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What changed in SAUL CENTERS, INC.'s 10-K — 2024 vs 2025

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Paragraph-level year-over-year comparison of SAUL CENTERS, INC.'s 2024 and 2025 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 2025 report.

+305 added−294 removedSource: 10-K (2026-02-27) vs 10-K (2025-02-28)

Top changes in SAUL CENTERS, INC.'s 2025 10-K

305 paragraphs added · 294 removed · 256 edited across 8 sections

Item 1. Business

Business — how the company describes what it does

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Biggest changeThe Company will continue its practice of expanding existing properties by undertaking new construction on outparcels suitable for development as free standing retail or office facilities. 5 Table of Contents Investment in Real Estate Including Twinbrook Quarter and Hampden House, the Company has a pipeline of entitled sites in its portfolio, some of which are currently Shopping Centers, for development of up to an additional 3,200 apartment units and 870,000 square feet of retail and office space.
Biggest changeThe Company will continue its practice of expanding existing properties by undertaking new construction on outparcels suitable for development as free-standing retail or office facilities.
Additional competitive factors impacting the Company’s properties include the ease of access to the properties, the adequacy of related facilities such as parking, and the demographic characteristics in the markets in which the properties compete. Overall economic circumstances and trends and new properties in the vicinity of each of the Current Portfolio Properties are also competitive factors.
Additional competitive factors impacting the Company’s properties include ease of access to the properties, the adequacy of related facilities such as parking, and the demographic characteristics in the markets in which the properties compete. Overall economic circumstances and trends and new properties in the vicinity of each of the Current Portfolio Properties are also competitive factors.
As a matter of policy, the Company requires an environmental study be performed with respect to a property that may be subject to possible environmental hazards prior to its acquisition to ascertain that there are no material environmental hazards associated with such property. See " Item 1A.
As a matter of policy, the Company requires that an environmental study be performed with respect to a property that may be subject to possible environmental hazards prior to its acquisition to ascertain that there are no material environmental hazards associated with such property. See " Item 1A.
In connection with the development of the residential and retail portions of Phase I, we also invested in infrastructure and other items that will support both Phase I and other portions of the development of Twinbrook Quarter.
In connection with the development of the residential and retail portions of Twinbrook Quarter Phase I, we also invested in infrastructure and other items that will support both Twinbrook Quarter Phase I and other portions of the development of Twinbrook Quarter.
The Company’s primary strategy is to continue to focus on diversification of its assets through development of transit-oriented, residential mixed-use projects and expansion of and additions to its grocery-anchored shopping centers in the Washington, DC metropolitan area.
The Company’s primary strategy is to continue to focus on diversification of its assets through development of transit-oriented, residential mixed-use projects and expansion of and additions to its grocery-anchored shopping centers in the Washington, DC/Baltimore metropolitan area.
Risk Factors — Risk Factors Related to our REIT Status and Other Laws and Regulations " for further discussion of potential material effects of our compliance with government regulations, including environmental regulations and the rules governing REITS. 8 Table of Contents Recent Developments The Company is developing Twinbrook Quarter Phase I (“Phase I”) located in Rockville, Maryland.
Risk Factors — Risk Factors Related to our REIT Status and Other Laws and Regulations " for further discussion of potential material effects of our compliance with government regulations, including environmental regulations and the rules governing REITS. 8 Table of Contents Recent Developments The Company is developing Twinbrook Quarter Phase I located in Rockville, Maryland.
The Company has two executed leases and four leases are under negotiation for a total of six more pad sites. In the current economic and capital markets environment, management believes acquisition opportunities for investment in existing and new shopping center and mixed-use properties in the near future is uncertain.
The Company has two executed leases and six leases are under negotiation for a total of eight more pad sites. In the current economic and capital markets environment, management believes acquisition opportunities for investment in existing and new shopping center and mixed-use properties in the near future is uncertain.
Given the Company’s current debt level, it is management’s belief that the ratio of the Company’s debt to total asset value is below 50% as of December 31, 2024. The organizational documents of the Company do not limit the absolute amount or percentage of indebtedness that it may incur.
Given the Company’s current debt level, it is management’s belief that the ratio of the Company’s debt to total asset value is below 50% as of December 31, 2025. The organizational documents of the Company do not limit the absolute amount or percentage of indebtedness that it may incur.
The Company selectively refinances or renegotiates the terms of its outstanding debt in order to extend maturities and obtain additional liquidity. The Company intends to finance future acquisitions and developments and to make debt repayments by utilizing the sources of capital then deemed to be most advantageous.
The Company selectively refinances or renegotiates the terms of its outstanding debt to extend maturities and obtain additional liquidity. The Company intends to finance future acquisitions and developments and to make debt repayments by utilizing the sources of capital then deemed to be most advantageous.
The Board of Directors may, from time to time, reevaluate the Company’s debt capitalization policy in light of current economic conditions, relative costs of capital, market values of the Company's property portfolio, opportunities for acquisition, development or expansion, financial covenants related to the Credit Facility, and such other factors as the Board of Directors then deems relevant.
The Board of Directors may, from time to time, reevaluate the Company’s debt capitalization policy in light of current economic conditions, relative costs of capital, market values of the Company's property portfolio, opportunities for acquisition, development or expansion, financial covenants related to the New Credit Facility (hereinafter defined), and such other factors as the Board of Directors then deems relevant.
The Company currently does not, and does not intend to, retain third party managers or provide management services to third parties. The Company augments its property management capabilities by sharing with the Saul Organization certain ancillary functions, at cost, such as information technology and payroll services, benefits administration and in-house legal services.
The Company currently does not, and does not intend to, retain third-party managers or provide management services to third parties. The Company augments its property management capabilities by sharing with the Saul Organization certain ancillary functions, at cost, such as information technology, payroll services, human resources and benefits administration, accounting services, and in-house legal services.
All such sites are located proximate to Washington Metropolitan Area Transit Authority red line Metro stations in Montgomery County, Maryland. The Company intends to selectively add free-standing pad site buildings within its Shopping Center portfolio, and replace underperforming tenants with tenants that generate strong traffic, including anchor stores such as grocery stores.
All such sites are located proximate to Washington Metropolitan Area Transit Authority red line Metro stations in Montgomery County, Maryland. 5 Table of Contents The Company intends to selectively add free-standing pad site buildings within its Shopping Center portfolio, and replace underperforming tenants with tenants that generate strong traffic, including anchor stores such as grocery stores.
Management believes that characteristics such as cleanliness, lighting and security are particularly important in community and neighborhood shopping centers, which are frequently visited by shoppers during hours outside of the normal work-day. Management believes that the Shopping Centers and Mixed-Use Properties generally are attractive and well maintained.
Management believes that characteristics such as cleanliness, lighting and security are particularly important in community and neighborhood shopping centers, which are frequently visited by shoppers during hours outside of the normal workday. Management believes that the Shopping Centers and Mixed-Use Properties generally are attractive and well maintained.
When possible, management also will seek to include scheduled increases in base rent, as well as percentage rental provisions, in its leases. It is management’s intention to hold properties for long-term investment and to place strong emphasis on regular maintenance, periodic renovation and capital improvement.
When possible, management also will seek to include scheduled increases in base rent, as well as percentage rent based on sales provisions, in its leases. It is management’s intention to hold properties for long-term investment and management places strong emphasis on regular maintenance, periodic renovation and capital improvement.
Operating Strategy The Company’s primary strategy is to continue to focus on diversification of its assets through development of transit-oriented, residential mixed-use projects and expansion of and additions to its grocery-anchored shopping centers in the Washington, DC metropolitan area.
Operating Strategy The Company's primary strategy is to continue to diversify its assets through development of transit-oriented, residential mixed-use projects and expansion of and additions to its grocery-anchored Shopping Centers in the Washington, DC/Baltimore metropolitan area.
The Operating Partnership provides each property with a fully integrated property management capability, with approximately 69 full-time equivalent employees at its headquarters office and 72 full-time employees and eight part-time employees at its properties and with an extensive network of relationships with tenants and potential tenants as well as with members of the brokerage and property owners’ communities.
The Operating Partnership provides each property with a fully integrated property management capability, with approximately 70 full-time equivalent employees at its headquarters office and 86 full-time employees and 12 part-time employees at its properties and with an extensive network of relationships with tenants and potential tenants as well as with members of the brokerage and property owners’ communities.
As of December 31, 2024, the Company’s properties (the “Current Portfolio Properties”) consisted of 50 shopping center properties (the “Shopping Centers”), eight mixed-use properties, which are comprised of office, retail and multi-family residential uses (the “Mixed-Use Properties”) and four (non-operating) development properties.
As of December 31, 2025, the Company’s properties (the “Current Portfolio Properties”) consisted of 50 shopping center properties (the “Shopping Centers”), nine mixed-use properties, which are comprised of office, retail and multi-family residential uses (the “Mixed-Use Properties”) and three (non-operating) development properties.
We support the continuing education of our employees through (a) reimbursement of the cost of seeking undergraduate and graduate degrees at colleges and universities and (b) reimbursement of costs related to seminars, conferences and workshops.
We support the continuing education of our employees through (a) reimbursement of the cost of seeking undergraduate and graduate degrees at colleges and universities and (b) reimbursement of costs related to seminars, conferences and workshops. We previously launched a program that we call B. F.
On August 26, 1993, members of the Saul Organization transferred to Saul Holdings Limited Partnership, a newly formed Maryland limited partnership (the “Operating Partnership”), and two newly formed subsidiary limited partnerships (the “Subsidiary Partnerships,” and collectively with the Operating Partnership, the “Partnerships”), shopping center and mixed-use properties, and the management functions related to the transferred properties.
In 1993, in connection with this restructuring, members of the Saul Organization transferred to Saul Holdings Limited Partnership, a newly formed Maryland limited partnership (the “Operating Partnership”), and two newly formed subsidiary limited partnerships (the “Subsidiary Partnerships,” and collectively with the Operating Partnership, the “Partnerships”), certain shopping center and mixed-use properties, and the management functions related to the transferred properties.
Item 1. Business General Saul Centers, Inc. (“Saul Centers”) was incorporated under the Maryland General Corporation Law on June 10, 1993, and operates as a real estate investment trust (a “REIT”) under the Internal Revenue Code of 1986, as amended (the “Code”).
Item 1. Business General Saul Centers, Inc. (“Saul Centers”) was incorporated under the Maryland General Corporation Law in 1993, and operates as a REIT under the Internal Revenue Code of 1986, as amended (the “Code”).
Human Capital As of December 31, 2024, the Company had approximately 69 full-time equivalent corporate employees and 72 full-time employees and eight part-time employees at its properties. None of our employees are represented by a collective bargaining unit.
Human Capital As of December 31, 2025, the Company had approximately 70 full-time equivalent corporate employees and 86 full-time employees and 12 part-time employees at its properties. None of our employees are represented by a collective bargaining agreement.
The residential portion of Phase I was delivered on October 1, 2024 and includes 452 apartment units. The remaining portions of Phase I include an 80,000 square foot Wegmans supermarket, approximately 25,000 square feet of small shop space, and a 230,000 square foot office building. The office tower portion of Phase I is not being constructed at this time.
It includes 452 apartment units, an 81,000 square foot Wegmans supermarket, approximately 25,000 square feet of small shop space, and a 230,000 square foot office building. The office tower portion is not being constructed at this time.
Even if the tenants do renew or the Company can re-let the space, the terms of renewal or re-letting, including the cost of required renovations, may be less 7 Table of Contents favorable than current lease terms or than expectations for the space.
Even if the tenants do renew or the Company can re-let the space, the terms of renewal or re-letting, including the cost of required renovations, may be less favorable than current lease terms or than expectations for the space. This risk may be magnified if the properties owned by our competitors have lower occupancy rates than the Company’s properties.
Government Regulation Affecting Our Properties The Current Portfolio Properties are subject to various laws and regulations relating to environmental and pollution controls. The impact upon the Company from the application of such laws and regulations either prospectively or retrospectively is not expected to have a materially adverse effect on the Company’s property operations.
The impact upon the Company from the application of such laws and regulations either prospectively or retrospectively is not expected to have a material adverse effect on the Company’s property operations.
Including Twinbrook Quarter and Hampden House, the Company has a pipeline of entitled sites in its portfolio, some of which are currently Shopping Centers, for development of up to an additional 3,200 apartment units and 870,000 square feet of retail and office space.
Investment in Real Estate The Company has a pipeline of entitled mixed-use sites in its portfolio, some of which are currently Shopping Centers, for development of up to 2,500 apartment units and 850,000 square feet of retail and office space.
Construction of the residential building is complete and The Milton at Twinbrook Quarter opened and residential tenants began moving in on October 1, 2024. As of February 24, 2025, 202 residential units have been leased and occupied. Of the approximately 105,000 square feet of ground floor retail, the base building is complete and 96,600 square feet (92.0%) has been leased.
The Milton at Twinbrook Quarter opened and residential tenants began moving in on October 1, 2024. As of February 23, 2026, 440 of the 452 (97.3%) residential units were leased and occupied. Of the approximately 106,000 square feet of ground floor retail, the base building is complete and 101,400 square feet (95.7%) has been leased.
We previously launched a program that we call LEAD that enhances our other training and education programs by providing our talented employees with the tools necessary to effectively lead and manage. We manage an internship program to support the development of future real estate professionals.
Saul University that enhances our other training and education programs by providing our talented employees with the tools necessary to effectively lead and manage. We manage an internship program to support the development of future real estate professionals. Government Regulation Affecting Our Properties The Current Portfolio Properties are subject to various laws and regulations relating to environmental and pollution controls.
Management believes that success in the competition for ownership and leasing property is dependent in part upon the geographic location of the property, the tenant mix, the performance of property managers, the amount of new construction in the area and the maintenance and appearance of the property.
As a result, these competitors may be willing to make space available at lower prices than the space in the Current Portfolio Properties. 7 Table of Contents Management believes that success in the competition for ownership and leasing property is dependent in part upon the geographic location of the property, the tenant mix, the performance of property managers, the amount of new construction in the area and the maintenance and appearance of the property.
Capital Policies The Company has established a debt capitalization policy relative to asset value, which is computed by reference to the aggregate annualized cash flow from the properties in the Company’s portfolio rather than relative to book value.
Dispositions The Company may elect to dispose of properties if, based upon management’s periodic review of the Company’s portfolio, the Board of Directors determines that such action would be in the best interest of the Company’s stockholders. 6 Table of Contents Capital Policies The Company has established a debt capitalization policy relative to asset value, which is computed by reference to the aggregate annualized cash flow from the properties in the Company’s portfolio rather than relative to book value.
A portion of the cost of the project is being financed by a $145.0 million construction-to-permanent loan. During the second quarter of 2023, the Company commenced drawing on the loan and, as of December 31, 2024, the outstanding balance of the loan was $127.3 million, net of unamortized deferred debt costs.
Excluding imputed capitalized interest, the remaining investment to complete Twinbrook Quarter Phase I is not expected to exceed $9.9 million. A portion of the cost of the project is being financed by a $145.0 million construction-to-permanent loan. As of December 31, 2025, the outstanding balance of the loan was $139.3 million, net of unamortized deferred debt costs.
All such sites are located proximate to Washington Metropolitan Area Transit Authority (“WMATA”) red line Metro stations in Montgomery County, Maryland. Management believes there is potential for long term growth in cash flow as existing leases for space in the Shopping Centers and Mixed-Use Properties expire and are renewed, or newly available or vacant space is leased.
Management believes there is potential for long term growth in cash flow as existing leases for space in the Shopping Centers and Mixed-Use Properties expire and are renewed, or newly available or vacant space is leased. Through its leasing activities, the Company intends to optimize the mix of uses at the Shopping Centers to improve foot traffic.
A portion of the cost of the project is being financed by a $133.0 million construction-to-permanent loan. During the fourth quarter of 2023, the Company commenced drawing on the loan and, as of December 31, 2024, the outstanding balance of the loan was $71.4 million, net of unamortized deferred debt costs. Exterior façade installation is nearing completion.
Excluding imputed capitalized interest, the remaining investment to complete the project is not expected to exceed $6.8 million. A portion of the cost of the project is being financed by a $133.0 million construction-to-permanent loan. As of December 31, 2025, the outstanding balance of the loan was $115.4 million, net of unamortized deferred debt costs.
The leased retail space, including Wegmans, is expected to open at various times over 2025 and 2026 as tenants complete their buildouts. The development potential of all phases of the entire 18.4 acre Twinbrook Quarter site totals 1,865 residential units, 473,000 square feet of retail space, and 431,000 square feet of office space.
The development potential of all phases of the entire 18.4 acre Twinbrook Quarter site totals 1,865 residential units, 473,000 square feet of retail space, and 431,000 square feet of office space. The Company is also developing Hampden House, a project located in downtown Bethesda, Maryland, which includes 366 apartment units and 10,100 square feet of retail space.
The Company does not presently invest, nor does it intend to invest, in any securities of other REITs. 6 Table of Contents Dispositions The Company may elect to dispose of properties if, based upon management’s periodic review of the Company’s portfolio, the Board of Directors determines that such action would be in the best interest of the Company’s stockholders.
The Company does not presently invest, nor does it intend to invest, in any securities of other REITs.
Removed
The Company intends to renegotiate leases where possible and seek new tenants for available space in order to optimize the mix of uses to improve foot traffic through the Shopping Centers.
Added
The Company has a pipeline of entitled sites in its portfolio, some of which are currently Shopping Centers, for development of up to 2,500 apartment units and 850,000 square feet of retail and office space. All such sites are located proximate to Washington Metropolitan Area Transit Authority red line Metro stations in Montgomery County, Maryland.
Removed
As leases expire, management expects to revise rental rates, lease terms and conditions, relocate existing tenants, reconfigure tenant spaces and introduce new tenants with the goals of increasing occupancy, improving overall retail sales, and ultimately increasing cash flow.
Added
In addition, the Company recently entered into a lease with Publix to develop a new grocery store at Ashland Square in Prince William County, Virginia.
Removed
This risk may be magnified if the properties owned by our competitors have lower occupancy rates than the Company’s properties. As a result, these competitors may be willing to make space available at lower prices than the space in the Current Portfolio Properties.
Added
When complete, Ashland Square is expected to ultimately comprise approximately 124,000 square feet of retail space including the 50,325 square foot Publix, three existing pad sites, four additional pad sites and approximately 30,000 square feet of small shop space.
Removed
Excluding imputed capitalized interest, the total cost of the project is expected to be approximately $331.5 million, of which $271.4 million is related to the development of the residential and retail portions of Phase I and $60.1 million is related to infrastructure and other items. Of the expected $331.5 million total cost, $318.0 million has been invested to date.
Added
Management’s leasing goals are to increase occupancy, improve overall retail sales, and ultimately increase cash flow.
Removed
The Company is developing Hampden House, a project located in downtown Bethesda, Maryland that will include up to 366 apartment units and 10,100 square feet of retail space. Excluding imputed capitalized interest, the total cost of the project is expected to be approximately $246.4 million, of which $200.5 million has been invested to date.
Added
The Wegmans supermarket at Twinbrook Quarter opened for business on June 25, 2025. As of February 23, 2026, including the Wegmans supermarket, approximately 88,500 square feet of the retail space is open and the remaining leased retail space is expected to open at various times during 2026 as tenants complete their buildouts.
Removed
Interior construction and installation of unit finishes continues. Delivery and opening is expected in late 2025. 9 Table of Contents
Added
Hampden House opened and residential tenants began moving in on October 1, 2025. As of February 23, 2026, 130 of the 366 (35.5%) residential units are leased and occupied. Of the approximately 10,100 square feet of ground floor retail, 8,600 square feet (85.1%) has been leased and tenant build-outs are in progress.
Added
During 2025, the Company entered into a lease with Publix for a new grocery store, which we will construct, at Ashland Square in Prince William County, Virginia. The Ashland Square property currently includes three pad sites with operating tenants. We have executed leases at Ashland Square for two additional pad sites.
Added
When complete, Ashland Square is expected to ultimately comprise approximately 124,000 square feet of retail space including the 50,325 square foot Publix, the three existing pad sites, four additional pad sites and approximately 30,000 square feet of small shop space. 9 Table of Contents

Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeA majority of our shopping center properties are anchored by several major tenants and offer primarily day-to-day necessities and services. Thirty-four of our properties are anchored by a grocery store. Our net income could be adversely affected in the event of a downturn in the business, or the bankruptcy or insolvency, of any anchor store or anchor tenant.
Biggest changeOur ability to increase our net income depends on the success and continued presence of our shopping center “anchor” tenants and other significant tenants. A majority of our shopping center properties are anchored by one or more major tenants, most of whom primarily offer day-to-day necessities and services. Thirty-four of our properties are anchored by a grocery store.
Small business retail tenants and anchor retailers that lease space in the Company’s properties may experience a deterioration in their sales or other revenue, or experience a constraint on the availability of credit necessary to fund operations, which in turn may adversely impact those tenants’ ability to pay contractual base rents and operating expense recoveries.
Small business retail tenants and anchor retailers that lease space in the Company’s properties may experience a deterioration in their sales or other revenue, or a constraint on the availability of credit necessary to fund operations, which in turn may adversely impact those tenants’ ability to pay contractual base rents and operating expense recoveries.
In addition, a tenant that files for bankruptcy protection may terminate our lease in which event we would have a general unsecured claim that would likely be for less than the full amount owed to us for the remainder of the lease term, which could adversely affect our financial condition and results of operations.
In addition, a tenant that files for bankruptcy protection may reject or terminate our lease, in which event we would have a general unsecured claim that would likely be for less than the full amount owed to us for the remainder of the lease term, which could adversely affect our financial condition and results of operations.
The closing of one or more anchor stores prior to the expiration of the lease of that store or the termination of a lease by one or more of a property’s anchor tenants could adversely affect that property and result in lease terminations by, or reductions in rent from, other tenants whose leases may permit termination or rent reduction in those circumstances or whose own operations may suffer as a result.
The closing of one or more anchor stores prior to the expiration of the applicable lease term, or the termination of a lease by one or more of a property’s anchor tenants could adversely affect that property and result in lease terminations by, or reductions in rent from, other tenants whose leases may permit termination or rent reduction in those circumstances or whose own operations may suffer as a result.
In this section, unless the context indicates otherwise, the terms “Company,” “we,” “us” and “our” refer to Saul Centers, Inc., and its subsidiaries, including the Operating Partnership. Risk Factors Related to our Real Estate Investments and Operations Revenue from our properties may be reduced or limited if the operations of our retail tenants are not successful.
In this section, unless the context indicates otherwise, the terms “Company,” “we,” “us” and “our” refer to Saul Centers, Inc., and its subsidiaries, including the Operating Partnership. Risk Factors Related to our Real Estate Investments and Operations Revenue from our properties may be negatively impacted if the operations of our retail tenants are not successful.
We may be unable to collect balances due from tenants that file for bankruptcy protection. Historically and from time to time, certain of our tenants experienced financial difficulties and filed for bankruptcy protection, typically under the United States Bankruptcy Code.
We may be unable to collect balances due from tenants that file for bankruptcy protection. Historically and from time to time, certain of our tenants have experienced financial difficulties and filed for bankruptcy protection, typically under the U.S. Bankruptcy Code.
Some of our leases provide for the payment, in addition to base rent, of additional rent above the base amount according to a specified percentage of the gross sales generated by the retail tenants. Decreasing sales revenue by retail tenants could adversely impact the Company’s receipt of percentage rents required to be paid by tenants under certain leases.
Some of our leases provide for the payment of additional rent above the base amount based on a specified percentage of the gross sales generated by the retail tenants. As a result, declines in our retail tenants’ sales revenue could adversely impact the Company’s receipt of percentage rents required to be paid by tenants under certain leases.
In the event that a tenant with a significant number of leases in our shopping centers files for bankruptcy protection and rejects its leases, we may experience a significant reduction in our revenues and may not be able to collect all pre-petition amounts owed by such tenant. 10 Table of Contents Our ability to increase our net income depends on the success and continued presence of our shopping center “anchor” tenants and other significant tenants.
In the event that a tenant with a significant number of leases in our shopping centers files for bankruptcy protection and rejects its leases, we may experience a significant reduction in our revenues and may not be able to collect all pre-petition amounts owed by such tenant.
In the event that we are unable to re-lease space vacated by an anchor tenant, we may incur additional expenses in order to re-model the space to be able to re-lease the space to one or more new anchor tenants. This could reduce our net income. We may experience difficulty or delay in renewing leases or leasing vacant space.
In the event that we are unable to re-lease space vacated by an anchor tenant, we may incur additional expenses to reconfigure or re-model the space to be able to re-lease the space to one or more new anchor tenants or other tenants.
Adverse changes in consumer spending or consumer preferences for particular goods, services or store based retailing could severely impact the ability of our retail tenants to pay rent. Revenue from our properties depends primarily on the ability of our retail tenants to pay the full amount of rent due under their leases on a timely basis.
Adverse changes in consumer spending or consumer preferences for particular goods, services or store-based retailing could negatively impact the ability of our retail tenants to pay rent.
Some retail tenants may terminate their occupancy due to an inability to operate profitably for an extended period of time, impacting the Company’s ability to maintain occupancy levels. Any reduction in the ability of our retail tenants, particularly our anchor tenants, to pay base rent or percentage rent may adversely affect our financial condition and results of operations.
Some retail tenants may terminate their leases or vacate space due to an inability to operate profitably for an extended period of time, impacting the Company’s ability to maintain occupancy levels.
Our largest shopping center anchor tenant is Giant Food, which accounted for 4.8% of our total revenue for the year ended December 31, 2024.
Our net income could be adversely affected in the event of a downturn in the business, or the bankruptcy or insolvency, of any anchor store or anchor tenant. Our largest shopping center anchor tenant by revenue is Giant Food, which accounted for 4.5% of our total revenue for the year ended December 31, 2025.
The amount of rent we receive from our retail tenants generally will depend in part on the success of our retail tenants’ operations, making us vulnerable to general economic downturns and other conditions affecting the retail industry.
Revenue from our properties depends primarily on the ability of our retail tenants to pay the full amount of rent due under their leases on a timely basis, which is in turn dependent on the success of their operations, making us vulnerable to general economic downturns and other conditions affecting the retail industry.
We derive most of our revenue directly or indirectly from rent received from our office and retail tenants.
This could reduce our net income and negatively impact our financial condition and results of operations. 10 Table of Contents We may experience difficulty or delay in renewing leases or leasing vacant space. We derive most of our revenue directly or indirectly from rent received from our office and retail tenants.
Removed
Economic challenges that can adversely affect our retail tenants and anchor retailers include inflation, labor shortages, supply chain constraints, decreasing consumer confidence and discretionary spending, and increasing energy prices and interest rates.
Added
Any reduction in the ability of our retail tenants, particularly our anchor tenants, to pay base rent or percentage rent may have a material adverse effect on our financial condition and results of operations.

Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

30 edited+6 added−2 removed15 unchanged
Biggest changeWashington, DC 227,651 1973 (1986) 1.0 91% 82% 76% 78% 90% National Gallery of Art, American Assn. of Health Plans, Southern Company, Regus, Capital Grille Washington Square Alexandria, VA 236,376 1975 (2000) 2.0 83% 84% 78% 71% 80% Academy of Managed Care Pharmacy, Cooper Carry, International Information Systems Security Certification Consortium, Trader Joe's, FedEx Office, Talbots, National Association of Drug Court Professionals (NADCP) The Waycroft-Residential (491 units) Arlington, VA (4) 404,709 2020 2.8 99% 98% 98% 97% 76% The Waycroft-Retail Arlington, VA (4) 60,048 2020 100% 100% 100% 91% 90% Target, Enterprise Rent-A-Car, Silver Diner, Salon Lofts The Milton at Twinbrook Quarter (452 units) Rockville, MD 366,120 2024 2.8 48% —% —% —% —% Twinbrook Quarter Phase 1-Retail Rockville, MD 105,924 2024 92% —% —% —% —% Wegmans Total Mixed-Use Properties (1) 2,416,909 49.0 87.9% 86.0% 82.5% 82.3% 88.4% (2) Total Portfolio (1) 10,225,692 815.6 95.2% 94.1% 93.2% 92.0% 92.5% (2) 32 Table of Contents Property Location Year Acquired or Developed (Renovated) Land Area (Acres) Development Activity Land and Development Properties Hampden House Bethesda, MD 2018 0.6 Exterior façade installation is nearing completion.
Biggest changeWashington, DC 227,651 1973 (1986) 1.0 87% 91% 82% 76% 78% National Gallery of Art, American Assn. of Health Plans, Southern Company, Regus, Capital Grille Washington Square Alexandria, VA 236,376 1975 (2000) 2.0 78% 83% 84% 78% 71% Academy of Managed Care Pharmacy, Cooper Carry, International Information Systems Security Certification Consortium, Trader Joe's, FedEx Office, Talbots The Waycroft-Residential (491 units) Arlington, VA (4) 404,709 2020 2.8 97% 99% 98% 98% 97% The Waycroft-Retail Arlington, VA (4) 60,048 2020 100% 100% 100% 100% 91% Target, Enterprise Rent-A-Car, Silver Diner, Salon Lofts The Milton at Twinbrook Quarter (452 units) Rockville, MD (5) 365,226 2024 2.8 98% 48% N/A N/A N/A Twinbrook Quarter Phase 1-Retail Rockville, MD 105,924 2024 96% 92% N/A N/A N/A Wegmans Hampden House - Residential (366 units) Bethesda, MD (5) 312,154 2025 0.6 30% N/A N/A N/A N/A Hampden House - Retail Bethesda, MD 10,051 2025 85% N/A N/A N/A N/A Visual Comfort & Co.
Boyd's Pet Resort, Metropolitan Emergency Animal Clinic 1500/1580 Rockville Pike Rockville, MD 64,781 2012/2014 10.2 100% 100% 98% 100% 100% Party City, CVS Pharmacy Seabreeze Plaza Palm Harbor, FL 146,673 2005 18.4 99% 97% 96% 94% 96% Publix, Petco, Planet Fitness, Vision Works, Sanitas Medical Center Marketplace at Sea Colony Bethany Beach, DE 21,677 2008 5.1 100% 100% 100% 100% 100% Armand's Pizza, Candy Kitchen, Summer Salts, Fin's Alehouse, Vacasa Seven Corners Falls Church, VA 573,481 1973 (1994-7/07) 31.6 100% 99% 98% 98% 99% The Home Depot, Giant Food, Michaels Arts & Crafts, Barnes & Noble, Ross Dress For Less, Ski Chalet, Off-Broadway Shoes, JoAnn Fabrics, Starbucks, Red Robin Gourmet Burgers, Chipotle, Wendy's, Burlington Coat Factory, Mattress Warehouse, J.
Boyd's Pet Resort, Metropolitan Emergency Animal Clinic 1500/1580 Rockville Pike Rockville, MD 64,781 2012/2014 10.2 100% 100% 100% 98% 100% CVS Pharmacy Seabreeze Plaza Palm Harbor, FL 146,673 2005 18.4 99% 99% 97% 96% 94% Publix, Petco, Planet Fitness, Vision Works, Sanitas Medical Center Marketplace at Sea Colony Bethany Beach, DE 21,677 2008 5.1 100% 100% 100% 100% 100% Armand's Pizza, Candy Kitchen, Summer Salts, Fin's Alehouse, Vacasa Seven Corners Falls Church, VA 573,481 1973 (1994-7/07) 31.6 99% 100% 99% 98% 98% The Home Depot, Giant Food, Michaels Arts & Crafts, Barnes & Noble, Ross Dress For Less, Ski Chalet, Off-Broadway Shoes, Starbucks, Red Robin Gourmet Burgers, Chipotle, Wendy's, Burlington Coat Factory, Mattress Warehouse, J.
Annual base rent due under these leases is $26.2 million and $3.2 million for the years ending December 31, 2025 and 2026, respectively. 27 Table of Contents Current Portfolio Properties The following table sets forth, at the dates indicated, certain information regarding the Current Portfolio Properties: Percentage Leased as of December 31, 2024 Property Location Leasable Area (Square Feet) Year Acquired or Developed (Renovated) Land Area (Acres) 2024 2023 2022 2021 2020 Anchor / Significant Tenants as at December 31, 2024 Shopping Centers Ashbrook Marketplace Ashburn, VA 85,819 2018 (2019) 13.7 100% 100% 100% 100% 100% Lidl, Planet Fitness, Starbucks, Dunkin Donuts, Valvoline, Cafe Rio, McAlisters Deli, Apple Federal Credit Union Ashburn Village Ashburn, VA 221,596 1994-2006 26.4 98% 96% 94% 96% 95% Giant Food, Hallmark, McDonald's, Dunkin Donuts, Kinder Care, Blue Ridge Grill Ashland Square Phase I Dumfries, VA 23,120 2007 2.0 100% 100% 100% 100% 100% Capital One Bank, CVS Pharmacy, The All American Steakhouse Beacon Center Alexandria, VA 359,671 1972 (1993/99/07) 32.3 100% 99% 100% 100% 100% Lowe's Home Improvement Center, Giant Food, Home Goods, Outback Steakhouse, Marshalls, Party Depot, Panera Bread, TGI Fridays, Starbucks, Famous Dave's, Chipotle, Capital One Bank, Wendy's, First Watch BJ's Wholesale Club Alexandria, VA 115,660 2008 9.6 100% 100% 100% 100% 100% BJ's Wholesale Club Boca Valley Plaza Boca Raton, FL 121,365 2004 12.7 99% 100% 100% 94% 89% Publix, Palm Beach Fitness, Anima Domus, Foxtail Coffee Boulevard Fairfax, VA 49,140 1994 (1999/09) 4.9 100% 100% 100% 96% 97% Panera Bread, Party City, Petco, JP Morgan Chase Briggs Chaney MarketPlace Silver Spring, MD 194,258 2004 18.2 98% 98% 99% 95% 97% Global Food, Ross Dress For Less, Advance Auto Parts, McDonald's, Dunkin Donuts, Enterprise Rent-A-Car, Dollar Tree, Dollar General, Salon Plaza, Chipotle Broadlands Village Ashburn, VA 174,438 2003/2004/ 2006 24.0 100% 100% 91% 92% 90% Aldi Grocery, The All American Steakhouse, Dollar Tree, Starbucks, Minnieland Day Care, LA Fitness, Chase Bank, X-Golf, Inova Go Health Burtonsville Town Square Burtonsville, MD (4) 139,928 2017 26.3 100% 100% 100% 100% 100% Giant Food, Petco, Starbucks, Greene Turtle, Capital One Bank, CVS Pharmacy, Roy Rogers, Mr.
Annual base rent due under these leases is $34.7 million and $4.5 million for the years ending December 31, 2026 and 2027, respectively. 27 Table of Contents Current Portfolio Properties The following table sets forth, at the dates indicated, certain information regarding the Current Portfolio Properties: Percentage Leased as of December 31, 2025 Property Location Leasable Area (Square Feet) Year Acquired or Developed (Renovated) Land Area (Acres) 2025 2024 2023 2022 2021 Anchor / Significant Tenants as at December 31, 2025 Shopping Centers Ashbrook Marketplace Ashburn, VA 85,819 2018 (2019) 13.7 100% 100% 100% 100% 100% Lidl, Planet Fitness, Starbucks, Dunkin Donuts, Valvoline, Tous Le Jours, McAlisters Deli, Apple Federal Credit Union Ashburn Village Ashburn, VA 221,596 1994-2006 26.4 98% 98% 96% 94% 96% Giant Food, Hallmark, McDonald's, Dunkin Donuts, Kinder Care, Blue Ridge Grill Ashland Square Phase I Dumfries, VA 23,120 2007 2.0 100% 100% 100% 100% 100% Capital One Bank, CVS Pharmacy, The All American Steakhouse Beacon Center Alexandria, VA 359,671 1972 (1993/99/07) 32.3 100% 100% 99% 100% 100% Lowe's Home Improvement Center, Giant Food, Home Goods, Outback Steakhouse, Marshalls, Party Depot, Panera Bread, TGI Fridays, Starbucks, Famous Dave's, Chipotle, Capital One Bank, Wendy's, First Watch BJ's Wholesale Club Alexandria, VA 115,660 2008 9.6 100% 100% 100% 100% 100% BJ's Wholesale Club Boca Valley Plaza Boca Raton, FL 121,365 2004 12.7 96% 99% 100% 100% 94% Publix, Boca Raton Fitness Center, Anima Domus, Foxtail Coffee Boulevard Fairfax, VA 49,140 1994 (1999/09) 4.9 100% 100% 100% 100% 96% Panera Bread, Petco, JP Morgan Chase, Dollar Tree Briggs Chaney MarketPlace Silver Spring, MD 194,258 2004 18.2 98% 98% 98% 99% 95% Global Food, Ross Dress For Less, Advance Auto Parts, McDonald's, Dunkin Donuts, Enterprise Rent-A-Car, Dollar Tree, Dollar General, Salon Plaza, Chipotle Broadlands Village Ashburn, VA 174,438 2003/2004/ 2006 24.0 97% 100% 100% 91% 92% Aldi Grocery, The All American Steakhouse, Dollar Tree, Starbucks, Minnieland Day Care, LA Fitness, Chase Bank, X-Golf, Inova Go Health Burtonsville Town Square Burtonsville, MD (4) 139,928 2017 26.3 100% 100% 100% 100% 100% Giant Food, Petco, Starbucks, Greene Turtle, Capital One Bank, CVS Pharmacy, Roy Rogers, Mr.
Cheese, Sardi's Chicken, Capital One Bank, Kool Smiles, Wells Fargo Hunt Club Corners Apopka, FL 106,886 2006 13.9 99% 98% 98% 99% 100% Publix, Pet Supermarket, Boost Mobile Jamestown Place Altamonte Springs, FL 96,201 2005 10.9 100% 100% 100% 100% 100% Carrabas Italian Grill, Orlando Health, Crunch Fitness, AT&T Kentlands Square I Gaithersburg, MD 119,694 2002 11.5 98% 100% 100% 100% 100% Lowe's Home Improvement Center, Chipotle, Starbucks, Shake Shack Kentlands Square II and Kentlands Pad Gaithersburg, MD 253,322 2011 23.4 100% 100% 96% 97% 97% Giant Food, At Home, Party City, Panera Bread, Hallmark, Chick-Fil-A, Coal Fire Pizza, Cava Mezza Grill, Truist Bank, Hand & Stone Massage, Crumbl Cookie, Quincy's Restaurant Kentlands Place Gaithersburg, MD 40,697 2005 3.4 100% 79% 78% 86% 75% Bonefish Grill, F45 Training, Dollar Tree Lansdowne Town Center Leesburg, VA 196,817 2006 23.3 97% 94% 91% 90% 91% Harris Teeter, CVS Pharmacy, Panera Bread, Starbucks, Ford's Oyster House, Fusion Learning, Chick-Fil-A, Chase Bank Leesburg Pike Plaza Baileys Crossroads, VA 97,752 1966 (1982/95) 9.4 100% 100% 100% 93% 93% CVS Pharmacy, Capital One Bank, Five Guys, Dollar Tree, Advanced Auto Lumberton Plaza Lumberton, NJ 162,718 1975 (1992/96) 23.3 76% 61% 66% 66% 68% Aldi, Family Dollar, Big Lots, Burger King, Big Rich Fitness, Enterprise Rent-A-Car, Five Below Metro Pike Center Rockville, MD 67,488 2010 4.6 96% 96% 85% 85% 83% Dunkin Donuts, 7-Eleven, Palm Beach Tan, Mattress Warehouse, Salvation Army, Dollar Tree 29 Table of Contents Percentage Leased as of December 31, 2024 Property Location Leasable Area (Square Feet) Year Acquired or Developed (Renovated) Land Area (Acres) 2024 2023 2022 2021 2020 Anchor / Significant Tenants as at December 31, 2024 Shops at Monocacy Frederick, MD 111,341 2004 13.0 100% 98% 100% 98% 100% Giant Food, Panera Bread, Five Guys, California Tortilla, Firehouse Subs, Comcast, NTB, Wing Stop Northrock Warrenton, VA 100,032 2009 15.4 94% 94% 96% 94% 99% Harris Teeter, Longhorn Steakhouse, Ledo's Pizza, Capital One Bank, Novant Health Olde Forte Village Ft.
Cheese, Sardi's Chicken, Capital One Bank, Kool Smiles, Wells Fargo Hunt Club Corners Apopka, FL 106,886 2006 13.9 100% 99% 98% 98% 99% Publix, Pet Supermarket, Boost Mobile Jamestown Place Altamonte Springs, FL 96,201 2005 10.9 100% 100% 100% 100% 100% Carrabas Italian Grill, Orlando Health, Crunch Fitness, AT&T Kentlands Square I Gaithersburg, MD 119,694 2002 11.5 100% 98% 100% 100% 100% Lowe's Home Improvement Center, Chipotle, Starbucks, Shake Shack Kentlands Square II and Kentlands Pad Gaithersburg, MD 253,322 2011 23.4 97% 100% 100% 96% 97% Giant Food, At Home, Panera Bread, Hallmark, Chick-Fil-A, Coal Fire Pizza, Cava Mezza Grill, Truist Bank, Hand & Stone Massage, Crumbl Cookie, Quincy's Restaurant, Wonder Kentlands Place Gaithersburg, MD 40,697 2005 3.4 87% 100% 79% 78% 86% Bonefish Grill, F45 Training, Dollar Tree Lansdowne Town Center Leesburg, VA 196,817 2006 23.3 99% 97% 94% 91% 90% Harris Teeter, CVS Pharmacy, Panera Bread, Starbucks, Ford's Oyster House, Fusion Learning, Chick-Fil-A, Chase Bank Leesburg Pike Plaza Baileys Crossroads, VA 97,752 1966 (1982/95) 9.4 100% 100% 100% 100% 93% CVS Pharmacy, Capital One Bank, Five Guys, Dollar Tree, Advanced Auto Lumberton Plaza Lumberton, NJ 162,718 1975 (1992/96) 23.3 69% 76% 61% 66% 66% Aldi, Burger King, Big Rich Fitness, Enterprise Rent-A-Car, Five Below, Ollie's Bargain Outlet Metro Pike Center Rockville, MD 67,488 2010 4.6 94% 96% 96% 85% 85% Dunkin Donuts, 7-Eleven, Palm Beach Tan, Mattress Warehouse, Salvation Army, Dollar Tree 29 Table of Contents Percentage Leased as of December 31, 2025 Property Location Leasable Area (Square Feet) Year Acquired or Developed (Renovated) Land Area (Acres) 2025 2024 2023 2022 2021 Anchor / Significant Tenants as at December 31, 2025 Shops at Monocacy Frederick, MD 111,341 2004 13.0 100% 100% 98% 100% 98% Giant Food, Panera Bread, Five Guys, California Tortilla, Firehouse Subs, Comcast, NTB, Wing Stop Northrock Warrenton, VA 100,032 2009 15.4 87% 94% 94% 96% 94% Harris Teeter, Longhorn Steakhouse, Ledo's Pizza, Capital One Bank Olde Forte Village Ft.
Morgan Chase, Five Below, Raising Canes Severna Park Marketplace Severna Park, MD 254,011 2011 20.6 96% 93% 95% 89% 89% Giant Food, Kohl's, Office Depot, Goodyear, Chipotle, McDonald's, Five Guys, Jersey Mike's, Bath & Body Works, Wells Fargo, MOD Pizza, Petco, AT&T Shops at Fairfax Fairfax, VA 68,762 1975 (1993/99) 6.7 100% 100% 100% 98% 97% 99 Ranch Smallwood Village Center Waldorf, MD 173,341 2006 25.1 93% 90% 90% 79% 75% Safeway, CVS Pharmacy, Family Dollar 30 Table of Contents Percentage Leased as of December 31, 2024 Property Location Leasable Area (Square Feet) Year Acquired or Developed (Renovated) Land Area (Acres) 2024 2023 2022 2021 2020 Anchor / Significant Tenants as at December 31, 2024 Southdale Glen Burnie, MD 485,628 1972 (1986) 39.8 99% 99% 100% 94% 94% The Home Depot, Michaels Arts & Crafts, Marshalls, PetSmart, Value City Furniture, Athletic Warehouse, Starbucks, Gallo Clothing, Office Depot, The Tile Shop, Mercy Health Care, Massage Envy, Potbelly, Capital One Bank, Chipotle, Banfield Pet Hospital, Glory Days Grill, Bank of America, Grocery Outlet, Longhorn Steakhouse Southside Plaza Richmond, VA 371,761 1972 32.8 99% 96% 95% 98% 96% Super Fresh, Citi Trends, City of Richmond, McDonald's, Burger King, Kool Smiles, Crafty Crab, Roses South Dekalb Plaza Atlanta, GA 163,418 1976 14.6 75% 94% 94% 94% 87% Emory Clinic, Roses, Deal $, Humana Oak Street Health Thruway Winston-Salem, NC 368,688 1972 (1997) 31.5 94% 97% 90% 81% 80% Harris Teeter, Trader Joe's, Talbots, Hanes Brands, Jos.
Morgan Chase, Five Below, Raising Canes, Ebisu Severna Park Marketplace Severna Park, MD 254,011 2011 20.6 96% 96% 93% 95% 89% Giant Food, Kohl's, Office Depot, Goodyear, Chipotle, McDonald's, Five Guys, Jersey Mike's, Bath & Body Works, Wells Fargo, MOD Pizza, Petco, AT&T, Chase Bank Shops at Fairfax Fairfax, VA 68,762 1975 (1993/99) 6.7 100% 100% 100% 100% 98% 99 Ranch Smallwood Village Center Waldorf, MD 173,341 2006 25.1 84% 93% 90% 90% 79% Safeway, Family Dollar, Won's Beauty Outlet 30 Table of Contents Percentage Leased as of December 31, 2025 Property Location Leasable Area (Square Feet) Year Acquired or Developed (Renovated) Land Area (Acres) 2025 2024 2023 2022 2021 Anchor / Significant Tenants as at December 31, 2025 Southdale Glen Burnie, MD 491,628 1972 (1986) 39.8 99% 99% 99% 100% 94% The Home Depot, Michaels Arts & Crafts, Marshalls, PetSmart, Value City Furniture, Athletic Warehouse, Starbucks, Gallo Clothing, Office Depot, The Tile Shop, Mercy Health Care, Massage Envy, Potbelly, Capital One Bank, Chipotle, Banfield Pet Hospital, Glory Days Grill, Bank of America, Grocery Outlet, Longhorn Steakhouse Southside Plaza Richmond, VA 371,761 1972 32.8 97% 99% 96% 95% 98% Super Fresh, Citi Trends, City of Richmond, McDonald's, Burger King, Kool Smiles, Crafty Crab, Roses South Dekalb Plaza Atlanta, GA 163,418 1976 14.6 92% 75% 94% 94% 94% Emory Clinic, Roses, Deal $, Humana Oak Street Health, Auto Zone Thruway Winston-Salem, NC 368,688 1972 (1997) 31.5 97% 94% 97% 90% 81% Harris Teeter, Trader Joe's, Talbots, Hanes Brands, Jos.
Tire, Taco Bell Countryside Marketplace Sterling, VA 137,804 2004 16.0 93% 92% 85% 91% 92% Lotte Plaza Market, CVS Pharmacy, Starbucks, McDonald's, 7-Eleven, VA ABC, K-9 Luxury Pet Hotel 28 Table of Contents Percentage Leased as of December 31, 2024 Property Location Leasable Area (Square Feet) Year Acquired or Developed (Renovated) Land Area (Acres) 2024 2023 2022 2021 2020 Anchor / Significant Tenants as at December 31, 2024 Cranberry Square Westminster, MD 141,450 2011 18.9 100% 100% 100% 97% 87% Giant Food, Giant Gas Station, Staples, Party City, Wendy's, Sola Salons, Ledo Pizza, Hallmark Cruse MarketPlace Cumming, GA 78,686 2004 10.6 96% 95% 93% 94% 92% Publix, Orange Theory, Anytime Fitness Flagship Center Rockville, MD 21,500 1972, 1989 0.5 100% 100% 100% 100% 100% Chase Bank, Bank of America French Market Oklahoma City, OK 246,148 1974 (1984/98) 13.8 80% 63% 75% 75% 78% Burlington Coat Factory, Petco, The Tile Shop, Lakeshore Learning Center, Dollar Tree, Verizon, Raising Cane's, Skechers, Hobby Lobby, Mathis Sleep Center Germantown Germantown, MD 18,982 1992 2.7 100% 100% 100% 100% 100% CVS Pharmacy, Jiffy Lube The Glen Woodbridge, VA 136,440 1994 (2005) 14.7 100% 100% 99% 93% 98% Safeway, Panera Bread, Five Guys, Chipotle Great Falls Center Great Falls, VA 91,666 2008 11.0 99% 100% 100% 98% 100% Safeway, CVS Pharmacy, Trustar Bank, Starbucks, Subway Hampshire Langley Takoma Park, MD 131,700 1972 (1979) 9.9 100% 100% 100% 100% 100% Mega Mart, Starbucks, Chuck E.
Tire, Taco Bell Countryside Marketplace Sterling, VA 137,804 2004 16.0 96% 93% 92% 85% 91% Lotte Plaza Market, CVS Pharmacy, Starbucks, McDonald's, 7-Eleven, VA ABC, K-9 Luxury Pet Hotel 28 Table of Contents Percentage Leased as of December 31, 2025 Property Location Leasable Area (Square Feet) Year Acquired or Developed (Renovated) Land Area (Acres) 2025 2024 2023 2022 2021 Anchor / Significant Tenants as at December 31, 2025 Cranberry Square Westminster, MD 141,450 2011 18.9 91% 100% 100% 100% 97% Giant Food, Giant Gas Station, Staples, Wendy's, Sola Salons, Ledo Pizza, Hallmark Cruse MarketPlace Cumming, GA 78,686 2004 10.6 89% 96% 95% 93% 94% Publix, Orange Theory Flagship Center Rockville, MD 21,500 1972, 1989 0.5 100% 100% 100% 100% 100% Chase Bank, Bank of America French Market Oklahoma City, OK 246,148 1974 (1984/98) 13.8 76% 80% 63% 75% 75% Burlington Coat Factory, The Tile Shop, Lakeshore Learning Center, Dollar Tree, Verizon, Raising Cane's, Skechers, Hobby Lobby, Mathis Sleep Center Germantown Germantown, MD 18,982 1992 2.7 100% 100% 100% 100% 100% CVS Pharmacy, Jiffy Lube The Glen Woodbridge, VA 136,440 1994 (2005) 14.7 100% 100% 100% 99% 93% Safeway, Panera Bread, Five Guys, Chipotle Great Falls Center Great Falls, VA 91,666 2008 11.0 95% 99% 100% 100% 98% Safeway, CVS Pharmacy, Northwest Federal Credit Union, Starbucks, Subway Hampshire Langley Takoma Park, MD 131,700 1972 (1979) 9.9 93% 100% 100% 100% 100% Mega Mart, Starbucks, Chuck E.
Washington, MD 143,577 2003 16.0 93% 98% 98% 98% 92% Safeway, Advance Auto Parts, Dollar Tree, McDonald's, Wendy's, Ledo's Pizza, M&T Bank Olney Olney, MD 53,765 1975 (1990) 3.7 95% 95% 96% 93% 93% Walgreens, Olney Grille, Ledo's Pizza, Popeye's, Sardi's Fusion Orchard Park Dunwoody, GA 87,365 2007 10.5 99% 99% 100% 100% 99% Kroger, Jett Ferry Dental Palm Springs Center Altamonte Springs, FL 126,446 2005 12.0 95% 98% 97% 98% 100% Publix, Duffy's Sports Grill, Toojay's Deli, The Tile Shop, Rockler Tools, Sola Salons Ravenwood Baltimore, MD 93,328 1972 (2006) 8.0 91% 92% 93% 95% 97% Giant Food, Dominos, Bank of America 11503 Rockville Pk / 5541 Nicholson Ln Rockville, MD 40,249 2010 / 2012 3.0 57% 57% 57% 61% 61% Dr.
Washington, MD 143,577 2003 16.0 93% 93% 98% 98% 98% Safeway, Advance Auto Parts, Dollar Tree, McDonald's, Wendy's, Ledo's Pizza, M&T Bank Olney Olney, MD 53,765 1975 (1990) 3.7 93% 95% 95% 96% 93% Walgreens, Olney Grille, Ledo's Pizza, Popeye's, Sardi's Fusion, Qdoba Orchard Park Dunwoody, GA 87,365 2007 10.5 99% 99% 99% 100% 100% Kroger, Jett Ferry Dental Palm Springs Center Altamonte Springs, FL 126,446 2005 12.0 100% 95% 98% 97% 98% Publix, Toojay's Deli, The Tile Shop, Rockler Tools, Sola Salons Ravenwood Baltimore, MD 93,328 1972 (2006) 8.0 90% 91% 92% 93% 95% Giant Food, Dominos, Wingstop 11503 Rockville Pk / 5541 Nicholson Ln Rockville, MD 40,249 2010 / 2012 3.0 57% 57% 57% 57% 61% Dr.
The properties are located primarily in the Washington, DC/Baltimore, Maryland metropolitan area. The operating property portfolio is composed of 50 neighborhood and community Shopping Centers, and eight Mixed-Use Properties totaling approximately 7.8 million and 2.4 million square feet of GLA, respectively. One property, Seven Corners Center, accounted for more than 5% of the total gross leasable area.
The properties are located primarily in the Washington, DC/Baltimore metropolitan area. The operating property portfolio is composed of 50 neighborhood and community Shopping Centers, and nine Mixed-Use Properties totaling approximately 7.8 million and 2.8 million square feet of GLA, respectively. One property, Seven Corners Center, accounted for more than 5% of the total gross leasable area.
Clarendon Center-North Block Arlington, VA (4) 108,386 2010 0.6 89% 89% 85% 86% 83% AT&T Mobility, Chipotle, Airlines Reporting Corporation Clarendon Center-South Block Arlington, VA (4) 104,894 2010 1.3 53% 53% 71% 88% 88% Trader Joe's, Circa, Burke & Herbert Bank, South Block Blends, Keppler Speakers Bureau, Leadership Institute, Massage Envy Clarendon Center Residential-South Block (244 units) Arlington, VA (4) 188,671 2010 97% 98% 97% 98% 95% Park Van Ness- Residential (271 units) Washington, DC (4) 214,600 2016 1.4 97% 97% 97% 96% 95% Park Van Ness-Retail Washington, DC (4) 8,847 2016 76% 76% 32% 100% 100% Sfoglina Pasta House, Rosedale 601 Pennsylvania Ave.
Clarendon Center-North Block Arlington, VA (4) 108,386 2010 0.6 96% 89% 89% 85% 86% Airlines Reporting Corporation, AT&T Mobility, Chipotle Clarendon Center-South Block Arlington, VA (4) 104,894 2010 1.3 58% 53% 53% 71% 88% Trader Joe's, Circa, Burke & Herbert Bank, South Block Blends, Leadership Institute, Massage Envy Clarendon Center Residential-South Block (244 units) Arlington, VA (4) 188,671 2010 98% 97% 98% 97% 98% Park Van Ness- Residential (271 units) Washington, DC (4) 214,600 2016 1.4 97% 97% 97% 97% 96% Park Van Ness-Retail Washington, DC (4) 8,847 2016 94% 76% 76% 32% 100% Sfoglina Pasta House, Rosedale 601 Pennsylvania Ave.
Crew, Chop't, Lululemon, Orange Theory, Athleta, Sephora, O2 Fitness, Hallmark, Sleep Number, The Good Feet Store, Hand & Stone Massage, Golf Galaxy Village Center Centreville, VA 145,651 1990 17.2 94% 86% 89% 88% 88% Giant Food, Starbucks, McDonald's, Pet Supplies Plus, Bikram Yoga, Truist Bank, Vitality Fitness Westview Village Frederick, MD 103,186 2009 11.6 100% 99% 99% 92% 100% Silver Diner, Sleepy's, Music & Arts, Firehouse Subs, CiCi's Pizza, Café Rio, Five Guys, Regus, Krispy Kreme, Wendy's, State Employees Credit Union (SECU), GNC, Moby Dick's House of Kabobs White Oak Silver Spring, MD 480,676 1972 (1993) 27.9 100% 100% 100% 100% 100% Giant Food, Sears, Walgreens, Sarku Japan Total Shopping Centers (1) 7,808,783 766.6 96.4% 95.3% 94.7% 93.4% 93.1% 31 Table of Contents Percentage Leased as of December 31, 2024 Property Location Leasable Area (Square Feet) Year Acquired or Developed (Renovated) Land Area (Acres) 2024 2023 2022 2021 2020 Anchor / Significant Tenants as at December 31, 2024 Mixed-Use Properties (3) Avenel Business Park Gaithersburg, MD 390,683 1981-2000 37.1 95% 96% 90% 87% 93% General Services Administration, Gene Dx, Inc., American Type Culture Collection, Inc.
Crew, Chop't, Lululemon, Orange Theory, Athleta, Sephora, O2 Fitness, Hallmark, Sleep Number, The Good Feet Store, Hand & Stone Massage, Golf Galaxy, Warby Parker, Lovesac, Kendra Scott Village Center Centreville, VA 145,651 1990 17.2 95% 94% 86% 89% 88% Giant Food, Starbucks, Pet Supplies Plus, Bikram Yoga, Truist Bank, Vitality Fitness Westview Village Frederick, MD 103,186 2009 11.6 100% 100% 99% 99% 89% Silver Diner, Sleepy's, Music & Arts, Firehouse Subs, CiCi's Pizza, Café Rio, Five Guys, Regus, Krispy Kreme, Wendy's, State Employees Credit Union (SECU), GNC, Moby Dick's House of Kabobs, Wingstop White Oak Silver Spring, MD 480,676 1972 (1993) 27.9 98% 100% 100% 100% 100% Giant Food, Sears, Sarku Japan, Beauty 4 U Total Shopping Centers (1) 7,814,783 766.6 95.6% 96.4% 95.3% 94.7% 93.4% 31 Table of Contents Percentage Leased as of December 31, 2025 Property Location Leasable Area (Square Feet) Year Acquired or Developed (Renovated) Land Area (Acres) 2025 2024 2023 2022 2021 Anchor / Significant Tenants as at December 31, 2025 Mixed-Use Properties (3) Avenel Business Park Gaithersburg, MD 390,683 1981-2000 37.1 99% 95% 96% 90% 87% General Services Administration, Gene Dx, Inc., American Type Culture Collection, Inc.
By contrast, regional malls generally are larger and typically are anchored by one or more full-service department stores. In general, the Shopping Centers are seasoned community and neighborhood shopping centers located in well established, highly developed, densely populated, middle and upper income areas.
By contrast, regional malls generally are larger and typically are anchored by one or more full-service department stores. 25 Table of Contents In general, the Shopping Centers are seasoned community and neighborhood shopping centers located in well established, highly developed, densely populated, middle and upper income areas.
(3) For the purposes of the property count listed elsewhere in this document, residential and commercial are combined. The residential units at Clarendon South, Park Van Ness, The Waycroft and Twinbrook Quarter Phase 1 are all part of the same building as the commercial tenants at those locations. (4) Property is LEED certified. 33 Table of Contents
(3) For the purposes of the property count listed elsewhere in this document, residential and commercial are combined. The residential units at Clarendon South, Park Van Ness, The Waycroft, Twinbrook Quarter Phase 1 and Hampden House are all part of the same building as the commercial tenants at those locations. (4) Property is LEED certified.
Accordingly, management believes that the Mixed-Use Properties compete for tenants in different commercial and geographic sub-markets of the metropolitan Washington, DC market and do not compete with one another. 26 Table of Contents Lease Expirations of Mixed-Use Properties The following table sets forth, by year of expiration, the aggregate amount of base rent and leasable area for commercial leases in place at the Mixed-Use Properties that the Company owned as of December 31, 2024, for each of the next ten years beginning with 2025, assuming that none of the tenants exercise renewal options and excluding an aggregate of 150,973 square feet of unleased office and retail space, which represented 12.1% of the GLA of the commercial space within the Mixed-Use Properties as of December 31, 2024.
Accordingly, management believes that the Mixed-Use Properties compete for tenants in different commercial and geographic sub-markets of the metropolitan Washington, DC/Baltimore market and do not compete with one another. 26 Table of Contents Lease Expirations of Mixed-Use Properties The following table sets forth, by year of expiration, the aggregate amount of base rent and leasable area for commercial leases in place at the Mixed-Use Properties that the Company owned as of December 31, 2025, for each of the next ten years beginning with 2026, assuming that none of the tenants exercise renewal options and excluding an aggregate of 141,799 square feet of unleased office and retail space, which represented 11.3% of the GLA of the commercial space within the Mixed-Use Properties as of December 31, 2025.
For a detailed discussion of risks from cybersecurity threats, please see “Item 1A. Risk Factors.” Item 2. Properties Overview As of December 31, 2024, the Company is the owner and operator and developer of a real estate portfolio composed of 58 operating properties, totaling approximately 10.2 million square feet of gross leasable area (“GLA”), and four development properties.
For a detailed discussion of risks from cybersecurity threats, please see “Item 1A. Risk Factors.” Item 2. Properties Overview As of December 31, 2025, the Company is the owner and operator and developer of a real estate portfolio composed of 59 operating properties, totaling approximately 10.6 million square feet of gross leasable area (“GLA”), and three development properties.
The Mixed-Use Properties All of the Mixed-Use Properties are located in the Washington, DC metropolitan area and contain an aggregate GLA of approximately 2.4 million square feet, composed of 1.0 million and 0.2 million square feet of office and retail space, respectively, and 1,458 apartments.
The Mixed-Use Properties All of the Mixed-Use Properties are located in the Washington, DC/Baltimore metropolitan area and contain an aggregate GLA of approximately 2.8 million square feet, composed of 1.0 million and 0.3 million square feet of office and retail space, respectively, and 1,824 apartments.
New Market New Market, MD 2005 35.5 Parcel will accommodate retail development in excess of 120,000 square feet near I-70, east of Frederick, Maryland. A development timetable has not been determined. Total Development Properties 59.7 (1) Percentage leased is a percentage of rentable square feet leased for commercial space and a percentage of units leased for apartments.
New Market New Market, MD 2005 35.5 Parcel will accommodate retail development in excess of 120,000 square feet near I-70, east of Frederick, Maryland. A development timetable has yet to be finalized. Total Development Properties 59.1 (1) Percentage leased is a percentage of rentable square feet leased for commercial space and a percentage of units leased for apartments.
The Company’s internal audit team also periodically conducts a risk-based cybersecurity audit and, as part of such audit, engages third parties to conduct detailed security assessments, including adversary simulations, technical remediation validation and reporting of results. The Company’s internal audit team prepares cybersecurity audit reports in accordance with appropriate standards and reports findings and recommendations to Company management.
The Company’s internal audit team also periodically conducts a risk-based cybersecurity audit and, as part of such audit, engages third parties to conduct detailed 24 Table of Contents security assessments, including adversary simulations, technical remediation validation and reporting of results.
In addition, dedicated information technology and executive personnel convene quarterly to examine operational aspects of cybersecurity. The Company maintains an incident response plan that is designed to quickly respond to cyber security related incidents in a manner that protects its own information and the information of the Company’s customers and tenants as outlined in the incident response plan.
The Company maintains an incident response plan that is designed to quickly respond to cyber security related incidents in a manner that is intended to protect its own information and the information of the Company’s customers and tenants as outlined in the incident response plan.
As of December 31, 2024, the Company had 1,103 apartment leases, 800 of which will expire in 2025 and 303 of which will expire in 2026.
As of December 31, 2025, the Company had 1,484 apartment leases, 1,119 of which will expire in 2026 and 365 of which will expire in 2027.
The Shopping Center properties range in size from approximately 19,000 to 573,500 square feet of GLA, with six in excess of 300,000 square feet, and average approximately 156,200 square feet. 25 Table of Contents Lease Expirations of Shopping Center Properties The following table sets forth, by year of expiration, the aggregate amount of base rent and leasable area for leases in place at the Shopping Centers as of December 31, 2024, for each of the next ten years beginning with 2025, assuming that none of the tenants exercise renewal options and excluding an aggregate of 282,908 square feet of unleased space, which represented 3.6% of the GLA of the Shopping Centers as of December 31, 2024.
Lease Expirations of Shopping Center Properties The following table sets forth, by year of expiration, the aggregate amount of base rent and leasable area for leases in place at the Shopping Centers as of December 31, 2025, for each of the next ten years beginning with 2026, assuming that none of the tenants exercise renewal options and excluding an aggregate of 345,744 square feet of unleased space, which represented 4.4% of the GLA of the Shopping Centers as of December 31, 2025.
The 2024 average estimated population within a one- and three-mile radius of the Shopping Centers is approximately 15,500 and 83,400, respectively. The 2024 average household income within a one- and three-mile radius of the Shopping Centers is approximately $156,100 and $162,800, respectively, compared to a national average of $113,200.
The 2025 average estimated population within a one- and three-mile radius of the Shopping Centers is approximately 15,900 and 98,800, respectively. The 2025 average household income within a one- and three-mile radius of the Shopping Centers is approximately $154,700 and $158,900, respectively, compared to a national average of $116,200.
The audit reports and management’s responses, including descriptions of any corrective actions taken, are then reported to the Audit Committee and the Board of Directors.
The Company’s internal audit team prepares cybersecurity audit reports in accordance with appropriate standards and reports findings and recommendations to Company management. The audit reports and management’s responses, including descriptions of any corrective actions taken, are then reported to the Audit Committee and the Board of Directors.
The Audit Committee is apprised of cybersecurity controls, known and perceived risks, remediation of those risks, and other measures via the Chief Audit Executive, through direct briefings, or in writing (by the CIO and/or designee).
The Audit Committee is apprised of cybersecurity controls, known and perceived risks, remediation of those risks, and other measures by the Chief Audit Executive, through direct briefings, or in writing (by the CIO and/or designee). Our incident response policy/plan requires that key Company executives and the Audit Committee are informed of and involved with any confirmed cybersecurity incident (including mitigation/remediation).
The Company has designed a third-party risk management program, under the supervision of its Chief Data Privacy Officer, that is designed to manage third-party providers through the lifecycle of the relationship.
Company IT acceptable use policies require that employees report any security incidents to IT and his/her supervisor. Regularly scheduled Company training courses and security bulletins reinforce security awareness. The Company has designed a third-party risk management program, under the supervision of its Chief Data Privacy Officer, that is designed to manage third-party providers through the lifecycle of the relationship.
Because the Shopping Centers generally are located in highly developed areas, management believes that there is little likelihood that significant numbers of competing centers will be developed in the future.
Because the Shopping Centers generally are located in highly developed areas, management believes that there is little likelihood that significant numbers of competing centers will be developed in the future. The Shopping Center properties range in size from approximately 19,000 to 573,500 square feet of GLA, with six in excess of 300,000 square feet, and average approximately 156,300 square feet.
A majority of the Shopping Centers are anchored by several major tenants and offer primarily day-to-day necessities and services. Thirty-four of the Shopping Centers were anchored by a grocery store. Only one tenant, Giant Food (4.8%), a tenant at 11 Shopping Centers, individually accounted for 2.5% or more of the Company’s total revenue for the year ended December 31, 2024.
A majority of the Shopping Centers are anchored by one or more major tenants and offer primarily day-to-day necessities and services. Thirty-four of the Shopping Centers were anchored by a grocery store.
Business—Operating Strategies” and “Business—Capital Policies.” The Shopping Centers Community and neighborhood shopping centers typically are anchored by one or more grocery stores, discount department stores or drug stores. These anchors offer day-to-day necessities rather than apparel and luxury goods and, therefore, generate consistent local traffic.
It plans to selectively acquire additional income-producing properties and to expand, renovate, and improve its properties when circumstances warrant. See “Item 1. Business—Operating Strategies” and “Business—Capital Policies.” The Shopping Centers Community and neighborhood shopping centers typically are anchored by one or more grocery stores, discount department stores or drug stores.
Commercial Lease Expirations of Mixed-Use Properties Year of Lease Expiration Leasable Area Represented by Expiring Leases Percentage of Leasable Area Represented by Expiring Leases Annual Base Rent Under Expiring Leases (1) Percentage of Annual Base Rent Under Expiring Leases Annual Base Rent per Square Foot 2025 74,617 sf 6.0 % $ 3,033,514 8.6 % $ 40.65 2026 118,044 9.5 % 4,077,604 11.6 % 34.54 2027 80,352 6.5 % 2,495,156 7.1 % 31.05 2028 59,989 4.8 % 1,796,588 5.1 % 29.95 2029 53,974 4.4 % 1,894,230 5.4 % 35.10 2030 70,815 5.7 % 2,577,811 7.3 % 36.40 2031 171,261 13.8 % 3,492,392 9.9 % 20.39 2032 15,382 1.2 % 508,329 1.5 % 33.05 2033 76,776 6.2 % 3,835,424 10.9 % 49.96 2034 48,743 3.9 % 2,468,031 7.0 % 50.63 Thereafter 321,883 25.9 % 9,006,710 25.6 % 27.98 Total 1,091,836 sf 87.9 % $ 35,185,789 100.0 % $ 32.23 (1) Calculated using annualized contractual base rent payable as of December 31, 2024, for the expiring GLA, excluding expenses payable by or reimbursable from tenants.
Commercial Lease Expirations of Mixed-Use Properties Year of Lease Expiration Leasable Area Represented by Expiring Leases Percentage of Leasable Area Represented by Expiring Leases Annual Base Rent Under Expiring Leases (1) Percentage of Annual Base Rent Under Expiring Leases Annual Base Rent per Square Foot 2026 71,339 sf 5.7 % $ 2,233,344 6.1 % $ 31.31 2027 90,446 7.2 % 2,717,574 7.5 % 30.05 2028 80,825 6.5 % 2,206,738 6.1 % 27.30 2029 61,633 4.9 % 2,194,006 6.0 % 35.60 2030 90,085 7.2 % 3,472,524 9.5 % 38.55 2031 208,230 16.6 % 5,600,032 15.4 % 26.89 2032 20,051 1.6 % 608,341 1.6 % 30.34 2033 85,721 6.8 % 3,926,369 10.8 % 45.80 2034 59,773 4.8 % 3,019,531 8.3 % 50.52 2035 108,310 8.7 % 1,802,220 5.0 % 16.64 Thereafter 234,648 18.7 % 8,609,817 23.7 % 36.69 Total 1,111,061 sf 88.7 % $ 36,390,496 100.0 % $ 32.75 (1) Calculated using annualized contractual base rent payable as of December 31, 2025, for the expiring GLA, excluding expenses payable by or reimbursable from tenants.
Lease Expirations of Shopping Center Properties Year of Lease Expiration Leasable Area Represented by Expiring Leases Percentage of Leasable Area Represented by Expiring Leases Annual Base Rent Under Expiring Leases (1) Percentage of Annual Base Rent Under Expiring Leases Annual Base Rent per Square Foot 2025 855,680 sf 11.0 % $ 17,239,919 11.8 % $ 20.15 2026 793,490 10.2 % 16,680,482 11.4 % 21.02 2027 940,656 12.0 % 20,457,744 13.9 % 21.75 2028 1,409,647 18.1 % 22,324,024 15.2 % 15.84 2029 1,298,216 16.6 % 25,273,822 17.2 % 19.47 2030 516,982 6.6 % 10,174,318 6.9 % 19.68 2031 385,278 4.9 % 8,123,737 5.5 % 21.09 2032 276,686 3.6 % 3,892,344 2.7 % 14.07 2033 214,324 2.7 % 5,485,506 3.7 % 25.59 2034 216,194 2.8 % 4,401,354 3.0 % 20.36 Thereafter 618,722 7.9 % 12,728,228 8.7 % 20.57 Total 7,525,875 sf 96.4 % $ 146,781,478 100.0 % $ 19.50 (1) Calculated using annualized contractual base rent payable as of December 31, 2024 for the expiring GLA, excluding expenses payable by or reimbursable from tenants.
Lease Expirations of Shopping Center Properties Year of Lease Expiration Leasable Area Represented by Expiring Leases Percentage of Leasable Area Represented by Expiring Leases Annual Base Rent Under Expiring Leases (1) Percentage of Annual Base Rent Under Expiring Leases Annual Base Rent per Square Foot 2026 665,507 sf 8.5 % $ 12,652,115 8.4 % $ 19.01 2027 874,651 11.2 % 19,690,649 13.1 % 22.51 2028 1,445,641 18.5 % 23,358,271 15.5 % 16.16 2029 1,302,887 16.7 % 26,112,115 17.3 % 20.04 2030 836,672 10.7 % 18,136,431 12.0 % 21.68 2031 503,353 6.4 % 11,534,387 7.6 % 22.92 2032 355,835 4.5 % 6,090,285 4.0 % 17.12 2033 270,762 3.5 % 5,978,543 4.0 % 22.08 2034 218,536 2.8 % 5,041,448 3.3 % 23.07 2035 435,154 5.6 % 10,395,667 6.9 % 23.89 Thereafter 560,041 7.2 % 11,906,231 7.9 % 21.26 Total 7,469,039 sf 95.6 % $ 150,896,142 100.0 % $ 20.20 (1) Calculated using annualized contractual base rent payable as of December 31, 2025 for the expiring GLA, excluding expenses payable by or reimbursable from tenants.
The Company expects to hold its properties as long-term investments and it has no maximum period for retention of any investment. It plans to selectively acquire additional income-producing properties and to expand, renovate, and improve its properties when circumstances warrant. See “Item 1.
Only one tenant, Giant Food (4.5%), a tenant at 11 Shopping Centers, individually accounted for 2.5% or more of the Company’s total revenue for the year ended December 31, 2025. The Company expects to hold its properties as long-term investments and it has no maximum period for retention of any investment.
Removed
Our incident response policy/plan requires that key Company executives and the Audit 24 Table of Contents Committee are informed of and involved with any confirmed cybersecurity incident (including mitigation/remediation). Company IT acceptable use policies require that employees report any security incidents to IT and his/her supervisor. Regularly scheduled Company training courses and security bulletins reinforce security awareness.
Added
In addition, dedicated information technology and executive personnel convene quarterly to examine operational aspects of cybersecurity.
Removed
Interior construction and installation of unit finishes continues. Delivery and opening is expected in late 2025. Twinbrook Quarter - Future Phases Rockville, MD 2021 6.3 Development timetable yet to be finalized. Ashland Square Phase II Manassas, VA 2004 17.3 Marketing to grocers and other retail businesses, with a development timetable yet to be finalized.
Added
These anchors offer day-to-day necessities rather than apparel and luxury goods and, therefore, generate consistent local traffic.
Added
Total Mixed-Use Properties (1) 2,738,220 49.6 88.7% 87.9% 86.0% 82.5% 82.3% (2) Total Portfolio (1) 10,553,003 816.2 94.6% 95.2% 94.1% 93.2% 92.0% (2) 32 Table of Contents Property Location Year Acquired or Developed (Renovated) Land Area (Acres) Development Activity Land and Development Properties Twinbrook Quarter - Future Phases Rockville, MD 2021 6.3 A development timetable has yet to be finalized.
Added
Ashland Square Phase II Manassas, VA 2004 17.3 The Company has entered into a lease with Publix for a new grocery store and has executed leases for two additional pad sites.
Added
When complete, Ashland Square is expected to ultimately comprise approximately 124,000 square feet of retail space including the 50,325 square foot Publix, the three existing pad sites, four additional pad sites and approximately 30,000 square feet of small shop space. The development timetable is currently being finalized.
Added
(5) Property has received a gold certification under the National Green Building Standard. 33 Table of Contents

Item 2. Properties

Properties — owned and leased real estate

84 edited+14 added−13 removed78 unchanged
Biggest changeA pandemic or public health emergency could have a material and adverse effect on or cause disruption to our business or financial condition, results of operations and cash flows due to, among other factors: • a complete or partial closure of, or other operational issues at, our properties as a result of government or tenant action; • declines in or instability of the economy or financial markets that may result in a recession or negatively impact consumer discretionary spending, which could adversely affect retailers and consumers; • reduction of economic activity that severely impacts our tenants' business operations, financial condition and liquidity and may cause one or more of our tenants to be unable to meet their obligations to us in full, or at all, to default on their lease, or to otherwise seek modifications of such obligations; • inability to access debt and equity capital on favorable terms, if at all, and a severe disruption and instability in the global financial markets or deteriorations in credit and financing conditions may affect our access to capital necessary to fund business operations, pursue acquisition and development opportunities, refinance existing debt, reduce our ability to make cash distributions to our stockholders and increase our future interest expense; • a general decline in business activity and demand for real estate transactions could adversely affect our ability to successfully execute investment strategies or expand our property portfolio; • a significant reduction in our cash flows could impact our ability to continue paying cash dividends to our common and preferred stockholders at expected levels or at all; • the financial impact of a pandemic or public health emergency could negatively affect our future compliance with financial and other covenants of our credit facility and other debt instruments, and the failure to comply with such covenants could result in a default that accelerates the payment of such indebtedness; • the continued service and availability of personnel, including our executive officers and Board of Directors, and our ability to recruit, attract and retain skilled personnel, to the extent our management, Board of Directors or personnel are impacted in significant numbers by the outbreak of pandemic or epidemic disease and are not available or allowed to conduct work, could negatively impact our business and operating results; and • our ability to ensure business continuity in the event our continuity of operations plan is not effective or is improperly implemented or deployed during a disruption.
Biggest changeA pandemic or public health emergency could have a material adverse effect on or disrupt our business and financial condition, results of operations and cash flows due to, among other factors: • a complete or partial closure of, or other operational issues at, our properties as a result of government or tenant action; • declines in or instability of the economy or financial markets, which could adversely affect our tenants' business operations, financial condition and liquidity and may cause them to be unable to meet their obligations to us or to seek modifications of such obligations; • an inability to access debt and equity capital on favorable terms, if at all, and a severe disruption and instability in the global financial markets or deteriorations in credit and financing conditions may affect our access to capital necessary to fund business operations, pursue acquisition and development opportunities, refinance existing debt on favorable terms or at all, and may affect cash distributions to our stockholders; • a general decline in business activity and real estate transactions could adversely affect our ability to successfully execute investment strategies or expand our property portfolio; • a significant reduction in our cash flows could impact our ability to continue paying cash dividends to our common and preferred stockholders at expected levels or at all; • the financial impact of a pandemic or public health emergency could negatively affect our future compliance with financial and other covenants under our debt instruments, and the failure to comply with such covenants could result in a default that accelerates the payment of such indebtedness; • the discontinued service or lack of availability of personnel to conduct work could negatively impact our business and operating results; and • our ability to ensure business continuity in the event our continuity of operations plan is not effective or is improperly implemented or deployed during a disruption.
While many of the retailers in our shopping centers sell goods or provide services that are unable to be performed online, the continuing increase in e-commerce sales may cause retailers to adjust the size or number of retail locations in the future or close stores.
While many of the retailers in our shopping centers provide services that are unable to be performed online or sell goods, the continuing increase in e-commerce sales may cause retailers to adjust the size or number of retail locations in the future or close stores.
For example, it could: • require us to dedicate a substantial portion of our cash flow from operations to payments on our debt, thereby reducing funds available for operations, property acquisitions and other appropriate business opportunities that may arise in the future; • limit our ability to obtain any additional financing we may need in the future for working capital, debt refinancing, capital expenditures, acquisitions, development or other general corporate purposes; • make it difficult to satisfy our debt service requirements; • limit our ability to make distributions on our outstanding common and preferred stock; • require us to dedicate increased amounts of our cash flow from operations to payments on our variable rate, unhedged debt if interest rates rise; • limit our flexibility in planning for, or reacting to, changes in our business and the factors that affect the profitability of our business, which may place us at a disadvantage compared to competitors with less debt or debt with less restrictive terms; and • limit our ability to obtain any additional financing we may need in the future for working capital, debt refinancing, capital expenditures, acquisitions, development or other general corporate purposes.
For example, it could: • require us to dedicate a substantial portion of our cash flow from operations to payments on our debt, thereby reducing funds available for operations, property acquisitions and other appropriate business opportunities that may arise in the future; • limit our ability to obtain any additional financing we may need in the future for working capital, debt refinancing, capital expenditures, acquisitions, development or other general corporate purposes; • make it difficult to satisfy our debt service requirements; • limit our ability to make distributions on our outstanding common and preferred stock; • require us to dedicate increased amounts of our cash flow from operations to payments on our variable rate, unhedged debt if interest rates rise; and • limit our flexibility in planning for, or reacting to, changes in our business and the factors that affect the profitability of our business, which may place us at a disadvantage compared to competitors with less debt or debt with less restrictive terms.
Under various federal, state and local laws, ordinances and regulations, we and our tenants may be required to investigate and clean up certain hazardous or toxic substances released on or in properties we own or operate, and also may be required to pay other costs relating to hazardous or toxic substances.
Under various federal, state and local laws, ordinances and regulations, we and our tenants may be required to investigate and clean up certain hazardous or toxic substances released on or in properties we own or operate, and we and our tenants also may be required to pay other costs relating to hazardous or toxic substances.
Members of the Saul Organization are permitted under our articles of incorporation to convert Operating Partnership units into shares of common stock or acquire additional shares of common stock until the Saul Organization’s actual ownership of common stock reaches 39.9% in value of our equity securities.
Members of the Saul Organization are permitted under our articles of incorporation to convert Operating Partnership units into shares of common stock or acquire additional shares of common stock until the Saul Organization’s actual ownership of common stock reaches 39.9% in value of our equity securities.
These provisions include: • the REIT ownership limit described above; • authorization of the issuance of our preferred stock with powers, preferences or rights to be determined by the Board of Directors; • a staggered, fixed-size Board of Directors consisting of three classes of directors; • special meetings of our stockholders may be called only by the Chairman of the Board, the president, by a majority of the directors or by stockholders possessing no less than 25% of all the votes entitled to be cast at the meeting; • the Board of Directors, without a stockholder vote, can classify or reclassify unissued shares of preferred stock; 23 Table of Contents • a member of the Board of Directors may be removed only for cause upon the affirmative vote of 75% of the Board of Directors or 75% of the then-outstanding capital stock; • advance notice requirements for proposals to be presented at stockholder meetings; and • the terms of our articles of incorporation regarding business combinations and control share acquisitions.
These provisions include: 23 Table of Contents • the REIT ownership limit described above; • authorization of the issuance of our preferred stock with powers, preferences or rights to be determined by the Board of Directors; • a staggered, fixed-size Board of Directors consisting of three classes of directors; • special meetings of our stockholders may be called only by the Chairman of the Board, the president, by a majority of the directors or by stockholders possessing no less than 25% of all the votes entitled to be cast at the meeting; • the Board of Directors, without a stockholder vote, can classify or reclassify unissued shares of preferred stock; • a member of the Board of Directors may be removed only for cause upon the affirmative vote of 75% of the Board of Directors or 75% of the then-outstanding capital stock; • advance notice requirements for proposals to be presented at stockholder meetings; and • the terms of our articles of incorporation regarding business combinations and control share acquisitions.
If an uninsured loss or a loss in excess of our insured limits occurs, we could lose all or a portion of the capital we have invested in a property, as well as the anticipated future revenue from the property, but still remain obligated for any mortgage debt or other financial obligations related to the property.
If an uninsured loss or a loss in excess of our insured limits occurs, we could lose all or a portion of the capital we have invested in a property, as well as the anticipated future revenue from the property, but remain obligated for any mortgage debt or other financial obligations related to the property.
We and our tenants are subject to a wide range of federal, state and local laws and regulations, such as local licensing requirements, consumer protection laws and state and local fire, life-safety and similar requirements that affect the use of the properties. The leases typically require that each tenant comply with all regulations.
We and our tenants are subject to a wide range of federal, state and local laws and regulations, such as local licensing requirements, consumer protection laws and state and local fire, life-safety and similar requirements that affect the use of the properties. Our leases typically require that each tenant comply with all applicable laws and regulations.
Payment of dividends on our common stock may be subject to payment in full of the dividends on any preferred stock or depositary shares and payment of interest on any debt securities we may offer. Certain tax and anti-takeover provisions of our articles of incorporation and bylaws may inhibit a change of our control.
Payment of dividends on our common stock may be subject to the prior payment in full of the dividends on any preferred stock or depositary shares and payment of interest on any debt securities we may offer. Certain tax and anti-takeover provisions of our articles of incorporation and bylaws may inhibit a change of our control.
Our ability to meet some of the covenants in our debt, including covenants related to the condition of the property or payment of real estate taxes, may be dependent on the performance by our tenants under their leases. In addition, our Credit Facility requires us to satisfy financial covenants.
Our ability to meet some of the covenants in our debt, including covenants related to the condition of the property or payment of real estate taxes, may be dependent on the performance by our tenants under their leases. In addition, our New Credit Facility requires us to satisfy financial covenants.
Geographic concentration of our portfolio may make us particularly susceptible to adverse economic developments in the real estate markets of those areas. Over 85% of our property operating income is generated by properties in the metropolitan Washington, DC/Baltimore area.
Geographic concentration of our portfolio may make us particularly susceptible to adverse economic developments in the real estate markets of those areas. Over 85% of our property net operating income is generated by properties in the metropolitan Washington, DC/Baltimore metropolitan area.
We are not aware of any environmental condition with respect to any of our properties that management believes would have a material adverse effect on our business, assets or results of operations taken as a whole.
We are not currently aware of any environmental condition with respect to any of our properties that management believes would have a material adverse effect on our business, assets or results of operations taken as a whole.
If we fail to qualify as a REIT: • we would not be allowed a deduction for dividend distributions to stockholders in computing taxable income; • we would be subject to federal income tax at regular corporate rates; • unless we are entitled to relief under specific statutory provisions, we could not elect to be taxed as a REIT for four taxable years following the year during which we were disqualified; • we could be required to pay significant income taxes, which would substantially reduce the funds available for investment and for distribution to our stockholders for each year in which we failed to qualify; and • we would no longer be required by law to make any distributions to our stockholders.
If we fail to qualify as a REIT: • we would not be allowed a deduction for dividend distributions to stockholders in computing taxable income; • we would be subject to federal income tax at regular corporate rates; • unless we are entitled to relief under specific statutory provisions, we may not be permitted to elect to be taxed as a REIT for four taxable years following the year during which we were disqualified; • we could be required to pay significant income taxes, which would substantially reduce the funds available for investment and for distribution to our stockholders for each year in which we are not taxed as a REIT; and • we would no longer be required by law to make any distributions to our stockholders.
Such competition could have a material adverse effect on our ability to lease space in our retail properties and on the rents we can charge or the concessions we grant. This in turn could materially and adversely affect our results of operations and cash flows, and could affect the realizable value of our assets upon sale.
Such competition could have a material adverse effect on our ability to lease space in our retail properties and on the rents we can charge or the concessions we grant. This in turn could have a material adverse effect on our results of operations and cash flows and could affect the realizable value of our assets upon sale.
Our secured debt generally contains customary covenants, including, among others, provisions: • relating to the maintenance of the property securing the debt; • restricting our ability to assign or further encumber the properties securing the debt; and • restricting our ability to enter into certain new leases or to amend or modify certain existing leases without obtaining consent of the lenders.
Our secured debt contains covenants, including, among others, provisions: • relating to the maintenance of the property securing the debt; • restricting our ability to assign or further encumber the properties securing the debt; and • restricting our ability to enter into certain new leases or to amend or modify certain existing leases without obtaining consent of the lenders.
If that happened, either the transfer of ownership would be void or the shares would be transferred to a charitable trust and then sold to someone who can own those shares without violating the respective ownership limit. As of December 31, 2024, Mr. B. F.
If that happened, either the transfer of ownership would be void or the shares would be transferred to a charitable trust and then sold to someone who can own those shares without violating the respective ownership limit. As of December 31, 2025, Mr. B. F.
As a real estate company, we are susceptible to the following real estate industry risks: • economic downturns in the areas where our properties are located; • adverse changes in local real estate market conditions, such as oversupply or reduction in demand; • changes in tenant preferences that reduce the attractiveness of our properties to tenants; • zoning or regulatory restrictions; • decreases in market rental rates; • weather conditions that may increase energy costs and other operating expenses; • costs associated with the need to periodically repair, renovate and re-lease space; and • increases in the cost of adequate maintenance, insurance and other operating costs, including real estate taxes, associated with one or more properties, which may occur even when circumstances such as market factors and competition cause a reduction in revenue from one or more properties, although real estate taxes typically do not increase upon a reduction in such revenue.
As a real estate company, we are susceptible to the following real estate industry risks: • economic downturns in the areas where our properties are located; • adverse changes in local real estate market conditions, such as oversupply or reduction in demand; • changes in tenant preferences that reduce the attractiveness of our properties to tenants; • zoning or regulatory restrictions; • decreases in market rental rates; • weather conditions that may increase energy costs and other operating expenses; • costs associated with the need to periodically repair, renovate and re-lease space; and • increases in the cost of adequate maintenance, insurance and other operating costs, including real estate taxes, associated with one or more properties, which may occur even when circumstances such as market factors and competition cause a reduction in revenue from one or more properties.
Our access to debt or equity capital depends on a number of factors, including the general state of the capital markets, the market’s perception of our growth potential, our ability to pay dividends, and our current and potential future earnings.
Our access to debt or equity capital depends on a number of factors, including the general state of the capital markets, the market’s perception of the Company, our ability to pay dividends, and our current and potential future earnings.
We may need to borrow funds to meet our distribution requirements because: • our income may not be matched by our related expenses at the time the income is considered received for purposes of determining taxable income; and • non-deductible capital expenditures or debt service requirements may reduce available cash but not taxable income.
We may need to borrow funds to meet our distribution requirements because: 20 Table of Contents • our income may not be matched by our related expenses at the time the income is considered received for purposes of determining taxable income; and • non-deductible capital expenditures or debt service requirements may reduce available cash but not taxable income.
Our real estate assets may be subject to impairment charges. Our real estate properties are carried at cost less accumulated depreciation, unless circumstances indicate that the carrying amount of these assets may not be recoverable. We are required to make subjective assessments as to whether there are impairments in the value of our real estate assets and other investments.
Our real estate properties are carried at cost less accumulated depreciation, unless circumstances indicate that the carrying amount of these assets may not be recoverable. We are required to make subjective assessments as to whether there are impairments in the value of our real estate assets and other investments.
A property’s value is considered to be impaired if the estimated aggregate future undiscounted property cash flows are less than the carrying amount of the property. In our estimate of cash flows, we consider factors such as trends and prospects and the effects of demand and competition on expected future operating income.
A property’s value is impaired if the estimated aggregate future undiscounted property cash flows are less than the carrying amount of the property. In our estimate of cash flows, we consider factors such as trends and prospects and the effects of demand and competition on expected future operating income.
Our ability to refinance, sell assets or obtain additional financing may not be possible on terms that we would find acceptable. We are obligated to comply with financial and other covenants in our debt that could restrict our operating activities, and the failure to comply could result in defaults that accelerate the payment under our debt.
Our ability to refinance, sell assets or obtain additional financing may not be possible on terms that we would find acceptable. 17 Table of Contents We are obligated to comply with financial and other covenants in our debt that could restrict our operating activities, and the failure to comply could result in defaults that accelerate the payment under our debt.
The Company and the Saul Organization entered into a shared services agreement whereby each party pays a portion of the total rental payments based on a percentage proportionate to the number of employees employed by each party. The Company’s rent expense for the year ended December 31, 2024 was $847,600.
The Company and the Saul Organization entered into a shared services agreement whereby each party pays a portion of the total rental payments based on a percentage proportionate to the number of employees employed by each party. The Company’s rent expense for the year ended December 31, 2025 was $876,600.
Depending on the outcome of these factors, we could experience delay or difficulty in implementing our growth strategy on satisfactory terms, or be unable to implement this strategy. 18 Table of Contents Risk Factors Related to our REIT Status and Other Laws and Regulations Environmental laws and regulations could reduce the value or profitability of our properties.
Depending on the outcome of these factors, we could experience delay or difficulty in implementing our growth strategy on satisfactory terms, or be unable to implement our strategy. Risk Factors Related to our REIT Status and Other Laws and Regulations Environmental laws and regulations could reduce the value or profitability of our properties.
The redevelopment and acquisition of properties entails risks that include the following, any of which could adversely affect our results of operations and our ability to meet our obligations: • our estimate of the costs to improve, reposition or redevelop a property may prove to be too low, and, as a result, the property may fail to achieve the returns we have projected, either temporarily or for a longer time; • we may not be able to identify suitable properties to acquire or may be unable to complete the acquisition of the properties we identify; 11 Table of Contents • we may not be able to integrate new developments or acquisitions into our existing operations successfully; • properties we redevelop or acquire may fail to achieve the occupancy or rental rates we project at the time we make the decision to invest, which may result in the properties’ failure to achieve the returns we projected; • our pre-acquisition evaluation of the physical condition of each new investment may not detect certain defects or identify necessary repairs until after the property is acquired, which could significantly increase our total acquisition costs; and • our investigation of a property or building prior to our acquisition, and any representations we may receive from the seller, may fail to reveal various liabilities, which could reduce the cash flow from the property or increase our acquisition cost.
The redevelopment and acquisition of properties entail risks that include the following, any of which could adversely affect our results of operations and our ability to meet our obligations: • our estimate of the costs to improve, reposition or redevelop a property may prove to be too low, and, as a result, the property may fail to achieve the returns we have projected, either temporarily or for a longer time; • we may not be able to identify suitable properties to acquire or may be unable to complete the acquisition of the properties we identify; • we may not be able to integrate new developments or acquisitions into our existing operations successfully; • properties we redevelop or acquire may fail to achieve the occupancy or rental rates we project at the time we make the decision to invest, which may result in the properties’ failure to achieve the returns we projected; • our pre-acquisition evaluation of the physical condition of each new investment may not detect certain defects or identify necessary repairs until after the property is acquired, which could significantly increase our total acquisition costs; and • our investigation of a property or building prior to our acquisition, and any representations we may receive from the seller, may fail to reveal various liabilities, which could reduce the cash flow from the property or increase our acquisition cost. 11 Table of Contents Our performance and value are subject to general risks associated with the real estate industry.
Saul Company and a member of the Saul Organization, is a general insurance agency that receives commissions and counter-signature fees in connection with our insurance program. Such commissions and fees amounted to approximately $449,300 for the year ended December 31, 2024. Related Party Rents.
Saul Company and a member of the Saul Organization, is a general insurance agency that receives commissions and counter-signature fees in connection with our insurance program. Such commissions and fees amounted to approximately $573,300 for the year ended December 31, 2025. Related Party Rents.
We have used a measure tied to cash flow because we believe that the book value of our portfolio properties, which is the depreciated historical cost of the properties, does not accurately reflect our ability to borrow. Asset value, however, is somewhat more variable than book value.
We have used a measure tied to cash flow because we believe that the book value of our portfolio properties, which is the depreciated historical cost of the properties, does not accurately reflect our ability to borrow. Asset value, however, is somewhat more variable than book value. Book value may not reflect the fair market value of the underlying properties.
For example, in order to qualify as a REIT, at least 95% of our gross income in any year must be derived from qualifying rents and other income. Satisfying this requirement could be difficult, for example, if defaults by tenants were to reduce the amount of income from qualifying rents.
For example, to qualify as a REIT, at least 95% of our gross income in any year must be derived from qualifying rents and other income. Satisfying this requirement could be difficult, for example, if defaults by tenants reduced the amount of income from qualifying rents.
Saul II and members of the Saul Organization owned common stock representing approximately 38.6% in value of all our issued and outstanding equity securities. In addition, members of the Saul Organization beneficially owned Operating Partnership units that are, in general, convertible into our common stock on a one-for-one basis.
Saul II and members of the Saul Organization owned common stock representing approximately 37.1% in value of all our issued and outstanding equity securities. In addition, members of the Saul Organization beneficially owned Operating Partnership units that are, in general, convertible into our common stock on a one-for-one basis.
Except as discussed below, we do not have any additional written policies or procedures for the review, approval or ratification of transactions with related persons. Management Time.
Except as discussed below, we do not have any additional written policies or procedures for the review, approval or ratification of transactions with related persons. 15 Table of Contents Management Time.
The outbreak or pandemic of any highly infectious or contagious diseases or other public emergencies, could have a material and adverse effect on or cause disruption to our business or financial condition, results of operations, cash flows and the market value and trading price of our securities.
The outbreak or pandemic of any highly infectious or contagious diseases or other public emergencies, could have a material adverse effect on or disrupt our business and financial condition, results of operations, cash flows and the market value and trading price of our securities.
If we do not maintain or increase the dividend rate on our common stock, it could have an adverse effect on the market price of our common stock and other securities.
If we do not maintain or increase the dividend rate on our common stock, it could have a material adverse effect on the market price of our common stock and other securities.
Our ability to continue to pay dividends on our common stock at historical rates or to increase our common stock dividend rate will depend on a number of factors, including, among others, the following: • our financial condition and results of future operations; • the performance of lease terms by tenants; • the terms of our loan covenants; and • our ability to acquire, finance, develop or redevelop and lease additional properties at attractive rates.
Our ability to continue to pay dividends on our common stock at historical rates or to increase our common stock dividend rate will depend on a number of factors, including, among others, the following: • our financial condition and results of future operations; • our tenant’s performance under their leases; • the terms of our loan covenants; and • our ability to acquire, finance, develop or redevelop and lease additional properties at attractive rates.
Included in our general and administrative expenses or capitalized to specific development projects, for the year ended December 31, 2024, are charges totaling $11.4 million, net, related to such shared services, which included rental payments for the Company’s headquarters lease, which were billed by the Saul Organization.
Included in our general and administrative expenses or capitalized to specific development projects, for the year ended December 31, 2025, are charges totaling $12.0 million, net, related to such shared services, which included rental payments for the Company’s headquarters lease, which were billed by the Saul Organization.
The extent to which a pandemic or public health emergency impacts our operations and those of our tenants will depend on future developments, which are highly uncertain and cannot be predicted with confidence, including the scope, severity and duration of the outbreak, the actions taken to contain the outbreak or mitigate its impact, and the direct and indirect economic effects of the outbreak and containment measures, among others.
The extent to which a pandemic or public health emergency impacts our operations and those of our tenants will depend on future developments, which are highly uncertain and cannot be predicted with confidence, including the scope, severity and duration of the outbreak, the actions taken to contain the outbreak or mitigate its impact, and the direct and indirect economic effects of the outbreak and containment measures, among others. 22 Table of Contents Insurance coverage on our properties may be inadequate.
As of December 31, 2024, we were in compliance with all such covenants.
As of December 31, 2025, we were in compliance with all such covenants.
The covenants in our unsecured debt include, among others, provisions restricting our ability to: • incur additional unsecured debt; • guarantee additional debt; • make certain distributions, investments and other restricted payments, including distribution payments on our outstanding stock; • create certain liens; • increase our overall secured and unsecured borrowing beyond certain levels; and 17 Table of Contents • consolidate, merge or sell all or substantially all of our assets.
Our unsecured debt generally contains covenants including, among others, provisions restricting our ability to: • incur additional unsecured debt; • guarantee additional debt; • make certain distributions, investments and other restricted payments, including distribution payments on our outstanding stock; • create certain liens; • increase our overall secured and unsecured borrowing beyond certain levels; and • consolidate, merge or sell all or substantially all of our assets.
In these circumstances, we might have to borrow funds on unfavorable terms and even if our management believes the market conditions make borrowing financially unattractive. 20 Table of Contents Legislative, administrative, regulatory or other actions affecting REITs, including positions taken by the IRS, could have a material adverse effect on us and our investors.
To preserve our qualification as a REIT in these circumstances, we might choose to borrow funds on unfavorable terms even if our management believes the market conditions make borrowing financially unattractive. Legislative, administrative, regulatory or other actions affecting REITs, including positions taken by the IRS, could have a material adverse effect on us and our investors.
As of December 31, 2024, approximately 600,000 of the 10,011,903 units of the Operating Partnership would have been permitted to convert into additional shares of common stock, and would have resulted in Mr. B. F. Saul II and members of the Saul Organization owning common stock representing approximately 39.9% in value of all our issued and outstanding equity securities.
As of December 31, 2025, approximately 1,349,000 of the 10,615,771 units of the Operating Partnership would have been permitted to convert into additional shares of common stock, and would have resulted in Mr. B. F. Saul II and members of the Saul Organization owning common stock representing approximately 39.9% in value of all our issued and outstanding equity securities.
Changes to the tax laws or interpretations thereof by the IRS and the Treasury, with or without retroactive application, could materially and adversely affect us and our investors. No prediction can be made as to the likelihood of passage of new tax legislation or other provisions, or the direct or indirect effect on us and our shareholders.
Changes to the tax laws or interpretations thereof by the IRS and the Treasury, with or without retroactive application, could have a material adverse effect on us and our investors. No prediction can be made as to the likelihood of passage of new tax legislation or other provisions, or the direct or indirect effect on us and our investors.
In the event of our disposition of such properties, a disproportionately large share of the gain for federal income tax purposes would be allocated to members of the Saul Organization.
In the event that we dispose of such properties, a disproportionately large share of the gain for federal income tax purposes would be allocated to members of the Saul Organization.
These factors include, among others: • general economic and financial market conditions; • level and trend of interest rates; • our ability to access the capital markets to raise additional capital; • the issuance of additional equity or debt securities; • changes in our funds from operations (“FFO”) or earnings estimates; • changes in our credit or analyst ratings; • our financial condition and performance; • market perception of our business compared to other REITs; and • market perception of REITs, in general, compared to other investment alternatives.
These factors include, among others: • general economic and financial market conditions; • level and trend of interest rates; • our ability to access the capital markets to raise additional capital; • the issuance of additional equity or debt securities; • changes in our funds from operations (“FFO”) or earnings estimates; • changes in our credit or analyst ratings; • our financial condition and performance; • market perception of our business compared to other REITs; and • market perception of REITs, in general, compared to other investment alternatives. 18 Table of Contents Our ability to grow will be limited if we cannot obtain additional capital.
As of December 31, 2024, Mr. B. F. Saul II and members of the Saul Organization owned common stock representing approximately 38.6% in value of all our issued and outstanding equity securities.
As of December 31, 2025, Mr. B. F. Saul II and members of the Saul Organization owned common stock representing approximately 37.1% in value of all our issued and outstanding equity securities.
See Item 13 for risk factor mitigants. See Note 9 to the Consolidated Financial Statements for a discussion of related party transactions. 15 Table of Contents Shared Services. We share with the Saul Organization certain ancillary functions, such as computer and payroll services, benefits administration and in-house legal services.
See Item 13 for risk factor mitigants. See Note 9 to the Consolidated Financial Statements for a discussion of related party transactions. Shared Services. We share with the Saul Organization certain ancillary functions, such as information technology, payroll services, human resources and benefits administration, accounting services, and in-house legal services.
Our insurance coverage on our properties may be inadequate. We carry comprehensive insurance on all of our properties, including insurance for liability, earthquake, fire, flood, terrorism and rental loss. These policies contain coverage limitations. We believe this coverage is of the type and amount customarily obtained for or by an owner of real property assets.
We carry comprehensive insurance on all of our properties, including insurance for liability, earthquake, fire, flood, terrorism and rental loss. These policies contain coverage limitations. We believe this coverage is of the type and amount customarily obtained for or by an owner of real property assets. We intend to obtain similar insurance coverage on subsequently acquired properties.
If insurance is unavailable to us or is unavailable on acceptable terms, or if our insurance is not adequate to cover business interruption or losses from these events, our earnings, liquidity or capital resources could be adversely affected. We cannot assure you we will continue to pay dividends at historical rates.
If insurance is unavailable to us or is unavailable on acceptable terms, or if our insurance is not adequate to cover business interruption or losses from these events, such events could have a material adverse effect on our earnings, liquidity or capital resources. We cannot assure you we will continue to pay dividends at historical rates.
The requirements of the ADA, or of other federal, state or local laws, also may change in the future and restrict further renovations of our properties with respect to access for disabled persons. Future compliance with the ADA may require expensive changes to the properties.
The requirements of the ADA, or of other federal, state or local laws, also may change in the future and restrict further renovations of our properties to ensure access for disabled persons.
Potential consequences of a prolonged deterioration of economic and other market conditions include: • the financial condition of our tenants, many of which operate in the retail industry, may be adversely affected, which may result in tenant defaults under their leases due to bankruptcy, lack of liquidity, operational failures or for other reasons; • the ability to borrow on terms and conditions that we find acceptable, or at all, may be limited, which could reduce our ability to pursue acquisition and development opportunities and refinance existing debt, reduce our returns from acquisition and development activities and increase our future interest expense; 21 Table of Contents • reduced values of our properties may limit our ability to dispose of assets at attractive prices and may reduce the ability to refinance loans; and • one or more lenders under our credit facility could fail and we may not be able to replace the financing commitment of any such lenders on favorable terms, or at all.
Additional economic challenges that can adversely affect our retail tenants and anchor retailers include high inflation and unemployment levels, labor shortages, supply chain constraints, and increases in energy prices and interest rates. 21 Table of Contents Potential consequences of a prolonged deterioration of economic and other market conditions include: • the financial condition of our tenants, many of which operate in the retail industry, may be adversely affected by bankruptcy, lack of liquidity, operational failures or for other reasons, which may result in tenant defaults under their leases, including, but not limited to, defaults due to non-payment of rent to us; • the ability to borrow on terms and conditions that we find acceptable, or at all, may be limited, which could reduce our ability to pursue acquisition and development opportunities and refinance existing debt, reduce our returns from acquisition and development activities and increase our future interest expense; • reduced values of our properties may limit our ability to dispose of assets at attractive prices and may reduce the ability to refinance loans; and • one or more lenders under our New Credit Facility could fail and we may not be able to replace the financing commitment of any such lenders on favorable terms, or at all.
Further, as new technologies emerge, the relationships among customers, retailers, and shopping centers evolve rapidly and it is critical we adapt to such new technologies and relationships on a timely basis. We may be unable to adapt quickly and effectively, which could adversely impact our financial performance.
Further, as new technologies emerge, the relationships among customers, retailers, and shopping centers evolve rapidly and it is critical we adapt to such new technologies and relationships on a timely basis. We may be unable to adapt quickly and effectively, which could adversely impact our financial performance. Employee telecommuting, flexible work schedules, open workplaces and teleconferencing have become increasingly common.
In addition, operating expenses associated with each property, such as real estate taxes, insurance, utilities, maintenance costs and employee wages and benefits, may not decline as quickly or at the same rate as revenues when circumstances might cause a reduction of those revenues at our properties. Many real estate costs are fixed, even if income from our properties decreases.
In addition, operating expenses associated with each property, such as real estate taxes, insurance, utilities, maintenance costs and employee wages and benefits, may not decline as quickly as revenues, or at all, if revenues at our properties decline. Many real estate costs are fixed, even if income from our properties decreases.
Certain provisions contained in our articles of incorporation and bylaws and the Maryland General Corporation Law may discourage a third party from making a tender offer or acquisition proposal to us. If this were to happen, it could delay, deter or prevent a change in control or the removal of existing management.
Certain provisions contained in our articles of incorporation and bylaws and the Maryland General Corporation Law may discourage a third party from making a tender offer or acquisition proposal to purchase the Company. If such an offer or proposal was made, these provisions could delay, deter or prevent a change in control or the removal of existing management.
All of our properties, as commercial facilities, are required to comply with Title III of the ADA. Compliance with the ADA requirements could require removal of access barriers, and non-compliance could result in imposition of fines by the U.S. government or an award of damages to private litigants, or both. Investigation of a property may reveal non-compliance with the ADA.
Compliance with the ADA requirements could require removal of access barriers, and non-compliance could result in imposition of fines by the U.S. government or an award of damages to private litigants, or both. Investigation of a property may reveal non-compliance with the ADA.
The continued shift in retail sales towards e-commerce may adversely affect our financial condition, cash flows, and results of operations. Retailers are increasingly affected by e-commerce and changes in customer buying habits, which were further accelerated as a result of the COVID-19 pandemic.
The continued shift in retail sales towards e-commerce may adversely affect our financial condition, cash flows, and results of operations. Retailers are increasingly affected by e-commerce and changes in customer buying habits.
Generally, our tenants must comply with environmental laws and meet remediation requirements. Our leases typically impose obligations on our tenants to indemnify us from any compliance costs we may incur as a result of the environmental conditions on the property caused by the tenant. If a tenant fails to or cannot comply, we could be forced to pay these costs.
Generally, our tenants are required to comply with environmental laws and meet remediation requirements. Our leases typically impose obligations on our tenants to indemnify us from any compliance costs we may incur as a result of the environmental conditions on the property caused by the tenant.
The impact of climate change or the occurrence of natural disasters can delay new development projects, increase investment costs to repair or replace damaged properties, increase operating costs, create additional investment costs to make improvements to existing properties to comply with climate change regulations, increase future property insurance costs, and negatively impact the tenant demand for space.
The impact of climate change or the occurrence of natural disasters can delay new development projects, increase costs to repair or replace damaged properties, increase operating costs, require additional capital expenditures to improve existing properties, including to comply with applicable climate-related laws and regulations, increase future property insurance costs, and negatively impact the tenant demand for space.
As a result, our financial condition, operating results and ability to make distributions could be materially and adversely impacted by significant adverse economic changes affecting the real estate markets in that area. In turn, our common stock is subject to greater risk vis-à-vis other enterprises whose portfolio contains greater geographic diversity.
As a result, significant adverse economic changes, including actions of the Federal government, affecting the real estate markets in that area could have a material adverse effect on our financial condition, operating results and ability to make distributions. In turn, our common stock is subject to greater risk vis-à-vis other enterprises whose portfolio contains greater geographic diversity.
We use information technology and other computer resources to carry out important operational activities and to maintain our business records. As part of our normal business activities, we collect and store certain personal identifying and confidential information relating to our tenants, employees, vendors and suppliers, and maintain operational and financial information related to our business.
As part of our normal business activities, we collect and store certain personal identifying and confidential information relating to our tenants, employees, vendors and suppliers, and maintain operational and financial information related to our business.
In addition, the costs of maintaining adequate protection against data security threats, based on considerations of their evolution, increasing sophistication, pervasiveness and frequency and/or government-mandated standards or obligations regarding protective efforts, could be material to our consolidated financial statements in a particular period or over various periods.
In addition, the costs of maintaining adequate protection against data security threats, based on considerations of their evolution, increasing sophistication, pervasiveness and frequency and/or government-mandated standards or obligations regarding protective efforts, could be material to our consolidated financial statements in a particular period or over various periods. 14 Table of Contents We may be unable to sell properties when appropriate because real estate investments are illiquid.
Events such as these could adversely affect our results of operations and our ability to meet our obligations, including distributions to our stockholders. Natural disasters and climate change could have an adverse impact on our cash flow and operating results.
Events such as these could have a material adverse effect on our results of operations and our ability to meet our financial obligations, including distributions to our stockholders. Natural disasters and climate change could have a material adverse effect on our cash flows and operating results.
Saul II had the potential to exercise control over 10,852,766 shares of our common stock representing 45.2% of our issued and outstanding shares of common stock. Mr. B. F. Saul II also beneficially owned, as of December 31, 2024, 10,011,903 units of the Operating Partnership.
In addition, as of December 31, 2025, Mr. B. F. Saul II had the potential to exercise control over 10,887,456 shares of our common stock representing 45.0% of our issued and outstanding shares of common stock. Mr. B. F. Saul II also beneficially owned, as of December 31, 2025, 10,615,771 units of the Operating Partnership.
The uses of any of our properties prior to our acquisition of the property and the building materials used at the property are among the property-specific factors that will affect how the environmental laws are applied to our properties.
The uses of any of our properties prior to our acquisition of the property and the building materials used at the property are among the property-specific factors that will affect how environmental laws are applied to our properties. If we are subject to any material environmental liabilities, such liabilities could adversely affect our results of operations and financial condition.
Our business may be affected by market and economic challenges experienced by the U.S. economy or real estate industry as a whole, by the local economic conditions in the markets in which our properties are located, including the impact of high inflation, high unemployment, volatility in the public equity and debt markets, and international economic conditions.
Our business may be affected by market and economic challenges experienced by the U.S. economy and real estate industry as a whole, as well as by the economic conditions in the markets in which our properties are located.
We may be unable to sell properties when appropriate because real estate investments are illiquid. Real estate investments generally cannot be sold quickly. In addition, there are some limitations under federal income tax laws applicable to real estate and in particular to REITs that may limit our ability to sell our assets.
Real estate investments generally cannot be sold quickly. In addition, there are some limitations under federal income tax laws applicable to real estate and in particular to REITs that may limit our ability to sell our assets. We may not be able to alter our portfolio promptly in response to changes in economic or other conditions.
If we are unable to anticipate and respond promptly to trends in the market, our occupancy levels and rental rates may decline, and our financial condition and results of operations may be adversely impacted. 13 Table of Contents Cybersecurity risks and cyber incidents could adversely affect our business, disrupt operations and expose us to liabilities to tenants, employees, capital providers and other third parties.
If we are unable to anticipate and respond promptly to trends in the market, our occupancy levels and rental rates may decline, and our financial condition and results of operations may be adversely impacted. 13 Table of Contents AI presents risks and challenges that could adversely affect our business, results of operations and reputations.
As a result, we may not be able to renew existing resident leases or enter into new resident leases, or if we are able to renew or enter into new leases, they may be at rates or terms that are less favorable than our current rates or terms, resulting in a material impact on our results of operations.
As a result, we may not be able to renew existing resident leases or enter into new resident leases, or if we are able to renew or enter into new leases, they may be at rates or terms that are less favorable than our current rates or terms, resulting in a material impact on our results of operations. 12 Table of Contents The short-term nature of apartment leases exposes us more quickly to the effects of declining market rents, potentially making our results of operations and cash flows more volatile.
The revenue generated by our tenants could be negatively affected by various federal, state and local laws to which they are subject.
Future compliance with the ADA may require expensive changes to the properties. 19 Table of Contents The revenue generated by our tenants could be negatively affected by various federal, state and local laws to which they are subject.
We may not be able to alter our portfolio promptly in response to changes in economic or other conditions. Our inability to respond quickly to adverse changes in the performance of our investments could have an adverse effect on our ability to meet our obligations and make distributions to our stockholders.
Our inability to respond quickly to adverse changes in the performance of our investments could have an adverse effect on our ability to meet our obligations and make distributions to our stockholders. Our real estate assets may become impaired.
Failure to comply could result in fines by governmental authorities, awards of damages to private litigants, or restrictions on the ability to conduct business on such properties.
Failure to comply could result in fines by governmental authorities, awards of damages to private litigants, or restrictions on the ability to conduct business on such properties. Such non-compliance could reduce our rental revenue, require us to pay penalties or fines, and adversely affect our ability to sell or lease a property.
Our ability to grow will be limited if we cannot obtain additional capital. Our growth strategy includes the redevelopment of properties we already own and the acquisition of additional properties.
Our growth strategy includes the redevelopment of properties we already own and the acquisition of additional properties.
We could experience an adverse effect to our financial condition and results of operations due to an unfavorable outcome. 19 Table of Contents Failure to qualify as a REIT for federal income tax purposes would cause us to be taxed as a corporation, which would substantially reduce funds available for payment of distributions.
Failure to qualify as a REIT for federal income tax purposes would cause us to be taxed as a corporation, which would substantially reduce funds available for payment of distributions.
Consequently, it is in the interests of the Saul Organization that we continue to hold the contributed portfolio properties, that a portion of our debt remains outstanding or is refinanced and that the Saul Organization guarantees and indemnities remain in place, in order to defer the taxable gain to members of the Saul Organization.
Depending on the overall level of debt and other factors, these distributions could exceed the Saul Organization’s basis in their Partnership units, in which case such excess constructive distributions would be taxable. 16 Table of Contents Consequently, it is in the interests of the Saul Organization that we continue to hold the contributed portfolio properties, that a portion of our debt remains outstanding or is refinanced and that the Saul Organization guarantees and indemnities remain in place, to defer the taxable gain to members of the Saul Organization.
Guevara, our Executive Vice President-Chief Legal and Administrative Officer, are officers of certain entities within the Saul Organization, and persons associated with the Saul Organization constitute five of the 12 members of our Board of Directors. In addition, as of December 31, 2024, Mr. B. F.
Todd Pearson, our President and Chief Operating Officer, Joel A. Friedman, our Executive Vice President, Chief Accounting Officer and Treasurer, and Bettina T. Guevara, our Executive Vice President-Chief Legal and Administrative Officer, are officers of certain entities within the Saul Organization, and persons associated with the Saul Organization constitute five of the 11 members of our Board of Directors.
However, our organizational documents contain no limitation on the amount or percentage of indebtedness that we may incur. Therefore, the Board of Directors could alter or eliminate the current limitation on borrowing at any time.
Therefore, the Board of Directors could alter or eliminate the current limitation on borrowing at any time.
If the terms of the renewal or releasing are less favorable than current terms, then our results of operations and financial condition could be negatively affected. Given our generally shorter-term lease structure, our rental revenues are impacted by declines in market rents more quickly than if our leases were for longer terms.
Given our shorter-term residential lease structure, our rental revenues are impacted by declines in market rents more quickly than if our leases were for longer terms.
As an owner and operator of commercial properties, we are party to legal and regulatory proceedings from time to time that arise in the ordinary course of business. Due to the inherent uncertainties of litigation and regulatory proceedings, we cannot accurately predict the ultimate outcome of any such litigation or proceedings.
We could be subject to legal or regulatory proceedings that may adversely affect our financial condition and results of operations. As an owner and operator of commercial properties, we are party to legal and regulatory proceedings from time to time that arise in the ordinary course of business.
Constraints on the availability of credit to office and retail tenants, necessary to purchase and install improvements, fixtures and equipment, and fund start-up business expenses, could impact the Company’s ability to procure new office and retail tenants for spaces currently vacant in existing operating properties or properties under development.
Item 2. Properties—Lease Expirations of Shopping Center Properties and Lease Expirations of Mixed-Use Properties for additional information regarding the scheduled lease expirations in our portfolio. Constraints on the availability of credit to office and retail tenants could impact the Company’s ability to procure new office and retail tenants for spaces currently vacant in existing operating properties or properties under development.
As a result, we may be unable to renew or duplicate our current insurance coverage in adequate amounts or at reasonable prices.
Following significant catastrophic events and other large losses incurred by the insurance industry, the availability of insurance coverage has decreased and the prices for insurance have increased. As a result, we may be unable to renew or duplicate our current insurance coverage in adequate amounts or at reasonable prices.
Book value may not at all times reflect the fair market value of the underlying properties. The amount of our debt outstanding from time to time could have important consequences to our stockholders.
The amount of our debt outstanding from time to time could have important consequences for our stockholders.
If not addressed, environmental conditions could impair our ability to sell or re-lease the affected properties in the future or result in lower sales prices or rent payments. The Americans with Disabilities Act of 1990 (the “ADA”) could require us to take remedial steps with respect to newly acquired properties.
If a tenant fails to or cannot comply, we could be forced to pay these costs. If not addressed, environmental conditions could impair our ability to sell or re-lease the affected properties in the future or result in lower sales prices or rent payments.
A continuation of the movement towards these practices could over time erode the overall demand for office space and, in turn, place downward pressure on occupancy, rental rates and property valuations, each of which could have an adverse effect on our financial position, results of operations, cash flows and ability to make distributions to our stockholders. 12 Table of Contents Our residential properties face competition for residents from other existing or new multifamily properties, condominiums, single family homes and other living arrangements, whether owned or rental, that may attract residents from our properties or prospective residents that would otherwise choose to live with us.
These practices enable businesses to reduce their space requirements, and wider adoption could erode the overall demand for office space and, in turn, place downward pressure on occupancy, rental rates and property valuations, each of which could have an adverse effect on our financial position, results of operations, cash flows and ability to make distributions to our stockholders.

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Item 4. Mine Safety Disclosures

Mine Safety Disclosures — required of mining issuers

1 edited+0 added−1 removed0 unchanged
Biggest changeItem 4. Mine Safety Disclosures 34 PART II Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities 35 Item 6. [Reserved] 36 Item 7. Management’s Discussion and Analysis of Financial Condition And Results of Operations 37 Item 7A. Quantitative and Qualitative Disclosures About Market Risk 51 Item 8.
Biggest changeItem 4. Mine Safety Disclosures 34 PART II Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities 35 Item 6. [Reserved] 36 Item 7. Management’s Discussion and Analysis of Financial Condition And Results of Operations 37 Item 7A. Quantitative and Qualitative Disclosures About Market Risk 53 Item 8.
Removed
Financial Statements and Supplementary Data 51 Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure 51 Item 9A. Controls and Procedures 52

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

5 edited+1 added−2 removed6 unchanged
Biggest changeSaul Company, acquired an aggregate of 4,835 shares of common stock and 41,248 limited partnership units at an average price of $38.85 per share/unit, in respect of the October 31, 2024 dividend distribution.
Biggest changeSaul II, through participation in the Company's Dividend Reinvestment and Stock Purchase Plan for the October 31, 2025 dividend distribution acquired 7,207 shares of common stock at a price of $28.78 per share and 197,908 limited partnership units at an average price of $28.89 per unit. The limited partnership units were sold pursuant to Section 4(a)(2) of the Securities Act.
The Company distributed more than the required amount in 2024 and 2023. See Notes to Consolidated Financial Statements, No. 13, “Distributions.” The Company may or may not elect to distribute in excess of 90% of REIT taxable income in future years.
The Company distributed more than the required amount in 2025 and 2024. See Notes to Consolidated Financial Statements, No. 13, “Distributions.” The Company may or may not elect to distribute in excess of 90% of REIT taxable income in future years.
Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities Market Information Shares of Saul Centers common stock are listed on the New York Stock Exchange under the symbol “BFS.” Holders The approximate number of holders of record of the common stock was 161 as of February 24, 2025.
Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities Market Information Shares of Saul Centers common stock are listed on the New York Stock Exchange under the symbol “BFS.” Holders The approximate number of holders of record of the common stock was 157 as of February 23, 2026.
The graph assumes the investment of $100 on December 31, 2019.
The graph assumes the investment of $100 on December 31, 2020.
We are obligated to pay regular quarterly distributions to holders of preferred depositary shares, prior to distributions on the common stock. Acquisition of Equity Securities by the Saul Organization Through participation in the Company’s Dividend Reinvestment and Stock Purchase Plan, during the quarter ended December 31, 2024, (a) B.
We are obligated to pay regular quarterly distributions to holders of preferred depositary shares, prior to distributions on the common stock. Acquisition of Equity Securities by the Saul Organization B. Francis Saul II, the Company's Chairman of the Board and Chief Executive Officer, his spouse and entities affiliated with Mr.
Removed
Francis Saul II, the Company’s Chairman of the Board and Chief Executive Officer, (b) his spouse, (c) B. F. Saul Company, for which Mr. B. F. Saul II serves as Chairman, and (d) B. F. Saul Property Company, Van Ness Square Corporation, and Westminster Investing, LLC, which are related parties of B. F.
Added
Period Ended Index 12/31/2020 12/31/2021 12/31/2022 12/31/2023 12/31/2024 12/31/2025 Saul Centers, Inc. $ 100.00 $ 176.58 $ 142.38 $ 146.32 $ 153.62 $ 133.97 S&P 500 $ 100.00 $ 128.75 $ 105.36 $ 132.95 $ 166.03 $ 195.45 Russell 2000 $ 100.00 $ 114.54 $ 91.08 $ 106.42 $ 118.54 $ 133.55 NAREIT Equity $ 100.00 $ 143.25 $ 108.40 $ 123.26 $ 134.01 $ 137.84 Source: Bloomberg
Removed
Period Ended Index 12/31/2019 12/31/2020 12/31/2021 12/31/2022 12/31/2023 12/31/2024 Saul Centers, Inc. $100.00 $ 63.94 $ 112.91 $ 91.04 $ 93.56 $ 98.23 S&P 500 $100.00 $ 118.39 $ 152.34 $ 124.72 $ 157.39 $ 196.55 Russell 2000 $100.00 $ 119.19 $ 136.81 $ 108.82 $ 127.14 $ 141.62 NAREIT Equity $100.00 $ 92.05 $ 131.86 $ 99.78 $ 113.46 $ 123.35 Source: Bloomberg

Item 7. Management's Discussion & Analysis

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

84 edited+19 added−13 removed40 unchanged
Biggest changeDecember 31, (Dollars in thousands) 2024 2023 Interest Rate * Scheduled Maturity * Leesburg Pike Center $ — $ 11,822 7.35 % Jun-24 Avenel Business Park — 21,611 7.45 % Jul-24 White Oak — 19,031 6.89 % Jul-24 Ashburn Village — 21,805 7.30 % Jan-25 Ravenwood 10,708 11,361 6.18 % Jan-26 Clarendon Center 76,873 81,693 5.31 % Apr-26 Severna Park Marketplace 22,998 24,458 4.30 % Oct-26 Kentlands Square II 26,455 28,093 4.53 % Nov-26 Cranberry Square 12,468 13,224 4.70 % Dec-26 Fixed-rate portion of Credit Facility 100,000 100,000 4.38 % Feb-27 Hampshire-Langley 10,878 11,569 4.04 % Apr-28 Seabreeze Plaza 12,038 12,683 3.99 % Sep-28 Great Falls Center 29,751 30,547 3.91 % Sep-29 Shops at Fairfax / Boulevard 21,424 22,452 3.69 % Mar-30 Northrock 11,597 12,135 3.99 % Apr-30 Burtonsville Town Square 30,874 32,178 3.39 % Feb-32 Park Van Ness 58,838 60,874 4.88 % Sep-32 Washington Square 48,400 50,249 3.75 % Dec-32 BJ's Wholesale Club 14,817 15,099 6.07 % Mar-33 Broadlands Village 27,101 27,999 4.41 % Nov-33 The Glen 19,612 20,234 4.69 % Jan-34 Olde Forte Village 18,964 19,563 4.65 % Feb-34 Olney 12,836 12,655 8.00 % Apr-34 Shops at Monocacy 24,886 25,670 4.14 % Dec-34 Ashbrook Marketplace 19,604 20,216 3.80 % Aug-35 Kentlands 26,456 27,321 3.43 % Aug-35 The Waycroft 145,306 149,078 4.67 % Sep-35 Village Center 23,838 24,460 4.14 % Aug-37 Beacon Center / Seven Corners 136,466 139,570 5.05 % Oct-37 Avenel Business Park / Leesburg Pike Plaza / White Oak 99,060 — 6.38 % Oct-37 Thruway 69,810 — 6.41 % Oct-39 Ashburn Village 50,000 — 5.47 % Jan-40 Hampden House 74,006 7,726 3.90 % Mar-40 Twinbrook Quarter Phase I 129,625 74,909 3.83 % Dec-41 Total fixed rate 1,365,689 1,130,285 4.73 % 9.82 years Variable rate loans: Variable-rate portion of Credit Facility** 187,000 276,000 SOFR + 1.40% Aug-25 Total variable rate** 187,000 276,000 5.99 % 0.66 years Total notes payable $ 1,552,689 $ 1,406,285 4.88 % 8.72 years * Totals computed using weighted averages. ** The interest rate incurred on our variable rate debt changes monthly and is based on the 1-month Term Secured Overnight Financing Rate (“SOFR”) rate plus a 0.10% SOFR credit spread plus the applicable margin on the Credit Facility, which was 1.40% as of December 31, 2024. 47 Table of Contents Funds From Operations In 2024, the Company reported Funds From Operations (“FFO”) 1 available to common stockholders and noncontrolling interests of $106.8 million, a 0.5% increased from 2023 FFO available to common stockholders and noncontrolling interests of $106.3 million.
Biggest changeDecember 31, (Dollars in thousands) 2025 2024 Interest Rate * Scheduled Maturity * Ravenwood $ — $ 10,708 6.18 % Jan-26 Clarendon Center 71,790 76,873 5.31 % Apr-26 Severna Park Marketplace 21,474 22,998 4.30 % Oct-26 Kentlands Square II 24,741 26,455 4.53 % Nov-26 Cranberry Square 11,676 12,468 4.70 % Dec-26 Hampshire-Langley 10,160 10,878 4.04 % Apr-28 Fixed rate portion of New Credit Facility 100,000 100,000 4.28 % Jul-28 Seabreeze Plaza 11,367 12,038 3.99 % Sep-28 Great Falls Center 28,923 29,751 3.91 % Sep-29 Shops at Fairfax / Boulevard 20,358 21,424 3.69 % Mar-30 Northrock 11,037 11,597 3.99 % Apr-30 Burtonsville Town Square 29,525 30,874 3.39 % Feb-32 Park Van Ness 56,701 58,838 4.88 % Sep-32 Washington Square 46,480 48,400 3.75 % Dec-32 BJ's Wholesale Club 14,518 14,817 6.07 % Mar-33 Broadlands Village 26,162 27,101 4.41 % Nov-33 The Glen 18,961 19,612 4.69 % Jan-34 Olde Forte Village 18,335 18,964 4.65 % Feb-34 Olney 13,018 12,836 8.00 % Apr-34 Shops at Monocacy 24,069 24,886 4.14 % Dec-34 Ashbrook Marketplace 18,967 19,604 3.80 % Aug-35 Kentlands 25,560 26,456 3.43 % Aug-35 The Waycroft 141,353 145,306 4.67 % Sep-35 Village Center 23,190 23,838 4.14 % Aug-37 Beacon Center / Seven Corners 133,201 136,466 5.05 % Oct-37 Avenel Business Park / Leesburg Pike Plaza / White Oak 97,086 99,060 6.38 % Oct-37 Thruway 68,626 69,810 6.41 % Oct-39 Ravenwood 15,000 — 5.58 % Jan-40 Ashburn Village 49,115 50,000 5.47 % Jan-40 Hampden House 117,871 74,006 3.90 % Mar-40 Lansdowne 46,000 — 5.74 % Jan-41 Twinbrook Quarter Phase I 141,554 129,625 3.83 % Dec-41 Total fixed rate 1,436,818 1,365,689 4.72 % 9.52 years Variable rate loans: Variable-rate portion of New Term Loan ** 40,000 — SOFR + 1.35% Jul-28 Variable-rate portion of New Revolving Credit Facility** 149,000 187,000 SOFR + 1.40% Jul-29 Total variable rate** 189,000 187,000 5.08 % 3.37 years Total notes payable $ 1,625,818 $ 1,552,689 4.76 % 8.80 years * Totals computed using weighted averages. ** At December 31, 2025, the interest rate incurred on our variable rate debt is based on the 1-month Term Secured Overnight Financing Rate (“SOFR”) plus a spread. 48 Table of Contents Funds From Operations We use certain non-GAAP measures, in addition to certain performance metrics calculated under GAAP, because we believe these measures improve the understanding of our operating results.
In connection with the development of the residential and retail portions of Phase I, we also invested in infrastructure and other items that will support both Phase I and other portions of the development of Twinbrook Quarter.
In connection with the development of the residential and retail portions of Twinbrook Quarter Phase I, we also invested in infrastructure and other items that will support both Twinbrook Quarter Phase I and other portions of the development of Twinbrook Quarter.
The fair value of restricted stock granted is determined at the time of the grant using a discounted cash flow analysis, and the following assumptions: (1) Expected Dividend Yield determined by management after considering the Company’s current and historic dividend yield, the Company’s yield in relation to other retail REITs and the Company’s market yield at the grant date; (2) the closing price of the Company’s common stock on the date of the grant; (3) estimated forfeitures; and (4) a present value discount rate equal to the Expected Dividend Yield.
The fair value of granted restricted stock is determined at the time of the grant using a discounted cash flow analysis, and the following assumptions: (1) Expected Dividend Yield determined by management after considering the Company’s current and historic dividend yield, the Company’s yield in relation to other retail REITs and the Company’s market yield at the grant date; (2) the closing price of the Company’s common stock on the date of the grant; (3) estimated forfeitures; and (4) a present value discount rate equal to the Expected Dividend Yield.
Because the majority of the Company’s property operating income is produced by our Shopping Centers, we continually monitor the implications of government policy changes, as well as shifts in consumer demand between on-line and in-store shopping, on future shopping center construction and retailer store expansion and closure plans.
Because the majority of the Company’s property net operating income is produced by our Shopping Centers, we continually monitor the implications of government policy changes, as well as shifts in consumer demand between on-line and in-store shopping, on future shopping center construction and retailer store expansion and closure plans.
We believe the exclusion of these items from revenue and operating income is useful because the resulting measures capture the actual revenue generated and actual expenses incurred by operating our properties. Same property revenue and same property operating income are measures of the operating performance of our properties but do not measure our performance as a whole.
We believe the exclusion of these items from revenue and operating income is useful because the resulting measures capture the actual revenue generated and actual expenses incurred by operating our properties. Same property revenue and same property net operating income are measures of the operating performance of our properties but do not measure our performance as a whole.
See Note 5 to the Consolidate Financial Statements. (2) See Note 7 to Consolidated Financial Statements. Corporate Headquarters Lease amounts represent an allocation to the Company based upon employees’ time dedicated to the Company’s business as specified in the Shared Services Agreement.
See Note 5 to the Consolidated Financial Statements. (2) See Note 7 to Consolidated Financial Statements. Corporate Headquarters Lease amounts represent an allocation to the Company based upon employees’ time dedicated to the Company’s business as specified in the Shared Services Agreement.
In order to qualify as a REIT for federal income tax purposes, the Company must distribute to its stockholders at least 90% of its “real estate investment trust taxable income,” as defined in the Code.
To qualify as a REIT for federal income tax purposes, the Company must distribute to its stockholders at least 90% of its “real estate investment trust taxable income,” as defined in the Code.
Both the amount of the loss and the point at which its occurrence is considered probable can be difficult to determine. 38 Table of Contents Results of Operations The following is a discussion of the components of revenue and expense for the entire Company. This section generally discusses 2024 and 2023 items and year-to-year comparisons between 2024 and 2023.
Both the amount of the loss and the point at which its occurrence is considered probable can be difficult to determine. 38 Table of Contents Results of Operations The following is a discussion of the components of revenue and expense for the entire Company. This section generally discusses 2025 and 2024 items and year-to-year comparisons between 2025 and 2024.
The Company expects to meet these short-term liquidity requirements (other than amounts required for additional property acquisitions and developments) through cash provided from operations, available cash and its existing line of credit. The Company is developing Twinbrook Quarter Phase I (“Phase I”) located in Rockville, Maryland.
The Company expects to meet these short-term liquidity requirements (other than amounts required for additional property acquisitions and developments) through cash provided from operations, available cash and its existing line of credit. The Company is developing Twinbrook Quarter Phase I located in Rockville, Maryland.
The Company’s operating strategy also includes improvement of the operating performance of its assets, internal growth of its Shopping Centers through the additions of pad sites, and supplementing its development pipeline with selective redevelopment and renovations of its core Shopping Centers.
The Company's operating strategy also includes improvement of the operating performance of its assets, internal growth of its Shopping Centers through the addition of pad sites, and supplementing its development pipeline with selective redevelopment and renovations of its core Shopping Centers.
The remaining units held in escrow were released on October 18, 2023. Acquisitions and Redevelopments Management anticipates that during the coming year, the Company may redevelop certain of the Current Portfolio Properties and may develop additional freestanding outparcels or expansions within certain of the Shopping Centers.
The remaining units held in escrow were released on October 18, 2023. 49 Table of Contents Acquisitions and Redevelopments Management anticipates that during the coming year, the Company may redevelop certain of the Current Portfolio Properties and may develop additional freestanding outparcels or expansions within certain of the Shopping Centers.
The Company maintains a ratio of total debt to total asset value of under 50%, which allows the Company to obtain additional secured borrowings if necessary. As of December 31, 2024, including $100.0 million of hedged variable-rate debt, total fixed-rate debt with staggered maturities from 2026 to 2041 represented approximately 88.0% of the Company’s notes payable, thus minimizing refinancing risk.
The Company maintains a ratio of total debt to total asset value of under 50%, which allows us to obtain additional secured borrowings if necessary. As of December 31, 2025, including $100.0 million of hedged variable-rate debt, total fixed-rate debt with staggered maturities from 2026 to 2041 represented approximately 88.4% of the Company’s notes payable, thus minimizing refinancing risk.
Discussions of 2022 items and year-to-year comparisons between 2023 and 2022 that are not included in this Form 10-K can be found in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” Part II, Item 7 of our Annual Report on Form 10-K for the fiscal year ended December 31, 2023 filed on February 29, 2024.
Discussions of 2023 items and year-to-year comparisons between 2024 and 2023 that are not included in this Form 10-K can be found in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” Part II, Item 7 of our Annual Report on Form 10-K for the fiscal year ended December 31, 2024 filed on February 28, 2025.
Discussions of 2022 items and year-to-year comparisons between 2023 and 2022 that are not included in this Form 10-K can be found in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” Part II, Item 7 of our Annual Report on Form 10-K for the fiscal year ended December 31, 2023, filed on February 29, 2024.
Discussions of 2023 items and year-to-year comparisons between 2024 and 2023 that are not included in this Form 10-K can be found in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” Part II, Item 7 of our Annual Report on Form 10-K for the fiscal year ended December 31, 2024, filed on February 28, 2025.
Liquidity and Capital Resources Cash and cash equivalents were $10.3 million and $8.4 million at December 31, 2024 and 2023, respectively. The changes in cash and cash equivalents during the years ended December 31, 2024 and 2023 were attributable to operating, investing and financing activities, as described below.
Liquidity and Capital Resources Cash and cash equivalents were $8.7 million and $10.3 million at December 31, 2025 and 2024, respectively. The changes in cash and cash equivalents during the years ended December 31, 2025 and 2024 were attributable to operating, investing and financing activities, as described below.
Based on our observations, we continue to adapt our marketing and merchandising strategies in ways to maximize our future performance. The Company's commercial leasing percentage, on a same property basis, which excludes the impact of properties not in operation for the entirety of the comparable periods, increased to 95.2% at December 31, 2024, from 94.1% at December 31, 2023.
Based on our observations, we continue to adapt our marketing and merchandising strategies in ways to maximize our future performance. The Company's commercial leasing percentage, on a same property basis, which excludes the impact of properties not in operation for the entirety of the comparable periods, decreased to 94.6% at December 31, 2025, from 95.2% at December 31, 2024.
During the coming year, any developments, expansions or acquisitions are expected to be funded with bank borrowings from the Company’s credit line, construction financing, proceeds from the operation of the Company’s dividend reinvestment plan or other external capital resources available to the Company. 48 Table of Contents The Company has been selectively involved in acquisition, development, redevelopment and renovation activities.
During the coming year, any developments, expansions or acquisitions are expected to be funded with bank borrowings from the Company’s New Credit Facility, construction financing, proceeds from the operation of the Company’s dividend reinvestment plan or other external capital resources available to the Company. The Company has been selectively involved in acquisition, development, redevelopment and renovation activities.
Given the Company’s current debt level, it is management’s belief that the ratio of the Company’s debt to total estimated asset value was below 50% as of December 31, 2024. The organizational documents of the Company do not limit the absolute amount or percentage of indebtedness that it may incur.
Given the Company’s current debt level, it is management’s belief that the ratio of the Company’s debt to total estimated asset value was below 50% as of December 31, 2025. 46 Table of Contents The organizational documents of the Company do not limit the absolute amount or percentage of indebtedness that it may incur.
The base rent for an expiring lease is the annualized contractual base rent, on a cash basis, as of the expiration date of the lease. The base rent for a new or renewed lease is the annualized contractual base rent, on a cash basis, as of the expected rent commencement date.
The base rent for a new or renewed lease is the annualized contractual base rent, on a cash basis, as of the expected rent commencement date.
Risk Factors." Overview The Company’s primary strategy is to continue to focus on diversification of its assets through development of transit-oriented, residential mixed-use projects and expansion of and additions to its grocery-anchored shopping centers in the Washington, DC metropolitan area.
Risk Factors." Overview The Company's primary strategy is to continue to diversify its assets through development of transit-oriented, residential mixed-use projects and expansion of and additions to its grocery-anchored Shopping Centers in the Washington, DC/Baltimore metropolitan area.
The following discussion and analysis should be read in conjunction with the Consolidated Financial Statements and related footnotes included elsewhere in this Annual Report on Form 10-K. We make statements in this section that are forward-looking statements within the meaning of the federal securities laws.
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations The following discussion and analysis should be read in conjunction with the Consolidated Financial Statements and related footnotes included elsewhere in this Annual Report on Form 10-K. We make statements in this section that are forward-looking statements within the meaning of the federal securities laws.
The $14.9 million decrease in cash used in investing activities is primarily due to (a) decreased development expenditures of $25.8 million partially offset by (b) increased additions to real estate investments throughout the portfolio of $11.0 million. 43 Table of Contents Financing Activities Net cash provided by financing activities represents (a) cash received from loan proceeds and issuance of common stock, preferred stock and limited partnership units minus (b) cash used to repay and curtail loans, redeem preferred stock and pay dividends and distributions to holders of common stock, preferred stock and limited partnership units.
The $92.9 million decrease in cash used in investing activities is primarily due to (a) decreased development expenditures of $98.9 million partially offset by (b) increased additions to real estate investments throughout the portfolio of $5.9 million. 44 Table of Contents Financing Activities Net cash provided by (used in) financing activities represents (a) cash received from loan proceeds and issuance of common stock, preferred stock and limited partnership units minus (b) cash used to repay and curtail loans, redeem preferred stock and pay dividends and distributions to holders of common stock, preferred stock and limited partnership units.
Collectively, these leases are expected to produce approximately $4.4 million of additional annualized base rent, an average of $25.63 per square foot, upon tenant occupancy and following any contractual rent concessions. The Mixed-Use commercial leasing percentage is composed of commercial leases at office mixed-use properties and residential mixed-use properties.
Collectively, these leases are expected to produce approximately $5.0 million of additional annualized base rent, an average of $25.50 per square foot, upon tenant occupancy and following any contractual rent concessions. The Mixed-Use commercial leased percentage is composed of commercial leases at office mixed-use properties and residential mixed-use properties.
This section generally discusses 2024 and 2023 items and year-to-year comparisons between 2024 and 2023.
This section generally discusses 2025 and 2024 items and year-to-year comparisons between 2025 and 2024.
The Company also credited 7,539 and 7,643 shares to directors pursuant to the reinvestment of dividends specified by the Directors’ Deferred Compensation Plan at a weighted average discounted price of $37.50 and $36.50 per share, during the years ended December 31, 2024 and 2023, respectively.
The Company also credited 9,174 and 7,539 shares to directors pursuant to the reinvestment of dividends specified by the Directors’ Deferred Compensation Plan at a weighted average discounted price of $31.49 and $37.50 per share, during the years ended December 31, 2025 and 2024, respectively.
Accordingly, our same property revenue and same property operating income may not be comparable to those of other REITs. 40 Table of Contents Same property revenue and same property operating income are used by management to evaluate and compare the operating performance of our properties, and to determine trends in earnings, because these measures are not affected by the cost of our funding, the impact of depreciation and amortization expenses, gains or losses from the acquisition and sale of operating real estate assets, general and administrative expenses or other gains and losses that relate to ownership of our properties.
Same property revenue and same property net operating income are used by management to evaluate and compare the operating performance of our properties, and to determine trends in earnings, because these measures are not affected by the cost of our funding, the impact of depreciation and amortization expenses, gains or losses from the acquisition and sale of operating real estate assets, general and administrative expenses or other gains and losses that relate to ownership of our properties.
Average Annualized Commercial Rents per Square Foot Year ended December 31, 2024 2023 2022 Base rent $ 21.30 $ 20.79 $ 20.55 Effective rent $ 19.70 $ 19.24 $ 18.95 The following chart sets forth certain information regarding commercial leases at our properties for the periods indicated.
Average Annualized Commercial Rents per Square Foot Year ended December 31, 2025 2024 2023 Base rent $ 22.53 $ 21.30 $ 20.79 Effective rent $ 20.85 $ 19.70 $ 19.24 The following chart sets forth certain information regarding commercial leases at our properties for the periods indicated.
Mixed-Use same property operating income increased primarily due to (a) higher residential base rent of $1.3 million and (b) higher commercial base rent of $1.0 million partially offset by (c) lower parking income, net of expenses, of $0.5 million. 42 Table of Contents Mixed-Use same property operating income is composed of the following: Year Ended December 31, (In thousands) 2024 2023 Office mixed-use properties (1) $ 25,701 $ 24,826 Residential mixed-use properties (residential activity) (2) 22,032 21,358 Residential mixed-use properties (retail activity) (3) 3,225 3,156 Total Mixed-Use same property operating income $ 50,958 $ 49,340 (1) Includes Avenel Business Park, Clarendon Center – North and South Blocks, 601 Pennsylvania Avenue and Washington Square (2) Includes Clarendon South Block, The Waycroft and Park Van Ness (3) Includes The Waycroft and Park Van Ness Impact of Inflation The impact of rising operating expenses due to inflation on the operating performance of the Company’s portfolio is partially mitigated by terms in substantially all of the Company’s retail and office leases, which contain provisions designed to increase revenues to offset the adverse impact of inflation on the Company’s results of operations.
Mixed-Use same property net operating income decreased primarily due to (a) lower commercial base rent of $1.5 million and (b) lower property operating expense recoveries, net of $1.2 million partially offset by (c) higher residential base rent of $1.3 million. 43 Table of Contents Mixed-Use same property net operating income is composed of the following: Year Ended December 31, (In thousands) 2025 2024 Office mixed-use properties (1) $ 23,767 $ 25,701 Residential mixed-use properties (residential activity) (2) 22,674 22,032 Residential mixed-use properties (retail activity) (3) 3,193 3,225 Total Mixed-Use same property net operating income $ 49,634 $ 50,958 (1) Includes Avenel Business Park, Clarendon Center – North and South Blocks, 601 Pennsylvania Avenue and Washington Square (2) Includes Clarendon South Block, The Waycroft and Park Van Ness (3) Includes The Waycroft and Park Van Ness Impact of Inflation The impact of rising operating expenses due to inflation on the operating performance of the Company’s portfolio is partially mitigated by terms in substantially all of the Company’s retail and office leases, which contain provisions designed to increase revenues to offset the adverse impact of inflation on the Company’s results of operations.
The Company has identified the following policies that, due to estimates and assumptions inherent in those policies, involve a relatively high degree of judgment and complexity. Real Estate Investments Real estate investment properties are stated at historic cost less depreciation.
See Note 2 to the Consolidated Financial Statements in this report. The Company has identified the following policies that, due to estimates and assumptions inherent in those policies, involve a relatively high degree of judgment and complexity. Real Estate Investments Real estate investment properties are stated at historic cost less depreciation.
We define same property revenue as total revenue less straight-line base rent and above/below market lease amortization of leases acquired in connection with purchased real estate investment properties minus the revenue of properties not in operation for the entirety of the comparable reporting periods, and we define same property operating income as net income plus (a) interest expense, net and amortization of deferred debt costs, (b) depreciation and amortization of deferred leasing costs, (c) general and administrative expenses, (d) change in fair value of derivatives, and (e) loss on the early extinguishment of debt minus (f) gains on sale of property, (g) straight-line base rent and above/below market lease amortization of leases acquired in connection with purchased real estate investment properties and (h) the operating income of properties that were not in operation for the entirety of the comparable periods.
Same property revenue and same property net operating income Same property revenue and same property net operating income are non-GAAP financial measures of performance intended to enhance period-to-period comparability by excluding the results of properties that were not in operation for the entirety of the comparable reporting periods. 40 Table of Contents We define same property revenue as total revenue less straight-line base rent and above/below market lease amortization of leases acquired in connection with purchased real estate investment properties minus the revenue of properties not in operation for the entirety of the comparable reporting periods, and we define same property net operating income as net income plus (a) interest expense, net and amortization of deferred debt costs, (b) depreciation and amortization of deferred leasing costs, (c) general and administrative expenses, (d) change in fair value of derivatives, and (e) loss on the early extinguishment of debt minus (f) gains on sale of property, (g) straight-line base rent and above/below market lease amortization of leases acquired in connection with purchased real estate investment properties and (h) the operating income of properties that were not in operation for the entirety of the comparable periods.
The following table presents a reconciliation from net income to FFO available to common stockholders and noncontrolling interests for the periods indicated: Year ended December 31, (In thousands, except per share amounts) 2024 2023 2022 Net income $ 67,703 $ 69,026 $ 65,392 Subtract Gain on disposition of property (181) — — Add: Real estate depreciation and amortization 50,502 48,430 48,969 FFO 118,024 117,456 114,361 Subtract: Preferred stock dividends (11,194) (11,194) (11,194) FFO available to common stockholders and noncontrolling interests $ 106,830 $ 106,262 $ 103,167 Weighted average shares and units: Basic 34,508 33,474 33,256 Diluted (2) 34,526 34,066 33,972 Basic FFO per share available to common stockholders and noncontrolling interests $ 3.10 $ 3.17 $ 3.10 Diluted FFO per share available to common stockholders and noncontrolling interests. $ 3.09 $ 3.12 $ 3.04 (1) The National Association of Real Estate Investment Trusts (“Nareit”) developed FFO as a relative non-GAAP financial measure of performance of an equity REIT in order to recognize that income-producing real estate historically has not depreciated on the basis determined under GAAP.
The following table presents a reconciliation from net income to FFO available to common stockholders and noncontrolling interests for the periods indicated: Year ended December 31, (In thousands, except per share amounts) 2025 2024 2023 Net income $ 49,219 $ 67,703 $ 69,026 Subtract: Gains on dispositions of properties (120) (181) — Add: Real estate depreciation and amortization 58,784 50,502 48,430 FFO 107,883 118,024 117,456 Subtract: Preferred stock dividends (11,194) (11,194) (11,194) FFO available to common stockholders and noncontrolling interests $ 96,689 $ 106,830 $ 106,262 Weighted average shares and units: Basic 34,969 34,508 33,474 Diluted (2) 34,990 34,526 34,066 Basic FFO per share available to common stockholders and noncontrolling interests $ 2.76 $ 3.10 $ 3.17 Diluted FFO per share available to common stockholders and noncontrolling interests. $ 2.76 $ 3.09 $ 3.12 (1) The National Association of Real Estate Investment Trusts (“Nareit”) developed FFO as a relative non-GAAP financial measure of performance of an equity REIT in order to recognize that income-producing real estate historically has not depreciated on the basis determined under GAAP.
Such measures are therefore not substitutes for total revenue, net income or operating income as computed in accordance with GAAP. The tables below provide reconciliations of property revenue and property operating income under GAAP to same property revenue and same property operating income for the indicated periods. One property, Twinbrook Quarter Phase I, was excluded from same property results.
Such measures are therefore not substitutes for total revenue, net income or operating income as computed in accordance with GAAP. The tables below provide reconciliations of property revenue and property net operating income under GAAP to same property revenue and same property net operating income for the indicated periods.
Base rent: Base rent includes $(7.8) million and $(0.6) million for 2024 and 2023, respectively, to recognize base rent on a straight-line basis. In addition, base rent includes $0.8 million and $1.3 million for 2024 and 2023, respectively, to recognize income from the amortization of in-place leases acquired in connection with purchased real estate investment properties.
Base rent: Base rent includes $9.5 million and $(7.8) million for 2025 and 2024, respectively, to recognize base rent on a straight-line basis. In addition, base rent includes $0.6 million and $0.8 million for 2025 and 2024, respectively, to recognize income from the accretion of discounts related to in-place leases acquired in connection with purchased real estate investment properties.
The availability and terms of any such financing will depend upon market and other conditions. 44 Table of Contents Contractual Payment Obligations As of December 31, 2024, the Company had unfunded contractual payment obligations totaling approximately $333.4 million, excluding operating obligations, due within the next 12 months.
The availability and terms of any such financing will depend upon market and other conditions. Contractual Payment Obligations As of December 31, 2025, the Company had unfunded contractual payment obligations totaling approximately $239.7 million, excluding operating obligations, due within the next 12 months. The table below shows the total contractual payment obligations as of December 31, 2025.
Year Ended December 31, (In thousands) 2024 2023 Net cash provided by operating activities $ 121,224 $ 117,727 Net cash used in investing activities (188,732) (203,681) Net cash provided by financing activities 69,400 81,082 Net increase (decrease) in cash and cash equivalents $ 1,892 $ (4,872) Operating Activities Net cash provided by operating activities represents cash received primarily from rental revenue, plus other revenue, less property operating expenses, leasing costs, normal recurring general and administrative expenses and interest payments on outstanding debt.
Year Ended December 31, (In thousands) 2025 2024 Net cash provided by operating activities $ 99,796 $ 121,224 Net cash used in investing activities (95,814) (188,732) Net cash provided by (used in) financing activities (5,540) 69,400 Net increase (decrease) in cash and cash equivalents $ (1,558) $ 1,892 Operating Activities Net cash provided by operating activities represents cash received primarily from rental revenue, plus other revenue, less property operating expenses, leasing costs, normal recurring general and administrative expenses and interest payments on outstanding debt.
As of December 31, 2024, the Company has availability of approximately $134.5 million under its Credit Facility. 37 Table of Contents Although it is management’s present intention to concentrate future acquisition and development activities on transit-oriented, residential mixed-use properties and grocery-anchored shopping centers in the Washington, DC/Baltimore metropolitan area, the Company may, in the future, also acquire other types of real estate in other areas of the country as opportunities present themselves.
Although it is management’s present intention to concentrate future acquisition and development activities on transit-oriented, residential mixed-use properties and grocery-anchored shopping centers in the Washington, DC/Baltimore metropolitan area, the Company may, in the future, also acquire other types of real estate in other areas of the country as opportunities present themselves.
The Company issued 431,495 and 44,500 limited partnership units under the Plan at a weighted average price of $38.20 and $33.83 per unit during the years ended December 31, 2024 and 2023, respectively.
The Company issued 603,868 and 431,495 limited partnership units under the Plan at a weighted average price of $30.95 and $38.20 per unit during the years ended December 31, 2025 and 2024, respectively.
The loan matures in 2040, bears interest at a fixed-rate of 5.47%, requires monthly principal and interest payments of $306,100 based on a 25-year amortization schedule and requires a final principal payment of $28.4 million at maturity.
The loan matures in 2040, bears interest at a fixed-rate of 5.58%, requires monthly principal and interest payments of $92,800 based on a 25-year amortization schedule and requires a final payment of $9.2 million at maturity.
The Company issued 57,689 and 53,716 shares under the Plan at a weighted average discounted price of $37.50 and $36.46 per share during the years ended December 31, 2024 and 2023, respectively.
The Company issued 95,370 and 57,689 shares under the Plan at a weighted average discounted price of $30.77 and $37.50 per share during the years ended December 31, 2025 and 2024, respectively.
For the year ended December 31, 2024, restricted stock compensation expense totaled $0.5 million, which was included in general and administrative expense in the Consolidated Statement of Operations. As of December 31, 2024, the estimated future expense related to unvested restricted stock grants was approximately $3.2 million.
For the year ended December 31, 2025, restricted stock compensation expense totaled $1.3 million, which was included in general and administrative expense in the Consolidated Statement of Operations. As of December 31, 2025, the estimated future expense related to unvested restricted stock awards that are granted for accounting purposes was approximately $5.5 million.
Proceeds were used to repay the remaining balance of approximately $20.5 million on the existing mortgage and reduce the outstanding balance of the Company’s Credit Facility. 46 Table of Contents The Company's 2023 financing activity is described within Note 5 to the Consolidated Financial Statements. The following is a summary of notes payable as of December 31, 2024 and 2023.
Proceeds were used to reduce the outstanding balance of the New Credit Facility. 47 Table of Contents The Company's 2025 financing activity is described within Note 5 to the Consolidated Financial Statements. The following is a summary of notes payable as of December 31, 2025 and 2024.
Commercial Property Leasing Activity Average Base Rent per Square Foot Year ended December 31, Square Feet Number of Leases New/Renewed Leases Expiring Leases Shopping Centers Mixed-Use Shopping Centers Mixed-Use Shopping Centers Mixed-Use Shopping Centers Mixed-Use 2024 1,263,347 141,350 276 21 $ 22.43 $ 45.29 $ 21.69 $ 46.29 2023 1,554,663 229,956 282 35 20.38 36.70 19.35 38.68 Additional information about commercial leasing activity during the three months ended December 31, 2024, is set forth below.
Commercial Property Leasing Activity Average Base Rent per Square Foot Year ended December 31, Square Feet Number of Leases New/Renewed Leases Expiring Leases Shopping Centers Mixed-Use Shopping Centers Mixed-Use Shopping Centers Mixed-Use Shopping Centers Mixed-Use 2025 1,264,000 165,900 252 30 $ 22.86 $ 38.39 $ 20.94 $ 37.86 2024 1,263,347 141,350 276 21 22.43 45.29 21.69 46.29 Additional information about commercial leasing activity during the three months ended December 31, 2025, is set forth below.
Included in the 95.2% of space leased as of December 31, 2024, is approximately 170,422 square feet of space, representing 1.9% of total commercial square footage, that has not been occupied by the tenant.
Included in the 94.6% of space leased as of December 31, 2025, is approximately 197,718 square feet of space, representing 2.2% of total commercial square footage, that has not been occupied by the tenant.
Revenue Year ended December 31, Percentage Change (Dollars in thousands) 2024 2023 2022 2024 from 2023 2023 from 2022 Base rent $ 216,622 $ 208,295 $ 201,182 4.0 % 3.5 % Expense recoveries 40,826 37,094 36,025 10.1 % 3.0 % Percentage rent 1,853 1,790 1,632 3.5 % 9.7 % Other property revenue 2,737 2,412 1,910 13.5 % 26.3 % Credit (losses) recoveries on operating lease receivables, net (860) (534) 88 61.0 % NM Rental revenue 261,178 249,057 240,837 4.9 % 3.4 % Other revenue 7,669 8,150 5,023 (5.9) % 62.3 % Total revenue $ 268,847 $ 257,207 $ 245,860 4.5 % 4.6 % NM = Not Meaningful Total revenue increased 4.5% in 2024 compared to 2023 as described below.
Revenue Year ended December 31, Percentage Change (Dollars in thousands) 2025 2024 2023 2025 from 2024 2024 from 2023 Base rent $ 237,426 $ 216,622 $ 208,295 9.6 % 4.0 % Expense recoveries 44,310 40,826 37,094 8.5 % 10.1 % Percentage rent 1,806 1,853 1,790 (2.5) % 3.5 % Other property revenue 2,545 2,737 2,412 (7.0) % 13.5 % Credit losses on operating lease receivables, net (1,722) (860) (534) 100.2 % 61.0 % Rental revenue 284,365 261,178 249,057 8.9 % 4.9 % Other revenue 5,478 7,669 8,150 (28.6) % (5.9) % Total revenue $ 289,843 $ 268,847 $ 257,207 7.8 % 4.5 % Total revenue increased 7.8% in 2025 compared to 2024 as described below.
Total Properties Total Square Footage Percentage Leased As of December 31, Shopping Centers Mixed-Use Shopping Centers Mixed-Use Shopping Centers Mixed-Use 2024 50 8 7,808,783 1,242,809 96.4 % 87.9 % 2023 50 7 7,878,088 1,136,885 95.3 % 86.0 % 49 Table of Contents The overall commercial portfolio leasing percentage, on a comparative same property basis, increased to 95.2% at December 31, 2024 from 94.1% at December 31, 2023.
Total Properties Total Square Footage Percentage Leased As of December 31, Shopping Centers Mixed-Use Shopping Centers Mixed-Use Shopping Centers Mixed-Use 2025 50 9 7,814,783 1,252,860 95.6 % 88.7 % 2024 50 8 7,808,783 1,242,809 96.4 % 87.9 % The overall commercial portfolio leased percentage, on a comparative same property basis, decreased to 94.6% at December 31, 2025 from 95.2% at December 31, 2024.
The residential portion of Phase I was delivered on October 1, 2024 and includes 452 apartment units. The remaining portions of Phase I include an 80,000 square foot Wegmans supermarket, approximately 25,000 square feet of small shop space, and a 230,000 square foot office building. The office tower portion of Phase I is not being constructed at this time.
It includes 452 apartment units, an 81,000 square foot Wegmans supermarket, approximately 25,000 square feet of small shop space, and a 230,000 square foot office building. The office tower portion is not being constructed at this time.
The loan matures in 2037, bears interest at a fixed-rate of 6.38%, requires monthly principal and interest payments of $686,300 based on a 23.4-year amortization schedule and requires a final principal payment of $61.5 million at maturity.
The loan matures in 2041, bears interest at a fixed-rate of 5.74%, requires monthly principal and interest payments of $289,100 based on a 25-year amortization schedule and requires a final payment of $26.6 million at maturity.
Restricted Stock Compensation On May 17, 2024, following shareholder approval, the Company established the Saul Centers, Inc. 2024 Stock Incentive Plan (the “Incentive Plan”), under which various equity incentives may be granted. On May 17, 2024, the Company granted 117,000 restricted shares to officers, divided equally between time-vested and performance-based awards.
Restricted Stock Compensation On May 17, 2024, following shareholder approval, the Company established the Saul Centers, Inc. 2024 Stock Incentive Plan (the “Incentive Plan”), under which various equity incentives may be granted.
For accounting purposes, performance-based awards are not treated as granted until the Board establishes the target for those awards. As of December 31, 2024, (a) no expense has been recognized and (b) no estimate of future expense has been made for the 35,100 performance-based restricted shares awarded to officers where the accounting grant date has not occurred.
As of December 31, 2025, (a) no expense has been recognized and (b) no estimate of future expense has been made for the 59,100 performance-based restricted stock awarded to officers where the accounting grant date has not occurred.
Interest expense, net and amortization of deferred debt costs: Interest expense, net and amortization of deferred debt costs increased $4.5 million in 2024 compared to 2023 primarily due to (a) $7.9 million of higher interest incurred as a result of higher average outstanding debt partially offset by (b) $0.3 million of lower interest incurred as a result of lower average interest rates and (c) higher capitalized interest of $3.3 million related to Twinbrook Quarter Phase I and Hampden House.
Interest expense, net and amortization of deferred debt costs: Interest expense, net and amortization of deferred debt costs increased 31.4% in 2025 compared to 2024 primarily due to (a) the initial operations of Twinbrook Quarter Phase I of $14.8 million and Hampden House of $2.8 million, (b) $2.1 million of higher interest incurred as a result of higher average outstanding debt and (c) higher amortization of deferred debt costs of $0.6 million partially offset by (d) $2.8 million of lower interest incurred as a result of lower average interest rates and (e) higher capitalized interest, exclusive of Twinbrook Quarter Phase I and Hampden House, prior to Hampden House opening on October 1, 2025, of $0.6 million.
FFO available to common stockholders and noncontrolling interests increased primarily due to (a) higher commercial base rent of $6.4 million and (b) higher residential rent of $1.3 million partially offset by (c) the initial operations of Twinbrook Quarter Phase I, which adversely impacted FFO by $5.0 million (d) higher general and administrative costs of $1.2 million and (e) higher credit losses on operating lease receivables of $0.8 million.
Exclusive of Twinbrook Quarter Phase I and Hampden House, FFO available to common stockholders and noncontrolling interest increased by $1.2 million primarily due to (a) higher commercial base rent of $7.7 million and (b) higher residential rent of $1.4 million partially offset by (c) lower lease termination fees of $2.6 million, (d) lower property operating expense recoveries, net of expenses of $2.5 million, (e) higher general and administrative expenses of $1.5 million, (f) higher credit losses on operating lease receivables, net, of $0.8 million and (g) lower other property revenue of $0.5 million.
Construction of the residential building is complete and The Milton at Twinbrook Quarter opened and residential tenants began moving in on October 1, 2024. As of February 24, 2025, 202 residential units have been leased and occupied. Of the approximately 105,000 square feet of ground floor retail, the base building is complete and 96,600 square feet (92.0%) has been leased.
The Milton at Twinbrook Quarter opened and residential tenants began moving in on October 1, 2024. As of February 23, 2026, 440 of the 452 (97.3%) residential units were leased and occupied. Of the approximately 106,000 square feet of ground floor retail, the base building is complete and 101,400 square feet (95.7%) has been leased.
The $10.0 million increase in same property revenue in 2024 compared to 2023 was primarily due to (a) higher commercial base rent of $5.5 million, (b) higher property operating expense recoveries of $3.7 million and (c) higher residential base rent of $1.3 million partially offset by (d) higher credit losses on operating receivables of $0.3 million. 41 Table of Contents Mixed-Use same property revenue is composed of the following: Year Ended December 31, (Dollars In thousands) 2024 2023 Office mixed-use properties (1) $ 39,839 $ 38,831 Residential mixed-use properties (residential activity) (2) 35,994 34,770 Residential mixed-use properties (retail activity) (3) 4,494 4,393 Total Mixed-Use same property revenue $ 80,327 $ 77,994 (1) Includes Avenel Business Park, Clarendon Center – North and South Blocks, 601 Pennsylvania Avenue and Washington Square (2) Includes Clarendon South Block, The Waycroft and Park Van Ness (3) Includes The Waycroft and Park Van Ness Same property operating income Year Ended December 31, (In thousands) 2024 2023 Net income $ 67,703 $ 69,026 Interest expense, net and amortization of deferred debt costs 53,696 49,153 Depreciation and amortization of deferred leasing costs 50,502 48,430 General and administrative 25,066 23,459 Gain on disposition of property (181) — Revenue adjustments (1) 6,979 (666) Total property operating income 203,765 189,402 Acquisition, dispositions and development properties (8,108) — Total same property operating income $ 195,657 $ 189,402 Shopping Centers $ 144,699 $ 140,062 Mixed-Use properties 50,958 49,340 Total same property operating income $ 195,657 $ 189,402 Shopping Center operating income $ 144,699 $ 140,062 Shopping Center acquisitions, dispositions and development properties — — Total same Shopping Center operating income $ 144,699 $ 140,062 Mixed-Use property operating income $ 59,066 $ 49,340 Mixed-Use acquisitions, dispositions and development properties (8,108) — Total same Mixed-Use property operating income $ 50,958 $ 49,340 (1) Revenue adjustments are straight-line base rent and above/below market lease amortization.
Mixed-Use same property revenue is composed of the following: Year Ended December 31, (Dollars In thousands) 2025 2024 Office mixed-use properties (1) $ 38,474 $ 39,839 Residential mixed-use properties (residential activity) (2) 37,522 35,994 Residential mixed-use properties (retail activity) (3) 4,590 4,494 Total Mixed-Use same property revenue $ 80,586 $ 80,327 (1) Includes Avenel Business Park, Clarendon Center – North and South Blocks, 601 Pennsylvania Avenue and Washington Square (2) Includes Clarendon South Block, The Waycroft and Park Van Ness (3) Includes The Waycroft and Park Van Ness 42 Table of Contents Same property net operating income Year Ended December 31, (In thousands) 2025 2024 Net income $ 49,219 $ 67,703 Interest expense, net and amortization of deferred debt costs 70,548 53,696 Depreciation and amortization of deferred leasing costs 58,784 50,502 General and administrative 26,932 25,066 Gains on dispositions of properties (120) (181) Revenue adjustments (1) (10,044) 6,979 Total property net operating income 195,319 203,765 Acquisition, dispositions and development properties (3,570) (8,108) Total same property net operating income $ 191,749 $ 195,657 Shopping Centers $ 142,115 $ 144,699 Mixed-Use properties 49,634 50,958 Total same property net operating income $ 191,749 $ 195,657 Shopping Center property net operating income $ 142,115 $ 144,699 Shopping Center acquisitions, dispositions and development properties — — Total Shopping Center same property net operating income $ 142,115 $ 144,699 Mixed-Use property net operating income $ 53,204 $ 59,066 Mixed-Use acquisitions, dispositions and development properties (3,570) (8,108) Total Mixed-Use same property net operating income $ 49,634 $ 50,958 (1) Revenue adjustments are straight-line base rent and above/below market lease amortization.
Other REITs may use different methodologies for calculating same property revenue and same property operating income.
Other REITs may use different methodologies for calculating same property revenue and same property net operating income. Accordingly, our same property revenue and same property net operating income may not be comparable to those of other REITs.
The Company may also redevelop certain of the Current Portfolio Properties and may develop additional freestanding outparcels or expansions within certain of the Shopping Centers. Acquisition and development of properties are undertaken only after careful analysis and review, and management’s determination that such properties are expected to provide long-term earnings and cash flow growth.
Acquisition and development of properties are undertaken only after careful analysis and review, and management’s determination that such properties are expected to provide long-term earnings and cash flow growth.
Depreciation and amortization of deferred leasing costs: Depreciation and amortization of deferred leasing costs increased $2.1 million in 2024 compared to 2023 primarily due to Twinbrook Quarter Phase I assets being placed in service during 2024.
Depreciation and amortization of deferred leasing costs: Depreciation and amortization of deferred leasing costs increased $8.3 million in 2025 compared to 2024 primarily due to Twinbrook Quarter Phase I of $6.7 million and Hampden House of $1.6 million as a result of being placed into service in 2024 and 2025, respectively.
Residential Property Leasing Activity Average Rent per Square Foot Year ended December 31, Number of leases New/Renewed Leases Expiring Leases 2024 890 $ 3.69 $ 3.57 2023 929 $ 3.53 $ 3.43
The following table shows the number of new or renewed leases, exclusive of first generation leases, as December 31, 2025. Residential Property Leasing Activity Average Rent per Square Foot Year ended December 31, Number of leases New/Renewed Leases Expiring Leases 2025 912 $ 3.74 $ 3.65 2024 890 $ 3.69 $ 3.57
Proceeds were used to reduce the outstanding balance of the Company’s Credit Facility. On December 18, 2024, the Company closed on a 15-year, non-recourse, $50.0 million mortgage secured by Ashburn Village Shopping Center.
Proceeds were used to repay the remaining balance of approximately $10.0 million on the existing mortgage and reduce the outstanding balance of the New Credit Facility. On December 17, 2025, the Company closed on a 15-year, non-recourse, $46.0 million mortgage secured by Lansdowne Town Center.
Other Revenue: The $0.5 million decrease in other revenue was primarily due to lower parking revenue of $0.3 million. 39 Table of Contents Expenses Year ended December 31, Percentage Change (Dollars in thousands) 2024 2023 2022 2024 from 2023 2023 from 2022 Property operating expenses $ 41,719 $ 37,489 $ 35,934 11.3 % 4.3 % Real estate taxes 30,342 29,650 28,588 2.3 % 3.7 % Interest expense, net and amortization of deferred debt costs 53,696 49,153 43,937 9.2 % 11.9 % Depreciation and amortization of deferred leasing costs 50,502 48,430 48,969 4.3 % (1.1) % General and administrative 25,066 23,459 22,392 6.9 % 4.8 % Loss on early extinguishment of debt — — 648 NA NM Total expenses $ 201,325 $ 188,181 $ 180,468 7.0 % 4.3 % NM = Not Meaningful Total expenses increased 7.0% in 2024 compared to 2023 as described below.
Other Revenue: The $2.2 million decrease in other revenue was primarily due to (a) lower lease termination fees of $2.6 million partially offset by (b) higher parking revenue of $0.4 million. 39 Table of Contents Expenses Year ended December 31, Percentage Change (Dollars in thousands) 2025 2024 2023 2025 from 2024 2024 from 2023 Property operating expenses $ 52,034 $ 41,719 $ 37,489 24.7 % 11.3 % Real estate taxes 32,446 30,342 29,650 6.9 % 2.3 % Interest expense, net and amortization of deferred debt costs 70,548 53,696 49,153 31.4 % 9.2 % Depreciation and amortization of deferred leasing costs 58,784 50,502 48,430 16.4 % 4.3 % General and administrative 26,932 25,066 23,459 7.4 % 6.9 % Total expenses $ 240,744 $ 201,325 $ 188,181 19.6 % 7.0 % Total expenses increased 19.6% in 2025 compared to 2024, primarily due to the initial operations of Twinbrook Quarter Phase I and Hampden House.
Credit (losses) recoveries on operating lease receivables, net: Credit (losses) recoveries on operating lease receivables, net was a loss of $0.9 million during 2024. The loss is primarily due to higher reserve on lease receivables in 2024.
Expense recoveries: The $3.5 million increase in expense recoveries in 2025 compared to 2024 is primarily attributable to an increase in recoverable property operating expenses. Credit losses on operating lease receivables, net: Credit losses on operating lease receivables, net was a loss of $1.7 million during 2025. The loss is primarily due to higher reserves on lease receivables in 2025.
Expiring Commercial Property Leases: Total Square feet 930,297 Average base rent per square foot $ 21.79 Estimated market base rent per square foot $ 21.79 50 Table of Contents On a same property basis, excluding The Milton at Twinbrook Quarter, the Residential portfolio was 98.3% leased at December 31, 2024, compared to 98.0% at December 31, 2023.
Expiring Commercial Property Leases: Total Square feet 736,846 Average base rent per square foot $ 20.20 Estimated market base rent per square foot $ 20.91 52 Table of Contents Residential Properties On a same property basis, excluding the apartments at Hampden House, the Residential portfolio was 97.7% leased at December 31, 2025, compared to 82.8% at December 31, 2024.
The Board of Directors may modify the Company’s debt capitalization policy based on such a reevaluation without shareholder approval and may increase or decrease the Company’s debt to total asset ratio above or below 50% or may waive the policy for certain periods of time. 45 Table of Contents On May 28, 2024, the Company closed on a 13.4-year, non-recourse, $100.0 million mortgage secured by Avenel Business Park, Leesburg Pike Plaza and White Oak Shopping Center.
The Board of Directors may modify the Company’s debt capitalization policy based on such a reevaluation without shareholder approval and may increase or decrease the Company’s debt to total asset ratio above or below 50% or may waive the policy for certain periods of time.
A portion of the cost of the project is being financed by a $145.0 million construction-to-permanent loan. During the second quarter of 2023, the Company commenced drawing on the loan and, as of December 31, 2024, the outstanding balance of the loan was $127.3 million, net of unamortized deferred debt costs.
Excluding imputed capitalized interest, the remaining investment to complete Twinbrook Quarter Phase I is not expected to exceed $9.9 million. A portion of the cost of the project is being financed by a $145.0 million construction-to-permanent loan. As of December 31, 2025, the outstanding balance of the loan was $139.3 million, net of unamortized deferred debt costs.
All such sites are located proximate to Washington Metropolitan Area Transit Authority red line Metro stations in Montgomery County, Maryland. The Company intends to selectively add free-standing pad site buildings within its Shopping Center portfolio and replace underperforming tenants with tenants that generate strong traffic, including anchor stores such as grocery stores.
The Company intends to selectively add free-standing pad site buildings within its Shopping Center portfolio and replace underperforming tenants with tenants that generate strong traffic, including anchor stores such as grocery stores. The Company has two executed leases and six leases are under negotiation for a total of eight more pad sites.
The Company will continue to evaluate acquisition, development and redevelopment as integral parts of its overall business plan. Actions taken by the Federal government will likely continue to impact the office, retail and residential real estate markets over the coming years.
Actions taken by the Federal government will likely continue to impact the office, retail and residential real estate markets in the Washington, DC/Baltimore metropolitan area over the coming years.
Management believes it will continue to be challenging to identify acquisition opportunities for investment in existing and new shopping center and mixed-use properties into the near future. It is management’s view that several of the sub-markets in which the Company operates have, or are expected to have in the future, attractive supply/demand characteristics.
It is management’s view that several of the sub-markets in which the Company operates have, or are expected to have in the future, attractive supply/demand characteristics. The Company will continue to evaluate acquisition, development and redevelopment as integral parts of its overall business plan.
Property operating expenses: Property operating expenses increased $4.2 million in 2024 compared to 2023 primarily due to (a) increased repairs and maintenance expense across the portfolio of $3.3 million, of which $1.4 million was related to snow removal costs, (b) higher property employee compensation and benefits of $0.4 million and (c) increased utilities expense across the portfolio of $0.3 million.
Property operating expenses: Property operating expenses increased $10.3 million in 2025 compared to 2024 primarily due to (a) the initial operations of Twinbrook Quarter Phase I of $4.3 million, (b) higher repairs and maintenance expenses, exclusive of Twinbrook Quarter Phase I and Hampden House, of $3.6 million, of which $2.2 million relates to snow removal costs, (c) higher utility expenses, exclusive of Twinbrook Quarter Phase I and Hampden House, of $1.0 million, (d) the initial operations of Hampden House of $0.9 million and (e) higher insurance costs, exclusive of Twinbrook Quarter Phase I and Hampden House of $0.3 million.
Including Twinbrook Quarter and Hampden House, the Company has a pipeline of entitled sites in its portfolio, some of which are currently Shopping Centers, for development of up to an additional 3,200 apartment units and 870,000 square feet of retail and office space.
The Company has a pipeline of entitled sites in its portfolio, some of which are currently Shopping Centers, for development of up to 2,500 apartment units and 850,000 square feet of retail and office space. All such sites are located proximate to Washington Metropolitan Area Transit Authority red line Metro stations in Montgomery County, Maryland.
The Company plans to continue to diversify in terms of property types, locations, size and market, and it does not set any limit on the amount or percentage of assets that may be invested in any one property or any one geographic area.
The Company plans to continue to diversify in terms of property types, locations, size and market, and it does not set any limit on the amount or percentage of assets that may be invested in any one property or any one geographic area. 37 Table of Contents Critical Accounting Policies The Company’s consolidated financial statements are prepared in accordance with accounting principles generally accepted in the United States (“GAAP”), which requires management to make certain estimates and assumptions that affect the reporting of financial position and results of operations.
The Company’s unhedged variable-rate debt consists of $187.0 million outstanding under the Credit Facility.
The Company’s unhedged variable-rate debt consists of $189.0 million outstanding under the New Credit Facility. As of December 31, 2025, the Company has availability of approximately $96.2 million under its New Credit Facility.
The Mixed-Use portfolio includes 68,895 square feet of leasable retail space and 1,067,990 square feet of leasable office space.
On a comparable same property basis, excluding Hampden House, the Mixed-Use portfolio includes 174,819 square feet of leasable retail space and 1,067,990 square feet of leasable office space at December 31, 2025.
A portion of the cost of the project is being financed by a $133.0 million construction-to-permanent loan. During the fourth quarter of 2023, the Company commenced drawing on the loan and, as of December 31, 2024, the outstanding balance of the loan was $71.4 million, net of unamortized deferred debt costs. Exterior façade installation is nearing completion.
Excluding imputed capitalized interest, the remaining investment to complete the project is not expected to exceed $6.8 million. A portion of the cost of the project is being financed by a $133.0 million construction-to-permanent loan. As of December 31, 2025, the outstanding balance of the loan was $115.4 million, net of unamortized deferred debt costs.
On May 20, 2024, the Company granted 18,000 restricted shares to non-employee directors, which will vest on an annual basis over three years. The Company uses the fair value method to value and account for restricted stock grants.
On May 9, 2025, the Company granted 59,500 shares of restricted stock to officers, that will vest on an annual basis over five years, 16,000 shares of restricted stock to non-employee directors, which will vest on an annual basis over three years, and 59,500 performance-based shares of restricted stock to officers, which will vest on the fifth anniversary of the grant date.
Commercial Property Leasing Activity New Leases First Generation/Development Leases Renewed Leases Number of leases 13 6 61 Square feet 57,340 102,509 279,102 Per square foot average annualized: Base rent $ 27.55 $ 25.80 $ 22.54 Tenant improvements (2.51) (5.62) (0.04) Leasing costs (0.93) (0.55) — Rent concessions (0.16) (0.10) (0.22) Effective rents $ 23.95 $ 19.53 $ 22.28 As of December 31, 2024, 930,297 square feet of Commercial space was subject to leases scheduled to expire in 2025.
Commercial Property Leasing Activity New Leases First Generation/Development Leases Renewed Leases Number of leases 20 3 56 Square feet 83,911 14,564 213,365 Per square foot average annualized: Base rent $ 21.93 $ 60.08 $ 30.52 Tenant improvements (3.20) (12.56) (0.57) Leasing costs (0.78) (2.10) (0.15) Rent concessions (0.23) (0.85) — Effective rents $ 17.72 $ 44.57 $ 29.80 As of December 31, 2025, 736,846 square feet of Commercial space was subject to leases scheduled to expire in 2026.
The $8.3 million increase in base rent in 2024 compared to 2023 was primarily attributable to (a) higher commercial base rent of $6.4 million and (b) higher residential rent of $1.9 million. Expense recoveries: The $3.7 million increase in expense recoveries in 2024 compared to 2023 is primarily attributable to an increase in recoverable property operating expenses.
The $20.8 million increase in base rent in 2025 compared to 2024 was primarily attributable to (a) higher residential and commercial base rent related to Twinbrook Quarter Phase I of $11.0 million, (b) higher commercial base rent, exclusive of Twinbrook Quarter Phase I and Hampden House, of $7.7 million, (c) higher residential base rent, exclusive of Twinbrook Quarter Phase I and Hampden House, of $1.4 million and (d) higher residential and commercial base rent of Hampden House of $0.7 million.
On a comparative same property basis, the leasing percentage at office mixed-use properties increased to 86.9% at December 31, 2024 from 85.3% at December 31, 2023 and the retail leasing percentage at residential mixed-use properties was unchanged at 97.0% at December 31, 2024 and 2023.
On a comparative same property basis the leased percentage at office mixed-use properties increased to 87.3% at December 31, 2025 from 86.9% at December 31, 2024 and the retail leased percentage at residential mixed-use properties increased to 97.1% from 93.9% at December 31, 2025 and 2024. 51 Table of Contents The following table shows selected data for leases executed in the indicated periods, excluding first generation and/or development leases.
If those awards had been granted for accounting purposes as of December 31, 2024, the additional estimated future expense would have been approximately $1.3 million, calculated using the fair value method and based on the closing share price of $38.80 on December 31, 2024, the final trading day of 2024.
If those awards had been granted for accounting purposes as of December 31, 2025, the additional estimated future expense would have been approximately $1.7 million, calculated using the fair value method and based on the closing share price of $31.53 on December 31, 2025, the final trading day of 2025. 50 Table of Contents Portfolio Leasing Status Commercial Properties The following table sets forth average annualized base rent per square foot and average annualized effective rent per square foot for the Company's commercial properties (all properties except for the apartments within The Waycroft, Clarendon Center, Park Van Ness, The Milton at Twinbrook Quarter and Hampden House properties).
The leased retail space, including Wegmans, is expected to open at various times over 2025 and 2026 as tenants complete their buildouts. The development potential of all phases of the entire 18.4 acre Twinbrook Quarter site totals 1,865 residential units, 473,000 square feet of retail space, and 431,000 square feet of office space.
The development potential of all phases of the entire 18.4 acre Twinbrook Quarter site totals 1,865 residential units, 473,000 square feet of retail space, and 431,000 square feet of office space. The Company is also developing Hampden House, located in downtown Bethesda, Maryland, which includes 366 apartment units and 10,100 square feet of retail space.
Real estate taxes: Real estate taxes increased $0.7 million in 2024 compared to 2023, which was due to higher tax assessments across the portfolio.
Real estate taxes: Real estate taxes increased $2.1 million in 2025 compared to 2024, primarily due to (a) the initial operations of Twinbrook Quarter Phase I of $1.1 million and Hampden House of $0.6 million and (b) higher tax assessments across the portfolio, exclusive of Twinbrook Quarter Phase I and Hampden House.
General and administrative: General and administrative costs increased $1.6 million in 2024 compared to 2023 primarily due to (a) higher development start-up costs relating to Twinbrook Quarter Phase 1 of $0.8 million, (b) higher consulting fees of $0.4 million and (c) higher director fees of $0.4 million.
General and administrative: General and administrative costs increased $1.9 million in 2025 compared to 2024 primarily due to higher employment costs of $1.9 million.

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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 changeAs of December 31, 2024, the Company had fixed-rate indebtedness totaling $1.37 billion with a weighted average interest rate of 4.73%. If interest rates on the Company’s fixed-rate debt instruments at December 31, 2024 had been one percentage point higher, the fair value of those debt instruments on that date would have decreased by $64.4 million.
Biggest changeAs of December 31, 2025, the Company had fixed-rate indebtedness totaling $1.44 billion with a weighted average interest rate of 4.73%. If interest rates on the Company’s fixed-rate debt instruments at December 31, 2025 had been one percentage point higher, the fair value of those debt instruments on that date would have decreased by $76.3 million.
If the interest rates on the Company’s unhedged variable rate debt instruments outstanding at December 31, 2024 had been one percentage point higher or lower, our annual interest expense relating to these debt instruments would have increased or decreased by $1.9 million based on those balances.
If the interest rates on the Company’s unhedged variable rate debt instruments outstanding at December 31, 2025 had been one percentage point higher or lower, our annual interest expense relating to these debt instruments would have increased or decreased by $1.9 million based on those balances.
The Company is exposed to interest rate fluctuations that will affect the amount of interest expense of its variable-rate debt and the fair value of its fixed-rate debt. As of December 31, 2024, the Company had unhedged variable rate indebtedness totaling $187.0 million.
The Company is exposed to interest rate fluctuations that will affect the amount of interest expense of its variable-rate debt and the fair value of its fixed-rate debt. As of December 31, 2025, the Company had unhedged variable rate indebtedness totaling $189.0 million.
If interest rates on the Company’s fixed-rate debt instruments at December 31, 2024 had been one percentage point lower, the fair value of those debt instruments on that date would have increased by $70.6 million.
If interest rates on the Company’s fixed-rate debt instruments at December 31, 2025 had been one percentage point lower, the fair value of those debt instruments on that date would have increased by $83.7 million.

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