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What changed in Kimco Realty's 10-K — 2022 vs 2023

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Paragraph-level year-over-year comparison of Kimco Realty's 2022 and 2023 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2023 report.

+316 added−270 removedSource: 10-K (2024-02-26) vs 10-K (2023-02-24)

Top changes in Kimco Realty's 2023 10-K

316 paragraphs added · 270 removed · 219 edited across 6 sections

Item 1. Business

Business — how the company describes what it does

42 edited+20 added−18 removed29 unchanged
Biggest changeClimate Risk Description Physical Windstorms Increased frequency and intensity of windstorms, such as hurricanes, could lead to property damage, loss of property value and interruptions to business operations Sea Level Rise Rising sea levels could lead to storm surge and other potential impacts for low-lying coastal properties leading to damage, loss of property value and interruptions to business operations Flooding Change in rainfall conditions leading to increased frequency and severity of flooding could lead to property damage, loss of property value and interruptions to business operations Wildfires Change in fire potential could lead to permanent loss of property, stress on human health (air quality) and stress on ecosystem services Heat and Water Stress Increases in temperature could lead to droughts and decreased available water supply could lead to higher utility usage, supply interruptions and reputational issues in local communities Transition Regulation Regulations at the federal, state and local levels could impose additional operating and capital costs associated with utilities, energy efficiency, building materials and building design Reputation Increased interest among retail tenants in building efficiency, sustainable design criteria and "green leases", which incorporate provisions intended to promote sustainability at the property, could result in decreased demand for outdated space The Company’s approach in mitigating these risks include but are not limited to (i) carrying additional insurance coverage relating to flooding and windstorms, (ii) maintaining a geographically diversified portfolio, which limits exposure to event driven risks and (iii) creating a form “green lease” for its tenants which incorporates varied criteria that align landlord and tenant sustainability priorities as well as establishing green construction criteria.
Biggest changeThe Company’s approach in mitigating these risks include but are not limited to (i) carrying additional insurance coverage relating to flooding and windstorms, (ii) maintaining a geographically diversified portfolio, which limits exposure to event driven risks, (iii) creating a form “green lease” for its tenants which incorporates varied criteria that align landlord and tenant sustainability priorities as well as establishing green construction criteria and (iv) implementing emergency preparedness and operational energy and water efficiency programs.
Our benefits programs include a robust offering of medical, dental, vision, life, disability and a number of exciting ancillary benefits, all of which require very low associate contributions or are offered at no cost to associates. The Company also provides a Safe Harbor 401(k) program with both pretax and Roth offering including a robust, fully vested matching contribution.
Our benefits programs include a robust offering of medical, dental, vision, life, disability and a number of exciting ancillary benefits, all of which require very low associate contributions or are offered at no cost to associates. The Company also provides a Safe Harbor 401(k) program with both pretax and Roth offerings including a robust, fully vested matching contribution.
The net proceeds from this offering are allocated to finance or refinance, in whole or in part, recently completed, existing or future eligible green projects, with projects are to be aligned with the four core components of the Green Bond Principles, 2018 as administered by the International Capital Market Association.
The net proceeds from this offering are allocated to finance or refinance, in whole or in part, recently completed, existing or future eligible green projects, which projects are to be aligned with the four core components of the Green Bond Principles, 2018 as administered by the International Capital Market Association.
The Company has also provided preferred equity capital to real estate professionals and, from time to time, provides real estate capital and management services to both healthy and distressed retailers.
The Company has also provided preferred equity capital to real estate professionals and, from time to time, provides real estate capital, financing and management services to both healthy and distressed retailers.
As of December 31, 2022, no single open-air shopping center accounted for more than 1.3% of the Company's annualized base rental revenues, including the proportionate share of base rental revenues from properties in which the Company has less than a 100% economic interest, or more than 1.4% of the Company’s total shopping center GLA.
As of December 31, 2023, no single open-air shopping center accounted for more than 1.3% of the Company's annualized base rental revenues, including the proportionate share of base rental revenues from properties in which the Company has less than a 100% economic interest, or more than 1.4% of the Company’s total shopping center GLA.
We believe that the Company’s ESG programs are aligned with its core business strategy of creating destinations for everyday living that inspire a sense of community and deliver value to its many stakeholders. 8 Table of Contents The Company has identified the following five pillars that outline the Company’s current strategic priorities within our ESG program.
We believe that the Company’s ESG programs are aligned with its core business strategy of creating destinations for everyday living that inspire a sense of community and deliver value to its many stakeholders. The Company has identified the following five pillars that outline the Company’s current strategic priorities within our ESG program.
Furthermore, at December 31, 2022, the Company’s single largest tenant represented only 3.7%, and the Company’s five largest tenants aggregated less than 11.4%, of the Company’s annualized base rental revenues, including the proportionate share of base rental revenues from properties in which the Company has less than a 100% economic interest.
Furthermore, at December 31, 2023, the Company’s single largest tenant represented only 3.7%, and the Company’s five largest tenants aggregated less than 11.3%, of the Company’s annualized base rental revenues, including the proportionate share of base rental revenues from properties in which the Company has less than a 100% economic interest.
As one of the original participants in the growth of the shopping center industry and the nation's largest owners and operators of open-air shopping centers, the Company has established close relationships with major national and regional retailers and maintains a broad network of industry contacts. Management is associated with and/or actively participates in many shopping center and REIT industry organizations.
As one of the original participants in the growth of the shopping center industry and the nation's largest owner and operator of open-air shopping centers, the Company has established close relationships with major national and regional retailers and maintains a broad network of industry contacts. Management is associated with and/or actively participates in many shopping center and REIT industry organizations.
The Company expects to continue to take steps to reduce leverage, unencumber assets and improve its debt coverage metrics as mixed-use projects and redevelopments continue to come online and contribute additional cash flow growth.
The Company expects to continue to take steps to reduce leverage, unencumber assets and maintain its strong debt coverage metrics as mixed-use projects and redevelopments continue to come online and contribute additional cash flow growth.
The Company’s strong balance sheet and liquidity position are evidenced by its investment grade unsecured debt ratings (Baa1/BBB+) by two major ratings agencies. The Company maintains one of the longest weighted average debt maturity profiles in the REIT industry, now at 9.5 years.
The Company’s strong balance sheet and liquidity position are evidenced by its investment grade unsecured debt ratings (BBB+/Baa1) by two major ratings agencies. The Company maintains one of the longest weighted average debt maturity profiles in the REIT industry, now at 8.7 years.
The Company has been recognized as a Great Place to Work® for five consecutive years as well as a One of the 2022 Best Workplaces in Real Estate™, both of which are based on anonymous third-party surveys and feedback collected from our associates.
The Company has been recognized as a Great Place to Work® for six consecutive years as well as a One of the 2023 Best Workplaces in Real Estate™, both of which are based on anonymous third-party surveys and feedback collected from our associates.
The Company has defined 16 ESG goals that expand upon the Company’s commitment with clear targets in each pillar: The Company has aligned its annual reporting with standards from the Global Reporting Initiative (“GRI”), Sustainability Accounting Standards Board (“SASB”) and Task Force on Climate-related Financial Disclosures (“TCFD”).
The Company has defined 16 ESG goals that expand upon the Company’s commitment with clear targets in each pillar: 8 Table of Contents The Company has aligned its annual reporting towards standards from the Global Reporting Initiative (“GRI”), Sustainability Accounting Standards Board (“SASB”) and Task Force on Climate-related Financial Disclosures (“TCFD”).
This philosophy is exemplified by the Company’s Signature Series TM properties which include key value creation projects in our portfolio that exemplify our transformation and highlight our focus on quality, concentration around core MSAs, and growth through redevelopment and development opportunities.
This philosophy is exemplified by the Company’s Signature Series TM properties which include key value creation projects in our portfolio that exemplify our transformation and highlight our focus on quality, concentration around core metropolitan statistical areas, and/or growth through redevelopment and development opportunities.
The Company maintains certain subsidiaries that made joint elections with the Company to be treated as taxable REIT subsidiaries (“TRSs”), that permit the Company to engage through such TRSs in certain business activities that the REIT may not conduct directly.
The Company maintains certain subsidiaries that made joint elections with the Company to be treated as taxable REIT subsidiaries (“TRSs”). This permits the Company to engage in certain business activities that a REIT may not conduct directly, by conducting such business activities through such TRSs.
In order to add density to existing properties, the Company has obtained multi-family entitlements for 8,818 units of which 2,218 units have been constructed as of December 31, 2022. The Company continues to place strategic emphasis on live/work/play environments and in reinvesting in its existing assets, while building shareholder value.
In order to add density to existing properties, the Company has obtained multi-family entitlements for 9,945 units of which 3,157 units have been constructed as of December 31, 2023. The Company continues to place strategic emphasis on live/work/play environments and in reinvesting in its existing assets, while building shareholder value.
By cultivating high levels of associate satisfaction and improving the diversity of our team, management’s goal is to ensure the Company will remain a significant driving force in commercial real estate well into the future. The Company has been and will continue to be an equal opportunity employer committed to hiring, developing, and supporting a diverse, equitable, and inclusive workplace.
By cultivating high levels of associate satisfaction, management’s goal is to ensure the Company remains a significant driving force in commercial real estate well into the future. The Company has been and will continue to be an equal opportunity employer committed to hiring, developing, and supporting its highly inclusive workplace.
Whether it be through regular all employee calls, department meetings, frequent training sessions, Coffee Connections with the executive team, use of our BRAVO recognition program, awarding of iPads for Ideas, or participation in our LABS (Leaders Advancing Business Strategy) program, associates are encouraged to be inquisitive and share ideas.
Whether it be through regular all employee calls, department meetings, frequent training sessions, Coffee Connections with the executive team, use of our BRAVO recognition program, or participation in our LABS (Leaders Advancing Business Strategy) program, associates are encouraged to be inquisitive and share ideas. Those ideas have resulted in a number of programs and benefit enhancements.
Cohen 58 Executive Vice President, Chief Financial Officer and Treasurer 1995 David Jamieson 42 Executive Vice President, Chief Operating Officer 2007 Available Information The Company’s website is located at http://www.kimcorealty.com . The information contained on our website does not constitute part of this Form 10-K.
Flynn 43 Chief Executive Officer 2003 Ross Cooper 41 President and Chief Investment Officer 2006 Glenn G. Cohen 59 Executive Vice President, Chief Financial Officer 1995 David Jamieson 43 Executive Vice President, Chief Operating Officer 2007 Available Information The Company’s website is located at http://www.kimcorealty.com . The information contained on our website does not constitute part of this Form 10-K.
In addition, the Company has capitalized on its established expertise in retail real estate by establishing other ventures in which the Company owns a smaller equity interest and provides management, leasing and operational support for those properties.
The Company earns management fees, acquisition fees, disposition fees as well as promoted interests based on achieving certain performance metrics. In addition, the Company has capitalized on its established expertise in retail real estate by establishing other ventures in which the Company owns a smaller equity interest and provides management, leasing and operational support for those properties.
In response to the rising rate of inflation the Federal Reserve has steadily increased interest rates, and may continue to increase interest rates, until the rate of inflation begins to decrease. These increases in interest rates could adversely impact the business and financial results of the Company and its tenants.
The Federal Reserve may continue to increase interest rates or maintain these elevated levels, until the rate of inflation begins to decrease. These elevated interest rates could adversely impact the business and financial results of the Company and its tenants.
The Company believes it can achieve this objective by: ● increasing the value of its existing portfolio of properties and generating higher levels of portfolio growth; ● increasing cash flows for reinvestment and/or for distribution to shareholders while maintaining conservative payout ratios; ● improving debt metrics and upgraded unsecured debt ratings ● continuing growth in desirable demographic areas with successful retailers, primarily focused on grocery anchors; and ● increasing the number of entitlements for residential use.
The Company believes it can achieve this objective by: ● increasing the value of its existing portfolio of properties and generating higher levels of portfolio growth; ● increasing cash flows for reinvestment and/or for distribution to shareholders while maintaining conservative payout ratios; ● maintaining strong debt metrics and our BBB+/Baa1 unsecured debt ratings ● continuing growth in desirable demographic areas with successful retailers, primarily focused on grocery anchors; and ● increasing the number of entitlements for residential use. 6 Table of Contents Business Strategies The Company believes it is well positioned to achieve sustainable growth, with its strong core portfolio and its recent acquisitions allowing the Company to achieve higher occupancy levels, increased rental rates and rental growth in the future.
Both programs are managed by independent third parties who consider an equal balance of academics and financial need as determining factors. The Company's executive offices are located at 500 North Broadway, Suite 201, Jericho, NY 11753, a mixed-use property that is wholly owned by the Company, and its telephone number is (516) 869-9000 or 1-800-764-7114.
The Company's executive offices are located at 500 North Broadway, Suite 201, Jericho, NY 11753, a mixed-use property that is wholly owned by the Company, and its telephone number is (516) 869-9000 or 1-800-764-7114.
The Company also encourages associates to directly drive strategy around the Company’s environmental, social and governance initiatives through participation in five associate-driven KIMunity Councils focused in the areas of diversity, equity and inclusion, giving, wellness, sustainability, and tenant engagement. The Company recognizes the importance of advanced education.
The Company also encourages associates to directly drive strategy around the Company’s environmental, social and governance initiatives through participation in five associate-driven KIMunity Councils focused in the areas of diversity, equity and inclusion, giving, wellness, sustainability, and tenant engagement. 7 Table of Contents The Company recognizes the importance of advanced education and provides funds for scholarship programs to benefit the children of our associates as well as students interested in pursuing careers in real estate.
The scientific community has studied climate change and a consensus exists that warming is occurring outside the boundaries of historical planetary trends due in significant part, to human activity.
The Company recognizes that climate change is one of the most significant stakeholder issues of our times, threatening the viability of economic and environmental systems globally. The scientific community has studied climate change and a consensus exists that warming is occurring outside the boundaries of historical planetary trends due in significant part, to human activity.
If the Company determines that any of its assets are impaired, the Company would be required to take impairment charges, and such amounts could be material. 4 Table of Contents Business Objective and Strategies The Company has developed a strong nationally diversified portfolio of open-air, shopping centers located in drivable first-ring suburbs primarily within 19 major metropolitan sun belt and coastal markets, which are supported by strong demographics, significant projected population growth, and where the Company perceives significant barriers to entry.
Business Objective and Strategies The Company has developed a strong nationally diversified portfolio of open-air, grocery anchored shopping centers located in drivable first-ring suburbs primarily within 18 major metropolitan sun belt and coastal markets, which are supported by strong demographics, significant projected population growth, and where the Company perceives significant barriers to entry.
Management’s Discussion and Analysis of Financial Condition and Results of Operations” together with our audited consolidated financial statements and the related notes thereto for a discussion of material information relevant to an assessment of our financial condition and results of operations, including, to the extent material, the effects that compliance with governmental regulations may have upon our capital expenditures and earnings. 6 Table of Contents Human Capital Resources The Company believes that our associates are one of our strongest resources and that a variety of perspectives and experiences found in a diverse workforce spark innovation and enrich company culture.
Management’s Discussion and Analysis of Financial Condition and Results of Operations” together with our audited consolidated financial statements and the related notes thereto for a discussion of material information relevant to an assessment of our financial condition and results of operations, including, to the extent material, the effects that compliance with governmental regulations may have upon our capital expenditures and earnings.
As of December 31, 2022, a total of 639 persons were employed by the Company, of which 31% were located in our corporate office with the remainder located in 28 offices throughout the United States.
As of December 31, 2023, a total of 660 persons were employed by the Company, of which 31% were located in our corporate office with the remainder located in 26 offices throughout the United States. The average tenure of our employees was 9.4 years.
The Company also discloses aggregate-level EEO-1 workforce diversity data that can be found on the Company’s website, which data and website contents are not incorporated by reference hereto.
The Company also discloses aggregate-level EEO-1 workforce data that can be found on the Company’s website, which data and website contents are not incorporated by reference hereto. Additional ESG information of relevance to stakeholders can be found on the Company’s website, the contents of which are not incorporated by reference and do not form a part of this Form 10-K.
The Company continues to monitor economic, financial, and social conditions and will assess its asset portfolio for any impairment indicators.
Any of these events could materially adversely impact the Company’s business, financial condition, results of operations or stock price. The Company continues to monitor economic, financial, and social conditions and will assess its asset portfolio for any impairment indicators.
The Company’s ownership interests in real estate consist of its consolidated portfolio and portfolios where the Company owns an economic interest, such as properties in the Company’s investment real estate management programs, where the Company partners with institutional investors and also retains management. 3 Table of Contents The Company began to expand its operations through the development of real estate and the construction of shopping centers but revised its growth strategy to focus on the acquisition and redevelopment of existing shopping centers that include a grocery component.
The Company’s ownership interests in real estate consist of its consolidated portfolio and portfolios where the Company owns an economic interest, such as properties in the Company’s investment real estate management programs, where the Company partners with institutional investors and also retains management.
In March 2006, the Predecessor was added to the S&P 500 Index, an index containing the stock of 500 Large Cap companies, most of which are U.S. corporations. The Company's common stock, Class L Depositary Shares and Class M Depositary Shares are traded on the New York Stock Exchange (“NYSE”) under the trading symbols “KIM”, “KIMprL”, and “KIMprM”, respectively.
In March 2006, the Predecessor was added to the S&P 500 Index, an index containing the stock of 500 Large Cap companies, most of which are U.S. corporations.
The Company’s focus on high-quality locations has led to significant opportunities for value creation through the reinvestment in its assets to add density, replace outdated shopping center concepts, and better meet changing consumer demands.
The Company’s shopping centers provide essential, necessity-based goods and services to the local communities and are primarily anchored by a grocery store, home improvement center, off-price retailer, discounter and/or service-oriented tenant. 5 Table of Contents The Company’s focus on high-quality locations has led to significant opportunities for value creation through the reinvestment in its assets to add density, replace outdated shopping center concepts, and better meet changing consumer demands.
Parent Company is the managing member of Kimco OP and owns 100% of the limited liability company interests, and exercises exclusive control over Kimco OP. As of December 31, 2022, the Company had interests in 532 shopping center properties (the “Combined Shopping Center Portfolio”), aggregating 90.8 million square feet of gross leasable area (“GLA”), located in 28 states.
As of December 31, 2023, the Company had interests in 523 shopping center properties (the “Combined Shopping Center Portfolio”), aggregating 89.7 million square feet of gross leasable area (“GLA”), located in 28 states.
Those ideas have resulted in a number of programs and benefit enhancements. The Company promotes physical health, including access to a national gym membership program for associates and their family members as well as host to regular wellness and nutrition seminars and health screenings.
The Company promotes physical health, including access to a national gym membership program for associates and their family members as well as host to regular wellness and nutrition seminars and health screenings. The Company also feels it is important that our associates are engaged and active in the community. Across our numerous offices, associates host volunteer and social activities.
Additionally, the Company’s $2.0 billion Credit Facility (as defined below) is a green credit facility which incorporates rate adjustments associated with attainment (or nonattainment) of Scope 1 and 2 greenhouse gas emissions reductions.
Additionally, the Company’s $2.0 billion Credit Facility (as defined below) is a green credit facility which incorporates rate adjustments associated with attainment (or nonattainment) of Scope 1 and 2 greenhouse gas emissions reductions. 9 Table of Contents Information About Our Executive Officers The following table sets forth information with respect to the executive officers of the Company as of December 31, 2023: Name Age Position Joined Kimco Milton Cooper 94 Executive Chairman of the Board of Directors Co-Founder Conor C.
The Company reduces its operating and leasing risks through diversification achieved by the geographic distribution of its properties and a large tenant base.
The Company identified the following components to effectively execute and achieve its strategic goals: The Company has identified the following areas where it is well positioned for sustainable growth in the future. The Company reduces its operating and leasing risks through diversification achieved by the geographic distribution of its properties and a large tenant base.
Government Regulation Compliance with various governmental regulations has an impact on our business, including our capital expenditures, earnings and competitive position, which can be material.
The Company believes that management’s expertise, experience, reputation, and key relationships in the retail real estate industry provides it with a significant competitive advantage in attracting new business opportunities. 6 Table of Contents Government Regulation Compliance with various governmental regulations has an impact on our business, including our capital expenditures, earnings and competitive position, which can be material.
The Company also expanded internationally within Canada, Mexico, Chile, Brazil and Peru, but has since exited all international investments. Additionally, the Company developed various residential and mixed-use operating properties and continues to obtain entitlements to embark on additional projects of this nature through re-development opportunities.
Additionally, the Company developed various residential and mixed-use operating properties and continues to obtain entitlements to embark on additional projects of this nature through re-development opportunities. The Company has implemented its investment real estate management format through the establishment of various institutional joint venture programs, in which the Company has noncontrolling interests.
The Company is committed to diversity, equity and inclusion best practices in all phases of the associate life cycle, including recruitment, training and development and promotion.
Human Capital Resources The Company believes that its associates are one of its strongest resources and that a variety of perspectives and experiences found in its diverse workforce sparks innovation and enriches Company culture. The Company is committed to equitable and inclusive best practices in all phases of the associate life cycle, including recruitment, training, development and promotion.
The Nominating and Corporate Governance Committee of the Board of Directors is responsible for overseeing the Company's efforts with regard to the Company's ESG matters. The Company recognizes that climate change is one of the most significant stakeholder issues of our times, threatening the viability of economic and environmental systems globally.
The Company’s Board of Directors sets the Company’s overall ESG program objectives and oversees enterprise risk management. The Nominating and Corporate Governance Committee of the Board of Directors is responsible for overseeing the Company’s efforts with regard to the Company’s ESG matters.
In addition, the Company had 23 other property interests, primarily through the Company’s preferred equity investments and other investments, totaling 5.7 million square feet of GLA. Economic Conditions The economy continues to face several issues including the lack of qualified employees, inflation risk, supply chain issues and new COVID-19 variants, which could impact the Company and its tenants.
Economic Conditions The economy continues to face several issues, including inflation risk, liquidity constraints, lack of qualified employees, tenant bankruptcies and supply chain disruptions, which could impact the Company and its tenants. In response to the rising rate of inflation, the Federal Reserve steadily increased interest rates and has kept them at elevated levels.
The Company’s science-based GHG emissions reduction goals are aligned with the Paris Climate Accord and while there can be no guarantees, we believe they could put the Company on pace to achieve Scope 1 and Scope 2 net zero GHG emissions by 2050. 9 Table of Contents Climate risks and opportunities are generally evaluated at both the corporate and individual asset level.
The Company has established a near-term greenhouse gas (“GHG”) emissions reduction target of reducing Scope 1 and 2 emissions 30% from a 2018 baseline by 2030, and separately has a target of achieving net zero Scope 1 and 2 GHG emissions by 2050. Climate risks and opportunities are generally evaluated at both the corporate and individual asset level.
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In August 2021, the Company expanded through a merger with Weingarten Realty Investors (“Weingarten”), whereby Weingarten merged with and into the Predecessor, with the Predecessor continuing as the surviving public company (the “Merger”), pursuant to the definitive merger agreement (the “Merger Agreement”) between the Predecessor and Weingarten which was entered into on April 15, 2021.
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The Company's common stock, Class L Depositary Shares, Class M Depositary Shares, and Class N Depositary Shares are traded on the New York Stock Exchange (“NYSE”) under the trading symbols “KIM”, “KIMprL”, “KIMprM”, and “KIMprN”, respectively.
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The Merger brought together two industry-leading retail real estate platforms with highly complementary portfolios and created the preeminent open-air shopping center and mixed-use real estate owner in the country. The Merger further enhanced the Company’s portfolio in coastal and sun belt regions.
Added
The Company began to expand its operations through the development of real estate and the construction of shopping centers but revised its growth strategy to focus on the acquisition and redevelopment of existing shopping centers that include a grocery component.
Removed
The Company has implemented its investment real estate management format through the establishment of various institutional joint venture programs, in which the Company has noncontrolling interests. The Company earns management fees, acquisition fees, disposition fees as well as promoted interests based on achieving certain performance metrics.
Added
At December 31, 2023, the Parent Company is the managing member of Kimco OP and owns 100% of the limited liability company interests of, and exercises exclusive control over, Kimco OP.
Removed
As a result, the Company could feel pricing pressure on rents that it is able to charge to new or renewing tenants, such that future rents and rent spreads could be negatively impacted. Any of these events could materially adversely impact the Company’s business, financial condition, results of operations or stock price.
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In addition, the Company had 21 other property interests, primarily through the Company’s preferred equity investments and other investments, totaling 5.5 million square feet of GLA. 4 Table of Contents RPT Merger On August 28, 2023, the Company and RPT Realty (“RPT”) announced that they had entered into a definitive merger agreement (the “Merger Agreement”) pursuant to which the Company would acquire RPT through a series of mergers (collectively, the “RPT Merger”).
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As of December 31, 2022, the Company derived 85% of its annualized base rent from these top major metro markets. The Company’s shopping centers provide essential, necessity-based goods and services to the local communities and are primarily anchored by grocers, home improvement, and pharmacy.
Added
On January 2, 2024, RPT merged with and into the Company, with the Company continuing as the surviving public company. The RPT Merger added 56 open-air shopping centers, 43 of which are wholly owned and 13 of which are owned through a joint venture, comprising 13.3 million square feet of GLA, to the Company’s existing portfolio of 523 properties.
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Business Strategies The Company believes with its strong core portfolio and its recent acquisitions, it will continue to achieve higher occupancy levels, increased rental rates and rental growth in the future.
Added
In addition, pursuant to the RPT Merger, the Company obtained RPT’s 6% stake in a 49-property net lease joint venture.
Removed
To effectively execute the Company’s strategy and achieve its strategic goals the Company identified the following growth components to focus on: The Company believes it is well positioned for sustainable growth with its high-quality portfolio, accretive and opportunistic capital allocation, financial strength and environmental, social and governance leadership. 5 Table of Contents The Company has identified the following areas where it is well positioned for sustainable growth in the future.
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Under the terms of the Merger Agreement, each RPT common share was converted into 0.6049 of a newly issued share of the Company’s common stock, together with cash in lieu of fractional shares, and each 7.25% Series D Cumulative Convertible Perpetual Preferred Share of RPT was converted into the right to receive one depositary share representing one one-thousandth of a share of the Company’s 7.25% Class N Cumulative Convertible Perpetual Preferred Stock, par value $1.00 per share (the “Class N Preferred Stock”).
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To ensure full implementation of this equal employment policy, we take steps to ensure that persons are recruited, hired, assigned and promoted without regard to race, creed, national origin, ancestry, citizenship status, religion, age, color, sex, gender (including pregnancy, childbirth and related medical conditions), gender identity and expression, sexual orientation, marital status, disability, genetic information, protected veteran status, or any other characteristic protected by local, state, or federal laws, rules, or regulations.
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In connection with the RPT Merger, the Company issued 53.0 million shares of common stock, 1.8 million shares of Class N Preferred Stock, and 953,400 OP Units. See Footnote 28 of the Notes to Consolidated Financial Statements for further details on the RPT Merger.
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Additionally, the Company was designated a Best Place to Work for LGBTQ+ Equality and has achieved a perfect score on the Human Rights Campaign Foundation’s 2022 Corporate Equality Index, a nationally recognized benchmarking survey and report measuring corporate policies and practices related to LGBTQ+ workplace equality.
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If the Company determines that any of its assets are impaired, the Company would be required to take impairment charges, and such amounts could be material.
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The Company also feels it is important that our associates are engaged and active in the community. Across our numerous offices, associates host volunteer and social activities.
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As of December 31, 2023, the Company derived 86% of its proportionate share of annualized base rental revenues from these top major metro markets.
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Each year, the Company funds $100,000 in college scholarships to benefit the children of our associates. In addition, the Company recently announced, in partnership with ICSC, it is providing $100,000 in scholarships to students wishing to pursue careers in real estate, of which no less than 50% will be awarded to students of under-represented groups.
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The Company’s executive and senior management teams are seasoned real estate operators with extensive retail and public company leadership experience. The Company’s management has a deep industry knowledge and well-established relationships with retailers, brokers, and vendors through many years of operational and transactional experience, as well as significant capital markets capabilities.
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The average tenure of our employees was 9.0 years. 7 Table of Contents Cybersecurity The Company’s Audit Committee receives quarterly briefings from the Company’s Chief Information Officer regarding the emerging cybersecurity threat and risk landscape as well as the Company’s security program and related readiness, resiliency, and response efforts.
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The Company takes steps to support its commitment that employment decisions (including how persons are recruited, hired, assigned and promoted) are not made on the basis of any legally protected characteristic.
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The Company has a Cyber Risk Committee (“Cyber Committee”) which reviews and reports on technology-based security issues.
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Additionally, the Company was once again designated a Leader in LGBTQ+ Workplace Inclusion having achieved the highest score on the Human Rights Campaign Foundation’s 2023-2024 Corporate Equality Index, one of only a few REITs earning the Equality 100 Award.
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The Cyber Committee is comprised of senior management from various business units within the Company and meets quarterly to review the status of the Company’s overall security program as well as controls and procedures and to stay up-to-date of relevant legislative, regulatory and technical developments.
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Climate Risk Description Physical Acute Hazards - Windstorms Increased frequency and intensity of windstorms, such as hurricanes, could lead to property damage, loss of property value, increased operation and capital costs and insurance premiums, and interruptions to business operations.
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The Company utilizes a variety of administrative, technical and physical safeguards that take into account the nature of our IT environment, information assets and cyber risks posed by both internal and external threats. The Company has incorporated cybersecurity coverage in its insurance policies.
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Acute Hazards - Flooding Change in rainfall conditions leading to increased frequency and severity of flooding could lead to property damage, loss of property value, increased operating and capital costs and insurance premiums, and interruptions to business operations.
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The Company’s goal is to keep its data and systems, as well as its employees safe from cybersecurity threats. The Company conducts employee security awareness training and internal phishing exercises. When security issues arise, the Company conducts a prompt investigation and initiates response protocols and other measures to protect the Company and its valued employees and key stakeholders.
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Chronic Stressors - Sea Level Rise Rising sea levels could lead to storm surge and other potential impacts for low-lying coastal properties leading to damage, loss of property value, increased operating and capital costs and insurance premiums, and interruptions to business operations.
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Additional ESG information of relevance to stakeholders can be found on the Company’s website, the contents of which are not incorporated by reference and do not form a part of this Form 10-K. The Company’s Board of Directors sets the Company’s overall ESG program objectives and oversees enterprise risk management.
Added
Chronic Stressors - Wildfires Change in fire potential could lead to permanent loss of property, stress on human health (air quality) and stress on ecosystem services. Chronic Stressors - Heat and Water Stress Increases in temperature could lead to droughts and decreased available water supply could lead to higher utility usage and supply interruptions.
Removed
Information About Our Executive Officers The following table sets forth information with respect to the executive officers of the Company as of December 31, 2022: Name Age Position Joined Kimco Milton Cooper 93 Executive Chairman of the Board of Directors Co-Founder Conor C. Flynn 42 Chief Executive Officer 2003 Ross Cooper 40 President and Chief Investment Officer 2006 Glenn G.
Added
Transition Policy and Legal Regulations at the federal, state and local levels, in addition to stakeholder adherence to international regulations, could impose additional operating and capital costs associated with utilities, energy efficiency, building materials and building design.
Added
Reputation and Market Increased interest among retail tenants in building efficiency, sustainable design criteria and "green leases", which incorporate provisions intended to promote sustainability at the property, could result in decreased demand for outdated space. Potential for fluctuating costs for carbon intensive raw materials used to construct and renovate properties.
Added
Technology Increasing market and regulatory expectations may result in increased investment in upgrading technology and assets, including training and startup costs.

Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

33 edited+41 added−4 removed143 unchanged
Biggest changeAlthough we make efforts to maintain the security and integrity of IT networks and related systems on which we rely, and we have implemented various measures to manage the risk of a cyberattack, security breach or security related disruption, there can be no assurance that our efforts and measures or those of our third-party services providers will be effective or that attempted security breaches or disruptions would not be successful or damaging. 15 Table of Contents Attack methodologies change frequently or are not recognized until launched, and we may be unable to investigate or remediate incidents because attackers increasingly use techniques and tools designed to circumvent controls, to avoid detection, and to remove or obfuscate forensic evidence.
Biggest changeAttack methodologies change frequently or are not recognized until launched, and we may be unable to investigate or remediate incidents because attackers increasingly use techniques and tools, including artificial intelligence, that circumvent controls, avoid detection, and remove obscure forensic evidence.
The economic performance and value of our properties is subject to all of the risks associated with owning and operating real estate, including but not limited to: ● changes in the national, regional and local economic climate; ● local conditions, including an oversupply of, or a reduction in demand for, space in properties like those that we own or operate; ● trends toward smaller store sizes as retailers reduce inventory and develop new prototypes; ● increasing use by customers of e-commerce and online store sites; ● the attractiveness of our properties to tenants; ● market disruptions due to global pandemics; ● the ability of tenants to pay rent, particularly anchor tenants with leases in multiple locations; ● tenants who may declare bankruptcy and/or close stores; ● competition from other available properties to attract and retain tenants; ● changes in market rental rates; ● the need to periodically pay for costs to repair, renovate and re-let space; ● ongoing consolidation in the retail sector; ● the excess amount of retail space in a number of markets; ● changes in operating costs, including costs for maintenance, insurance and real estate taxes; ● the expenses of owning and operating properties, which are not necessarily reduced when circumstances such as market factors and competition cause a reduction in income from the properties; ● changes in laws and governmental regulations, including those governing usage, zoning, the environment and taxes; ● acts of terrorism and war and acts of God, including physical and weather-related damage to our properties; ● the continued service and availability of key personnel; and ● the risk of functional obsolescence of properties over time.
The economic performance and value of our properties is subject to all of the risks associated with owning and operating real estate, including but not limited to: ● changes in the national, regional and local economic climate; ● local conditions, including an oversupply of, or a reduction in demand for, space in properties like those that we own or operate; ● trends toward smaller store sizes as retailers reduce inventory and develop new prototypes; ● increasing use by customers of e-commerce and online store sites; ● the attractiveness of our properties to tenants; ● market disruptions due to global pandemics or other health epidemics; ● the ability of tenants to pay rent, particularly anchor tenants with leases in multiple locations; ● tenants who may declare bankruptcy and/or close stores; ● competition from other available properties to attract and retain tenants; ● changes in market rental rates; ● the need to periodically pay for costs to repair, renovate and re-let space; ● ongoing consolidation in the retail sector; ● the excess amount of retail space in a number of markets; ● changes in operating costs, including costs for maintenance, insurance and real estate taxes; ● the expenses of owning and operating properties, which are not necessarily reduced when circumstances such as market factors and competition cause a reduction in income from the properties; ● changes in laws and governmental regulations, including those governing usage, zoning, the environment and taxes; ● acts of terrorism and war and acts of God, including physical and weather-related damage to our properties; ● the continued service and availability of key personnel; and ● the risk of functional obsolescence of properties over time.
In the event of a major loan default or several loan defaults resulting in losses, our investments in mortgage receivables would be materially and adversely affected. 14 Table of Contents The economic performance and value of our other investments, which we do not control and are in retail operations, are subject to risks associated with owning and operating retail businesses, including: ● changes in the national, regional and local economic climate; ● the adverse financial condition of some large retailing companies; ● increasing use by customers of e-commerce and online store sites; and ● ongoing consolidation in the retail sector.
In the event of a major loan default or several loan defaults resulting in losses, our investments in mortgage receivables would be materially and adversely affected. 14 Table of Contents The economic performance and value of our other investments, which we do not control, are subject to risks associated with owning and operating retail businesses, including: ● changes in the national, regional and local economic climate; ● the adverse financial condition of some large retailing companies; ● increasing use by customers of e-commerce and online store sites; and ● ongoing consolidation in the retail sector.
The construction and building industry, similar to many other industries, are experiencing worldwide supply chain disruptions due to a multitude of factors that are beyond our control. Materials, parts and labor have also increased in cost over the past year or more, sometimes significantly and over a short period of time.
The construction and building industry, similar to many other industries, is experiencing worldwide supply chain disruptions due to a multitude of factors that are beyond our control. Materials, parts and labor have also increased in cost over the past year or more, sometimes significantly and over a short period of time.
The level of indebtedness could have adverse consequences on our business, such as: ● requiring the Company to use a substantial portion of our cash flow from operations to service our indebtedness, which would reduce the available cash flow to fund working capital, capital expenditures, development projects, and other general corporate purposes and reduce cash for distributions; ● limiting our ability to obtain additional financing to fund our working capital needs, acquisitions, capital expenditures, or other debt service requirements or for other purposes; ● increasing our costs of incurring additional debt; ● subjecting us to floating interest rates; ● limiting our ability to compete with other companies that are not as highly leveraged, as we may be less capable of responding to adverse economic and industry conditions; 18 Table of Contents ● restricting the Company from making strategic acquisitions, developing properties, or exploiting business opportunities; ● restricting the way in which we conduct our business because of financial and operating covenants in the agreements governing our existing and future indebtedness; ● exposing the Company to potential events of default (if not cured or waived) under covenants contained in our debt instruments that could have a material adverse effect on our business, financial condition, and operating results; ● increasing our vulnerability to a downturn in general economic conditions; and ● limiting our ability to react to changing market conditions in its industry.
The level of indebtedness could have adverse consequences on our business, such as: ● requiring the Company to use a substantial portion of our cash flow from operations to service our indebtedness, which would reduce the available cash flow to fund working capital, capital expenditures, development projects, and other general corporate purposes and reduce cash for distributions; ● limiting our ability to obtain additional financing to fund our working capital needs, acquisitions, capital expenditures, or other debt service requirements or for other purposes; ● increasing our costs of incurring additional debt; ● subjecting us to floating interest rates; ● limiting our ability to compete with other companies that are not as highly leveraged, as we may be less capable of responding to adverse economic and industry conditions; ● restricting the Company from making strategic acquisitions, developing properties, or exploiting business opportunities; ● restricting the way in which we conduct our business because of financial and operating covenants in the agreements governing our existing and future indebtedness; ● exposing the Company to potential events of default (if not cured or waived) under covenants contained in our debt instruments that could have a material adverse effect on our business, financial condition, and operating results; ● increasing our vulnerability to a downturn in general economic conditions; and ● limiting our ability to react to changing market conditions in its industry.
Accordingly, investors who are individuals, trusts and estates may perceive investments in REITs to be relatively less attractive than investments in the stocks of non-REIT corporations that pay dividends treated as qualified dividend income, which could materially and adversely affect the value of the shares of REITs, including the per share trading price of our common stock. Item 1B.
Accordingly, investors who are individuals, trusts and estates may perceive investments in REITs to be relatively less attractive than investments in the stocks of non-REIT corporations that pay dividends treated as qualified dividend income, which could materially and adversely affect the value of the shares of REITs, including the per share trading price of our common stock.
Our joint venture and preferred equity investments generally own real estate properties for which the economic performance and value is subject to all the risks associated with owning and operating real estate as described above. We may not be able to recover our investments in marketable securities, mortgage receivables or other investments, which may result in significant losses to us.
Our joint venture and preferred equity investments generally own real estate properties for which the economic performance and value are subject to all the risks associated with owning and operating real estate as described above. We may not be able to recover our investments in marketable securities, mortgage receivables or other investments, which may result in significant losses to us.
Such events could adversely impact tenants’ sales and/or cause the temporary closure of our tenants’ businesses, which could severely disrupt their operations and have a material adverse effect on our business, financial condition and results of operations. Financial disruption or a prolonged economic downturn could materially and adversely affect the Company ’ s business.
Such events could adversely impact tenants’ sales and/or cause the temporary closure of our tenants’ businesses, which could severely disrupt their operations and have a material adverse effect on our business, financial condition, results of operations and cash flows. Financial disruption or a prolonged economic downturn could materially and adversely affect the Company ’ s business.
These risks include, but are not limited to, risks related to obtaining all necessary zoning, land-use, building occupancy and other governmental permits and authorizations, risks related to the environmental concerns of government entities or community groups, risks related to changes in economic and market conditions between development commencement and stabilization, risks related to construction labor disruptions, adverse weather, acts of God or shortages of materials and labor which could cause construction delays and risks related to increases in the cost of labor and materials which could cause construction costs to be greater than projected and adversely impact the amount of our development fees or our financial condition, results of operations and cash flows.
These risks include, but are not limited to, risks related to obtaining all necessary zoning, land-use, building occupancy and other governmental permits and authorizations, risks related to the environmental concerns of government entities or community groups, risks related to changes in economic and market conditions, especially in an inflationary environment, between development commencement and stabilization, risks related to construction labor disruptions, adverse weather, acts of God or shortages of materials and labor which could cause construction delays and risks related to increases in the cost of labor and materials which could cause construction costs to be greater than projected and adversely impact the amount of our development fees or our financial condition, results of operations and cash flows.
Risks Related to Our Debt and Equity Securities We may be unable to obtain financing through the debt and equity markets, which would have a material adverse effect on our growth strategy, our financial condition and our results of operations.
Risks Related to Our Debt and Equity Securities We may be unable to obtain financing through the debt and equity markets, which could have a material adverse effect on our growth strategy, our financial condition and our results of operations.
Adverse changes in our credit ratings could impair our ability to obtain additional debt and equity financing on terms favorable to us, if at all, and could significantly reduce the market price of our publicly traded securities. We are subject to financial covenants that may restrict our operating and acquisition activities.
Adverse changes in our credit ratings could impair our ability to obtain additional debt and equity financing on terms favorable to us, if at all, and could significantly reduce the market price of our publicly traded securities. 18 Table of Contents We are subject to financial covenants that may restrict our operating and acquisition activities.
Our Credit Facility and the indentures under which our senior unsecured debt is issued contain certain financial and operating covenants, including, among other things, certain coverage ratios and limitations on our ability to incur debt, make dividend payments, sell all or substantially all of our assets and engage in mergers and consolidations and certain acquisitions.
Our Credit Facility, bank term loans and the indentures under which our senior unsecured debt is issued contain certain financial and operating covenants, including, among other things, certain coverage ratios and limitations on our ability to incur debt, make dividend payments, sell all or substantially all of our assets and engage in mergers and consolidations and certain acquisitions.
However, there can be no assurance that we have qualified or will continue to qualify as a REIT for U.S. federal income tax purposes. 19 Table of Contents Qualification as a REIT involves the application of highly technical and complex Code provisions, for which there are only limited judicial and administrative interpretations.
However, there can be no assurance that we have qualified or will continue to qualify as a REIT for U.S. federal income tax purposes. Qualification as a REIT involves the application of highly technical and complex Code provisions, for which there are only limited judicial and administrative interpretations.
Corporate responsibility, specifically related to ESG factors and commitments, imposes additional costs and expose us to new risks. Sustainability evaluations is becoming more broadly accepted or expected by investors and shareholders.
Corporate responsibility, specifically related to ESG factors and commitments, imposes additional costs and expose us to new risks. Sustainability evaluation is becoming more broadly accepted or expected by investors and shareholders.
Our charter contains various provisions that are intended to preserve our qualification as a REIT and, subject to certain exceptions, authorize our directors to take such actions as are necessary or appropriate to preserve our qualification as a REIT .
Our charter contains certain ownership limits. Our charter contains various provisions that are intended to preserve our qualification as a REIT and, subject to certain exceptions, authorize our directors to take such actions as are necessary or appropriate to preserve our qualification as a REIT .
In addition, joint venture arrangements may decrease our ability to manage risk and implicate additional risks, such as: ● our joint venture partner having potentially inferior financial capacity, diverging business goals and strategies and the need for their continued cooperation; ● our inability to take actions with respect to the joint venture activities that we believe are favorable to us if our joint venture partner does not agree; ● our inability to control the legal entity that has title to the real estate associated with the joint venture; ● our lenders may not be easily able to sell our joint venture assets and investments or may view them less favorably as collateral, which could negatively affect our liquidity and capital resources; ● our joint venture partners can take actions that we may not be able to anticipate or prevent, which could result in negative impacts on our debt and equity; and ● our joint venture partners’ business decisions or other actions or omissions may result in harm to our reputation or adversely affect the value of our investments.
In addition, joint venture arrangements may decrease our ability to manage risk and implicate additional risks, such as: ● our joint venture partner having potentially inferior financial capacity or diverging business goals and strategies, which could lead to actions not aligned with our interests; ● our inability to take actions with respect to the joint venture activities that we believe are favorable to us if our joint venture partner does not agree; ● our inability to control the legal entity that has title to the real estate associated with the joint venture; ● our lenders may not be easily able to sell our joint venture assets and investments or may view them less favorably as collateral, which could negatively affect our liquidity and capital resources; ● our joint venture partners can take actions that we may not be able to anticipate or prevent, which could result in negative impacts on our debt and equity; and ● our joint venture partners’ business decisions or other actions or omissions may result in harm to our reputation or adversely affect the value of our investments.
The occurrence of natural disasters, severe weather conditions and the effects of climate change, including extreme temperatures and ambient temperature increases, can delay new development or redevelopment projects, decrease the attractiveness of locations, increase investment costs to repair or replace damaged properties (or make repair or replacement impossible), increase operation costs, including the cost of energy at our properties, increase costs for future property insurance, negatively impact the tenant demand for lease space and cause substantial damages or losses to our properties which could exceed any applicable insurance coverage.
The occurrence of natural disasters, severe weather conditions and the effects of climate change, including extreme temperatures changes to meteorological or hydrological patterns, can delay new development or redevelopment projects, decrease the attractiveness of locations, increase investment costs to repair or replace damaged properties (or make repair or replacement impossible), increase operation costs, including the cost of energy at our properties, increase costs for future property insurance, negatively impact the tenant demand for lease space and cause substantial damages or losses to our properties which could exceed any applicable insurance coverage.
The maximum tax rate applicable to “qualified dividend income” payable to U.S. stockholders that are individuals, trusts and estates is 20%. Dividends payable by REITs, however, generally are not eligible for these reduced rates.
Dividends payable by REITs do not qualify for the reduced tax rates available for some dividends. The maximum tax rate applicable to “qualified dividend income” payable to U.S. stockholders that are individuals, trusts and estates is 20%. Dividends payable by REITs, however, generally are not eligible for these reduced rates.
See “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and Footnote 9 of the Notes to the Consolidated Financial Statements included in this Form 10-K for additional discussion regarding the shares held by the Company of Albertsons Companies, Inc. (“ACI”).
See “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and Footnotes 8 and 28 of the Notes to Consolidated Financial Statements included in this Form 10-K for additional discussion regarding the shares held by the Company of Albertsons Companies, Inc. (“ACI”).
If we admit outside members to our operating company, our duties as managing member of our operating company and to its members may come into conflict with the duties of our directors and officers to the corporation and our stockholders.
Our duties as managing member of our operating company and to its members may come into conflict with the duties of our directors and officers to the corporation and our stockholders.
A cyber incident could: ● disrupt the proper functioning of our networks and systems and therefore our operations and/or those of certain of our tenants; ● result in misstated financial reports, violations of loan covenants and/or missed reporting deadlines; ● result in our inability to properly monitor our compliance with the rules and regulations regarding our qualification as a REIT; ● result in the unauthorized access to, and destruction, loss, theft, misappropriation or release of proprietary, confidential, sensitive or otherwise valuable information of ours or others, which others could use to compete against us or for disruptive, destructive or otherwise harmful purposes and outcomes; ● result in our inability to maintain the building systems relied upon by our tenants for the efficient use of their leased space; ● require significant management attention and resources to remediate systems, fulfill compliance requirements and/or to remedy any damages that result; ● subject us to regulatory enforcement, including investigative costs and fines or penalties, as the White House, SEC and other regulators have increased their focus on companies’ cybersecurity vulnerabilities and risks; ● subject us to litigation claims for negligence, breach of contract or other agreements or other causes of action, potentially resulting in remedies such as damages, credits, penalties or termination of leases or other agreements; or ● damage our reputation among our tenants, investors and associates.
A cyber incident could materially affect our operations and financial condition by: ● disrupting the proper functioning of our networks and systems and, therefore, our operations and/or those of certain of our tenants; ● resulting in misstated financial reports, violations of loan covenants and/or missed reporting deadlines; ● resulting in our inability to properly monitor our compliance with the rules and regulations regarding our qualification as a REIT; ● resulting in the unauthorized access to, and destruction, loss, theft, misappropriation or release of proprietary, confidential, sensitive or otherwise valuable information of ours or others, which others could use to compete against us or for disruptive, destructive or otherwise harmful purposes and outcomes; ● resulting in our inability to maintain the building systems relied upon by our tenants for the efficient use of their leased space; ● requiring significant management attention and resources to remediate systems, fulfill compliance requirements and/or to remedy any damages that result; ● subjecting us to regulatory enforcement, including investigative costs and fines or penalties; ● subjecting us to litigation claims for negligence, breach of contract or other agreements or other causes of action, potentially resulting in remedies such as damages, credits, penalties or termination of leases or other agreements; or ● damaging our reputation among our tenants, investors and associates.
Although we do not intend to hold any properties that would be characterized as held for sale to customers in the ordinary course of our business, unless a sale or disposition qualifies under certain statutory safe harbors, or is held through a taxable REIT subsidiary, such characterization is a factual determination and no guarantee can be given that the IRS would agree with our characterization of our properties or that we will always be able to make use of the available safe harbors. 20 Table of Contents Dividends payable by REITs do not qualify for the reduced tax rates available for some dividends.
Although we do not intend to hold any properties that would be characterized as held for sale to customers in the ordinary course of our business, unless a sale or disposition qualifies under certain statutory safe harbors, or is held through a taxable REIT subsidiary, such characterization is a factual determination and no guarantee can be given that the IRS would agree with our characterization of our properties or that we will always be able to make use of the available safe harbors.
Pandemics or other health crises may adversely affect our tenants ’ financial condition and the profitability of our properties. Our business and the businesses of our tenants could be materially and adversely affected by the risks, or the public perception of the risks, related to a pandemic or other health crisis, such as the outbreak of novel coronavirus (COVID-19).
Our business and the businesses of our tenants could be materially and adversely affected by the risks, or the public perception of the risks, related to a pandemic or other health crisis, such as the outbreak of novel coronavirus (COVID-19).
We have a substantial amount of indebtedness and may need to incur more in the future. We have substantial indebtedness.
Following the RPT Merger, we have a substantial amount of indebtedness and may need to incur additional indebtedness in the future. Following the RPT Merger, we have a substantial amount of indebtedness and may need to incur additional indebtedness.
Moreover, while we may create and publish voluntary disclosures regarding ESG matters from time to time, many of the statements in those voluntary disclosures are based on hypothetical expectations and assumptions that may or may not be representative of current or actual risks or events or forecasts of expected risks or events, including the costs associated therewith.
To the extent we are subject to such activism, it may require us to incur costs or otherwise adversely impact our business. 17 Table of Contents Moreover, while we may create and publish voluntary disclosures regarding ESG matters from time to time, many of the statements in those voluntary disclosures are based on hypothetical expectations and assumptions that may or may not be representative of current or actual risks or events or forecasts of expected risks or events, including the costs associated therewith.
Our charter and bylaws and Maryland law contain provisions that may delay, defer or prevent a change of control transaction, even if such a change in control may be in our best interest, and as a result may depress the market price of our securities. Our charter contains certain ownership limits.
Any negative change in our dividend policy could have a material adverse effect on the market price of our common stock. 19 Table of Contents Our charter and bylaws and Maryland law contain provisions that may delay, defer or prevent a change of control transaction, even if such a change in control may be in our best interest, and as a result may depress the market price of our securities.
Such ESG matters may also impact our suppliers or customers, which may adversely impact our business, financial condition, or results of operations. 17 Table of Contents Our success depends largely on the continued service and availability of key personnel.
Such ESG matters may also impact our suppliers or customers, which may adversely impact our business, financial condition, or results of operations. Our success depends largely on the continued service and availability of key personnel. We depend on the deep industry knowledge and efforts of key personnel, including our executive officers, to manage our day-to-day operations and strategic business direction.
In the ordinary course of our business, we and our third-party service providers collect, process, transmit and store sensitive information and data, including intellectual property, our proprietary business information and that of our customers, suppliers and business partners, as well as personally identifiable information.
In the ordinary course of our business, we and our third-party service providers collect, process, transmit and store sensitive information and data, including intellectual property, our proprietary business information and that of our customers, suppliers and business partners, as well as personally identifiable information. 15 Table of Contents We, and our third-party service providers like all businesses, are subject to cyberattacks and security incidents, which threaten the confidentiality, integrity, and availability of our systems and information resources.
To maintain our REIT status, we may be forced to borrow funds during unfavorable market conditions, and the unavailability of such capital on favorable terms at the desired times, or at all, may cause us to curtail our investment activities and/or to dispose of assets at inopportune times, which could adversely affect our financial condition, results of operations, cash flows and per share trading price of our common stock.
Our failure to qualify as a REIT or new legislation or changes in U.S. federal income tax laws, including with respect to qualification as a REIT or the tax consequences of such qualification, could also impair our ability to expand our business or raise capital and have a materially adverse effect on the value of our securities. 20 Table of Contents To maintain our REIT status, we may be forced to borrow funds during unfavorable market conditions, and the unavailability of such capital on favorable terms at the desired times, or at all, may cause us to curtail our investment activities and/or to dispose of assets at inopportune times, which could adversely affect our financial condition, results of operations, cash flows and per share trading price of our common stock.
These covenants may restrict our ability to pursue certain business initiatives or certain acquisition transactions that might otherwise be advantageous. In addition, failure to meet any of the financial covenants could cause an event of default under our Credit Facility and the indentures and/or accelerate some or all of our indebtedness, which would have a material adverse effect on us.
In addition, failure to meet any of the financial covenants could cause an event of default under our Credit Facility, bank term loans and the indentures and/or accelerate some or all of our indebtedness, which would have a material adverse effect on us. We have a substantial amount of indebtedness and may need to incur more indebtedness in the future.
As a result, it is likely that we would recover substantially less than the full value of any unsecured claims we hold, if at all. E-commerce and other changes in consumer buying practices present challenges for many of our tenants and may require us to modify our properties, diversify our tenant composition and adapt our leasing practices to remain competitive.
E-commerce and other changes in consumer buying practices present challenges for many of our tenants and may require us to modify our properties, diversify our tenant composition and adapt our leasing practices to remain competitive.
The impact of any of these potential adverse consequences could have a material adverse effect on our results of operations, financial condition, and liquidity. Changes in market conditions could adversely affect the market price of our publicly traded securities. The market price of our publicly traded securities depends on various market conditions, which may change from time-to-time.
The impact of any of these potential adverse consequences could have a material adverse effect on our business, financial condition, results of operations and liquidity. Counterparties to certain agreements with RPT may exercise their contractual rights under such agreements in connection with the RPT Merger.
Our failure to qualify as a REIT or new legislation or changes in U.S. federal income tax laws including with respect to qualification as a REIT or the tax consequences of such qualification, could also impair our ability to expand our business or raise capital and have a materially adverse effect on the value of our securities.
Such REIT qualification failure could impair our ability to expand our business and raise capital, and would materially adversely affect the value of the Parent Company’s stock and the OP Units.
Removed
We, and our third-party service providers like all businesses, are subject to cyberattacks and security incidents, which threaten the confidentiality, integrity, and availability of our systems and information resources.
Added
As a result, it is likely that we would recover substantially less than the full value of any unsecured claims we hold, if at all.
Removed
If we cannot not meet these goals fully or on time, we may face reputational damage.
Added
The success of our tenants in operating their businesses and their corresponding ability to pay us rent continue to be significantly impacted by many current economic challenges, which impact the performance of their businesses, including, but not limited to, inflation, labor shortages, supply chain constraints, decreasing consumer confidence and discretionary spending, and increasing energy prices and interest rates.
Removed
We depend on the deep industry knowledge and efforts of key personnel, including our executive officers, to manage our day-to-day operations and strategic business direction.
Added
There can be no assurance that our cybersecurity risk management program, security controls and security process, or those of our third-party services providers will be fully implemented, complied with, or effective or that attempted security breaches or disruptions would not be successful or damaging.
Removed
Any negative change in our dividend policy could have a material adverse effect on the market price of our common stock.
Added
We have acquired in the past and may acquire in the future companies with cybersecurity vulnerabilities or unsophisticated security measures, which could expose us to significant cybersecurity, operational, and financial risks.
Added
Artificial intelligence presents risks and challenges that can impact our business, including by posing security risks to our confidential information, proprietary information, and personal data. Issues in the development and use of artificial intelligence, combined with an uncertain regulatory environment, may result in reputational harm, liability, or other adverse consequences to our business operations.
Added
As with many technological innovations, artificial intelligence presents risks and challenges that could impact our business. We have adopted generative artificial intelligence tools into our systems for specific use cases reviewed by legal and information security.
Added
Our vendors may incorporate generative artificial intelligence tools into their services and deliverables without disclosing this use to us, and the providers of these generative artificial intelligence tools may not meet existing or rapidly evolving regulatory or industry standards with respect to privacy and data protection and may inhibit our or our vendors’ ability to maintain an adequate level of service and experience.
Added
If we, our vendors, or our third-party partners experience an actual or perceived breach or a privacy or security incident because of the use of generative artificial intelligence, we may lose valuable intellectual property and confidential information, and our reputation and the public perception of the effectiveness of our security measures could be harmed.
Added
Further, bad actors around the world use increasingly sophisticated methods, including the use of artificial intelligence, to engage in illegal activities involving the theft and misuse of personal information, confidential information, and intellectual property. Any of these outcomes could damage our reputation, result in the loss of valuable property and information, and adversely impact our business.
Added
For more information on potential climate-related risks, please refer to our disclosures title “Environmental, Social and Governance (“ESG”) Programs” above. Pandemics or other health crises may adversely affect our tenants ’ financial condition and the profitability of our properties.
Added
If we cannot not meet these goals fully or on time, we may face reputational damage. Simultaneously, there are efforts by some parties to restrict companies’ efforts on various ESG-related matters. Both advocates and opponents to certain ESG matters are increasingly resorting to a range of activism forms, including media campaigns and litigation, to advance their perspectives.
Added
For example, we note that standards regarding the monitoring and accounting of GHG emissions, as well as any GHG emissions reductions, continues to evolve, and our disclosures on such matters may continue to evolve as well, though we cannot guarantee our disclosures will always be perceived as in keeping with particular best practices.
Added
These covenants may restrict our ability to pursue certain business initiatives or certain acquisition transactions that might otherwise be advantageous.
Added
The impact of any of these potential adverse consequences could have a material adverse effect on our results of operations, financial condition, and liquidity. We are exposed to interest rate risk, and there can be no assurance that we will manage or mitigate this risk effectively. We are exposed to interest rate risk, primarily through our unsecured revolving credit facility.
Added
Borrowings under our unsecured revolving credit facility bear interest at a floating rate, and as a result an increase in interest rates will increase the amount of interest we must pay. Our interest rate risk may materially change in the future if we increase our borrowings under this facility.
Added
A significant increase in interest rates could also make it more difficult to find alternative financing on desirable terms. Increases in interest rates on any of our variable-rate debt would result in an increase in interest expense, which could have an adverse effect on our results of operations, financial condition, and liquidity.
Added
For additional information with respect to interest rate risk, see “Item 7A. Quantitative and Qualitative Disclosures About Market Risk” in this Form 10-K. Changes in market conditions could adversely affect the market price of our publicly traded securities. The market price of our publicly traded securities depends on various market conditions, which may change from time-to-time.
Added
If Kimco OP were to fail to qualify as a partnership for federal income tax purposes, the Parent Company would fail to qualify as a REIT and suffer other adverse consequences.
Added
We believe that after the RPT Merger, Kimco OP has been organized and operated in a manner that allows it to be treated as a partnership, and not an association or publicly traded partnership taxable as a corporation, for federal income tax purposes.
Added
As an entity treated as a partnership for federal income tax purposes, Kimco OP is not subject to federal income tax on its income. Instead, each of its partners, including the Parent Company, is allocated, and may be required to pay tax with respect to, that partner’s share of Kimco OP’s income.
Added
No assurance can be provided, however, that the IRS will not challenge Kimco OP’s status as a partnership for federal income tax purposes or that a court would not sustain such a challenge.
Added
If the IRS were successful in treating Kimco OP as an association or publicly traded partnership taxable as a corporation for federal income tax purposes, the Parent Company would fail to meet the gross income tests and certain of the asset tests applicable to REITs and, accordingly, would cease to qualify as a REIT.
Added
Also, the failure of Kimco OP to qualify as a partnership would cause it to become subject to federal corporate income tax, which would reduce significantly the amount of its cash available for debt service and for distribution to its partners, including the Parent Company. Tax liabilities and attributes inherited in connection with acquisitions may adversely impact our business.
Added
From time to time we may acquire other corporations or entities and, in connection with such acquisitions, we may succeed to the historic tax attributes and liabilities of such entities.
Added
For example, if we acquire a C corporation and subsequently dispose of its assets within five years of the acquisition, we could be required to pay tax on any built-in gain attributable to such assets determined as of the date on which we acquired the assets.
Added
In addition, in order to qualify as a REIT, at the end of any taxable year, we must not have any earnings and profits accumulated in a non-REIT year.
Added
As a result, if we acquire a C corporation, we must distribute the corporation’s earnings and profits accumulated prior to the acquisition before the end of the taxable year in which we acquire the corporation. We also could be required to pay the acquired entity’s unpaid taxes even though such liabilities arose prior to the time we acquired the entity.
Added
Risks Relating to the Company after Completion of the RPT Merger We expect to incur substantial expenses related to the RPT Merger. We expect to incur substantial expenses in completing the RPT Merger and integrating the business, operations, networks, systems, technologies, policies and procedures of the Company and RPT.
Added
There are a large number of processes that must be integrated in the RPT Merger, including leasing, billing, management information, purchasing, accounting and finance, sales, payroll and benefits, fixed asset, lease administration and regulatory compliance.
Added
While we have assumed that a certain level of transaction and integration expenses would be incurred, there are a number of factors beyond our control that could affect the total amount or the timing of such integration expenses.
Added
Our stockholders were diluted by the RPT Merger and the trading price of shares of the combined company may be affected by factors different from those affecting the price of shares of our common stock before the RPT Merger. The RPT Merger diluted the ownership position of our stockholders.
Added
After completion of the RPT Merger, our legacy stockholders own approximately 92% of the issued and outstanding shares of our common stock, and legacy RPT stockholders own approximately 8% of the issued and outstanding shares of our common stock. Consequently, our stockholders have somewhat less influence over our management and policies after the RPT Merger than they previously exercised.
Added
The results of our operations and the trading price of our common stock after the RPT Merger may also be affected by factors different from those previously affecting our results of operations and the trading prices of our common stock. For example, some of our and RPT’s prior institutional investors may elect to decrease their ownership in the combined company.
Added
Accordingly, the historical trading prices and financial results of the Company and RPT may not be indicative of trading prices and financial results of the combined company after the RPT Merger. 21 Table of Contents Following the RPT Merger, we may be unable to integrate the business of RPT successfully or realize the anticipated synergies and related benefits of the RPT Merger or do so within the anticipated time frame.
Added
The RPT Merger involves the combination of two companies, which previously operated as independent public companies, and requires significant management attention and resources.
Added
Potential difficulties we may encounter in the integration process include: ● the inability to successfully combine the businesses of the Company and RPT in a manner that permits the Company to achieve the anticipated cost savings from the RPT Merger, which would result in some anticipated benefits of the RPT Merger not being realized in the time frame currently anticipated, or at all; ● the failure to integrate operations and internal systems, programs and controls within the expected time frame or at all; ● the inability to successfully realize the anticipated value from some of RPT’s assets; ● lost sales and tenants as a result of certain tenants of either of the Company or RPT deciding not to continue to do business with the combined company; ● complexities associated with combining two companies with different histories, cultures, markets, strategies and customer bases and managing the combined Company; ● any failure of the combined company to retain key employees of either of the two companies; ● potential unknown liabilities and unforeseen increased expenses associated with the RPT Merger; and ● performance shortfalls, including as a result of the diversion of management’s attention caused by the RPT Merger and integration.
Added
For all these reasons, you should be aware that it is possible that the integration process could result in the distraction of our management, the disruption of our ongoing business or inconsistencies in our services, standards, controls, procedures and policies, any of which could adversely affect the ability of the Company to maintain relationships with tenants, vendors and employees or to achieve the anticipated future opportunities, plans and benefits of the RPT Merger, or could otherwise adversely affect our business, financial condition, results of operations and cash flows.
Added
Our substantial indebtedness and the incurrence of new indebtedness could have adverse consequences on our business following the RPT Merger, such as: ● requiring the Company to use a substantial portion of our cash flow provided by operating activities to service our indebtedness, which would reduce the available cash flow to fund working capital, capital expenditures, development projects, and other general corporate purposes and reduce cash for distributions; ● limiting our ability to obtain additional financing to fund our working capital needs, acquisitions, capital expenditures, or other debt service requirements or for other purposes; ● increasing our costs of incurring additional debt; ● increasing our exposure to floating interest rates; ● limiting our ability to compete with other companies that are not as highly leveraged, as we may be less capable of responding to adverse economic and industry conditions; ● restricting the Company from making strategic acquisitions, developing properties, or exploiting business opportunities; ● restricting the way in which we conduct our business because of financial and operating covenants in the agreements governing our existing and future indebtedness; ● exposing the Company to potential events of default (if not cured or waived) under covenants contained in our debt instruments; ● increasing our vulnerability to a downturn in general economic conditions; and ● limiting our ability to react to changing market conditions in its industry.
Added
RPT is party to certain agreements that give the counterparty certain rights following a “change in control,” including in some cases the right to terminate such agreements.
Added
Under some such agreements, for example certain debt obligations, the RPT Merger constitutes a change in control and therefore the counterparty may exercise certain rights under the agreement upon the closing of the RPT Merger. Any such counterparty may request modifications of its respective agreements as a condition to granting a waiver or consent under its agreement.
Added
There is no assurance that such counterparties will not exercise their rights under such agreements, including termination rights where available, that the exercise of any such rights will not result in a material adverse effect or that any modifications of such agreements will not result in a material adverse effect to the combined company or its securities subsequent to the RPT Merger. 22 Table of Contents Item 1B.

Item 2. Properties

Properties — owned and leased real estate

13 edited+5 added−2 removed11 unchanged
Biggest changeMinimum base rental revenues and operating expense reimbursements accounted for 97% and other revenues, including percentage rents, accounted for 3% of the Company's total revenues from rental properties for the year ended December 31, 2022.
Biggest changeAdditionally, many of the leases provide for reimbursements by the tenant of capital expenditures. 24 Table of Contents Minimum base rental revenues, operating expense reimbursements, and percentage rents accounted for 98% of the Company's total revenues from rental properties for the year ended December 31, 2023.
Some of the major national and regional companies that are tenants in the Company's shopping center properties include TJX Companies, The Home Depot, Albertsons Companies, Ross Stores, Amazon/Whole Foods Market, PetSmart, Ahold Delhaize, Kroger, Burlington Stores and Walmart.
Some of the major national and regional companies that are tenants in the Company's shopping center properties include TJX Companies, The Home Depot, Albertsons Companies, Ross Stores, Amazon/Whole Foods Market, Burlington Stores, PetSmart, Ahold Delhaize, Kroger, and Walmart.
At December 31, 2022, the Company’s five largest tenants were TJX Companies, The Home Depot, Ross Stores, Albertsons Companies and Amazon/Whole Foods Market, which represented 3.7%, 2.1%, 1.9%, 1.9% and 1.8%, respectively, of the Company’s annualized base rental revenues, including the proportionate share of base rental revenues from properties in which the Company has less than a 100% economic interest.
At December 31, 2023, the Company’s five largest tenants were TJX Companies, The Home Depot, Albertsons Companies, Ross Stores and Amazon/Whole Foods Market, which represented 3.7%, 2.1%, 1.9%, 1.9% and 1.8%, respectively, of the Company’s annualized base rental revenues, including the proportionate share of base rental revenues from properties in which the Company has less than a 100% economic interest.
As of December 31, 2022, no single open-air shopping center accounted for more than 1.3% of the Company's annualized base rental revenues, including the proportionate share of base rental revenues from properties in which the Company has less than a 100% economic interest, or more than 1.4% of the Company’s total shopping center GLA.
As of December 31, 2023, no single open-air shopping center accounted for more than 1.3% of the Company's annualized base rental revenues, including the proportionate share of base rental revenues from properties in which the Company has less than a 100% economic interest, or more than 1.4% of the Company’s total shopping center GLA.
Ground-Leased Properties . The Company has interests in 40 consolidated shopping center properties that are subject to long-term ground leases where a third party owns and has leased the underlying land to the Company to construct and/or operate a shopping center.
Ground-Leased Properties . The Company has interests in 38 consolidated shopping center properties that are subject to long-term ground leases where a third party owns and has leased the underlying land to the Company to construct and/or operate a shopping center.
Although many of the leases require the Company to make roof and structural repairs as needed, a number of tenant leases place that responsibility on the tenant, and the Company's standard small store lease provides for reimbursements by the tenant as part of common area maintenance. Additionally, many of the leases provide for reimbursements by the tenant of capital expenditures.
Although many of the leases require the Company to make roof and structural repairs as needed, a number of tenant leases place that responsibility on the tenant, and the Company's standard small store lease provides for reimbursements by the tenant as part of common area maintenance.
For the period of January 1, 2022 to December 31, 2022, the Company increased the average base rent per leased square foot, which includes the impact of tenant concessions, in its consolidated portfolio of open-air shopping centers from $19.05 to $19.60, an increase of $0.55.
For the period of January 1, 2023 to December 31, 2023, the Company increased the average base rent per leased square foot, which includes the impact of tenant concessions, in its consolidated portfolio of open-air shopping centers from $19.60 to $20.24, an increase of $0.64.
Item 2. Properties Real Estate Portfolio. As of December 31, 2022, the Company had interests in 532 shopping center properties aggregating 90.8 million square feet of GLA located in 28 states. In addition, the Company had 23 other property interests, primarily through the Company’s preferred equity investments and other investments, totaling 5.7 million square feet of GLA.
Item 2. Properties Real Estate Portfolio. As of December 31, 2023, the Company had interests in 523 shopping center properties aggregating 89.7 million square feet of GLA located in 28 states. In addition, the Company had 21 other property interests, primarily through the Company’s preferred equity investments and other investments, totaling 5.5 million square feet of GLA.
The Company’s leases may also include escalation clauses, which provide for increases based upon changes in the consumer price index or similar inflation indices. As of December 31, 2022, the Company’s consolidated operating portfolio, comprised of 428 shopping center properties aggregating 70.6 million square feet of GLA, was 95.5% leased.
The Company’s leases may also include escalation clauses, which provide for increases based upon changes in the consumer price index or similar inflation indices. As of December 31, 2023, the Company’s consolidated operating portfolio, comprised of 426 shopping center properties aggregating 70.8 million square feet of GLA, was 96.1% leased.
During 2022, the Company expended $113.9 million in connection with property redevelopments and $79.8 million related to improvements. 21 Table of Contents The Company's management believes its experience in the real estate industry and its relationships with numerous national and regional tenants gives it an advantage in an industry where ownership is fragmented among a large number of property owners.
During 2023, the Company expended $151.1 million in connection with property redevelopments and $113.3 million related to improvements. The Company's management believes its experience in the real estate industry and its relationships with numerous national and regional tenants gives it an advantage in an industry where ownership is fragmented among a large number of property owners.
This increase primarily consists of (i) a $0.28 increase relating to rent step-ups within the portfolio and new leases signed, net of leases vacated, (ii) a $0.17 increase relating to acquisitions and (iii) a $0.10 increase relating to dispositions. The Company has a total of 8,292 leases in the consolidated operating portfolio.
This increase primarily consists of (i) a $0.48 increase relating to rent step-ups within the portfolio and new leases signed, net of leases vacated, (ii) an $0.08 increase relating to acquisitions and transfers and (iii) a $0.08 increase relating to dispositions. The Company has a total of 8,413 leases in the consolidated operating portfolio.
Open-air shopping centers comprise the primary focus of the Company's current portfolio. As of December 31, 2022, the Company’s Combined Shopping Center Portfolio, including noncontrolling interests, was 95.7% leased. The Company's open-air shopping center properties, which are generally owned and operated through subsidiaries or joint ventures, had an average size of 170,754 square feet as of December 31, 2022.
Open-air shopping centers comprise the primary focus of the Company's current portfolio. As of December 31, 2023, the Company’s Combined Shopping Center Portfolio, was 96.2% leased. The Company's open-air shopping center properties, which are generally owned and operated through subsidiaries or joint ventures, had an average size of 171,471 square feet as of December 31, 2023.
The leasing costs associated with these new leases are estimated to aggregate $107.4 million or $39.40 per square foot. These costs include $84.3 million of tenant improvements and $23.1 million of external leasing commissions. The average rent per square foot for (i) new leases was $21.76 and (ii) renewals and options was $18.20.
These costs include $93.9 million of tenant improvements and $25.6 million of external leasing commissions. The average rent per square foot for (i) new leases was $21.41 and (ii) renewals and options was $19.20.
Removed
A substantial portion of the Company's income consists of rent received under long-term leases.
Added
The following table shows the number of properties, total proportionate share of GLA and total proportionate share of annualized base rental revenues (including % of total) for the Company’s top 10 major metropolitan markets by total proportionate share of annualized based rent as of December 31, 2023.
Removed
Amounts in thousands, except for number of leases data: Year Ending December 31, Number of Leases Expiring Square Feet Expiring Total Annual Base Rent Expiring % of Gross Annual Rent (1) 167 469 $ 11,527 0.9 % 2023 867 4,771 $ 89,735 7.2 % 2024 1,185 7,648 $ 146,985 11.8 % 2025 1,149 8,134 $ 152,931 12.3 % 2026 1,071 9,563 $ 158,673 12.7 % 2027 1,138 9,726 $ 175,091 14.0 % 2028 790 7,860 $ 141,934 11.4 % 2029 432 3,915 $ 73,695 5.9 % 2030 321 2,612 $ 58,702 4.7 % 2031 338 2,385 $ 54,674 4.4 % 2032 402 2,901 $ 56,550 4.5 % (1) Leases currently under a month-to-month lease or in process of renewal. 22 Table of Contents During 2022, the Company executed 1,696 leases totaling 10.7 million square feet in the Company’s consolidated operating portfolio comprised of 525 new leases and 1,171 renewals and options.
Added
Amounts for GLA and Annual Base Rent in thousands: Total Total Proportionate Number of Proportionate Share of Annual % of Gross Market Rank Properties Share of GLA Base Rent Annual Rent New York 1 71 6,770 $ 166,799 11.7 % Baltimore, Washington D.C. 2 46 8,139 $ 161,295 11.3 % Los Angeles, Orange County, San Diego 3 49 7,570 $ 148,733 10.4 % Miami, Ft.
Added
Lauderdale 4 41 6,396 $ 124,806 8.7 % Houston 5 31 6,036 $ 122,453 8.6 % San Francisco, Sacramento, San Jose 6 24 3,076 $ 79,535 5.6 % Phoenix 7 23 4,524 $ 63,453 4.4 % Philadelphia 8 21 3,040 $ 56,567 4.0 % Orlando 9 15 2,373 $ 46,754 3.3 % Raleigh-Durham 10 14 2,905 $ 42,587 3.0 % A substantial portion of the Company's income consists of rent received under long-term leases.
Added
Amounts in thousands, except for number of leases data: Year Ending December 31, Number of Leases Expiring Square Feet Expiring Total Annual Base Rent Expiring % of Gross Annual Rent (1) 115 381 $ 9,741 0.7 % 2024 814 3,965 $ 85,798 6.6 % 2025 1,167 7,756 $ 150,601 11.6 % 2026 1,150 9,600 $ 164,580 12.7 % 2027 1,178 9,559 $ 177,095 13.6 % 2028 1,218 10,467 $ 200,255 15.4 % 2029 796 7,299 $ 130,729 10.1 % 2030 368 2,903 $ 65,229 5.0 % 2031 355 2,350 $ 54,949 4.2 % 2032 381 2,717 $ 54,113 4.2 % 2033 411 3,209 $ 61,773 4.8 % (1) Leases currently under a month-to-month lease or in process of renewal.
Added
During 2023, the Company executed 1,620 leases totaling 11.1 million square feet in the Company’s consolidated operating portfolio comprised of 500 new leases and 1,120 renewals and options. The leasing costs associated with these new leases are estimated to aggregate $119.5 million or $39.74 per square foot.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

13 edited+3 added−0 removed9 unchanged
Biggest changeComparison of 5 year cumulative total return data points Dec-17 Dec-18 Dec-19 Dec-20 Dec-21 Dec-22 Kimco Realty Corporation $ 100 $ 87 $ 130 $ 99 $ 167 $ 149 S&P 500 $ 100 $ 96 $ 126 $ 149 $ 192 $ 157 NAREIT Equity REITs $ 100 $ 95 $ 120 $ 111 $ 158 $ 120
Biggest changeThe information in this paragraph and the following performance chart are deemed to be furnished, not filed. 27 Table of Contents Comparison of 5 year cumulative total return data points Dec-18 Dec-19 Dec-20 Dec-21 Dec-22 Dec-23 Kimco Realty Corporation $ 100 $ 150 $ 114 $ 193 $ 172 $ 183 S&P 500 $ 100 $ 131 $ 156 $ 200 $ 164 $ 207 NAREIT Equity REITs $ 100 $ 126 $ 116 $ 166 $ 126 $ 143 Item 6.
The Company maintains a dividend reinvestment and direct stock purchase plan (the "Plan") pursuant to which common and preferred stockholders and other interested investors may elect to automatically reinvest their dividends to purchase shares of the Company’s common stock or, through optional cash payments, purchase shares of the Company’s common stock.
The Company maintains a dividend reinvestment and direct stock purchase plan (the "Plan") pursuant to which common stockholders and other interested investors may elect to automatically reinvest their dividends to purchase shares of the Company’s common stock or, through optional cash payments, purchase shares of the Company’s common stock.
Under this program, the Company may repurchase shares of its common stock, par value $0.01 per share, with an aggregate gross purchase price of up to $300.0 million. The Company did not repurchase any shares under the share repurchase program during the year ended December 31, 2022.
Under this program, the Company may repurchase shares of its common stock, par value $0.01 per share, with an aggregate gross purchase price of up to $300.0 million. The Company did not repurchase any shares under the share repurchase program during the year ended December 31, 2023.
The Company does not believe that the preferential rights available to the holders of its Class L Preferred Stock and Class M Preferred Stock, the financial covenants contained in its public bond indentures, as amended, or the credit agreement for its Credit Facility will have an adverse impact on the Company's ability to pay dividends in the normal course to its common stockholders or to distribute amounts necessary to maintain its qualification as a REIT.
The Company does not believe that the preferential rights available to the holders of its Class L Preferred Stock, Class M Preferred Stock, and Class N Preferred Stock, the financial covenants contained in its public bond indentures, as amended, or the credit agreement for its Credit Facility and bank term loans will have an adverse impact on the Company's ability to pay dividends in the normal course to its common stockholders or to distribute amounts necessary to maintain its qualification as a REIT.
Item 5. Market for the Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities Market Information: The Company’s common stock is traded on the NYSE under the trading symbol "KIM". Holders: The number of holders of record of the Company's common stock, par value $0.01 per share, was 2,767 as of January 31, 2023.
Item 5. Market for the Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities Market Information: The Company’s common stock is traded on the NYSE under the trading symbol "KIM". Holders: The number of holders of record of the Company's common stock, par value $0.01 per share, was 2,853 as of January 31, 2024.
The following table presents information regarding the shares of common stock repurchased by the Company during the three months ended December 31, 2022.
The following table presents information regarding the shares of common stock repurchased by the Company during the three months ended December 31, 2023.
The following table reflects the income tax status of distributions per share paid to holders of shares of our common stock: Year Ended December 31, 2022 2021 Dividend paid per share $ 0.84 $ 0.68 Ordinary income 81 % 77 % Capital gains 16 % 3 % Return of capital 3 % 20 % In addition to common stock offerings, the Company has capitalized on the growth in its business through the issuance of unsecured fixed rate medium-term notes, underwritten bonds, unsecured bank debt, mortgage debt and perpetual preferred stock.
The following table reflects the income tax status of distributions per share paid to holders of shares of our common stock: Year Ended December 31, 2023 2022 Dividend paid per share $ 1.02 $ 0.84 Ordinary income 99 % 81 % Capital gains - 16 % Return of capital 1 % 3 % In addition to common stock offerings, the Company has capitalized on the growth in its business through the issuance of unsecured fixed rate medium-term notes, underwritten bonds, unsecured bank debt, mortgage debt and perpetual preferred stock.
See "Management's Discussion and Analysis of Financial Condition and Results of Operations" and Footnotes 13, 14 and 19 of the Notes to Consolidated Financial Statements included in this Form 10-K.
See "Management's Discussion and Analysis of Financial Condition and Results of Operations" and Footnotes 12, 13 and 18 of the Notes to Consolidated Financial Statements included in this Form 10-K.
Issuer Purchases of Equity Securities: The Company’s Board of Directors had authorized the repurchase of up to 900,000 depositary shares of Class L preferred stock and 1,058,000 depositary shares of Class M preferred stock through December 31, 2022, which represented up to an aggregate of 1,958 shares of the Company’s preferred stock, par value $1.00 per share.
Issuer Purchases of Equity Securities: The Company’s Board of Directors had authorized the repurchase of up to 894,000 depositary shares of Class L preferred stock and 1,048,000 depositary shares of Class M preferred stock through December 31, 2023, which represented up to an aggregate of 1,942 shares of the Company’s preferred stock, par value $1.00 per share.
Period Total Number of Shares Purchased Average Price Paid per Share Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs Approximate Dollar Value of Shares that May Yet Be Purchased Under the Plans or Programs (in millions) October 1, 2022 – October 31, 2022 1,791 $ 18.63 - $ 224.9 November 1, 2022 – November 30, 2022 - - - $ 224.9 December 1, 2022 – December 31, 2022 4,472 21.49 - $ 224.9 Total 6,263 $ 20.67 - Total Stockholder Return Performance: The following performance chart compares, over the five years ended December 31, 2022, the cumulative total stockholder return on the Company’s common stock with the cumulative total return of the S&P 500 Index and the cumulative total return of the NAREIT Equity REITs Index (the “NAREIT Equity REITs”) prepared and published by the National Association of Real Estate Investment Trusts (“NAREIT”).
Period Total Number of Shares Purchased Average Price Paid per Share Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs Approximate Dollar Value of Shares that May Yet Be Purchased Under the Plans or Programs (in millions) October 1, 2023 – October 31, 2023 213 $ 17.28 - $ 224.9 November 1, 2023 – November 30, 2023 - - - $ 224.9 December 1, 2023 – December 31, 2023 2,250 22.33 - $ 224.9 Total 2,463 $ 21.89 - Total Stockholder Return Performance: The following performance chart compares, over the five years ended December 31, 2023, the cumulative total stockholder return on the Company’s common stock with the cumulative total return of the S&P 500 Index and the cumulative total return of the NAREIT Equity REITs Index (the “NAREIT Equity REITs”) prepared and published by the National Association of Real Estate Investment Trusts (“NAREIT”).
As of December 31, 2022, the Company had $224.9 million available under this common share repurchase program. 24 Table of Contents During the year ended December 31, 2022, the Company repurchased 567,450 shares of the Company’s common stock for an aggregate purchase price of $13.7 million (weighted average price of $24.11 per share) in connection with common shares surrendered or deemed surrendered to the Company to satisfy statutory minimum tax withholding obligations in connection with equity-based compensation plans.
During the year ended December 31, 2023, the Company repurchased 761,149 shares of the Company’s common stock for an aggregate purchase price of $16.3 million (weighted average price of $21.41 per share) in connection with common shares surrendered or deemed surrendered to the Company to satisfy statutory minimum tax withholding obligations in connection with equity-based compensation plans.
Stockholder return performance, presented annually for the five years ended December 31, 2022, is not necessarily indicative of future results. All stockholder return performance assumes the reinvestment of dividends. The information in this paragraph and the following performance chart are deemed to be furnished, not filed.
Stockholder return performance, presented annually for the five years ended December 31, 2023, is not necessarily indicative of future results. All stockholder return performance assumes the reinvestment of dividends.
During the year ended December 31, 2022, the Company repurchased 54,508 depositary shares of Class L preferred stock and 90,760 depositary shares of Class M preferred stock for a purchase price of $1.3 million and $2.1 million, respectively. During February 2018, the Company’s Board of Directors authorized a share repurchase program, which is scheduled to expire February 29, 2024.
During the year ended December 31, 2023, the Company repurchased 43,777 depositary shares of Class L preferred stock and 23,791 depositary shares of Class M preferred stock for a purchase price of $1.0 million and $0.5 million, respectively.
Added
See Footnote 28 of the Notes to Consolidated Financial Statements included in this Form 10-K.
Added
In addition, during January 2024, the Company’s Board of Directors authorized the repurchase of up to 891,000 depositary shares of Class L Preferred Stock, 1,047,000 depositary shares of Class M Preferred Stock, and 185,000 depositary shares of Class N Preferred Stock through February 28, 2026. 26 Table of Contents The Company’s Board of Directors also extended its previously authorized common share repurchase program, which is now scheduled to expire February 28, 2026.
Added
As of December 31, 2023, the Company had $224.9 million available under this common share repurchase program.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

116 edited+26 added−27 removed58 unchanged
Biggest changeThe following is a reconciliation of Net (loss)/income available to the Company’s common shareholders to Same property NOI (in thousands): Three Months Ended December 31, Year Ended December 31, 2022 2021 2022 2021 Net (loss)/income available to the Company’s common shareholders $ (56,086 ) $ 75,327 $ 100,758 $ 818,643 Adjustments: Management and other fee income (3,955 ) (4,249 ) (16,836 ) (14,883 ) General and administrative 31,928 28,985 119,534 104,121 Impairment charges 200 2,643 21,958 3,597 Merger charges - - - 50,191 Depreciation and amortization 124,676 133,633 505,000 395,320 Gain on sale of properties (4,221 ) - (15,179 ) (30,841 ) Interest and other expense, net 50,969 49,503 205,652 184,323 Loss/(gain) on marketable securities, net 100,314 37,347 315,508 (505,163 ) Provision for income taxes, net 57,750 483 56,654 3,380 Equity in income of other investments, net (1,912 ) (12,807 ) (17,403 ) (23,172 ) Net income/(loss) attributable to noncontrolling interests 2,710 268 (11,442 ) 5,637 Preferred dividends 6,307 6,354 25,218 25,416 Weingarten same property NOI (1) - - - 252,651 Non same property net operating income (14,942 ) (15,661 ) (80,504 ) (113,794 ) Non-operational expense from joint ventures, net 23,934 9,987 55,514 55,213 Same property NOI $ 317,672 $ 311,813 $ 1,264,432 $ 1,210,639 (1) Amount for the year ended December 31, 2021, represents the Same property NOI from Weingarten properties, not included in the Company's Net income available to the Company's common shareholders pre-Merger.
Biggest changeThe following is a reconciliation of Net income/(loss) available to the Company’s common shareholders to Same property NOI (in thousands): Three Months Ended December 31, Year Ended December 31, 2023 2022 2023 2022 Net income/(loss) available to the Company’s common shareholders $ 133,360 $ (56,086 ) $ 629,252 $ 100,758 Adjustments: Management and other fee income (3,708 ) (3,955 ) (16,343 ) (16,836 ) General and administrative 35,627 31,928 136,807 119,534 Impairment charges - 200 14,043 21,958 Merger charges 1,016 - 4,766 - Depreciation and amortization 124,282 124,676 507,265 505,000 Gain on sale of properties (22,600 ) (4,221 ) (74,976 ) (15,179 ) Special dividend income - - (194,116 ) - Interest expense and other income, net 46,917 50,969 210,241 205,652 (Gain)/loss on marketable securities, net (3,620 ) 100,314 (21,262 ) 315,508 (Benefit)/provision for income taxes, net (175 ) 57,750 60,952 56,654 Equity in income of other investments, net (1,968 ) (1,912 ) (10,709 ) (17,403 ) Net income/(loss) attributable to noncontrolling interests 2,468 2,710 11,676 (11,442 ) Preferred dividends 6,285 6,307 25,021 25,218 Non same property net operating income (12,967 ) (13,293 ) (62,357 ) (68,548 ) Non-operational expense from joint ventures, net 24,713 23,934 86,625 55,514 Same property NOI $ 329,630 $ 319,321 $ 1,306,885 $ 1,276,388 Same property NOI increased by $10.3 million, or 3.2%, for the three months ended December 31, 2023, as compared to the corresponding period in 2022.
The Company’s reconciliation of Net (loss)/income available to the Company’s common shareholders to FFO available to the Company’s common shareholders is reflected in the table below (in thousands, except per share data).
The Company’s reconciliation of Net income/(loss) available to the Company’s common shareholders to FFO available to the Company’s common shareholders is reflected in the table below (in thousands, except per share data).
Sales of the shares of common stock may be made, as needed, from time to time in “at the market” offerings as defined in Rule 415 of the Securities Act of 1933, including by means of ordinary brokers’ transactions on the New York Stock Exchange or otherwise (i) at market prices prevailing at the time of sale, (ii) at prices related to prevailing market prices or (iii) as otherwise agreed to with the applicable sales agent.
Sales of the shares of common stock may be made, as needed, from time to time in “at the market” offerings as defined in Rule 415 of the Securities Act of 1933, as amended, including by means of ordinary brokers’ transactions on the New York Stock Exchange or otherwise (i) at market prices prevailing at the time of sale, (ii) at prices related to prevailing market prices or (iii) as otherwise agreed to with the applicable sales agent.
Investing activities during 2022 consisted primarily of: Cash inflows: ● $302.5 million in proceeds from the sale of marketable securities, primarily due to the sale of 11.5 million shares of ACI; ● $184.3 million in proceeds from the sale of nine consolidated properties and 13 parcels; ● $68.4 million in reimbursements of investments in and advances to real estate joint ventures and other investments primarily due to the sale of properties within the investments; ● $60.3 million in collection of mortgage and other financing receivables; and ● $4.0 million for principal payments from securities held to maturity.
Investing activities during 2022 consisted primarily of: Cash inflows: ● $302.5 million in proceeds from the sale of marketable securities, primarily due to the sale of 11.5 million shares of ACI common stock; ● $184.3 million in proceeds from the sale of nine consolidated properties and 13 parcels; ● $68.4 million in reimbursements of investments in and advances to real estate joint ventures and other investments primarily due to the sale of properties within the investments; ● $60.3 million in collection of mortgage and other financing receivables; and ● $4.0 million for principal payments from securities held to maturity.
The Company will continue to evaluate its capital requirements for both its short-term and long-term liquidity needs, which could be affected by various risks and uncertainties, including, but not limited to, the effects of the current inflationary environment, rising interest rates, and other risks detailed in Part I, Item 1A.
The Company will continue to evaluate its capital requirements for both its short-term and long-term liquidity needs, which could be affected by various risks and uncertainties, including, but not limited to, the effects of the current inflationary environment, rising interest rates, and other risks detailed in Part I, Item 1A. Risk Factors.
In addition to the public equity and debt markets as capital sources, the Company may, from time to time, obtain mortgage financing on selected properties to partially fund the capital needs of its real estate re-development and re-tenanting projects. As of December 31, 2022, the Company had over 485 unencumbered property interests in its portfolio.
In addition to the public equity and debt markets as capital sources, the Company may, from time to time, obtain mortgage financing on selected properties to partially fund the capital needs of its real estate re-development and re-tenanting projects. As of December 31, 2023, the Company had over 485 unencumbered property interests in its portfolio.
In connection with the construction of its development/redevelopment projects and related infrastructure, certain public agencies require posting of performance and surety bonds to guarantee that the Company’s obligations are satisfied. These bonds expire upon the completion of the improvements and infrastructure. As of December 31, 2022, the Company had $18.4 million in performance and surety bonds outstanding.
In connection with the construction of its development/redevelopment projects and related infrastructure, certain public agencies require posting of performance and surety bonds to guarantee that the Company’s obligations are satisfied. These bonds expire upon the completion of the improvements and infrastructure. As of December 31, 2023, the Company had $18.4 million in performance and surety bonds outstanding.
The lender generally does not have recourse against any other assets owned by the borrower or any of the constituent members of the borrower, except for certain specified exceptions listed in the particular loan documents (see Footnote 7 of the Notes to Consolidated Financial Statements included in this Form 10-K).
The lender generally does not have recourse against any other assets owned by the borrower or any of the constituent members of the borrower, except for certain specified exceptions listed in the particular loan documents (see Footnote 6 of the Notes to Consolidated Financial Statements included in this Form 10-K).
The properties owned by the joint ventures are primarily financed with individual non-recourse mortgage loans, however, the Company, on a selective basis, has obtained unsecured financing for certain joint ventures. As of December 31, 2022, the Company did not guarantee any joint venture unsecured debt.
The properties owned by the joint ventures are primarily financed with individual non-recourse mortgage loans, however, the Company, on a selective basis, has obtained unsecured financing for certain joint ventures. As of December 31, 2023, the Company did not guarantee any joint venture unsecured debt.
Under this program, the Company may repurchase shares of its common stock, par value $0.01 per share, with an aggregate gross purchase price of up to $300.0 million. The Company did not repurchase any shares under the share repurchase program during 2022 and 2021.
Under this program, the Company may repurchase shares of its common stock, par value $0.01 per share, with an aggregate gross purchase price of up to $300.0 million. The Company did not repurchase any shares under the share repurchase program during 2023 and 2022.
Since the completion of the Company’s IPO in 1991, the Company has utilized the public debt and equity markets as its principal source of capital for its expansion needs. Since the IPO, the Company has completed additional offerings of its public unsecured debt and equity, raising in the aggregate over $17.4 billion.
Since the completion of the Company’s IPO in 1991, the Company has utilized the public debt and equity markets as its principal source of capital for its expansion needs. Since the IPO, the Company has completed additional offerings of its public unsecured debt and equity, raising in the aggregate over $17.9 billion.
To assist in partially mitigating the Company's exposure to increases in costs and operating expenses, including common area maintenance costs, real estate taxes and insurance, resulting from inflation the Company’s leases include provisions that either (i) require the tenant to pay an allocable share of these operating expenses or (ii) contain fixed contractual amounts, which include escalation clauses, to reimburse these operating expenses. 39 Table of Contents Funds From Operations FFO is a supplemental non-GAAP financial measure utilized to evaluate the operating performance of real estate companies.
To assist in partially mitigating the Company’s exposure to increases in costs and operating expenses, including common area maintenance costs, real estate taxes and insurance, resulting from inflation, the Company’s leases include provisions that either (i) require the tenant to pay an allocable share of these operating expenses or (ii) contain fixed contractual amounts, which include escalation clauses, to reimburse these operating expenses. 41 Table of Contents Funds From Operations Funds From Operations (“FFO”) is a supplemental non-GAAP financial measure utilized to evaluate the operating performance of real estate companies.
The Company intends to maintain strong debt service coverage and fixed charge coverage ratios as part of its commitment to maintain or improve its unsecured debt ratings. The Company may, from time to time, seek to obtain funds through additional common and preferred equity offerings, unsecured debt financings and/or mortgage/construction loan financings and other capital alternatives.
The Company intends to maintain strong debt service coverage and fixed charge coverage ratios as part of its commitment to maintain its unsecured debt ratings. The Company may, from time to time, seek to obtain funds through additional common and preferred equity offerings, unsecured debt financings, unsecured term loans and/or mortgage/construction loan financings and other capital alternatives.
The Company also made an election, per the NAREIT Funds From Operations White Paper-2018 Restatement, to exclude from its calculation of FFO (i) gains and losses on the sale of assets and impairments of assets incidental to its main business and (ii) mark-to-market changes in the value of its equity securities.
The Company also made an election, in accordance with the NAREIT Funds From Operations White Paper-2018 Restatement, to exclude from its calculation of FFO (i) gains and losses on the sale of assets and impairments of assets incidental to its main business and (ii) mark-to-market changes in the value of its equity securities.
The Company is actively pursuing redevelopment opportunities within its operating portfolio which it believes will increase the overall value by bringing in new tenants and improving the assets’ value. The Company anticipates its capital commitment toward these redevelopment projects and re-tenanting efforts for 2023 will be approximately $175.0 million to $225.0 million.
The Company is actively pursuing redevelopment opportunities within its operating portfolio which it believes will increase the overall value by bringing in new tenants and improving the assets’ value. The Company anticipates its capital commitment toward these redevelopment projects and re-tenanting efforts for 2024 will be approximately $225.0 million to $275.0 million.
The Company’s supplemental indenture governing its senior notes contains the following covenants, all of which the Company is compliant with: Covenant Must Be As of December 31, 2022 Consolidated Indebtedness to Total Assets 37% Consolidated Secured Indebtedness to Total Assets 2% Consolidated Income Available for Debt Service to Maximum Annual Service Charge >1.50x 3.9x Unencumbered Total Asset Value to Consolidated Unsecured Indebtedness >1.50x 2.5x For a full description of the various indenture covenants refer to the Indenture dated September 1, 1993; the First Supplemental Indenture dated August 4, 1994; the Second Supplemental Indenture dated April 7, 1995; the Third Supplemental Indenture dated June 2, 2006; the Fourth Supplemental Indenture dated April 26, 2007; the Fifth Supplemental Indenture dated as of September 24, 2009; the Sixth Supplemental Indenture dated as of May 23, 2013; Seventh Supplemental Indenture dated as of April 24, 2014; and the Eighth Supplemental Indenture dated as of January 3, 2023 each as filed with the SEC.
The Company’s supplemental indenture governing its senior notes contains the following covenants, all of which the Company is compliant with: Covenant Must Be As of December 31, 2023 Consolidated Indebtedness to Total Assets 38% Consolidated Secured Indebtedness to Total Assets 2% Consolidated Income Available for Debt Service to Maximum Annual Service Charge >1.50x 5.3x Unencumbered Total Asset Value to Consolidated Unsecured Indebtedness >1.50x 2.4x For a full description of the various indenture covenants refer to the Indenture dated September 1, 1993; the First Supplemental Indenture dated August 4, 1994; the Second Supplemental Indenture dated April 7, 1995; the Third Supplemental Indenture dated June 2, 2006; the Fourth Supplemental Indenture dated April 26, 2007; the Fifth Supplemental Indenture dated as of September 24, 2009; the Sixth Supplemental Indenture dated as of May 23, 2013; Seventh Supplemental Indenture dated as of April 24, 2014; and the Eighth Supplemental Indenture dated as of January 3, 2023 each as filed with the SEC.
New Accounting Pronouncements See Footnote 1 of the Notes to Consolidated Financial Statements included in this Form 10-K. 41 Table of Contents
New Accounting Pronouncements See Footnote 1 of the Notes to Consolidated Financial Statements included in this Form 10-K. 43 Table of Contents
(3) General and administrative expense includes employee-related expenses (including salaries, bonuses, equity awards, benefits, severance costs and payroll taxes), professional fees, office rent, travel and entertainment costs and other company-specific expenses. Net income available to the Company’s common shareholders was $100.8 million for the year ended December 31, 2022, as compared to $818.6 million for the comparable period in 2021.
(3) General and administrative expense includes employee-related expenses (including salaries, bonuses, equity awards, benefits, severance costs and payroll taxes), professional fees, office rent, travel and entertainment costs and other company-specific expenses. Net income available to the Company’s common shareholders was $629.3 million for the year ended December 31, 2023, as compared to $100.8 million for the comparable period in 2022.
The incremental taxes and PIF are to remain intact until the earlier of the payment of the bond liability in full or 2040. Off-Balance Sheet Arrangements Unconsolidated Real Estate Joint Ventures The Company has investments in various unconsolidated real estate joint ventures with varying structures. These joint ventures primarily operate shopping center properties.
The incremental taxes and PIF are to remain intact until the earlier of the payment of the bond liability in full or 2040. Off-Balance Sheet Arrangements Unconsolidated Real Estate Joint Ventures The Company has investments in various unconsolidated real estate joint ventures with varying structures. These joint ventures primarily operate shopping centers or mixed-use properties.
If the amounts allocated in 2022 to above-market and below-market leases were each reduced by 1% of the total purchase price, the net annual market lease amortization through rental income would decrease by $0.9 million (using the weighted average life of above-market and below-market leases at each respective acquired property).
If the amounts allocated in 2023 to above-market and below-market leases were each reduced by 1% of the total purchase price, the net annual market lease amortization through rental income would decrease by $1.1 million (using the weighted average life of above-market and below-market leases at each respective acquired property).
These maturing loans are anticipated to be repaid with operating cash flows, debt refinancing, unsecured credit facilities, proceeds from sales of properties within the ventures, and partner capital contributions, as deemed appropriate (see Footnote 7 of the Notes to Consolidated Financial Statements included in this Form 10-K).
These maturing loans are anticipated to be repaid with operating cash flows, debt refinancing, unsecured credit facilities, proceeds from sales of properties within the respective entities, and partner capital contributions, as deemed appropriate (see Footnote 6 of the Notes to Consolidated Financial Statements included in this Form 10-K).
Impairment charges – During the years ended December 31, 2022 and 2021, the Company recognized impairment charges of $22.0 million and $3.6 million, respectively, primarily related to adjustments to property carrying values for which the Company’s estimated fair values were primarily based upon signed contracts or letters of intent from third-party offers.
Impairment charges – During the years ended December 31, 2023 and 2022, the Company recognized impairment charges of $14.0 million and $22.0 million, respectively, primarily related to adjustments to property carrying values for which the Company’s estimated fair values were primarily based upon signed contracts or letters of intent from third-party offers.
See Footnote 1 of the Notes to Consolidated Financial Statements for further discussion of the Company’s accounting policies and estimates. Executive Overview Kimco Realty Corporation is North America’s largest publicly traded owner and operator of open-air, grocery-anchored shopping centers, and a growing portfolio of mixed-use assets.
See Footnote 1 of the Notes to Consolidated Financial Statements included in this Form 10-K for further discussion of the Company’s accounting policies and estimates. Executive Overview Kimco Realty Corporation is North America’s largest publicly traded owner and operator of open-air, grocery-anchored shopping centers, and a growing portfolio of mixed-use assets.
On a diluted per share basis, net income available to the Company’s common shareholders for the year ended December 31, 2022, was $0.16 as compared to $1.60 for the comparable period in 2021. For additional disclosure, see Footnote 28 of the Notes to Consolidated Financial Statements included in this Form 10-K.
On a diluted per share basis, net income available to the Company’s common shareholders for the year ended December 31, 2023, was $1.02 as compared to $0.16 for the comparable period in 2022. For additional disclosure, see Footnote 27 of the Notes to Consolidated Financial Statements included in this Form 10-K.
Comparison of the years ended December 31, 2021 and 2020 Information pertaining to fiscal year 2020 was included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2021 under Part II, Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” which was filed with the SEC on March 1, 2022.
Comparison of the years ended December 31, 2022 and 2021 Information pertaining to fiscal year 2021 was included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2022 under Part II, Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” which was filed with the SEC on February 24, 2023.
The funding of these capital requirements will be provided by cash on hand, proceeds from property dispositions, proceeds from the sale of marketable securities, net cash flow provided by operating activities and/or availability under the Company’s Credit Facility. Financing Activities Net cash flows used for financing activities was $982.7 million for 2022, as compared to $101.1 million for 2021.
The funding of these capital requirements will be provided by cash on hand, proceeds from property dispositions, proceeds from the sale of marketable securities, net cash flow provided by operating activities and/or availability under the Company’s Credit Facility. Financing Activities Net cash flow used for financing activities was $300.7 million for 2023, as compared to $982.7 million for 2022.
The Company provides a guaranty for the payment of any debt service shortfalls on Series A bonds issued by the Sheridan Redevelopment Agency which are tax increment revenue bonds issued in connection with a property owned by the Company in Sheridan, Colorado. These tax increment revenue bonds have a balance of $45.5 million outstanding at December 31, 2022.
The Company provides a guaranty for the payment of any debt service shortfalls on Series A bonds issued by the Sheridan Redevelopment Agency which are tax increment revenue bonds issued in connection with a property owned by the Company in Sheridan, Colorado. These tax increment revenue bonds have a balance of $41.0 million outstanding at December 31, 2023.
Cash dividends paid were $544.7 million, $382.1 million and $379.9 million in 2022, 2021 and 2020, respectively. Although the Company receives substantially all of its rental payments on a monthly basis, it generally intends to continue paying dividends quarterly.
Cash dividends paid were $657.5 million, $544.7 million and $382.1 million in 2023, 2022 and 2021, respectively. Although the Company receives substantially all of its rental payments on a monthly basis, it generally intends to continue paying dividends quarterly.
For example, in the event that the Company’s collectability determinations are not accurate, and we are required to write off additional receivables equaling 1% of the outstanding accounts receivable balance at December 31, 2022, the Company’s rental income and net income would decrease by $3.0 million for the year ended December 31, 2022.
For example, in the event that the Company’s collectability determinations are not accurate, and the Company is required to write off additional receivables equaling 1% of the outstanding accounts and notes receivable, net balance at December 31, 2023, the Company’s rental income and net income would decrease by $3.1 million for the year ended December 31, 2023.
Debt balances within the Company’s unconsolidated joint venture investments for which the Company held noncontrolling ownership interests at December 31, 2022, aggregated $1.4 billion.
Debt balances within the Company’s unconsolidated joint venture investments for which the Company held noncontrolling ownership interests at December 31, 2023, aggregated $1.2 billion.
As of December 31, 2022, the Company had 40 consolidated shopping center properties that are subject to long-term ground leases where a third party owns and has leased the underlying land or a portion of the underlying land to the Company to construct and/or operate a shopping center. Amounts due in 2023 in connection with these leases aggregate $12.4 million.
As of December 31, 2023, the Company had 38 consolidated shopping center properties that are subject to long-term ground leases where a third party owns and has leased the underlying land or a portion of the underlying land to the Company to construct and/or operate a shopping center. Amounts due in 2024 in connection with these leases aggregate $11.8 million.
At December 31, 2022, the Company had 6.9 million shares of common stock available for issuance under the 2020 Plan. (see Footnote 23 of the Notes to Consolidated Financial Statements included in this Form 10-K).
At December 31, 2023, the Company had 4.9 million shares of common stock available for issuance under the 2020 Plan. (see Footnote 22 of the Notes to Consolidated Financial Statements included in this Form 10-K).
As such, the Company does not include gains/impairments on land parcels, mark-to-market gains/losses from marketable securities, allowance for credit losses on mortgage receivables or gains/impairments on other investments in NAREIT defined FFO.
As such, the Company does not include gains/impairments on land parcels, mark-to-market gains/losses from marketable securities, allowance for credit losses on mortgage receivables, gains/impairments on other investments or other amounts considered incidental to its main business in NAREIT defined FFO.
These estimates are based on, but not limited to, historical results, industry standards and current economic conditions, giving due consideration to materiality. The Company’s significant accounting policies are more fully described in Footnote 1 to the Consolidated Financial Statements.
These estimates are based on, but not limited to, historical results, industry standards and current economic conditions, giving due consideration to materiality. The Company’s significant accounting policies are more fully described in Footnote 1 of the Notes to Consolidated Financial Statements included in this Form 10-K.
The Company elected to retain the proceeds from the sale and as a result incurred federal corporate and state income tax aggregating $57.2 million on such gain.
The Company elected to retain the proceeds from the sale and as a result incurred federal and state income tax aggregating $60.9 million on such gain.
The 2023 debt maturities on properties in the Company’s unconsolidated joint ventures are anticipated to be repaid through operating cash flows, debt refinancing, unsecured credit facilities, proceeds from sales within the respective entities, and partner capital contributions, as deemed appropriate.
The 2024 debt maturities on properties in the Company’s unconsolidated joint ventures and preferred equity program are anticipated to be repaid through operating cash flows, debt refinancing, proceeds from sales within the respective entities, and partner capital contributions, as deemed appropriate.
The following describes the changes of certain line items included on the Company’s Consolidated Statements of Income, that the Company believes changed significantly and affected Net income available to the Company’s common shareholders during the year ended December 31, 2022, as compared to the corresponding period in 2021: Revenue from rental properties, net – The increase in Revenues from rental properties, net of $361.1 million is primarily from (i) an increase in revenues of $332.6 million due to properties acquired during 2022 and 2021, including the results of the Merger, and (ii) an increase in revenues from tenants of $53.7 million primarily due to an increase in leasing activity and net growth in the current portfolio, partially offset by (iii) a net decrease of $19.6 million due to changes in credit losses from tenants, (iv) a decrease in revenues of $3.1 million due to dispositions in 2022 and 2021 and (v) a decrease in lease termination fee income of $2.5 million.
The following describes the changes of certain line items included on the Company’s Consolidated Statements of Income, that the Company believes changed significantly and affected Net income available to the Company’s common shareholders during the year ended December 31, 2023, as compared to the corresponding period in 2022: Revenues from rental properties, net – The increase in Revenues from rental properties, net of $56.2 million is primarily from (i) an increase in revenues from tenants of $50.2 million, primarily due to an increase in leasing activity and net growth in the current portfolio, and (ii) an increase in revenues of $48.8 million due to properties acquired during 2023 and 2022, partially offset by (iii) a decrease in revenues of $24.5 million due to dispositions in 2023 and 2022, (iv) a net decrease of $15.2 million due to changes in credit losses from tenants, and (v) a decrease in lease termination fee income of $3.1 million.
In addition, the Company’s Board of Directors declared a quarterly cash dividend of $0.23 per common share, which was paid on December 23, 2022, to shareholders of record on December 9, 2022.
In addition, the Company’s Board of Directors declared a quarterly cash dividend of $0.24 per common share, which was paid on December 21, 2023, to shareholders of record on December 7, 2023.
FFO available to the Company’s common shareholders would be increased by $584 and $856 for the three months ended December 31, 2022 and 2021, respectively, and $2,041 and $1,053 for the years ended December 31, 2022 and 2021, respectively.
FFO available to the Company’s common shareholders would be increased by $763 and $584 for the three months ended December 31, 2023 and 2022, respectively, and $2,395 and $2,041 for the years ended December 31, 2023 and 2022, respectively.
Capitalization rates and discount rates utilized in these models are based upon unobservable rates that the Company believes to be within a reasonable range of current market rates. See Footnote 3, 4 and 6 of the Notes to Consolidated Financial Statements for further discussion.
Capitalization rates and discount rates utilized in these models are based upon unobservable rates that the Company believes to be within a reasonable range of current market rates. See Footnotes 3 and 5 of the Notes to Consolidated Financial Statements included in this Form 10-K for further discussion.
Real Estate Valuation of Real Estate, and Intangible Assets and Liabilities The Company’s investments in real estate properties are stated at cost, less accumulated depreciation and amortization. Expenditures for maintenance and repairs are charged to operations as incurred. Significant renovations and replacements, which improve and extend the life of the asset, are capitalized.
Real Estate Valuation of Real Estate, and Intangible Assets and Liabilities The Company’s investments in real estate properties are stated at cost, less accumulated depreciation and amortization. Expenditures for maintenance and repairs are charged to operations as incurred.
These amounts consist of the following (in thousands): Year Ended December 31, 2022 2021 Redevelopment and renovations $ 113,928 $ 100,784 Tenant improvements and tenant allowances 79,782 62,915 Total improvements $ 193,710 $ 163,699 The Company has an ongoing program to redevelop and re-tenant its properties to maintain or enhance its competitive position in the marketplace.
These amounts consist of the following (in thousands): Year Ended December 31, 2023 2022 Redevelopment and renovations $ 151,067 $ 113,928 Tenant improvements and tenant allowances 113,328 79,782 Total improvements $ 264,395 $ 193,710 The Company has an ongoing program to redevelop and re-tenant its properties to maintain or enhance its competitive position in the marketplace.
On October 25, 2022, the Company’s Board of Directors declared a quarterly dividend with respect to the Company’s classes of cumulative redeemable preferred shares (Classes L and M) which were paid on January 17, 2023, to shareholders of record on December 30, 2022.
On October 23, 2023, the Company’s Board of Directors declared a quarterly dividend with respect to the Company’s classes of cumulative redeemable preferred shares (Classes L and M) which were paid on January 16, 2024, to shareholders of record on January 2, 2024.
Same property NOI increased by $53.8 million, or 4.4%, for the year ended December 31, 2022, as compared to the corresponding period in 2021.
Same property NOI increased by $30.5 million, or 2.4%, for the year ended December 31, 2023, as compared to the corresponding period in 2022.
The Company’s cash flow activities are summarized as follows (in thousands): Year Ended December 31, 2022 2021 Cash, cash equivalents and restricted cash, beginning of year $ 334,663 $ 293,188 Net cash flow provided by operating activities 861,114 618,875 Net cash flow used for investing activities (63,217 ) (476,259 ) Net cash flow used for financing activities (982,731 ) (101,141 ) Net change in cash, cash equivalents and restricted cash (184,834 ) 41,475 Cash, cash equivalents and restricted cash, end of year $ 149,829 $ 334,663 Operating Activities The Company anticipates that cash on hand, net cash flow provided by operating activities, borrowings under its Credit Facility and the issuance of equity, public debt, as well as other debt and equity alternatives, and the sale of marketable equity securities, will provide the necessary capital required by the Company.
The Company’s cash flow activities are summarized as follows (in thousands): Year Ended December 31, 2023 2022 Cash, cash equivalents and restricted cash, beginning of year $ 149,829 $ 334,663 Net cash flow provided by operating activities 1,071,607 861,114 Net cash flow used for investing activities (136,983 ) (63,217 ) Net cash flow used for financing activities (300,696 ) (982,731 ) Net change in cash, cash equivalents and restricted cash 633,928 (184,834 ) Cash, cash equivalents and restricted cash, end of year $ 783,757 $ 149,829 Operating Activities The Company anticipates that cash on hand, net cash flow provided by operating activities, borrowings under its Credit Facility and the issuance of equity, public debt, as well as other debt and equity alternatives, and the sale of marketable equity securities, will provide the necessary capital required by the Company.
These assessments have a direct impact on the Company’s net earnings. During 2022, the Company acquired properties for a total purchase price of $524.9 million. $8.4 million, or less than 1.6% of the total purchase price, was allocated to above-market leases and $24.1 million, or 4.6% was allocated to below-market leases.
These assessments have a direct impact on the Company’s net earnings. During 2023, the Company acquired properties for a total purchase price of $346.0 million of which, $5.0 million, or less than 1.4% of the total purchase price, was allocated to above-market leases and $29.3 million, or 8.5% of the total purchase price, was allocated to below-market leases.
This Annual Report pertains to the business and results of operations of the Predecessor for its fiscal year ended December 31, 2022. As a result of the Reorganization, the Company became the successor issuer to the Predecessor under the Exchange Act.
Prior to the Reorganization, the Company’s business was conducted through the Predecessor. This Annual Report includes the business and results of operations of the Predecessor for its fiscal years ended December 31, 2022 and 2021. As a result of the Reorganization, the Company became the successor issuer to the Predecessor under the Exchange Act.
(Loss)/gain on marketable securities, net – The change in (Loss)/gain on marketable securities, net of $820.7 million is primarily the result of mark-to-market fluctuations of the shares of ACI common stock held by the Company.
Gain/(loss) on marketable securities, net – The change in Gain/(loss) on marketable securities, net of $336.8 million is primarily the result of mark-to-market fluctuations of the ACI shares of common stock held by the Company and the sale of ACI shares of common stock during 2023 and 2022.
Net loss/(income) attributable to noncontrolling interests – The change in Net loss/(income) attributable to noncontrolling interests of $17.1 million is primarily due to (i) impairment charges relating to properties within consolidated joint ventures recognized during 2022, partially offset by (ii) an increase in net income attributable to noncontrolling interests primarily related to consolidated joint ventures acquired in the Merger.
Net (income)/loss attributable to noncontrolling interests – The change in Net (income)/loss attributable to noncontrolling interests of $23.1 million is primarily due to (i) lower impairment charges of $16.4 million relating to properties within consolidated joint ventures recognized during 2022, and (ii) an increase in income from properties acquired within consolidated joint ventures during 2022.
(2) For loans which have interest at floating rates, future interest expense was calculated using the rate as of December 31, 2022. (3) For leases which have inflationary increases, future ground and office rent expense was calculated using the rent based upon initial lease payment. The Company has $12.0 million of consolidated secured debt scheduled to mature in 2023.
(2) For loans which have interest at floating rates, future interest expense was calculated using the rate as of December 31, 2023. (3) For leases which have inflationary increases, future ground and office rent expense was calculated using the rent based upon initial lease payment.
Gain on sale of properties – During 2022, the Company disposed of nine operating properties and 13 parcels, in separate transactions, for an aggregate sales price of $191.1 million, which resulted in aggregate gains of $15.2 million.
Gain on sale of properties – During 2023, the Company disposed of six operating properties and 13 parcels, in separate transactions, for an aggregate sales price of $214.2 million, which resulted in aggregate gains of $75.0 million.
On February 8, 2023, the Company’s Board of Directors declared quarterly dividends with respect to the Company’s classes of cumulative redeemable preferred shares (Classes L and M), which are scheduled to be paid on April 17, 2023, to shareholders of record on April 3, 2023.
On January 30, 2024, the Company’s Board of Directors declared quarterly dividends with respect to the Company’s classes of cumulative redeemable preferred shares (Classes L, M and N), which are scheduled to be paid on April 15, 2024, to shareholders of record on April 1, 2024.
As of December 31, 2022, the Company had $411.0 million available under this ATM program. 35 Table of Contents The Company has a share repurchase program, which is scheduled to expire on February 29, 2024.
As of December 31, 2023, the Company had $500.0 million available under this ATM Program. 37 Table of Contents The Company has a common share repurchase program, which is scheduled to expire on February 28, 2026.
The Company anticipates satisfying the remaining future maturities with operating cash flows or debt refinancing. Commitments The Company has issued letters of credit in connection with the completion and repayment guarantees, primarily on certain of the Company’s redevelopment projects and guaranty of payment related to the Company’s insurance program.
Commitments The Company has issued letters of credit in connection with the completion and repayment guarantees, primarily on certain of the Company’s redevelopment projects and guaranty of payment related to the Company’s insurance program.
As of December 31, 2022, these loans had scheduled maturities ranging from three months to 8.5 years and bore interest at rates ranging from 2.95% to LIBOR plus 200 basis points (6.39% as of December 31, 2022). Approximately $38.1 million of the aggregate outstanding loan balance matures in 2023.
As of December 31, 2023, these loans had scheduled maturities ranging from three months to 7.5 years and bore interest at rates ranging from 2.95% to SOFR plus 210 basis points (7.41% as of December 31, 2023). Approximately $112.9 million of the aggregate outstanding loan balance matures in 2024.
Transaction costs related to acquisitions that qualify as asset acquisitions are capitalized as part of the cost basis of the acquired assets, while transaction costs for acquisitions that are deemed to be business combinations are expensed as incurred.
Significant renovations and replacements, which improve and extend the life of the asset, are capitalized. 28 Table of Contents Transaction costs related to acquisitions that qualify as asset acquisitions are capitalized as part of the cost basis of the acquired assets, while transaction costs for acquisitions that are deemed to be business combinations are expensed as incurred.
The following table summarizes the Company’s consolidated debt maturities (excluding extension options, unamortized debt issuance costs of $68.1 million and fair market value of debt adjustments aggregating $43.7 million) and obligations under non-cancelable operating leases as of December 31, 2022: Payments due by period (in millions) 2023 2024 2025 2026 2027 Thereafter Total Long-Term Debt: Principal (1) $ 23.4 $ 667.7 $ 813.5 $ 780.4 $ 472.7 $ 4,424.6 $ 7,182.3 Interest (2) $ 250.3 $ 229.6 $ 204.1 $ 191.0 $ 161.4 $ 1,553.5 $ 2,589.9 Non-cancelable Leases: Operating leases (3) $ 12.4 $ 11.6 $ 11.1 $ 10.4 $ 10.1 $ 188.9 $ 244.5 Financing leases $ 23.0 $ - $ - $ - $ - $ - $ 23.0 (1) Maturities utilized do not reflect extension options, which range from two to five years.
The following table summarizes the Company’s consolidated debt maturities (excluding extension options, unamortized debt issuance costs of $66.2 million and fair market value of debt adjustments aggregating $24.4 million) and obligations under non-cancelable operating leases as of December 31, 2023: Payments due by period (in millions) 2024 2025 2026 2027 2028 Thereafter Total Long-Term Debt: Principal (1) $ 667.5 $ 813.5 $ 780.4 $ 472.7 $ 523.4 $ 4,401.2 $ 7,658.7 Interest (2) $ 261.8 $ 236.1 $ 223.0 $ 193.4 $ 178.2 $ 1,572.6 $ 2,665.1 Non-cancelable Leases: Operating leases (3) $ 11.8 $ 11.3 $ 10.6 $ 10.3 $ 10.4 $ 178.4 $ 232.8 Financing leases $ 25.9 $ - $ - $ - $ - $ - $ 25.9 (1) Maturities utilized do not reflect extension options, which range from two to five years.
For additional information about the Reorganization, please see the Company’s Current Reports on Form 8-K filed with the SEC on January 3, 2023 and January 4, 2023. 27 Table of Contents Financial Highlights The following highlights the Company’s significant transactions, events and results that occurred during the year ended December 31, 2022: Financial and Portfolio Information: ● Net income available to the Company’s common shareholders was $100.8 million, or $0.16 per diluted share, for the year ended December 31, 2022 as compared to $818.6 million, or $1.60 per diluted share, for the year ended December 31, 2021. ● FFO available to the Company's common shareholders was $976.4 million, or $1.58 per diluted share, for the year ended December 31, 2022, as compared to $706.8 million, or $1.38 per diluted share, for the corresponding period in 2021 (see additional disclosure on FFO beginning on page 40). ● Same property net operating income (“Same property NOI”) was $1.3 billion for the year ended December 31, 2022, as compared to $1.2 billion for the corresponding period in 2021, an increase of 4.4% (see additional disclosure on Same property NOI beginning on page 40). ● Executed 1,696 new leases, renewals and options totaling approximately 10.7 million square feet in the consolidated operating portfolio during the year ended December 31, 2022. ● Consolidated operating portfolio occupancy at December 31, 2022 was 95.5% as compared to 94.2% at December 31, 2021.
Financial Highlights The following highlights the Company’s significant transactions, events and results that occurred during the year ended December 31, 2023: Financial and Portfolio Information: ● Net income available to the Company’s common shareholders was $629.3 million, or $1.02 per diluted share, for the year ended December 31, 2023 as compared to $100.8 million, or $0.16 per diluted share, for the year ended December 31, 2022. ● FFO available to the Company’s common shareholders was $970.0 million, or $1.57 per diluted share, for the year ended December 31, 2023, as compared to $976.4 million, or $1.58 per diluted share, for the corresponding period in 2022 (see additional disclosure on FFO beginning on page 42). ● Same property net operating income (“Same property NOI”) was $1.31 billion and $1.28 billion for the years ended December 31, 2023 and December 31, 2022, respectively, an increase of 2.4% (see additional disclosure on Same property NOI beginning on page 43). ● Executed 1,620 new leases, renewals and options totaling approximately 11.1 million square feet in the consolidated operating portfolio during the year ended December 31, 2023. ● Consolidated operating portfolio occupancy at December 31, 2023 was 96.1% as compared to 95.5% at December 31, 2022.
The increase of $242.2 million is primarily attributable to: ● additional operating cash flow generated by operating properties acquired during 2022 and 2021, including those acquired from the Merger; ● new leasing, expansion and re-tenanting of core portfolio properties; ● changes in accounts payable and accrued expenses due to timing of receipts and payments; and ● nonrecurring costs incurred in connection with the Merger during 2021, partially offset by ● changes in operating assets and liabilities due to timing of receipts and payments; ● a decrease in distributions from the Company’s joint ventures programs due to the sale of properties within the ventures; and ● the disposition of operating properties in 2022 and 2021.
The increase of $210.5 million is primarily attributable to: ● special dividend payment from ACI of $194.1 million during 2023; ● additional operating cash flow generated by operating properties acquired during 2023 and 2022; and 34 Table of Contents ● new leasing, expansion and re-tenanting of core portfolio properties; partially offset by ● a decrease in distributions from the Company’s joint ventures programs; ● the disposition of operating properties in 2023 and 2022; ● changes in assets and liabilities due to timing of receipts and payments; and ● nonrecurring costs incurred in connection with the RPT Merger during 2023.
Fair value is determined based on a market approach, which contemplates the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. 26 Table of Contents Depreciation and amortization are provided on the straight-line method over the estimated useful lives of the assets, as follows: Buildings and building improvements (in years) 5 to 50 Fixtures, leasehold and tenant improvements (including certain identified intangible assets) Terms of leases or useful lives, whichever is shorter The Company is required to make subjective assessments as to the useful lives of its properties for purposes of determining the amount of depreciation to reflect on an annual basis with respect to those properties.
Depreciation and amortization are provided on the straight-line method over the estimated useful lives of the assets, as follows: Buildings and building improvements (in years) 5 to 50 Fixtures, leasehold and tenant improvements (including certain identified intangible assets) Terms of leases or useful lives, whichever is shorter The Company is required to make subjective assessments as to the useful lives of its properties for purposes of determining the amount of depreciation to reflect on an annual basis with respect to those properties.
This increase is primarily the result of (i) an increase of $15.4 million primarily related to an increase in rental revenue driven by strong leasing activity and a decrease in tenant rent abatements and vacancies as a result of the diminishing effects of the COVID-19 pandemic, partially offset by (ii) a change in credit loss from tenants of $9.5 million.
This increase is primarily the result of (i) an increase of $47.9 million primarily related to an increase in rental revenue driven by strong leasing activity, partially offset by (ii) a change in credit loss from tenants of $17.4 million.
Additionally, on February 8, 2023, the Company’s Board of Directors declared a quarterly cash dividend of $0.23 per common share payable on March 23, 2023 to shareholders of record on March 9, 2023.
Additionally, on January 30, 2024, the Company’s Board of Directors declared a quarterly cash dividend of $0.24 per common share payable on March 21, 2024 to shareholders of record on March 7, 2024.
Same Property Net Operating Income Same property NOI is a supplemental non-GAAP financial measure of real estate companies’ operating performance and should not be considered an alternative to net income in accordance with GAAP or cash flows from operations as a measure of liquidity.
In addition, includes income related to the liquidation of the pension plan of $5.0 million, net for the year ended December 31, 2023. 42 Table of Contents Same Property Net Operating Income Same property NOI is a supplemental non-GAAP financial measure of real estate companies’ operating performance and should not be considered an alternative to net income in accordance with GAAP or cash flows from operations as a measure of liquidity.
The financial covenants for the Credit Facility are as follows: Covenant Must Be As of December 31, 2022 Total Indebtedness to Gross Asset Value (“GAV”) 38% Total Priority Indebtedness to GAV 2% Unencumbered Asset Net Operating Income to Total Unsecured Interest Expense >1.75x 4.6x Fixed Charge Total Adjusted EBITDA to Total Debt Service >1.50x 4.1x For a full description of the Credit Facility’s covenants, refer to Amendment No. 2, dated July 12, 2022, to the Amended and Restated Credit Agreement, dated February 27, 2020, filed as Exhibit 10.1 to the Company’s Quarterly Report on Form 10-Q for the quarterly period ended June 30, 2022, file with the SEC on July 29, 2022.
The financial covenants for the Credit Facility are as follows: Covenant Must Be As of December 31, 2023 Total Indebtedness to Gross Asset Value (“GAV”) 36% Total Priority Indebtedness to GAV 1% Unencumbered Asset Net Operating Income to Total Unsecured Interest Expense >1.75x 5.4x Fixed Charge Total Adjusted EBITDA to Total Debt Service >1.50x 4.7x For a full description of the Credit Facility’s covenants, refer to the Amended and Restated Credit Agreement dated as of February 23, 2023, filed as Exhibit 10.20 in our Annual Report on Form 10-K for the year ended December 31, 2022.
Preferred Stock – The Company’s Board of Director’s authorized the repurchase of up to 900,000 depositary shares of Class L preferred stock and 1,058,000 depositary shares of Class M preferred stock representing up to 1,958 shares the Company’s preferred stock, par value $1.00 per share through December 31, 2022.
Preferred Stock – The Company’s Board of Directors had authorized the repurchase of up to 894,000 depositary shares of Class L preferred stock and 1,048,000 depositary shares of Class M preferred stock through December 31, 2023, which represented up to 1,942 shares of the Company’s preferred stock, par value $1.00 per share.
For additional disclosure, see Footnotes 6 and 18 of the Notes to Consolidated Financial Statements included in this Form 10-K. Merger charges – During the year ended December 31, 2021, the Company incurred costs of $50.2 million associated with the Merger. These charges are primarily comprised of severance costs and professional and legal fees.
Merger charges – During the year ended December 31, 2023, the Company incurred costs of $4.8 million associated with the RPT Merger, primarily comprised of professional and legal fees (see Footnote 28 of the Notes to Consolidated Financial Statements included in this Form 10-K).
Same property NOI assists in eliminating disparities in net income due to the development, acquisition or disposition of properties during the particular period presented, and thus provides a more consistent performance measure for the comparison of the Company's properties. 40 Table of Contents For the three months and years ended December 31, 2022 and 2021, the Company included Same property NOI from the Weingarten properties acquired through the Merger.
Same property NOI assists in eliminating disparities in net income due to the development, acquisition or disposition of properties during the particular period presented, and thus provides a more consistent performance measure for the comparison of the Company's properties.
The New Credit Facility accrues interest at a rate of Adjusted Term SOFR, as defined in the terms of the New Credit Facility, plus 77.5 basis points and fluctuates in accordance with the Company's credit ratings, which can be further adjusted upward or downward by four basis points based on the sustainability metric targets, as defined in the agreement.
The Credit Facility is a green credit facility tied to sustainability metric targets, as described in the agreement. The Credit Facility accrues interest at a rate of Adjusted Term SOFR, as defined in the terms of the Credit Facility, plus 77.5 basis points and fluctuates in accordance with the Company’s credit ratings.
During the year ended December 31, 2022, the Company repurchased the following preferred stock: Class of Preferred Stock Depositary Shares Repurchased Purchase Price (in millions) Class L 54,508 $ 1.3 Class M 90,760 $ 2.1 Common Stock – During August 2021, the Company established an at-the-market continuous offering program (the “ATM program”) pursuant to which the Company may offer and sell from time-to-time shares of its common stock, par value $0.01 per share, with an aggregate gross sales price of up to $500.0 million through a consortium of banks acting as sales agents.
Common Stock – During September 2023, the Company established an at-the-market continuous offering program (the “ATM Program”) pursuant to which the Company may offer and sell from time-to-time shares of its common stock, par value $0.01 per share, with an aggregate gross sales price of up to $500.0 million through a consortium of banks acting as sales agents.
In addition, for a full description of the various indenture covenants for senior unsecured notes assumed during the Merger, refer to the Indenture dated May 1, 1995 included as an exhibit to Weingarten’s Registration Statement on Form S-3, filed with the Securities and Exchange Commission on May 1, 1995; First Supplemental Indenture, dated as of August 2, 2006, included as an exhibit to Weingarten’s Current Report on Form 8-K dated August 2, 2006, Second Supplemental Indenture, dated as of October 9, 2012 filed with Weingarten’s Current Report on Form 8-K dated October 9, 2012.
Please refer to the form Indenture included in Weingarten’s Registration Statement on Form S-3, filed with the Securities and Exchange Commission on February 10, 1995, the First Supplemental Indenture, dated as of August 2, 2006 filed with Weingarten’s Current Report on Form 8-K dated August 2, 2006, and the Second Supplemental Indenture, dated as of October 9, 2012 filed with Weingarten’s Current Report on Form 8-K dated October 9, 2012.
Risk Factors 32 Table of Contents Net cash flows provided by operating activities for the year ended December 31, 2022, was $861.1. million, as compared to $618.9 million for the comparable period in 2021.
Net cash flow provided by operating activities for the year ended December 31, 2023 was $1.1 billion, as compared to $861.1 million for the comparable period in 2022.
Investing Activities Net cash flows used for investing activities was $63.2 million for 2022, as compared to $476.3 million for 2021.
Investing Activities Net cash flow used for investing activities was $137.0 million for 2023, as compared to $63.2 million for 2022.
Liquidity and Capital Resources The Company’s capital resources include accessing the public debt and equity capital markets, unsecured term loans, mortgages and construction loan financing, marketable securities (including 28.3 million shares of ACI common stock held by the Company, which had a value of $587.7 million at December 31, 2022 and are subject to certain contractual lock-up provisions that expire in May 2023) and immediate access to an unsecured revolving credit facility (the “Credit Facility”) with bank commitments of $2.0 billion which can be increased to $2.75 billion through an accordion feature.
Liquidity and Capital Resources The Company’s capital resources include accessing the public debt and equity capital markets, unsecured term loans, mortgages and construction loan financing, marketable securities (including 14.2 million shares of ACI common stock held by the Company, see Footnote 28 of the Notes to Consolidated Financial Statements included in this Form 10-K) and immediate access to an unsecured revolving credit facility (the “Credit Facility”) with bank commitments of $2.0 billion, which can be increased to $2.75 billion through an accordion feature.
This increase is primarily the result of (i) an increase of $81.0 million primarily related to an increase in rental revenue driven by strong leasing activity and a decrease in tenant rent abatements and vacancies as a result of the diminishing effects of the COVID-19 pandemic, partially offset by (ii) a change in credit loss from tenants of $27.2 million.
This increase is primarily the result of (i) an increase of $12.2 million, primarily related to an increase in rental revenue driven by strong leasing activity, partially offset by (ii) a change in credit loss from tenants of $1.9 million.
The executive officers are engaged in the day-to-day management and operation of real estate exclusively with the Company, with nearly all operating functions, including leasing, asset management, maintenance, construction, legal, finance and accounting, administered by the Company.
The executive officers are engaged in the day-to-day management and operation of real estate exclusively with the Company, with nearly all operating functions, including leasing, asset management, maintenance, construction, legal, finance and accounting, administered by the Company. 29 Table of Contents Corporate UPREIT Reorganization In January of 2023, the Company completed the Reorganization into an UPREIT structure as described in the Explanatory Note at the beginning of this Annual Report.
The Company anticipates spending approximately $125.0 million to $250.0 million towards the acquisition of operating properties during 2023. The Company intends to fund these acquisitions with cash on hand, net cash flow provided by operating activities, proceeds from property dispositions, proceeds from the sale of marketable securities and/or availability under its Credit Facility.
The Company intends to fund these acquisitions with cash on hand, net cash flow provided by operating activities, proceeds from property dispositions, proceeds from the sale of marketable securities and/or availability under its Credit Facility. 35 Table of Contents Improvements to Operating Real Estate During the years ended December 31, 2023 and 2022, the Company expended $264.4 million and $193.7 million, respectively, towards improvements to operating real estate.
Three Months Ended December 31, Year Ended December 31, 2022 2021 2022 2021 Net (loss)/income available to the Company’s common shareholders $ (56,086 ) $ 75,327 $ 100,758 $ 818,643 Gain on sale of properties (4,221 ) - (15,179 ) (30,841 ) Gain on sale of joint venture properties (643 ) (11,596 ) (38,825 ) (16,879 ) Depreciation and amortization - real estate related 123,663 132,797 501,274 392,095 Depreciation and amortization - real estate joint ventures 16,158 15,949 66,326 51,555 Impairment charges (including real estate joint ventures) 1,585 3,932 27,254 7,145 Profit participation from other investments, net (4,584 ) (9,824 ) (15,593 ) (8,595 ) Loss/(gain) on marketable securities, net 100,314 37,347 315,508 (505,163 ) Provision/(benefit) for income taxes (1) 58,608 (25 ) 58,373 2,152 Noncontrolling interests (1) 63 (3,835 ) (23,540 ) (3,285 ) FFO available to the Company’s common shareholders (3) $ 234,857 $ 240,072 $ 976,356 $ 706,827 Weighted average shares outstanding for FFO calculations: Basic 615,856 614,150 615,528 506,248 Units 2,559 3,878 2,492 2,627 Dilutive effect of equity awards 2,114 2,410 2,283 2,422 Diluted (2) 620,529 620,438 620,303 511,297 FFO per common share – basic $ 0.38 $ 0.39 $ 1.59 $ 1.40 FFO per common share – diluted (2) $ 0.38 $ 0.39 $ 1.58 $ 1.38 (1) Related to gains, impairment, depreciation on properties, and gains/(losses) on sales of marketable securities, where applicable.
Three Months Ended December 31, Year Ended December 31, 2023 2022 2023 2022 Net income/(loss) available to the Company’s common shareholders $ 133,360 $ (56,086 ) $ 629,252 $ 100,758 Gain on sale of properties (22,600 ) (4,221 ) (74,976 ) (15,179 ) Gain on sale of joint venture properties - (643 ) (9,020 ) (38,825 ) Depreciation and amortization - real estate related 123,053 123,663 502,347 501,274 Depreciation and amortization - real estate joint ventures 16,082 16,158 64,472 66,326 Impairment charges (including real estate joint ventures) 1,020 1,585 15,060 27,254 Profit participation from other investments, net 366 (4,584 ) (1,916 ) (15,593 ) Special dividend income - - (194,116 ) - (Gain)/loss on marketable securities/derivative, net (11,354 ) 100,314 (21,996 ) 315,508 (Benefit)/provision for income taxes (1) (112 ) 58,608 61,351 58,373 Noncontrolling interests (1) (372 ) 63 (440 ) (23,540 ) FFO available to the Company’s common shareholders (3) (4) $ 239,443 $ 234,857 $ 970,018 $ 976,356 Weighted average shares outstanding for FFO calculations: Basic 617,122 615,856 616,947 615,528 Units 2,389 2,559 2,380 2,492 Dilutive effect of equity awards 845 2,114 1,132 2,283 Diluted (2) 620,356 620,529 620,459 620,303 FFO per common share – basic $ 0.39 $ 0.38 $ 1.57 $ 1.59 FFO per common share – diluted (2) $ 0.39 $ 0.38 $ 1.57 $ 1.58 (1) Related to gains, impairment, depreciation on properties, and gains/(losses) on sales of marketable securities, where applicable.
Contractual Obligations and Other Commitments Contractual Obligations The Company has debt obligations relating to its Credit Facility (no outstanding balance as of December 31, 2022), unsecured senior notes and mortgages with maturities ranging from four months to 27 years. As of December 31, 2022, the Company’s consolidated total debt had a weighted average term to maturity of 9.5 years.
Contractual Obligations and Other Commitments Contractual Obligations The Company has debt obligations relating to its Credit Facility (no outstanding balance as of December 31, 2023), unsecured senior notes and mortgages with maturities ranging from less than one month to 26 years.
Other income, net – The increase in Other income, net of $9.0 million is primarily due to (i) a net increase in mortgage and other financing income of $9.4 million, including profit participation of $4.0 million relating to the repayment of a loan, and (ii) an increase in dividend, interest and other income of $3.2 million, partially offset by (iii) a decrease in net periodic benefit income of $3.6 million relating to the Company’s defined benefit plan.
Other income, net – The increase in Other income, net of $11.1 million is primarily due to (i) an increase of $8.6 million relating to net settlement gains recognized upon the liquidation of the Company’s defined benefit plan during 2023, and (ii) an increase in dividend, interest and other income of $6.8 million due to higher levels of cash on hand during 2023, partially offset by, (iii) a net decrease in mortgage and other financing income of $3.0 million.
Pursuant to the terms of the Credit Facility, the Company, among other things, is subject to maintenance of various covenants. The Company is currently in compliance with these covenants.
As of December 31, 2023, the Credit Facility had no outstanding balance and no appropriations for letters of credit. 38 Table of Contents Pursuant to the terms of the Credit Facility, the Company, among other things, is subject to maintenance of various covenants. The Company is currently in compliance with these covenants.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

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Biggest changeThe table does not include extension options where available (amounts in millions). 2023 2024 2025 2026 2027 Thereafter Total Fair Value Secured Debt Fixed Rate $ 12.0 $ 14.9 $ 53.0 $ - $ 34.3 $ 244.4 $ 358.6 $ 293.8 Average Interest Rate 3.23 % 4.87 % 3.50 % - 4.01 % 4.23 % 4.10 % Variable Rate $ - $ - $ 18.3 $ - $ - $ - $ 18.3 $ 17.9 Average Interest Rate - - 5.43 % - - - 5.43 % Unsecured Debt Fixed Rate $ - $ 654.3 $ 752.9 $ 785.4 $ 436.8 $ 4,151.6 $ 6,781.0 $ 5,837.4 Average Interest Rate - 3.37 % 3.48 % 3.06 % 4.03 % 3.47 % 3.45 % Based on the Company’s variable-rate debt balances, interest expense would have increased by $0.2 million for the year ended December 31, 2022, if short-term interest rates were 1.0% higher.
Biggest changeThe table does not include extension options where available (amounts in millions). 2024 2025 2026 2027 2028 Thereafter Total Fair Value Secured Debt Fixed Rate $ 12.2 $ 51.1 $ - $ 33.7 $ 138.2 $ 101.1 $ 336.3 $ 312.6 Average Interest Rate 4.48 % 3.50 % - 4.01 % 4.51 % 3.82 % 4.09 % Variable Rate $ - $ 17.6 $ - $ - $ - $ - $ 17.6 $ 17.4 Average Interest Rate - 6.64 % - - - - 6.64 % Unsecured Debt Fixed Rate $ 646.8 $ 747.9 $ 782.0 $ 436.1 $ 407.3 $ 4,242.8 $ 7,262.9 $ 6,671.5 Average Interest Rate 3.37 % 3.48 % 3.06 % 4.03 % 2.01 % 3.95 % 3.66 % Based on the Company’s variable-rate debt balances, interest expense would have increased by $0.2 million for the year ended December 31, 2023, if short-term interest rates were 1.0% higher.
The Company has not entered, and does not plan to enter, into any derivative financial instruments for trading or speculative purposes. The following table presents the Company’s aggregate fixed rate and variable rate debt obligations outstanding, including fair market value adjustments and unamortized deferred financing costs, as of December 31, 2022, with corresponding weighted-average interest rates sorted by maturity date.
The following table presents the carrying value of the Company’s aggregate fixed rate and variable rate debt obligations outstanding, including fair market value adjustments and unamortized deferred financing costs, as of December 31, 2023, with corresponding weighted-average interest rates sorted by maturity date.
Added
The Company has not entered, and does not plan to enter, into any derivative financial instruments for trading or speculative purposes.
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In addition, the following table presents the fair value of the Company’s debt obligations outstanding, excluding unamortized deferred financing costs.

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