, 2026, unless otherwise noted, and dollars in thousands):
Strike Rate
Fair Value
DerivativeInstrument
Aggregate Notional Amount
Effective Date
Balance SheetLocation
Interest Rate Swaps
731,000
May 2022—Aug 2025
Apr 2026—Jul 2030
1.98%
3.45%
Other Assets
12,216
9,531
177,000
Dec 2022—Jun 2025
Nov 2026—Dec 2029
3.57%
4.50%
(669
(2,140
908,000
11,547
7,391
Interest Rate Swap
50,000
Jan 2023
Dec 2029
3.23%
502
199
65,643
Jan 2023—May 2023
May 2026—Dec 2027
3.36%
3.47%
187
30,799
Jun 2025
Jun 2026
4.00%
(19
(1,056
Interest Rate Cap
32,200
Sep 2025
Sep 2026
5.00%
128,642
168
(1,048
Total Asset Derivatives
Total Liability Derivatives
All of the Company’s derivative instruments are designated as cash flow hedges and hedge the future cash outflows on variable-rate debt (Note 7). As of March 31, 2026, it is estimated that approximately $9.4 million included in Accumulated other comprehensive income related to derivatives will be reclassified as a reduction to interest expense within the next twelve months. As of March 31, 2026 and December 31, 2025, no derivatives were designated as fair value hedges or hedges of net investments in foreign operations. The Company does not use derivatives for trading or speculative purposes and currently does not have any derivatives that are not designated hedges.
During the three months ended March 31, 2026, the Company terminated five swaps with an aggregate notional value of $162.0 million in conjunction with the repayment of debt that occurred as part of the Fund V recapitalization (Note 2).
23
Other Financial Instruments
The carrying values and fair values of Company’s other financial assets and liabilities that are not measured at fair value on its Condensed Consolidated Balance Sheets are as follows as of the dates shown (dollars in thousands, inclusive of amounts attributable to noncontrolling interests where applicable):
Level
CarryingAmount
EstimatedFair Value
Notes Receivable (a)
156,075
157,325
City Point Loan (a)
34,821
35,142
35,346
Mortgage and Other Notes Payable (a, d)
626,510
622,110
897,616
894,607
Investment in non-traded equity securities (b)
2,562
3,307
Unsecured notes payable and Unsecured line of credit (c, e)
2
977,750
981,975
975,750
981,271
As of March 31, 2026 and December 31, 2025, the carrying amounts of the Company’s cash and cash equivalents, restricted cash, rents receivable, accounts payable, and certain financial instruments classified as Level 1 within other assets and other liabilities approximated their fair values. This approximation is due to the short-term nature and high liquidity of these instruments.
9. Commitments and Contingencies
The Company is involved in various matters of litigation arising out of, or incidental to, its business. While the Company is unable to predict with certainty the outcome of any particular matter, management does not expect, when such litigation is resolved, that the Company’s resulting exposure to loss contingencies, if any, will have a material adverse effect on its consolidated financial position or results of operations.
Commitments and Guaranties
From time to time, the Company (or ventures in which the Company has an ownership interest) has agreed, and may in the future agree, to guarantee portions of the principal, interest and other amounts in connection with their borrowings, provide customary environmental indemnifications and nonrecourse carve-outs (e.g., guarantees against fraud, misrepresentation and bankruptcy) in connection with their borrowings and provide guarantees to lenders, tenants and other third parties for the completion of development projects.
With respect to borrowings of our consolidated entities, the Company and certain subsidiaries of the Company have guaranteed $20.0 million of a principal payment guarantees on a property mortgage loan (Note 7). As of March 31, 2026 and December 31, 2025, no amounts related to the guarantee was recorded as a liability in the Company’s Condensed Consolidated Financial Statements.
The Operating Partnership is jointly and severally liable for the obligations under the Fund IV Term Loan, which may result in an obligation for the payment of principal, interest, and any other amounts due. As of March 31, 2026, the Company did not expect the Operating Partnership to make any payments under this arrangement. The outstanding balance of the facility was $61.3 million as of March 31, 2026 (Note 7).
Additionally, in connection with the refinancing of the La Frontera Village (Note 4) property mortgage loan of $57.0 million, which is collateralized by the investment property, Fund V guaranteed the joint venture’s obligation under the loan. Fund V acted as guarantor under the non-recourse carveout guaranty. At March 31, 2026 and December 31, 2025, $0.1 million and $0.1 million related to the guarantee was recorded as a liability in the Company’s Condensed Consolidated Balance Sheets, respectively.
24
Construction and Tenant Improvement Commitments
In conjunction with the development and expansion of various properties, the Company has entered into agreements with general contractors for the construction or development of properties aggregating approximately $53.0 million and $68.6 million, of which the Company’s share is $50.3 million and $64.8 million as of March 31, 2026 and December 31, 2025, respectively.
Additionally, the Company has committed to fund tenant improvements under executed leases totaling approximately $49.8 million and $44.1 million, as of March 31, 2026 and December 31, 2025, respectively. The Company’s share of these obligations is approximately $37.7 million and $37.1 million, respectively. The timing and amounts of these payments are uncertain and are subject to the satisfaction of certain performance conditions.
Insurance Coverage
The Company maintains insurance coverage on its properties in different types and amounts, with deductibles, that management believes are consistent with coverage typically carried by owners of similar properties.
10. Shareholders’ Equity, Noncontrolling Interests and Other Comprehensive Loss
ATM Program
The Company has an at-the-market equity issuance program (“ATM Program”) that provides the Company with an efficient vehicle for raising public equity capital to fund its needs. In March 2026, the Company physically settled 2,445,106 shares outstanding under the ATM Program’s forward, and received net proceeds of $55.9 million.
As of March 31, 2026, the Company had 12,293,731 forward shares outstanding under its ATM Program at a weighted-average net offering price of $19.70. All forward sales agreements require settlement within one-year of the various effective dates and are expected to result in net cash proceeds of approximately $239.2 million if the Company were to physically settle all outstanding forward shares.
The Company did not receive any proceeds from the sale of shares at the time it entered into each of the respective forward sale agreements. The Company determined that the ATM forward sales agreements meet the criteria for equity classification and, therefore, are exempt from derivative accounting. The Company recorded the ATM forward sales agreements at fair value at inception, which was determined to be zero, and no subsequent fair value adjustments are required under equity classification.
As of March 31, 2026, $199.1 million remains available for future share issuance under the current program.
Common Shares and Units
During the three months ended March 31, 2026, the Company withheld 6,546 shares of its restricted Common Shares (“Restricted Shares”) to pay the employees’ statutory minimum income tax withholding obligations upon vesting. For the three months ended March 31, 2026, the Company recognized $6.2 million in connection with Restricted Shares and Common OP Units (Note 13).
Share Repurchase Program
No shares were repurchased during the three months ended March 31, 2026 or 2025. As of March 31, 2026, $122.5 million remains available under the share repurchase program.
Dividends and Distributions
During each of the three months ended March 31, 2026 and 2025, the Company declared distributions of $0.20 per Common Share/OP Unit.
25
Noncontrolling Interests
The following tables summarize the change in the noncontrolling interests for the three months ended March 31, 2026 and 2025 (dollars in thousands, except per unit data):
NoncontrollingInterests inOperatingPartnership (a)
NoncontrollingInterests inPartially-OwnedAffiliates (b)
Redeemable Noncontrolling Interests (c)
92,482
302,189
Distributions declared of $0.20 per Common OP Unit and distributions on Preferred OP Units
Net income (loss) for the three months ended March 31, 2026
1,501
107,831
109,332
Conversion of 17,611 Common OP Units to Common Shares by limited partners of the Operating Partnership
Other comprehensive income - unrealized loss on valuation of swap agreements
153
1,490
1,643
Reclassification of realized interest expense on swap agreements
1
(16
(15
Employee Long-term Incentive Plan Unit Awards
Reallocation of noncontrolling interests (d)
109,838
248,659
85,730
350,287
Net income (loss) for the three months ended March 31, 2025
163
(11,759
(11,596
Conversion of 113,092 Common OP Units and 0 Series C Preferred Units to Common Shares by limited partners of the Operating Partnership
Other comprehensive income - unrealized gain on valuation of swap agreements
(456
(1,381
(1,837
(13
(753
(766
95,628
369,158
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Williamsburg Portfolio
In connection with the Williamsburg Portfolio acquisition in February 2022, the venture partner has a one-time right to put its 50.01% interest in the property to the Company for redemption at fair value after five years have passed (“Williamsburg NCI”). As it was unlikely as of the acquisition date that the venture partner would receive any consideration on redemption due to the Company’s preferential returns, the initial fair value of the Williamsburg NCI was determined to be zero.
As of March 31, 2026, the fair value of the Williamsburg NCI was zero.
City Point Loan
In August 2022, the Company provided a loan, through a separate lending subsidiary, to other Fund II investors in City Point, through a separate borrower subsidiary, to fund the investors’ pro-rata contribution necessary to complete the refinancing of the City Point debt, of which $65.9 million was funded at closing (“City Point Loan”). The City Point Loan has a five-year term which matures on August 1, 2027 and is collateralized by the investors’ equity in City Point (“City Point NCI”).
Because the City Point Loan was granted in return for a capital contribution from the investors, and is collateralized by the City Point NCI, the City Point Loan and accrued interest, net of a $0.5 million allowance for credit loss as of March 31, 2026, are presented as a reduction of the City Point NCI balance. The borrower subsidiary of the City Point Loan was determined to be a VIE for which the Company is not the primary beneficiary. The maximum loss in the VIE is limited to the amount of the City Point Loan and any accrued interest.
In connection with the City Point Loan, each investor has a one-time right to put its City Point NCI to the Company for redemption in exchange for the settlement of its proportion of the City Point Loan amount plus either (i) a fixed cash amount or (ii) a cash amount equal to the value of fixed number of Common Shares of the Company on the trading day prior to the election, which began in August 2023 (“Redemption Value”). As a result of granting these redemption rights, the City Point NCI, net of the City Point Loan, has been reclassified and presented as Redeemable noncontrolling interests on the Company’s Condensed Consolidated Balance Sheets.
During the three months ended March 31, 2026, the Company recorded an adjustment of $1.8 million to adjust the carrying value of the City Point NCI to its redemption value. As the noncontrolling interests are redeemable at an amount other than fair value, the measurement adjustment of $1.8 million was reflected as a reduction of net income attributable to Acadia shareholders within its earnings per share (Note 14).
8833 Beverly Boulevard
In July 2023, the Company entered into a limited partnership agreement to own and operate the 8833 Beverly Boulevard property. Following the formation of the partnership, the Company retained a 97.0% controlling interest. At a future point in time, either party may elect a buy-out right, where either the Company may purchase the venture partner’s interest, or the venture partner may sell its 3.0% interest in the partnership (the “8833 Beverly NCI”) to the Company for fair value. As a result of these redemption rights, the 8833 Beverly NCI was initially recorded at fair value.
As of March 31, 2026, the Company recorded an adjustment of $0.2 million to adjust the carrying value of the NCI to its redemption value. As this interest is redeemable at fair value, the adjustment to redemption value was recognized as an adjustment to Additional Paid-in Capital and had no impact on consolidated Net (loss) income, or Net income attributable to Acadia shareholders in the Company’s Condensed Consolidated Statements of Operations.
Preferred OP Units
In 1999, the Operating Partnership issued 1,580 Series A Preferred OP Units in connection with the acquisition of a property, which have a stated value of $1,000 per unit, and are entitled to a preferred quarterly distribution of the greater of (i) $22.50 (9.00% annually) per Series A Preferred OP Unit or (ii) the quarterly distribution attributable to a Series A Preferred OP Unit if such unit was converted into a Common OP Unit. Through March 31, 2026, 1,392 Series A Preferred OP Units were converted into 185,600 Common OP Units and then into Common Shares. The 188 remaining Series A Preferred OP Units are currently convertible into Common OP Units based on the stated value divided by $7.50. Either the Company or the holders can currently call for the conversion of the Series A Preferred OP Units at the lesser of $7.50 or the market price of the Common Shares as of the conversion date.
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11. Leases
As Lessor
The Company’s primary source of revenue is derived from lease agreements related to its portfolio of shopping centers and other retail properties. As of March 31, 2026, the Company was party to approximately 1,000 leases, which include both properties owned directly and those operated under long-term ground leases. These lease agreements have contractual terms that extend through January 31, 2099, and many include tenant renewal options. Certain leases also provide tenants with early termination rights.
Lease terms generally range from one month to sixty years. In addition to fixed base rent, many leases include provisions for variable lease payments, such as reimbursements for operating expenses and rent based on a percentage of the tenant’s sales volume.
The following table presents the components of rental revenue, disaggregated into fixed and variable lease income (in thousands):
Fixed lease revenue
78,693
84,203
Variable lease revenue
19,875
18,437
Total rental revenue
The following table summarizes the Company’s scheduled future minimum rental revenues under non-cancelable tenant leases with remaining terms greater than one year, as of March 31, 2026. These amounts assume no new or renegotiated leases or exercise of renewal options not deemed reasonably certain (in thousands):
Minimum RentalRevenues
194,788
260,772
239,152
211,741
186,935
710,760
1,804,148
During the three months ended March 31, 2026 and 2025, no single tenant or property collectively comprised more than 10% of the Company’s total revenues.
During the three months ended March 31, 2025, the Company recognized $8.4 million as rental and termination income related to a lease termination at City Center, a REIT Portfolio property, which is included in Other revenue on the Company’s condensed consolidated statements of operations.
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As Lessee
The Company leases certain properties that are owned by third parties, including ground leases for retail properties and leases for office space and equipment. These leases grant the Company the right to operate the underlying assets during the lease term. Lease terms generally range from five years to 98 years and may include renewal options that are evaluated for likelihood of exercise. The Company classifies these arrangements as either operating or finance leases in accordance with ASC Topic 842, Leases.
The following table summarizes the Company’s scheduled future minimum rental payments under non-cancelable leases as of March 31, 2026 (in thousands):
Minimum Rental Payments
Operating Leases (a)
Finance Leases (a)
4,232
998
4,849
1,350
4,646
1,396
4,121
1,415
4,077
1,495
8,988
153,825
30,913
160,479
Interest
(5,995
(128,192
The following table summarizes additional lease cost information for the Company’s lessee arrangements (dollars in thousands):
Lease Cost
Finance lease cost:
Amortization of right-of-use assets
374
Interest on lease liabilities
522
512
Subtotal
896
886
Operating lease cost
1,317
1,306
Variable lease cost
89
Total lease cost
2,250
2,281
Cash Paid
Payments of operating lease obligations - operating activities
1,373
Payments of interest on finance lease obligations - operating activities
Payments of finance lease obligations - financing activities
348
As of March 31,
Weighted-average remaining lease term - finance leases (years)
56.2
56.6
Weighted-average remaining lease term - operating leases (years)
8.0
8.4
Weighted-average discount rate - finance leases
6.5
Weighted-average discount rate - operating leases
5.2
5.1
During the three months ended March 31, 2025, the Company entered into a new corporate office lease and recorded a right-of-use assets - operating lease and corresponding lease liability - operating lease of $2.1 million.
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12. Segment Reporting
The Company has identified three reportable segments: REIT Portfolio, Investment Management and Structured Financing. The Company’s Chief Operating Decision Maker (“CODM”), its Chief Executive Officer, evaluates the performance of these segments and allocates resources based on financial information presented at the segment level. The CODM primarily uses net income as the key measure of segment profitability, as it reflects a comprehensive view of the segments’ financial performance, including all revenues and expenses.
The Company’s REIT Portfolio segment consists primarily of high-quality core retail properties located primarily in high-barrier-to-entry, densely-populated metropolitan areas with a long-term investment horizon. The Company’s Investment Management segment holds primarily retail real estate in which the Company co-invests with high-quality institutional investors. The Company’s Structured Financing segment consists of earnings and expenses related to notes and mortgages receivable (Note 3).
Fees earned by the Company as the general partner or managing member through consolidated Investment Management entities are eliminated in the Company’s Condensed Consolidated Financial Statements and are not presented in the Company’s segments.
The following tables present selected financial information for each reportable segment (in thousands):
As of or for the Three Months Ended March 31, 2026
REITPortfolio
StructuredFinancing
Unallocated
Rental revenue
62,614
35,954
Other revenue
599
3,825
Depreciation and amortization expenses
(24,371
(15,784
(40,155
Property operating expenses
(10,299
(7,950
(18,249
(9,354
(3,568
(12,922
General and administrative expenses
(15,303
19,189
154,625
Interest income
Equity in earnings (losses) of unconsolidated affiliates
(1,558
(12,303
(9,749
6,320
143,318
(15,315
Net income attributable to noncontrolling interests
(1,236
(108,096
5,084
35,920
Real estate at cost (a)
3,432,033
1,313,582
4,745,615
Total assets (a)
3,163,174
1,215,051
Cash paid for acquisition of real estate
77,833
Cash paid for development and property improvement costs
27,280
4,936
32,216
30
As of or for the Three Months Ended March 31, 2025
63,774
38,866
682
1,072
(23,684
(15,756
(39,440
(9,553
(8,727
(18,280
(8,958
(4,345
(13,303
(11,597
(6,450
22,261
4,660
313
(2,026
(9,379
(13,868
Realized and unrealized holding losses on investments and other
1,785
(164
5,358
(11,234
5,932
(11,713
Net loss attributable to noncontrolling interests
209
11,387
5,567
1,822
3,113,954
1,877,653
4,991,607
2,978,291
1,631,684
125,701
4,735,676
124,427
67,795
192,222
5,912
13,698
19,610
13. Share Incentive and Other Compensation
The Amended and Restated 2020 Share Incentive Plan (the “Amended and Restated 2020 Plan”), as approved by the Board and the Company’s shareholders, authorizes the issuance of up to 3,883,564 Common Shares. The Amended and Restated 2020 Plan allows for the issuance of options, Restricted Shares, LTIP Units, and other securities (collectively, the “Awards”) to, among others, the Company’s officers, trustees, and employees. As of March 31, 2026 a total of 1,321,106 shares remained available for issuance under the Amended and Restated 2020 Plan.
As of March 31, 2026, there was $29.5 million of total unrecognized compensation cost related to unvested share-based compensation arrangements granted under the Amended and Restated 2020 Plan. That cost is expected to be recognized over a weighted-average period of 1.6 years.
The total fair value of Restricted Shares that vested during the three months ended March 31, 2026 and the year ended December 31, 2025, was $0.4 million and $0.7 million, respectively. The total fair value of LTIP Units that vested (LTIP units vest primarily during the first quarter) during the three months ended March 31, 2026 and the year ended December 31, 2025, was $15.0 million and $9.9 million, respectively.
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During the three months ended March 31, 2026, the Company issued 593,577 time-based LTIP Units and 25,350 time-based restricted share units (“Restricted Share Units”), to employees of the Company pursuant to the Amended and Restated 2020 Plan.
Additionally, the Company awarded 360,666 performance-based LTIP Units and 368 performance-based Restricted Share Units. These awards were measured at their fair value on the grant date.
For valuation of the 2026 and 2025 performance-based award grants, a Monte Carlo simulation was used to estimate the fair values of the grants. The assumptions include volatility (24.0% and 29.0%) and risk-free interest rates of (3.6% and 4.4%) for 2026 and 2025, respectively. The total fair value of the 2026 and 2025 grants will be expensed on a graded vesting basis over the vesting period of the award.
The weighted-average grant date fair value for Restricted Shares and LTIP Units granted for the three months ended March 31, 2026 and the year ended December 31, 2025 were $17.33 and $21.29, respectively. The total fair value of the above Restricted Share Units and LTIP Units as of the grant date was $15.2 million for the three months ended March 31, 2026 and $14.7 million for the year ended December 31, 2025. Total long-term incentive compensation expense, including the expense related to the Amended and Restated 2020 Plan, was $6.2 million and $2.4 million for the three months ended March 31, 2026, and 2025, respectively, and is recorded in General and administrative in the Condensed Consolidated Statements of Operations.
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14. Earnings Per Common Share
Basic earnings per Common Share is computed by dividing net income attributable to Common Shareholders by the weighted-average Common Shares outstanding during the period (Note 10).
During the periods presented, the Company had unvested LTIP Units that entitle holders to non-forfeitable dividend equivalent rights. As such, these unvested LTIP Units are considered participating securities and are included in the computation of basic earnings per Common Share using the two-class method.
Diluted earnings per Common Share reflects the potential dilution from the assumed conversion or exercise of securities including the effects of Restricted Share Units issued under the Company’s Amended and Restated 2020 Plan (Note 13), and the shares issuable upon settlement of any outstanding forward sale agreements (Note 10). The shares related to forward sale agreements are included in the diluted earnings per share calculation using the treasury stock method for the period they are outstanding prior to settlement. Under this method, the number of incremental shares included in the diluted share count is equal to the excess, if any, of: (i) the number of Common Shares that would be issued upon full physical settlement of the forward sale agreements, over (ii) the number of Common Shares that could be repurchased using the proceeds receivable upon settlement, based on the average market price during the period and the adjusted forward sales price immediately prior to settlement. The impact of these shares is excluded from the diluted earnings per share calculation when the effect would be anti-dilutive.
Each Series A Preferred OP Unit is convertible into a fixed number of Common Shares. For periods in which the inclusion of Series A Preferred OP Units and their related income would reduce earnings per share, these units are treated as dilutive and are included in the computation of diluted earnings per Common Share. For the three months ended March 31, 2026, the Series A Preferred OP Units were dilutive and accordingly are included in the denominator for diluted earnings per share. For the three months ended March 31, 2025, the Series A Preferred OP Units were anti-dilutive and therefore excluded from the computation of diluted earnings per Common Share.
The effect of the conversion of Common OP Units is excluded from the computation of both basic and diluted earnings per share. These units are exchangeable for Common Shares on a one-for-one basis, and the income attributable to such units is allocated on this same basis. This income is reflected as noncontrolling interests in the Company’s Condensed Consolidated Financial Statements. As a result, the assumed conversion of Common OP Units would have no net impact on the determination of diluted earnings per share and is therefore excluded.
33
(dollars in thousands, except per share data)
Numerator:
Less: adjustment of redeemable non-controlling interest to estimated redemption value (Note 10)
Less: net income attributable to participating securities
(333
(339
Income from continuing operations net of income attributable to participating securities for basic earnings per share
28,351
1,269
Denominator:
Weighted average shares for basic earnings per share
131,247,295
121,328,731
Effect of dilutive securities:
Series A Preferred OP Units
25,067
Employee unvested restricted shares
7,019
Assumed settlement of forward sales agreements (Note 10)
52,912
Denominator for diluted earnings per share
131,332,293
Basic earnings per Common Share from continuing operations attributable to Acadia shareholders
Diluted earnings per Common Share from continuing operations attributable to Acadia shareholders
Anti-Dilutive Shares Excluded from Denominator:
188
Series A Preferred OP Units - Common share equivalent
Series C Preferred OP Units
66,519
Series C Preferred OP Units - Common share equivalent
230,967
Restricted shares
88,266
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15. Variable Interest Entities
The Company consolidates certain VIEs in which it has determined it is the primary beneficiary. As of March 31, 2026, the Company had identified eight consolidated VIEs, including the Operating Partnership and the Funds.
Excluding the Operating Partnership and the Funds, the Company’s consolidated VIEs include 20 in-service REIT Portfolio operating properties: the Williamsburg Portfolio, 239 Greenwich Avenue, 8833 Beverly Boulevard, and the Renaissance Portfolio.
The Operating Partnership is considered a VIE because the limited partners lack substantive kick-out or participating rights. The Company is deemed the primary beneficiary of each consolidated VIE because it: (i) has the power to direct the activities that most significantly impact the VIE’s economic performance, and (ii) has the obligation to absorb the losses or right to receive benefits that could potentially be significant to the VIE. The interest of third parties in these consolidated VIEs are presented as noncontrolling interests or redeemable noncontrolling interests in the accompanying Condensed Consolidated Financial Statements and in Note 10.
The operations of these VIEs are primarily funded through fees earned from investment activities or cash flows generated from the underlying properties. The Company has not provided financial support to any of these VIEs beyond its existing contractual obligations, which primarily include funding capital commitments, capital expenditures necessary to maintain operations, and covering any operating cash shortfalls.
Since the Company conducts its business through the Operating Partnership and substantially all of its assets and liabilities are held by the Operating Partnership, the Condensed Consolidated Balance Sheets as of March 31, 2026 and December 31, 2025, primarily reflect the assets and liabilities of the Operating Partnership, including those of its consolidated VIEs. The following table presents the assets and liabilities of the consolidated VIEs included in the Condensed Consolidated Balance sheets (in thousands):
VIE ASSETS
1,415,025
1,768,555
50,669
53,255
58,357
78,266
1,420
1,539
26,354
30,429
6,263
6,517
23,656
29,324
18,908
Total VIE assets (a)
1,600,652
1,967,885
VIE LIABILITIES
525,149
793,840
99,222
125,586
Lease liabilities - operating leases, net
1,480
1,604
Total VIE liabilities (a)
687,262
982,280
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Unconsolidated VIEs
The Company holds variable interests in certain entities that are considered VIEs but are not consolidated because the Company is not the primary beneficiary. Although the Company may be responsible for managing the day-to-day operations of these entities, it does not have unilateral power over the activities that, when taken together, most significantly impact the respective VIE’s economic performance.
As of March 31, 2026, the Company had interests in two unconsolidated VIEs: 1238 Wisconsin Avenue and the Georgetown Portfolio. The Company’s involvement in these entities consists of direct and indirect equity interests and contractual fee arrangements. These investments are accounted for under the equity method of accounting (Note 4). The Company’s maximum exposure to loss in these unconsolidated VIEs is limited to: (i) the carrying amount of its equity investment, and (ii) any debt guarantees provided (Note 9). The Company’s investment in the assets of these unconsolidated VIEs was $42.5 million and $42.6 million, respectively. The Company’s share of the liabilities of these unconsolidated VIEs was $39.0 million and $38.9 million as of March 31, 2026 and December 31, 2025, respectively.
The Company also holds a preferred equity investment in a VIE that is structured with characteristics that are substantially similar to a debt instrument and is accounted for as a note receivable. The Company is not the primary beneficiary as it does not have the power to direct the activities that most significantly impact the VIE’s economic performance, and therefore does not consolidate the VIE. As of March 31, 2026, the carrying value of the investment was $82.9 million, which represents the Company’s maximum exposure to loss related to this VIE.
16. Subsequent Events
In April 2026, the Company closed a $108.9 million acquisition of retail condominium units at 4-6 and 28 Newbury Street in Boston, MA.
On April 17, 2026, the Company entered into a Fourth Amended and Restated Credit Agreement (the “Fourth Amended and Restated Credit Facility”), which provides for (i) a $525.0 million revolving credit facility (unchanged in size from the existing credit facility), the maturity of which was extended from April 15, 2028 to April 17, 2030, subject to two six-month extension options, and which includes a $60.0 million letter of credit sublimit; (ii) a term loan of $512.5 million maturing April 17, 2031, reflecting an increase from, and extension of the maturity of, the existing $400.0 million term loan that was scheduled to mature on April 15, 2028; (iii) a $250.0 million term loan maturing May 29, 2030 (unchanged from the existing credit facility); and (iv) a new $137.5 million term loan maturing April 17, 2031. The Fourth Amended and Restated Credit Facility also includes an accordion feature permitting the Operating Partnership, at its option and subject to customary conditions, to increase total capacity to up to $2.0 billion.
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ITEM 2.MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.
OVERVIEW
Acadia Realty Trust (the “Trust”, collectively with its consolidated subsidiaries, the “Company”, “Acadia”, “we”, “us” or “our”), a Maryland real estate investment trust (“REIT”), is a fully-integrated equity REIT focused on the ownership, acquisition, development, and management of retail properties located primarily in high-barrier-to-entry, supply-constrained, densely populated metropolitan areas in the United States.
The Company operates through two primary platforms:
REIT Portfolio: The REIT Portfolio consists of open-air and street retail properties located in premier urban retail corridors and select suburban markets characterized by strong demographics and limited new supply. These assets generate recurring rental revenues and benefit from contractual rent escalations and leasing activity.
Investment Management (“IM”): Through its investment management platform, the Company manages opportunistic and value-add retail real estate investments alongside institutional partners through its strategic opportunity funds (Fund II, Fund III, Fund IV, and Fund V) and select co-investment ventures. From time to time, assets previously held in the Company’s opportunity funds may be recapitalized or transitioned into new joint ventures with third-party partners as part of the portfolio lifecycle, while the Company retains an ownership interest and continues its role as operator and manager. The Company earns management fees and, in certain cases, incentive-based performance fees.
All of the Company’s assets are held by, and all of its operations are conducted through, Acadia Realty Limited Partnership (the “Operating Partnership”) and its subsidiaries. As of March 31, 2026, the Trust controlled approximately 96% of the Operating Partnership as its sole general partner.
As of March 31, 2026, the Company owned or had an ownership interest in 231 properties, including development or redevelopment projects (Note 1). The Company’s operating income is primarily derived from rental revenues from operating properties, including tenant expense recoveries, net of property operating and corporate overhead expenses.
In addition, the Company maintains a Structured Financing (“SF”) program through which it selectively invests in first mortgage loans and other real estate-backed notes.
The following table summarizes the Company’s wholly owned and partially owned retail properties and related physical occupancy as of March 31, 2026:
Number of Properties
Operating Properties
Development orRedevelopment (1)
Operating
GLA
Occupancy
REIT Portfolio:
Chicago Metro
38
595,660
88.8
New York Metro
45
404,473
95.8
Los Angeles Metro
23,757
100.0
San Francisco Metro
Dallas Metro
59,522
85.3
Washington D.C. Metro
407,644
92.0
Boston Metro
1,051
South Florida Metro
10,118
Suburban
3,737,281
95.2
Total REIT Portfolio
151
5,239,506
94.2
Acadia Share of Total REIT Portfolio
4,978,793
94.1
529,372
80.7
288,521
81.5
5,185,785
90.9
3,303,362
95.0
Total Investment Management
9,307,040
91.5
Acadia Share of Total Investment Management
2,092,222
90.0
Total REIT and Investment Management
201
14,546,546
92.5
Acadia Share of Total REIT and Investment Management
7,071,015
92.9
SIGNIFICANT ACTIVITIES DURING 2026 AND SUBSEQUENT EVENTS
See Note 12 in the Notes to Condensed Consolidated Financial Statements for an overview of our three reportable segments: REIT Portfolio, Investment Management and Structured Financing. For purposes of the tables included below, these segments are abbreviated as “REIT”, “IM” and “SF”, respectively.
During the first quarter of 2026, the Company completed a number of transactions across its REIT Portfolio and Investment Management segments reflecting continued portfolio growth and deepening of relationships with key institutional partners.
Within the REIT Portfolio, the Company continued to selectively deploy capital into retail assets located in established, high-barrier markets. During the quarter, the Company completed consolidated acquisitions totaling approximately $78.7 million, including:
These acquisitions were integrated into the Company’s existing REIT Portfolio and are consolidated.
In April 2026, the Company closed a $108.9 million acquisition of retail condominium units at 4-6 and 28 Newbury Street in Boston (Note 16).
During the first quarter of 2026, the Company completed several transactions through its Investment Management segment, consisting of equity investments in unconsolidated joint ventures and recapitalizations of existing assets (Note 2, Note 4).
In January 2026, the Company acquired a 20% equity interest in a joint venture that purchased the Shops at Skyview, a retail shopping center located in Queens, New York, for a total purchase price of $424.1 million. At closing, the joint venture secured a mortgage loan with a total commitment of $290.0 million, of which $277.0 million was funded at closing. Additionally, the Company provided a preferred equity investment of approximately $41.7 million. The Company’s equity contribution to the joint venture totaled approximately $22.5 million.
In February 2026, the Company completed a $435.8 million recapitalization of a seven-property, open-air retail portfolio. Six of the properties were previously held in Fund V, while one property (Avenue at West Cobb) was previously held in the Company’s wholly-owned portfolio. In connection with the transaction, the properties were contributed to two newly formed joint ventures and the Company retained a 20% non-controlling equity interest. Additionally, the Company provided seller financing to the Atlantic Portfolio joint venture in the form of a $27.5 million preferred equity investment. The transaction resulted in the deconsolidation of the properties and the recognition of a gain on disposition and deconsolidation of $112.3 million, of which the Company’s proportionate share was $22.1 million.
In March 2026, the Company completed a recapitalization of Pinewood Square, an open-air retail center in Lake Worth, Florida, with a gross transaction value of $68.4 million. The property was contributed to a newly formed joint venture, with the Company retaining a 20% non-controlling equity interest. The transaction resulted in the deconsolidation of the property and the recognition of a gain on deconsolidation of $4.1 million.
During the first quarter of 2026, the Company completed consolidated property dispositions within its Investment Management platform totaling approximately $104.6 million, including the sale of Landstown Commons for $102.0 million and the sale of 1964 Union Street for $2.6 million (Note 2).
These transactions reflect the Company’s continued execution of its strategic objectives, including portfolio growth, balance sheet optimization, and the expansion of its Investment Management platform.
Financing and Capital Activity
In connection with the Investment Management disposition and recapitalization activity, the Company retired approximately $269.5 million of property-level mortgage loans associated with assets sold or contributed to joint ventures. The Company also terminated related interest rate hedges in conjunction with these repayments.
On April 17, 2026, the Company entered into the Fourth Amended and Restated Credit Facility, which extended the maturity of our $525.0 million revolving credit facility (the size of which remained unchanged) from April 15, 2028 to April 17, 2030 (subject to two six-month extension options), increased our existing $400.0 million term loan to $512.5 million and extended its maturity from April 15, 2028 to April 17, 2031, and provided for a new $137.5 million term loan maturing April 17, 2031. The existing $250.0 million term loan maturing May 29, 2030 remained unchanged. The Fourth Amended and Restated Credit Facility also includes an accordion feature permitting the Operating Partnership, at its option and subject to customary conditions, to increase total capacity to up to $2.0 billion. We believe the refinancing extended our weighted average debt maturity and enhanced our liquidity position.
Common Share Activity
In March 2026, we settled 2,445,106 outstanding forward shares under the Company’s $500.0 million “at-the-market” program (the “ATM Program”) and received proceeds of $55.9 million, which were used to reduce outstanding borrowings and fund investment activity.
Economic and Other Considerations
Macroeconomic conditions, including inflationary pressures, elevated energy prices, higher interest rates, and broader geopolitical developments, continue to present risks for our business and the businesses of our tenants. While inflation has moderated from prior periods, certain operating and capital costs remain elevated. However, the majority of our leases include contractual rent escalations and expense recovery provisions, which help mitigate the impact of inflation on operating results. We also seek to manage operating expenses through cost-conscious property management practices and the use of multi-year service contracts where appropriate.
We seek to drive value across our portfolio through leasing momentum, active development and redevelopment projects, and strategic deployment of capital into high-quality assets. The Company manages its exposure to interest rate fluctuations primarily through the use of fixed-rate debt and interest rate derivative instruments, including interest rate swaps and caps that are designated as hedging instruments (Note 8). While higher interest rates have increased borrowing costs, we believe our capital structure and hedging strategy provide meaningful protection against interest rate volatility.
In addition, evolving trade policies, tariffs, sanctions and related geopolitical developments could impact certain tenants’ operations or consumer demand in our markets. The ultimate impact of these factors remains uncertain, and the Company continues to monitor these developments closely.
39
RESULTS OF OPERATIONS
Comparison of Results for the Three Months Ended March 31, 2026 to the Three Months Ended March 31, 2025
The results of operations by reportable segment for the three months ended March 31, 2026 compared to the three months ended March 31, 2025 are summarized in the table below (in millions, totals may not add due to rounding):
Three Months Ended
March 31, 2025
Change
REIT
SF
62.6
36.0
98.6
63.8
38.9
102.6
(1.2
(2.9
(4.0
0.6
3.8
4.4
0.7
1.1
1.8
(0.1
2.7
2.6
(24.4
(15.8
(40.2
(23.7
(39.4
(10.3
(8.0
(18.2
(9.6
(8.7
(18.3
(0.7
(9.4
(3.6
(12.9
(9.0
(4.3
(13.3
0.4
(0.4
(15.3
(11.6
3.7
(6.5
142.1
Operating income (loss)
19.2
154.6
158.5
22.3
4.7
15.3
(3.1
149.9
143.2
4.8
6.1
(1.3
0.1
(1.6
(1.5
0.3
(2.0
(1.7
(0.2
0.2
(12.3
(9.7
(22.1
(13.9
(23.2
2.9
(4.2
(1.1
(0.6
1.6
(2.4
(2.2
6.3
143.3
139.1
5.4
(11.2
5.9
(11.7
0.9
132.1
127.4
Net loss (income) attributable to redeemable noncontrolling interests
1.7
(1.0
(108.1
(109.3
11.4
11.6
(1.4
(119.5
(120.9
Net income (loss) attributable to Acadia shareholders
35.9
30.5
5.6
(0.5
34.1
28.9
Segment net income attributable to Acadia shareholders for our REIT Portfolio decreased $0.5 million for the three months ended March 31, 2026 compared to the prior year period as a result of the changes further described below.
Rental revenues for our REIT Portfolio decreased $1.2 million for the three months ended March 31, 2026 compared to the prior year period, primarily reflecting $8.4 million of non-recurring rental and termination income recognized in 2025 from Whole Foods at City Center in San Francisco, CA, partially offset by (i) $4.8 million from REIT acquisitions completed in 2025 and 2026 and (ii) $1.7 million related to the acquisition of an additional interest in, and consolidation of, the Renaissance Portfolio in 2025.
Interest expense for our REIT Portfolio increased $2.9 million for the three months ended March 31, 2026 compared to the prior year period primarily due to higher average outstanding borrowings in 2026 to partially fund investment activity.
Loss on change in control of $9.6 million recognized in the prior year period resulted from the remeasurement to fair value of the Company’s previously held equity method investment upon acquiring an additional 48% controlling interest in the Renaissance Portfolio in 2025 (Note 2).
Realized and unrealized holding gains on investments and other of $1.8 million in the prior-year period resulted from a change in the mark-to-market adjustment on the investment in marketable securities, which was liquidated in 2025.
Net income attributable to noncontrolling interests for our REIT Portfolio increased $1.4 million for the three months ended March 31, 2026 compared to the prior year period based on the noncontrolling interests’ share of the variances discussed above.
(all amounts below are consolidated amounts and are not representative of our proportionate share)
Segment net income attributable to Acadia shareholders for Investment Management increased $34.1 million for the three months ended March 31, 2026 compared to the prior year period as a result of the changes described below.
40
Rental revenues for Investment Management decreased $2.9 million for the three months ended March 31, 2026 compared to the prior year period due to Fund V property sales completed in 2026.
Other revenues for Investment Management increased $2.7 million for the three months ended March 31, 2026 compared to the prior year period primarily reflecting higher fee income from new Investment Management acquisitions in 2025 and 2026.
An impairment charge of $6.5 million was recognized in 2025 related to a shortened expected hold period at one Fund III property (Note 8).
Gain on disposition of properties of $142.1 million recognized in 2026 was related to the Fund V recapitalization and the dispositions of Landstown Commons and Avenue at West Cobb.
Interest expense for Investment Management decreased $4.2 million for the three months ended March 31, 2026 compared to the prior year period primarily due to the Fund V recapitalization and disposition of Landstown Commons in 2026.
Net income attributable to noncontrolling interests for Investment Management increased $119.5 million for the three months ended March 31, 2026 compared to the prior year period based on the noncontrolling interests’ share of the variances discussed above. Net income attributable to noncontrolling interests in Investment Management includes asset management fees earned by the Company of $2.0 million for the three months ended March 31, 2026 compared to $2.3 million for the prior year period.
The Company does not allocate general and administrative expenses and income taxes to its reportable segments. These unallocated amounts are depicted in the table above under the headings labeled “Total.” General and administrative expenses increased $3.7 million for the three months ended March 31, 2026 compared to the prior year period primarily due to higher compensation expenses, legal expenses, and other transaction costs in 2026. The increase in expense for the three months ended March 31, 2026 includes accelerated compensation cost related to a modification of vesting provisions in connection with a change in expected service period.
Structured Financing
Interest income for our Structured Financing portfolio decreased $1.3 million for the three months ended March 31, 2026 compared to the prior year period primarily due to the partial redemption of the redeemable noncontrolling interest of the City Point Loan in 2025 (Note 10).
NON-GAAP FINANCIAL MEASURES
Net Property Operating Income
The following discussion of net property operating income (“NOI”) and rent spreads on new and renewal leases includes the activity from both our consolidated and our pro-rata share of unconsolidated properties within our REIT Portfolio. We do not consider NOI and rent spreads to be meaningful measures for our Investment Management investments, as Investment Management invests primarily in properties that typically require significant leasing and development, and is primarily comprised of finite-life investment vehicles.
We use NOI, a non-GAAP financial measure, to evaluate the performance of our properties. We define NOI as income from our REIT portfolio real estate, less our property operating expenses, excluding lease termination income received from tenants and other amounts such as above- or below-market rent, and straight-line rent. We consider NOI and rent spreads on new and renewal leases for our REIT Portfolio to be appropriate supplemental disclosures of portfolio operating performance due to their widespread acceptance and use within the REIT investor and analyst communities. NOI and rent spreads on new and renewal leases are presented to assist investors in analyzing our property performance; however, our method of calculating these may be different from methods used by other REITs and, accordingly, may not be comparable to such other REITs.
41
A reconciliation of consolidated operating income to net operating income - REIT Portfolio follows (in thousands):
Consolidated operating income
Add back:
Less:
Above/below-market rent, straight-line rent and other accounts (a)
(6,985
(2,704
Termination income (b)
(8,366
Consolidated NOI
64,836
61,741
Redeemable noncontrolling interest in consolidated NOI
(1,840
(1,888
Noncontrolling interest in consolidated NOI
(14,997
(17,655
Less: Operating Partnership's interest in Investment Management NOI included above
(7,542
(6,747
Add: Operating Partnership's share of unconsolidated joint ventures NOI (c)
1,358
1,279
REIT Portfolio NOI
41,815
36,730
We also use same-property NOI (“Same-Property NOI”), a non-GAAP financial measure, to evaluate the performance of our properties. Same-Property NOI includes REIT Portfolio properties that we owned for both the current and prior periods presented, but excludes those properties which we acquired, sold or expected to sell, redeveloped and developed during these periods. The following table summarizes Same-Property NOI for our REIT Portfolio (dollars in thousands):
Less properties excluded from Same-Property NOI
(2,973
(52
Same-Property NOI
38,842
36,678
Percent change from prior year period
Components of Same-Property NOI:
Same-Property Revenues
54,709
51,442
Same-Property Operating Expenses
(15,867
(14,764
42
Rent Spreads on REIT Portfolio New and Renewal Leases
The following table summarizes rent spreads on both a cash basis and straight-line basis for new and renewal leases based on leases executed within our REIT Portfolio for the periods presented. Cash basis represents a comparison of rent most recently paid on the previous lease as compared to the initial rent paid on the new lease. Straight-line basis represents a comparison of rents as adjusted for contractual escalations, abated rent, and lease incentives for the same comparable leases. The table below includes embedded option renewals for which the renewed rent was equal to or approximated existing base rent.
REIT Portfolio New and Renewal Leases
Cash Basis
Straight-Line Basis
Number of new and renewal leases executed
GLA commencing
182,374
New base rent
$45.86
$48.52
Expiring base rent
$41.15
$39.48
Percent growth in base rent
11.4%
22.9%
Average cost per square foot (a)
$22.53
Weighted average lease term (years)
6.0
(a) The average cost per square foot includes tenant improvement costs, leasing commissions, and tenant allowances.
Funds from Operations
We consider funds from operations (“FFO”) as defined by the National Association of Real Estate Investment Trusts (“NAREIT”) to be an appropriate supplemental disclosure of operating performance for an equity REIT due to its widespread acceptance and use within the REIT and analyst communities. FFO is presented to assist investors in analyzing our performance. It is helpful as it excludes various items included in net income that are not indicative of the operating performance, such as gains (losses) from sales of depreciated property, depreciation and amortization, and impairment of real estate. Our method of calculating FFO may be different from methods used by other REITs and, accordingly, may not be comparable to such other REITs. FFO does not represent cash generated from operations as defined by accounting principles generally accepted in the United States (“GAAP”) and is not indicative of cash available to fund all cash needs, including distributions. It should not be considered as an alternative to net income for the purpose of evaluating our performance or to cash flows as a measure of liquidity. Consistent with the NAREIT definition, we define FFO as net income (computed in accordance with GAAP), excluding gains (losses) from sales of depreciated property and impairment of depreciable real estate assets related to the Company’s main business and land held for the development of property for its operating portfolio, plus depreciation and amortization, after adjustments for unconsolidated partnerships and joint ventures. Also consistent with NAREIT’s definition of FFO, the Company has elected to include gains and losses incidental to its main business in FFO. A reconciliation of net income attributable to Acadia shareholders to FFO follows (dollars in thousands, except per share amounts):
Depreciation of real estate and amortization of leasing costs (net of noncontrolling interests' share)
35,851
31,607
Impairment charges (net of noncontrolling interests' share)
1,583
Net gain on disposition of properties (net of noncontrolling interests' share)
(30,954
Income attributable to Common OP Unit holders
1,496
96
Distributions - Preferred OP Units
67
Funds from operations attributable to Common Shareholders and Common OP Unit holders - Basic and Diluted
36,875
44,583
43
LIQUIDITY AND CAPITAL RESOURCES
Uses of Liquidity and Cash Requirements
Generally, our principal uses of liquidity are (i) distributions to our shareholders and OP Unit holders, (ii) investments which include the funding of capital committed to our Investment Management platform and property acquisitions and development/re-tenanting activities within our REIT Portfolio, (iii) distributions to our Investment Management investors, (iv) debt service and loan repayments and (v) share repurchases.
Distributions
In order to qualify as a REIT for federal income tax purposes, we must distribute at least 90% of our taxable income to our shareholders. During the three months ended March 31, 2026, we paid dividends and distributions on our Common Shares and preferred units of limited partnership interest (“Preferred OP Units”) totaling $28.4 million.
Investments
As previously discussed, during the three months ended March 31, 2026, we deployed approximately $181.3 million in cash outlays related to acquisitions within our REIT Portfolio and equity investments and recapitalizations completed through our Investment Management platform.
Structured Financing Investments
During the three months ended March 31, 2026, we provided advances under preferred equity investments aggregating to $69.2 million (Note 4).
Capital Commitments
As of March 31, 2026, our share of the remaining capital commitments to the Funds aggregated $11.5 million as follows:
We do not have any additional capital commitments to the Funds other than the remaining amounts described above.
Additionally, the Company has committed to fund tenant improvements under executed leases totaling approximately $49.8 million and $44.1 million, as of March 31, 2026 and December 31, 2025, respectively. The Company’s share of these obligations is approximately $37.7 million and $37.1 million, respectively (Note 9).
Development Activities
During the three months ended March 31, 2026, capitalized costs associated with development activities totaled $11.0 million (Note 2). As of March 31, 2026, we had a total of 20 consolidated projects under development or redevelopment, for which the estimated total cost to complete these projects through 2028 was $91.3 million to $122.2 million, respectively. These estimates exclude assets for which redevelopment or development plans are still being evaluated and for which costs are not yet determinable.
Substantially all remaining development and redevelopment costs are discretionary, other than the construction and tenant improvement commitments disclosed in Note 9, and could be affected by various risks and uncertainties, including, but not limited to, the effects of the current inflationary environment, elevated interest rates, global macroeconomic conditions, the imposition of tariffs and other risks detailed in Part I, Item 1A. Risk Factors of our Annual Report on Form 10-K for the year ended December 31, 2025.
Debt
A summary of our consolidated debt, which includes the full amount of Investment Management related obligations and excludes our pro rata share of debt at our unconsolidated subsidiaries, is as follows (in thousands):
Total Debt - Fixed and Effectively Fixed Rate
1,305,470
1,502,753
Total Debt - Variable Rate
298,790
370,614
1,873,367
(11,387
1,862,906
As of March 31, 2026, our consolidated indebtedness aggregated $1,604.3 million, excluding $0.7 million of unamortized premium and $8.7 million of net unamortized loan costs, and was secured by 37 properties and related tenant leases. Maturities on our outstanding indebtedness ranged from May 1, 2026 to April 15, 2035, excluding available extension options.
Taking into consideration $1,054.4 million of notional principal under variable-to-fixed interest rate swap agreements currently in effect, $1,305.5 million, or 81.4%, of the Company’s consolidated debt was fixed at a weighted-average interest rate of 4.67%, and $298.8 million, or 18.6%, was floating at a weighted-average interest rate of 5.73% as of March 31, 2026. Variable-rate debt included $32.2 million subject to interest rate cap agreements.
Without regard to available extension options, as of March 31, 2026, we had (i) $233.4 million of consolidated debt maturing in 2026 at a weighted-average interest rate of 6.11%, (ii) $2.5 million of scheduled principal amortization due during the remainder of 2026, and (iii) $46.7 million representing the Company’s pro-rata share of scheduled principal payments and maturities on unconsolidated debt during 2026. In addition, $281.4 million of consolidated debt and $48.5 million representing the Company’s pro-rata share of unconsolidated debt will mature by March 31, 2027.
The Company has extension options on consolidated debt aggregating $134.2 million maturing in 2026 and $96.3 million maturing in 2027; however, there can be no assurance that the Company will be able to successfully execute any or all of its available extension options. With respect to the debt maturing in the remainder of 2026, we are actively pursuing refinancing the remaining obligations, though there can be no assurance that we can refinance such obligations on favorable terms or at all. For the remaining indebtedness, we may not have sufficient cash on hand to repay such obligations, and, therefore, we expect to refinance at least a portion of this indebtedness or select other alternatives based on market conditions as these loans mature; however, there can be no assurance that we will be able to obtain financing on acceptable terms or at all.
Our ability to obtain financing could be affected by various risks and uncertainties, including, but not limited to, the current inflationary environment, elevated interest rates, tariff policies, and other risks, including, but not limited to those detailed in Part I, Item 1A. Risk Factors of our Annual Report on Form 10-K for the year ended December 31, 2025.
We maintain a share repurchase program under which $122.5 million remains available as of March 31, 2026 (Note 10). We did not repurchase any shares under this program during the three months ended March 31, 2026.
Sources of Liquidity
Our primary sources of capital for funding our short-term (less than 12 months) and long-term (12 months and longer) liquidity needs include (i) the issuance of both public equity and OP Units, (ii) the issuance of both secured and unsecured debt, (iii) unfunded capital commitments from noncontrolling interests within Investment Management, (iv) future sales of existing properties, (v) repayments of Structured Financing investments, and (vi) cash on hand and future cash flow from operating activities.
Our cash on hand in our consolidated subsidiaries as of March 31, 2026 totaled $31.4 million. Our remaining sources of liquidity are described further below. Depending upon the availability and cost of external capital, we believe our sources of capital are sufficient to meet our liquidity needs. Our historical cash flow uses are reflected in our Condensed Consolidated Statements of Cash Flows and are discussed in further detail below.
Issuances of Common Shares
Our ATM Program (Note 10) provides us with an efficient and low-cost vehicle for raising capital through public equity issuances on an “as-we-go” basis to fund our capital needs.
As of March 31, 2026, we physically settled 2,445,106 forward shares under the ATM Program in exchange for aggregate net proceeds of $55.9 million, which were used to reduce outstanding borrowings and fund investment activity. As of March 31, 2026, we had unsettled forward equity contracts to sell 12,293,731 shares for estimated aggregate net cash proceeds of $239.2 million. We also had $199.1 million of remaining availability for future share issuance under the ATM program.
Investment Management Capital
As of March 31, 2026, unfunded capital commitments from noncontrolling interests within Funds II, III, IV and V were zero, $0.6 million, $18.5 million and $22.9 million, respectively.
Financing and Debt
As of March 31, 2026, we had $433.5 million of capacity under existing REIT Portfolio debt facilities. In addition, our REIT Portfolio and Investment Management platform included 146 unleveraged consolidated properties with an aggregate carrying value of approximately $2.3 billion; however, there can be no assurance that financing would be available for these properties at favorable terms, if at all (Note 7). See also “—Financing and Capital Activity” for details on our Fourth Amended and Restated Credit Facility entered into in April 2026.
HISTORICAL CASH FLOW
The following table compares the historical cash flow for the three months ended March 31, 2026 with the cash flow for the three months ended March 31, 2025 (in millions, totals may not add due to rounding):
Variance
31.4
25.9
5.5
367.6
(196.0
563.6
(407.1
186.7
(593.8
(8.1
16.6
(24.7
Operating Activities
Net cash provided by operating activities primarily reflects the Company’s operating results, adjusted for non-cash items and changes in working capital.
Net cash provided by operating activities increased by $5.5 million for the three months ended March 31, 2026 compared to the prior year period, primarily reflecting improved operating performance driven by acquisition activity and additional lease‑up activity across the portfolio.
Investing Activities
Net cash used in investing activities is impacted by our investments in and advances to unconsolidated affiliates, the timing and extent of our real estate development, capital improvements, and acquisition and disposition activities during the period.
Net cash provided by investing activities increased by $563.6 million for the three months ended March 31, 2026 compared to the prior year period, primarily due to (i) $543.7 million of higher cash inflows from real estate dispositions and (ii) $102.7 million of lower cash outflows for acquisitions. These increases were partially offset by (i) $62.8 million of higher cash used for investments in unconsolidated affiliates and (ii) $12.6 million of increased spending on development, construction, and property improvements.
Financing Activities
Net cash provided by financing activities is impacted by the timing and extent of issuances of debt and equity securities, distributions paid to common shareholders and unitholders of the Operating Partnership as well as principal and other payments associated with our outstanding indebtedness.
46
Net cash used in financing activities increased by $593.8 million for the three months ended March 31, 2026 compared to the prior year period, primarily due to (i) $221.7 million of lower proceeds from the issuance of Common Shares, (ii) $199.3 million of increased repayments of debt, (iii) $158.6 million of higher capital distributions to noncontrolling interests, (iv) $8.0 million of lower contributions from noncontrolling interests, and (v) $3.5 million of higher dividend payments.
Unconsolidated Indebtedness
We have the following investments made through joint ventures (that may include, among others, tenancy-in common and other similar investments) for the purpose of investing in operating properties. We account for these investments using the equity method of accounting. As such, our financial statements reflect our investment and our share of income and loss from, but not the individual assets and liabilities, of these joint ventures.
See Note 4 for a discussion of our unconsolidated investments. The Operating Partnership’s pro-rata share of unconsolidated non-recourse debt related to those investments is as follows (dollars in millions):
Operating Partnership
Investment
OwnershipPercentage
Pro-rata Share ofMortgage Debt
Effective Interest Rate (a)
18.1
6.00
Apr 2026
Frederick County Square
6.18
May 2026
650 Bald Hill Rd
20.8
3.0
3.75
840 N. Michigan
94.4
32.7
6.50
Dec 2026
7.14
Mar 2027
La Frontera
10.0
6.11
Jun 2027
Riverdale FC
18.0
6.8
6.62
Nov 2027
Georgetown Portfolio
50.0
6.7
4.72
Dec 2027
LINQ Promenade(d)
15.0
26.3
5.42
Shoppes at South Hills(b)
5.95
Mar 2028
7.0
5.80
The Walk at Highwoods Preserve(b)
20.0
4.1
Oct 2028
Shops at Skyview(c)
55.3
5.17
Jan 2029
Atlantic Portfolio(c)
51.1
4.98
Feb 2029
Avenue at West Cobb(c)
8.5
Crossroads Shopping Center(c)
49.0
36.8
5.78
Nov 2029
Pinewood Square(b)
9.0
5.51
Mar 2030
13.7
5.90
Oct 2034
294.1
CRITICAL ACCOUNTING POLICIES
Management’s Discussion and Analysis of Financial Condition and Results of Operations in this Report is based upon the Condensed Consolidated Financial Statements, which have been prepared in accordance with GAAP. The preparation of Condensed Consolidated Financial Statements requires management to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses. We base our estimates on historical experience and assumptions that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about carrying value of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions. We believe there have been no material changes to the items that we disclosed as our critical accounting policies under Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” in our Annual Report on Form 10-K for the year ended December 31, 2025.
Recently Issued and Adopted Accounting Pronouncements
47
Reference is made to Note 1 in the Notes to Condensed Consolidated Financial Statements for information about recently issued accounting pronouncements.
ITEM 3.QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.
Information as of March 31, 2026
Our primary market risk exposure is to changes in interest rates related to our property mortgage loans and other debt. See Note 7 in the Notes to the Condensed Consolidated Financial Statements for certain quantitative details related to our property mortgage loans and other debt.
Currently, we manage our exposure to fluctuations in interest rates primarily through the use of fixed-rate debt and interest rate swap and cap agreements. As of March 31, 2026, total property mortgage loans and other notes payable aggregated $1,604.3 million, excluding $0.7 million of unamortized premium and $8.7 million of net unamortized debt issuance costs. Of this amount $1,305.5 million, or 81.4%, was fixed-rate, including debt with rates effectively fixed through the use of derivative financial instruments, and $298.8 million, or 18.6%, was variable-rate based upon the Secured Overnight Financing Rate (“SOFR”) or Prime rates plus applicable spreads.
As of March 31, 2026, we were party to 30 interest rate swap agreements and one interest rate cap agreement, which together hedged interest rate exposure on $1,054.4 million and $32.2 million of variable-rate debt, respectively.
If the Company decided to employ higher leverage levels, it would be subject to higher debt service requirements and an increased risk of default, which could adversely affect financial condition, cash flows and ability to make distributions to shareholders. In addition, increases or changes in interest rates could increase borrowing costs and may limit the Company’s ability to refinance its indebtedness.
The following table sets forth information as of March 31, 2026 concerning our long-term debt obligations, including principal cash flows by scheduled maturity (without regard to available extension options) and weighted average effective interest rates of maturing amounts (dollars in millions):
REIT Portfolio Consolidated Mortgage and Other Debt
Year
ScheduledAmortization
Maturities
Weighted AverageInterest Rate
102.0
103.8
45.1
49.9
561.9
563.7
1.2
97.1
98.3
326.6
326.9
1.0
10.9
1,132.7
1,143.6
Investment Management Consolidated Mortgage and Other Debt
131.4
6.2
0.5
103.3
6.4
224.8
5.3
459.5
460.7
Mortgage Debt in Unconsolidated Partnerships (at our Pro-Rata Share)
42.0
46.7
55.0
56.1
5.8
16.8
16.9
151.4
151.7
287.9
Without regard to available extension options, during the remainder of 2026, $235.9 million of our total consolidated debt and $46.7 million representing our pro-rata share of unconsolidated debt will mature. In addition, $153.8 million of consolidated debt and $56.1 million representing our pro-rata share of unconsolidated debt will mature in 2027. With respect to this maturing debt, we have extension options on consolidated debt aggregating $134.2 million maturing in 2026 and $96.3 million maturing in 2027 as of March 31, 2026; however, there can be no assurance that the Company will be able successfully execute any or all of its available extension options.
The Company expects to refinance some or all of such debt at the then-prevailing market interest rates, which may be greater than the current interest rates. Based on outstanding balances, a 100 basis point increase in interest rates on refinanced debt would increase annual interest expense by approximately $4.9 million, of which the Company’s pro-rata share would be $2.6 million.
As of March 31, 2026, the Company had variable-rate debt of $298.8 million, net of variable-to-fixed interest rate swap agreements currently in effect. A 100 basis point increase in applicable interest rate indices would increase annual interest expense on such debt by approximately $3.0 million, of which the Company’s pro-rata share would be $1.2 million. We may seek additional variable-rate financing if pricing and other commercial and financial terms are favorable and would consider hedging associated interest rate risk through interest rate swaps and protection agreements, or other means.
Based on our outstanding debt balances as of March 31, 2026, the estimated fair value of our total consolidated outstanding debt would decrease by approximately $7.6 million assuming a 100 basis point increase in interest rates. Conversely, a 100 basis point decrease in interest rates would increase the estimated fair value of our total outstanding debt by approximately $5.1 million.
As of March 31, 2026, and December 31, 2025, we had consolidated notes receivable of $154.4 million and $154.9 million, respectively. The estimated fair value of our notes receivable was determined by discounting future cash receipts utilizing a discount rate equivalent to the rate at which similar notes receivable would be originated under conditions then existing. Based on our outstanding notes receivable balances as of March 31, 2026, a 100 basis point increase in interest rates would decrease the estimated fair value of our total outstanding notes receivable by approximately $1.1 million, while a 100 basis point decrease would increase the estimated fair value by approximately $1.1 million.
Summarized Information as of December 31, 2025
As of December 31, 2025, we had total property mortgage loans and other notes payable of $1.9 billion, excluding the unamortized premium of $0.9 million and unamortized debt issuance costs of $11.4 million, of which $1.5 billion, or 80.2%, was fixed-rate, inclusive of debt with rates fixed through the use of derivative financial instruments, and $370.6 million, or 19.8%, was variable-rate based upon SOFR rates plus applicable spreads. As of December 31, 2025, we were party to 35 interest rate swap and one interest rate cap agreement to hedge our exposure to changes in interest rates with respect to $1.2 billion and $32.2 million of SOFR-based variable-rate debt, respectively.
Interest expense on our variable-rate debt of $370.6 million, net of variable to fixed-rate swap agreements currently in effect, as of December 31, 2025, would have increased $3.7 million if corresponding rate indices increased by 100 basis points. Based on our outstanding debt balances as of December 31, 2025, the fair value of our total outstanding debt would have decreased by approximately $9.4 million if interest rates increased by 1%. Conversely, if interest rates decreased by 1%, the fair value of our total outstanding debt would have increased by approximately $6.1 million.
Changes in Market Risk Exposures from December 31, 2025 to March 31, 2026
Our interest rate risk exposure from December 31, 2025, to March 31, 2026, has decreased on an absolute basis, as the $370.6 million of variable-rate debt as of December 31, 2025 has decreased to $298.8 million as of March 31, 2026. Our interest rate exposure as a percentage of total debt has decreased, as our variable-rate debt accounted for 19.8% of our consolidated debt as of December 31, 2025 compared to 18.6% as of March 31, 2026.
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ITEM 4.CONTROLS AND PROCEDURES.
Disclosure Controls and Procedures
Our disclosure controls and procedures include internal controls and other procedures designed to provide reasonable assurance that information required to be disclosed in this and other reports filed under the Exchange Act, is recorded, processed, summarized, and reported within the required time periods specified in the SEC’s rules and forms; and that such information is accumulated and communicated to management, including our Chief Executive Officer and Chief Financial Officer, to allow timely decisions regarding required disclosures. It should be noted that no system of controls can provide complete assurance of achieving a company’s objectives and that future events may impact the effectiveness of a system of controls. Our Chief Executive Officer and Chief Financial Officer, after conducting an evaluation, together with members of our management, of the effectiveness of the design and operation of our disclosure controls and procedures as of March 31, 2026, have concluded that our disclosure controls and procedures (as defined in Rule 13a-15(e) under the Exchange Act) were effective as of March 31, 2026, at a reasonable level of assurance.
Changes in Internal Control Over Financial Reporting
There have been no changes in our internal control over financial reporting during our most recently completed fiscal quarter that have materially affected, or are reasonably likely to materially affect, our internal controls over financial reporting.
PART II – OTHER INFORMATION
ITEM 1.LEGAL PROCEEDINGS.
From time to time, we are a party to various legal proceedings, claims or regulatory inquiries and investigations arising out of, or incident to, our ordinary course of business. While we are unable to predict with certainty the outcome of any particular matter, management does not expect, when such matters are resolved, that our resulting exposure to loss contingencies, if any, will have a material adverse effect on our consolidated financial position.
ITEM 1A.RISK FACTORS.
Except to the extent additional factual information disclosed elsewhere in this Report relates to such risk factors (including, without limitation, the matters discussed in Part I, “Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations”), there were no material changes to the risk factors disclosed in Part I, “Item 1A. Risk Factors” of our Annual Report on Form 10-K for the year ended December 31, 2025.
ITEM 2.UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS.
None.
ITEM 3.DEFAULTS UPON SENIOR SECURITIES.
ITEM 4.MINE SAFETY DISCLOSURES.
Not applicable.
ITEM 5.OTHER INFORMATION.
Trading Arrangements
During the three months ended March 31, 2026, none of our officers or trustees (as defined in Rule 16a-1(f) of the Exchange Act) adopted, terminated, or modified any contract, instruction or written plan for the purchase or sale of our securities that was intended to satisfy the affirmative defense conditions of Rule 10b5-1(c) or any non-Rule 10b5-1 trading arrangement (as defined in Item 408 of Regulation S-K).
ITEM 6.EXHIBITS.
The following is an index to all exhibits including (i) those filed with this Quarterly Report on Form 10-Q and (ii) those incorporated by reference herein:
Exhibit No.
Method of Filing
31.1
Certification of Chief Executive Officer pursuant to rule 13a-14(a)/15d-14(a) of the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
Filed herewith
31.2
Certification of Chief Financial Officer pursuant to rule 13a-14(a)/15d-14(a) of the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
32.1
Certification of Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
Furnished herewith
32.2
Certification of Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
101.INS
Inline XBRL Instance Document–the instance document does not appear in the Interactive Data File as its XBRL tags are embedded within the Inline XBRL document
101.SCH
Inline XBRL Taxonomy Extension Schema with Embedded Linkbase Documents
104
Cover page formatted as Inline XBRL and contained in Exhibit 101
SIGNATURES
Pursuant to the requirements 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.
(Registrant)
By:
/s/ Kenneth F. Bernstein
Kenneth F. Bernstein
Chief Executive Officer,
President and Trustee
/s/ John Gottfried
John Gottfried
Executive Vice President and
Chief Financial Officer
(Principal Financial Officer)
/s/ David Buell
David Buell
Senior Vice President and
Chief Accounting Officer
(Principal Accounting Officer)
Dated: April 29, 2026