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What changed in Whitestone REIT's 10-K — 2023 vs 2024

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Paragraph-level year-over-year comparison of Whitestone REIT's 2023 and 2024 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 2024 report.

+267 added−222 removedSource: 10-K (2025-03-17) vs 10-K (2023-12-31)

Top changes in Whitestone REIT's 2024 10-K

267 paragraphs added · 222 removed · 190 edited across 7 sections

Item 1. Business

Business — how the company describes what it does

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Biggest changeEmployee Retention and Training: We conduct individual annual employee reviews that focus on goal setting as well as informal sessions with associates and executive team members. We created the Real Estate Executive Development program for associates that wish to continue their career and expand their knowledge of Whitestone REIT and real estate.
Biggest changeWe created the Real Estate Executive Development program for associates that wish to continue their career and expand their knowledge of Whitestone REIT and real estate. Selected associates are chosen on an annual basis to participate in the program.
Environmental, Sustainability and Governance We believe that managing our environmental, sustainability and governance (“ESG”) responsibilities is critical to creating and sustaining long-term value for our stakeholders. As part of our ESG initiatives, we have established an ESG Steering Committee, adopted a Sustainability Statement along with certain Environmental Policies, and prepared our 2023 ESG report.
Environmental, Sustainability and Governance We believe that managing our environmental, sustainability and governance (“ESG”) responsibilities is critical to creating and sustaining long-term value for our stakeholders. As part of our ESG initiatives, we have established an ESG Steering Committee, adopted a Sustainability Statement along with certain Environmental Policies, and prepared our 2023 Corporate Sustainability Report.
Materials Available on Our Website Copies of our Annual Report on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K and amendments to those reports, proxy statements with respect to meetings of our shareholders, as well as Reports on Forms 3, 4 and 5 regarding our officers, trustees or 10% beneficial owners, filed or furnished pursuant to Section 13(a), 15(d) or 16(a) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), are available free of charge through our website (www.whitestonereit.com) as soon as reasonably practicable after we electronically file the material with, or furnish it to, the SEC.
Materials Available on Our Website Copies of our Annual Report on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K and amendments to those reports, proxy statements with respect to meetings of our shareholders, as well as Reports on Forms 3, 4 and 5 regarding our officers, trustees or 10% beneficial owners, filed or furnished pursuant to Section 13(a), 15(d) or 16(a) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), are available free of charge through our website (www.whitestonereit.com) as soon as reasonably practicable after we electronically file the material with, or furnish it to, the Securities and Exchange Commission (the “SEC”).
We have also made available on our website copies of our ESG Report, Audit Committee Charter, Compensation Committee Charter, Nominating and Governance Committee Charter, Corporate Governance Guidelines, Insider Trading Compliance Policy, and Code of Business Conduct and Ethics Policy. In the event of any changes to these documents, revised copies will also be made available on our website.
We have also made available on our website copies of our Corporate Sustainability Report, Audit Committee Charter, Compensation Committee Charter, Nominating and Governance Committee Charter, Corporate Governance Guidelines, Insider Trading Compliance Policy, and Code of Business Conduct and Ethics Policy. In the event of any changes to these documents, revised copies will also be made available on our website.
Some of our properties that we own (the “non-core properties”) may not fit our Community Centered Property® strategy, and we may look for opportunities to dispose of these properties as we continue to execute our strategy. • Prudent Management of Capital Structure. Of our 55 properties, we currently have 50 properties that are unencumbered.
Some of our properties that we own (the “non-core properties”) may not fit our Community Centered Property® strategy, and we may look for opportunities to dispose of these properties as we continue to execute our strategy. • Prudent Management of Capital Structure. Of our 55 properties, we currently have 51 properties that are unencumbered.
As of December 31, 2023, we wholly-owned a real estate portfolio consisting of 55 properties located in two states. The aggregate occupancy rate of our portfolio was 94% based on GLA as of December 31, 2023. We are hands-on owners who directly manage the operations and leasing of our properties.
As of December 31, 2024, we wholly-owned a real estate portfolio consisting of 55 properties located in two states. The aggregate occupancy rate of our portfolio was 94% based on GLA as of December 31, 2024. We are hands-on owners who directly manage the operations and leasing of our properties.
Diversity: We strive to create a culture of inclusivity and think of our shareholders, our tenants, and our communities as one. Every year, we hold diversity and sensitivity training for management and associates to reiterate the importance within our organization and to ensure that all associates practice this approach both internally and externally.
Inclusion: We strive to create a culture of inclusivity and think of our shareholders, our tenants, and our communities as one. Every year, we hold training for management and associates to reiterate the importance within our organization and to ensure that all associates practice this approach both internally and externally.
Our Structure Substantially all of our business is conducted through Whitestone REIT Operating Partnership, L.P., a Delaware limited partnership organized in 1998 (the “Operating Partnership”). We are the sole general partner of the Operating Partnership. As of December 31, 2023, we owned a 98.6% interest in the Operating Partnership.
Our Structure Substantially all of our business is conducted through Whitestone REIT Operating Partnership, L.P., a Delaware limited partnership organized in 1998 (the “Operating Partnership”). We are the sole general partner of the Operating Partnership. As of December 31, 2024, we owned a 98.7% interest in the Operating Partnership.
BLVD also accounted for 15.9% of our consolidated real estate assets, net of accumulated depreciation, as of the year ended December 31, 2023. 2 Table of Contents Competition All of our properties are located in areas that include competing properties.
BLVD also accounted for 15.8% of our consolidated real estate assets, net of accumulated depreciation, as of the year ended December 31, 2024. 2 Table of Contents Competition All of our properties are located in areas that include competing properties.
As of December 31, 2023, our ratio of debt, net of cash, to undepreciated book value of real estate assets was 50%. • Investing in People. We believe that our people are the heart of our culture, philosophy and strategy.
As of December 31, 2024, our ratio of debt, net of cash, to undepreciated book value of real estate assets was 48%. • Investing in People. We believe that our people are the heart of our culture, philosophy and strategy.
We are internally managed and, as of December 31, 2023, we wholly-owned a real estate portfolio of 55 properties that meet our Community Centered Property® strategy containing approximately 5.0 million square feet of gross leasable area (“GLA”), located in Texas and Arizona.
We are internally managed and, as of December 31, 2024, we wholly-owned a real estate portfolio of 55 properties that meet our Community Centered Property® strategy containing approximately 4.9 million square feet of gross leasable area (“GLA”), located in Texas and Arizona.
Employee engagement is critical to our long term success, so employees’ performances are reviewed annually. Key employees are provided with equity incentives to align their interests with those of our shareholders. Every Whitestone associate is encouraged to be an owner. As of December 31, 2023, we had 79 employees, including 2 on leave.
Employee engagement is critical to our long term success, so employees’ performances are reviewed annually. Key employees are provided with equity incentives to align their interests with those of our shareholders. Every Whitestone associate is encouraged to be an owner. As of December 31, 2024, we had 72 employees.
As of December 31, 2023, we wholly-owned 12 properties in Houston, nine properties in Dallas-Fort Worth, three properties in San Antonio, five properties in Austin and 26 properties in the Scottsdale and Phoenix, Arizona metropolitan areas.
As of December 31, 2024, we wholly-owned 12 properties in Houston, nine properties in Dallas-Fort Worth, three properties in San Antonio, six properties in Austin and 25 properties in the Scottsdale and Phoenix, Arizona metropolitan areas.
Selected associates are chosen on an annual basis to participate in the program. In addition, for associates that wish to continue their education, whether it be receiving a Bachelors, MBA, or specialized certification, we will help to reimburse a portion of the fees for the program in accordance with Company policy.
In addition, for associates that wish to continue their education, whether it be receiving a Bachelors, MBA, or specialized certification, we will help to reimburse a portion of the fees for the program in accordance with Company policy.
In this Annual Report on Form 10-K, unless otherwise indicated, we do not include the Pillarstone Properties when we refer to our properties.
In this Annual Report on Form 10-K, unless otherwise indicated, we do not include the Pillarstone Properties (defined below) when we refer to our properties as we no longer hold a majority interest in Pillarstone OP.
The aggregate occupancy rate of the Pillarstone properties was approximately 54% based on GLA as of December 31, 2023. Our largest property, BLVD Place (“BLVD”), a retail community purchased on May 26, 2017 and located in Houston, Texas, accounted for 10.5% of our total revenues for the year ended December 31, 2023.
Our largest property, BLVD Place (“BLVD”), a retail community purchased on May 26, 2017 and located in Houston, Texas, accounted for 9.6% of our total revenues for the year ended December 31, 2024.
Though we have no formal policy addressing diversity, any individual who does not satisfy the qualifications above is not eligible for nomination or election as a trustee. This commitment to diversity applies across our Company.
Though we have no formal policy, any individual who does not satisfy the qualifications above is not eligible for nomination or election as a trustee. This commitment to inclusion applies across our Company. Employee Retention and Training: We conduct individual annual employee reviews that focus on goal setting as well as informal sessions with associates and executive team members.
Our consolidated property portfolio has a gross book value of approximately $1.2 billion and book equity, including noncontrolling interests, of approximately $420 million as of December 31, 2023.
Our consolidated property portfolio has a gross book value of approximately $1.2 billion and book equity, including noncontrolling interests, of approximately $444 million as of December 31, 2024. On January 25, 2024, we exercised our notice of redemption for substantially all of our investment in Pillarstone Capital REIT Operating Partnership LP (“Pillarstone” or “Pillarstone OP”).
Substantially all of our revenues consist of base rents received under varying term leases. For the year ended December 31, 2023, our total revenues were approximately $147 million. Additionally, we, through our equity-method investment in Pillarstone, owned a majority interest in eight properties located in Dallas and Houston, Texas.
Substantially all of our revenues consist of base rents received under varying term leases. For the year ended December 31, 2024, our total revenues were approximately $154 million. As of December 31, 2024, our ownership in Pillarstone Capital REIT Operating Partnership LP (“Pillarstone” or “Pillarstone OP”) no longer represents a majority interest.
Removed
Further, as of December 31, 2023, we, through our equity-method investment in Pillarstone Capital REIT Operating Partnership LP (“Pillarstone” or “Pillarstone OP”), owned a majority interest in eight properties that do not meet our Community Centered Property® strategy containing approximately 0.9 million square feet of GLA (the “Pillarstone Properties”).
Added
On January 25, 2024, we exercised a notice of redemption for substantially all of our investment in Pillarstone OP. As of the date of this filing, we have not received consideration for the redemption of our equity investment in Pillarstone OP as required by the partnership agreement.
Removed
We own 81.4% of the total outstanding units of Pillarstone OP, which we account for using the equity method. We also managed the day-to-day operations of Pillarstone OP pursuant to a management agreement, which was terminated on August 18, 2022.
Added
On March 4, 2024, Pillarstone Capital REIT (“Pillarstone REIT”) authorized and filed a Chapter 11 bankruptcy (the “Pillarstone Bankruptcies”) of itself, Pillarstone OP, and all of its remaining special purpose entities in the United States Bankruptcy Court for the Northern District of Texas (the “Bankruptcy Court”).
Added
We have filed a claim in the “Pillarstone Bankruptcies” for the value of our redemption claim along with interest and other costs.
Added
We intend to pursue collection of amounts due from Pillarstone OP through all means necessary and while we do not know the ultimate amount to be collected, we believe the amount will be in excess of the current carrying value of our receivable, formerly our equity investment in Pillarstone OP.
Added
Please refer to Note 4 (Investment in Real Estate Partnership) to the accompanying consolidated financial statements for more information on our accounting treatment of our former investment in Pillarstone OP.

Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeOur ability to expand through acquisitions is integral to our business strategy and requires us to consummate suitable acquisition or investment opportunities that meet our criteria and are compatible with our growth strategy. We may not be successful in consummating acquisitions or investments in properties that meet our acquisition criteria on satisfactory terms or at all.
Biggest changeWe may not be successful in consummating suitable acquisitions or investment opportunities, which may impede our growth and adversely affect the trading price of our common shares. Our ability to expand through acquisitions is integral to our business strategy and requires us to consummate suitable acquisition or investment opportunities that meet our criteria and are compatible with our growth strategy.
A significant economic downturn in the Houston or Phoenix metropolitan area may adversely impact our ability to locate and retain financially sound tenants, could have an adverse impact on our existing tenants’ revenues, costs and results of operations and may adversely affect their ability to meet their obligations to us.
A significant economic downturn in the Houston, Dallas, or Phoenix metropolitan area may adversely impact our ability to locate and retain financially sound tenants, could have an adverse impact on our existing tenants’ revenues, costs and results of operations and may adversely affect their ability to meet their obligations to us.
The extent to which a resurgence of COVID-19 pandemic, or a future pandemic, impacts our operations and those of our tenants will depend on future developments, which are highly uncertain and cannot be predicted with confidence. We lease our properties to approximately 1,500 tenants and leases for approximately 10% to 20% of our GLA expire annually.
The extent to which a resurgence of COVID-19 pandemic, or a future pandemic, impacts our operations and those of our tenants will depend on future developments, which are highly uncertain and cannot be predicted with confidence. We lease our properties to approximately 1,400 tenants and leases for approximately 10% to 20% of our GLA expire annually.
Our Community Centered Property® business model produces shorter term leases to smaller, non-national tenants, and substantially all of our revenues consist of base rents received under these leases. As of December 31, 2023, approximately 33% of the aggregate GLA of our properties is subject to leases that expire prior to December 31, 2025.
Our Community Centered Property® business model produces shorter term leases to smaller, non-national tenants, and substantially all of our revenues consist of base rents received under these leases. As of December 31, 2024, approximately 29% of the aggregate GLA of our properties is subject to leases that expire prior to December 31, 2026.
As of December 31, 2023, we had fixed rate hedges on $315 million of our variable rate unsecured credit facility. We may enter into additional interest rate swap agreements for our variable rate debt not currently subject to hedges, which totaled $96 million as of December 31, 2023. Hedging may reduce the overall returns on our investments.
As of December 31, 2024, we had fixed rate hedges on $335 million of our variable rate unsecured credit facility. We may enter into additional interest rate swap agreements for our variable rate debt not currently subject to hedges, which totaled $75 million as of December 31, 2024. Hedging may reduce the overall returns on our investments.
We intend to pursue collection of amounts due from Pillarstone OP through all means, including further litigation if necessary and while we do not know the ultimate amount to be collected, we believe the amount will be in excess of the current carrying value of our equity investment in Pillarstone OP.
We intend to pursue collection of amounts due from Pillarstone OP through all means necessary, and while we do not know the ultimate amount to be collected, we believe the amount will be in excess of the current carrying value of our receivable, formerly our equity investment in Pillarstone OP.
As of December 31, 2023, we had approximately $136.7 million of mortgage debt secured by five of our properties. If there is a shortfall in cash flow, however, the amount available for distributions to shareholders may be affected.
As of December 31, 2024, we had approximately $136.3 million of mortgage debt secured by four of our properties. If there is a shortfall in cash flow, however, the amount available for distributions to shareholders may be affected.
One of the factors that may influence the price of our common shares will be the dividend distribution rate on the common shares (as a percentage of the price of our common shares) relative to market interest rates. If market interest rates continue to rise, prospective purchasers of shares of our common shares may expect a higher distribution rate.
Additionally, the market value of our common shares may also be influenced by the dividend distribution rate on the common shares (as a percentage of the price of our common shares) relative to market interest rates. If market interest rates continue to rise, prospective purchasers of shares of our common shares may expect a higher distribution rate.
As of December 31, 2023, we had outstanding indebtedness, net of cash, of $636.0 million, including, through our Operating Partnership, $92.9 million aggregate principal amount of the Notes (as defined below) and $411.0 million drawn on the 2022 Facility (as defined below). As of December 31, 2023, our unused borrowing capacity under our 2022 Facility was $104.0 million.
As of December 31, 2024, we had outstanding indebtedness, net of cash, of $627.3 million, including, through our Operating Partnership, $85.7 million aggregate principal amount of the Notes (as defined below) and $410.0 million drawn on the 2022 Facility (as defined below). As of December 31, 2024, our unused borrowing capacity under our 2022 Facility was $125.0 million.
The Maryland General Corporation Law (“MGCL”) contains many provisions, such as the business combination statute and the control share acquisition statute, that are designed to prevent, or have the effect of preventing, someone from acquiring control of us.
Maryland takeover statutes may deter others from seeking to acquire us and prevent shareholders from making a profit in such transactions. The Maryland General Corporation Law (“MGCL”) contains many provisions, such as the business combination statute and the control share acquisition statute, that are designed to prevent, or have the effect of preventing, someone from acquiring control of us.
Risks Associated with Our Operations Because a majority of our GLA is in the Houston and Phoenix metropolitan areas, an economic downturn in either area could adversely impact our operations and ability to make distributions to our shareholders. The majority of our assets and revenues are currently derived from properties located in the Houston and Phoenix metropolitan areas.
Risks Associated with Our Operations Because a majority of our GLA is in the Houston, Dallas, and Phoenix metropolitan areas, an economic downturn in any of these areas could adversely impact our operations and ability to make distributions to our shareholders.
Investments in real estate typically involve a high level of risk as the result of factors we cannot control or predict.
The value of investments in our common shares will be directly affected by general economic and regulatory factors we cannot control or predict. Investments in real estate typically involve a high level of risk as the result of factors we cannot control or predict.
As of December 31, 2023, 22% and 47% of our GLA was located in Houston and Phoenix, respectively. Our results of operations are directly affected by our ability to attract financially sound commercial tenants.
The majority of our assets and revenues are currently derived from properties located in the Houston, Dallas, and Phoenix metropolitan areas. As of December 31, 2024, 23%, 17%, and 45% of our GLA was located in Houston, Dallas, and Phoenix, respectively. Our results of operations are directly affected by our ability to attract financially sound commercial tenants.
Accordingly, if financial and macroeconomic conditions deteriorate, or if financial markets experience significant disruption, it could have a significant adverse effect on our cash flows, profitability, results of operations and the trading price of our common shares. The value of investments in our common shares will be directly affected by general economic and regulatory factors we cannot control or predict.
Accordingly, if financial and macroeconomic conditions deteriorate, or if financial markets experience significant disruption, it could have a significant adverse effect on our cash flows, profitability, results of operations and the trading price of our common shares. The 2024 U.S. presidential elections may introduce significant uncertainties.
As a result, prospective purchasers may decide to purchase other securities rather than our common shares, which would reduce the demand for, and result in a decline in the market price of, our common shares. Maryland takeover statutes may deter others from seeking to acquire us and prevent shareholders from making a profit in such transactions.
As a result, prospective purchasers may decide to purchase other securities rather than our common shares, which would reduce the demand for, and result in a decline in the market price of, our common shares. Our Board may change our business strategy, investment policy or objectives without shareholder approval.
Consequently, because of the geographic concentration among our current assets, if either the Houston or Phoenix metropolitan area were to experience an economic downturn, our operations and ability to make distributions to our shareholders could be adversely impacted. 7 Table of Contents Pandemics, epidemics, or other health crises could materially and adversely impact and disrupt our business, financial condition, results of operations and cash flows.
Likewise, we may be required to lower our rental rates to attract desirable tenants in such an environment. Consequently, because of the geographic concentration among our current assets, if the Houston, Dallas, or Phoenix metropolitan area were to experience an economic downturn, our operations and ability to make distributions to our shareholders could be adversely impacted.
As of the date of this filing, Whitestone has not received consideration for its redemption of its equity investment in Pillarstone OP as required by the partnership agreement.
On January 25, 2024, we exercised our notice of redemption for substantially all of our investment in Pillarstone OP. On March 4, 2024, Pillarstone REIT authorized and filed Pillarstone Bankruptcies. As of the date of this filing, we have not received consideration for the redemption of our equity investment in Pillarstone OP as required by the Pillarstone Partnership Agreement.
Some or all of these factors may affect our properties, which could adversely affect our operations and ability to make distributions to shareholders. We may not be successful in consummating suitable acquisitions or investment opportunities, which may impede our growth and adversely affect the trading price of our common shares.
Some or all of these factors may affect our properties, which could adversely affect our operations and ability to make distributions to shareholders. Climate change and natural disasters could adversely affect our properties and business. Some of our current or future properties could be subject to natural disasters and may be impacted by climate change.
Risks Related to Ownership of our Common Shares Increases in market interest rates may result in a decrease in the value of our common shares.
Risks Related to Ownership of our Common Shares The market value of our common shares is subject to various factors that may cause significant fluctuations or volatility.
Removed
Public health emergencies such as the COVID-19 pandemic have affected customers’ willingness to frequent some of our tenants’ businesses, which has impacted and may continue to impact their ability to fulfill their obligations to us in the event of a resurgence of COVID-19 or the rise of a variant of the virus.
Added
Risks related to properties under development, redevelopment, or newly developed properties may adversely affect our financial performance. We may be unable to obtain, or may suffer delays in obtaining, necessary zoning, land-use, building, occupancy, and other required governmental permits and authorizations, which could lead to increased costs or abandonment of projects.
Removed
Although most tenant businesses have returned to operating at pre-pandemic levels, for certain categories of our tenants, such as dry cleaners and fitness tenants, the negative impact of COVID-19 was more severe and the recovery is still in progress.
Added
We may not be able to obtain financing on favorable terms, or at all, and we may not be able to complete lease-up of a property on schedule. The resulting time required for development, redevelopment, and lease-up means that we may have to wait years for significant cash returns.
Removed
Likewise, we may be required to lower our rental rates to attract desirable tenants in such an environment.
Added
Many of our real estate costs are fixed, even if income from our properties decreases, which would cause a decrease in net income. Our financial results depend primarily on leasing space at our properties to tenants on terms favorable to us.
Removed
On January 25, 2024, the Company exercised its notice of redemption for substantially all of its investment in Pillarstone OP. On March 4, 2024, Pillarstone REIT authorized and filed the Chapter 11 bankruptcy of itself, Pillarstone OP, and the remainder of its special purpose entities in the United States Bankruptcy Court for the Northern District of Texas.
Added
Costs associated with real estate investment, such as real estate taxes, insurance, and maintenance costs, generally are not reduced even when a property is not fully occupied, rental rates decrease, or other circumstances cause a reduction in income from the property.
Removed
Risk associated with the Kroger acquisition of Albertsons. On October 14, 2022, Kroger Co. ("Kroger") announced its intention to acquire Albertsons Companies, Inc. ("Albertsons"). In connection with obtaining the regulatory clearance necessary to close the transaction, C&S Wholesale Grocers has entered into a definitive agreement to purchase Albertsons' 413 stores.
Added
As a result, cash flow from the operations of our properties may be reduced if a tenant does not pay its rent or we are unable to fully lease our properties on favorable terms.
Removed
As of December 31, 2023, Whitestone REIT had 5 grocers owned by Albertsons. It does not appear that any of the Albertsons' stores currently leasing from Whitestone REIT are likely to be purchased by C&S Wholesale Grocers.
Added
Additionally, properties that we develop or redevelop may not produce any significant revenue immediately, and the cash flow from existing operations may be insufficient to pay the operating expenses and debt service associated with such projects until they are fully occupied. 7 Table of Contents Pandemics, epidemics, or other health crises could materially and adversely impact and disrupt our business, financial condition, results of operations and cash flows.
Removed
Kroger has stated that they anticipate the closing will occur by August of 2024 and that they are in active and ongoing dialogue with the Federal Trade Commission and individual state Attorneys General regarding the proposed merger and divestiture plan.
Added
We have filed a claim in the Pillarstone Bankruptcies for the value of our redemption claim along with interest and other costs.
Added
There can be no assurance as to if or when we will be able to collect the amounts due from Pillarstone OP, and the failure to collect such amounts could harm our business, operating results and financial condition.
Added
As with other publicly traded securities, the market price of our common shares depends on various factors, which may change from time to time and/or may be unrelated to our financial condition, operating performance or prospects and may result in significant fluctuations or volatility in such prices.
Added
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.
Added
Our Board may determine to change our investment and financing policies or objectives, our growth strategy and our debt, capitalization, distribution, acquisition, disposition, and operating policies.
Added
Our Board may establish investment criteria or limitations as it deems appropriate, but currently does not limit the number of properties in which we may seek to invest or the concentration of investments in any one geographic region.
Added
Although our Board has no present intention to revise or amend our strategies and policies, it may do so at any time without a vote by our shareholders.
Added
Accordingly, the results of decisions made by our Board as implemented by management may or may not serve the interests of all of our shareholders and could adversely affect our financial condition, cash flows, results of operations, and ability to satisfy our debt service obligations and to make distributions to our shareholders.
Added
U.S. relations with the rest of the world remain uncertain with respect to taxes, trade policies and tariffs, especially as the political landscape changes due to the recent U.S. presidential and congressional elections.
Added
Changes in U.S. administrative policy may lead to significant increases in tariffs for imported goods among other possible changes, which could strain international trade relations and increase the risk that foreign governments implement retaliatory tariffs on goods imported from the United States.
Added
Any widespread imposition of new or increased tariffs could increase the cost of our development and redevelopment activities, as well as result in inflationary pressure, any of which could have a material adverse effect on our business, prospects, financial condition, results of operations or cash flows.
Added
To the extent climate change causes adverse changes in weather patterns, rising sea levels or extreme temperatures, our properties in certain markets may be adversely affected.
Added
Climate change could have a variety of direct or indirect adverse effects on our properties and business, including: • property damage to our properties; • indirect financial and operational impacts from disruptions to the operations of major tenants located in our retail properties from severe weather, such as hurricanes, floods, wildfires or other natural disasters; • increased insurance premiums and deductibles, or a decrease in or unavailability of coverage, for properties in areas subject to severe weather, such as hurricanes, floods, wildfires or other natural disasters; • increased insurance claims and liabilities; • increases in energy costs impacting operational returns; • changes in the availability or quality of water or other natural resources on which the tenant’s business depends; • decreased consumer demand for products or services resulting from physical changes associated with climate change (e.g., warmer temperatures or decreasing shoreline could reduce demand for residential and commercial properties previously viewed as desirable); • incorrect long-term valuation of an equity investment due to changing conditions not previously anticipated at the time of the investment; and • economic disruptions arising from the above.
Added
Moreover, compliance with new laws or regulations related to climate change, including compliance with “green” building codes, may require us to make improvements to our existing properties or pay additional taxes and fees assessed on us or our properties.
Added
Although we strive to identify, analyze, and respond to the risk and opportunities that climate change presents, at this time there can be no assurance that climate change will not have an adverse effect on us.
Added
We may not be successful in consummating acquisitions or investments in properties that meet our acquisition criteria on satisfactory terms or at all.

Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeAdditionally, we engage third-party providers to augment our cybersecurity capabilities. These partnerships entail ongoing assistance for threat monitoring and mitigation, as well as targeted support for specialized security expertise. As of December 31, 2023, we have not detected any cybersecurity threats, including prior incidents, that have materially impacted the Company, our business strategy, our financial results, or our financial health.
Biggest changeAdditionally, we engage third -party providers to augment our cybersecurity capabilities. These partnerships entail ongoing assistance for threat monitoring and mitigation, as well as targeted support for specialized security expertise.
For an examination of cybersecurity threats that could potentially have a material impact on us, please refer to our Risk Factors discussion in the section titled "We face risks relating to Cybersecurity attacks, loss of confidential information and other business disruptions" in this Form 10-K.
For an examination of cybersecurity threats that could potentially have a material impact on us, please refer to our Risk Factors discussion in the section titled “We face risks relating to Cybersecurity attacks, loss of confidential information and other business disruptions” in this Form 10-K.
Added
As of December 31, 2024, we have not detected any cybersecurity threats, including prior incidents, that have materially impacted the Company, our business strategy, our financial results, or our financial health.

Item 2. Properties

Properties — owned and leased real estate

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Biggest change(3) Whitestone Properties: Ahwatukee Plaza Phoenix 1979 72,650 81 % $ 844 $ 14.34 $ 18.13 Anderson Arbor Austin 2001 89,746 97 % 1,956 22.47 23.03 Anthem Marketplace Phoenix 2000 113,293 96 % 1,688 15.52 16.74 Anthem Marketplace Phase II Phoenix 2019 6,853 100 % 248 36.19 33.85 Arcadia Towne Center Phoenix 1966 69,503 100 % 1,771 25.48 26.93 BLVD Place Houston 2014 216,944 99 % 9,646 44.91 45.19 The Citadel Phoenix 2013 28,547 94 % 560 20.87 20.61 City View Village San Antonio 2005 17,870 100 % 591 33.07 33.02 Dana Park Pad Phoenix 2002 12,000 100 % 326 27.17 29.00 Davenport Village Austin 1999 128,934 95 % 3,589 29.30 29.15 Eldorado Plaza Dallas 2004 219,287 100 % 3,657 16.68 16.97 Fountain Hills Phoenix 2009 111,289 93 % 1,723 16.65 16.66 Fountain Square Phoenix 1986 118,209 92 % 2,020 18.57 18.02 Fulton Ranch Towne Center Phoenix 2005 120,575 92 % 2,411 21.73 21.90 Gilbert Tuscany Village Phoenix 2009 49,415 100 % 1,042 21.09 22.26 Heritage Dallas 2006 70,431 100 % 1,766 25.07 24.52 HQ Village Dallas 2009 89,134 94 % 2,652 31.65 31.44 Keller Place Dallas 2001 93,541 96 % 1,118 12.45 13.79 Kempwood Plaza Houston 1974 91,302 100 % 1,403 15.37 15.24 La Mirada Phoenix 1997 147,209 98 % 3,775 26.17 25.55 Lake Woodlands Crossing Houston 2018 60,246 100 % 1,974 32.77 40.88 Lakeside Market Dallas 2000 162,649 91 % 4,064 27.46 28.51 Las Colinas Dallas 2000 104,919 96 % 3,022 30.00 31.65 Lion Square Houston 1980 117,592 96 % 1,978 17.52 17.57 The MarketPlace at Central Phoenix 2012 111,130 99 % 1,175 10.68 10.23 Market Street at DC Ranch Phoenix 2003 244,888 99 % 6,090 25.12 24.90 Mercado at Scottsdale Ranch Phoenix 1987 118,730 95 % 2,047 18.15 17.49 Paradise Plaza Phoenix 1983 125,898 89 % 1,681 15.00 14.64 Parkside Village North Austin 2005 27,045 100 % 921 34.05 33.31 Parkside Village South Austin 2012 90,101 96 % 2,501 28.91 29.06 Pinnacle of Scottsdale Phoenix 1991 113,108 99 % 2,746 24.52 24.00 Pinnacle Phase II Phoenix 2017 27,063 100 % 880 32.52 30.41 The Promenade at Fulton Ranch Phoenix 2007 98,792 90 % 1,498 16.85 18.10 Providence Houston 1980 90,327 94 % 1,125 13.25 13.78 Quinlan Crossing Austin 2012 109,892 94 % 2,655 25.70 26.09 Seville Phoenix 1990 90,042 91 % 2,926 35.71 34.38 Shaver Houston 1978 21,926 100 % 383 17.47 17.19 Shops at Pecos Ranch Phoenix 2009 78,767 100 % 2,087 26.50 28.51 Shops at Starwood Dallas 2006 55,385 100 % 1,919 34.65 35.21 The Shops at Williams Trace Houston 1985 132,991 98 % 2,366 18.15 19.20 Starwood Phase II Dallas 2016 35,351 92 % 1,266 38.93 35.85 The Strand at Huebner Oaks San Antonio 2000 73,920 97 % 1,868 26.05 25.44 SugarPark Plaza Houston 1974 95,032 98 % 1,464 15.72 15.27 Sunset at Pinnacle Peak Phoenix 2000 41,530 98 % 890 21.87 22.68 Terravita Marketplace Phoenix 1997 102,733 97 % 1,539 15.44 15.26 Town Park Houston 1978 43,526 100 % 1,107 25.43 26.01 21 Table of Contents Whitestone REIT and Subsidiaries Property Details As of December 31, 2023 Village Square at Dana Park Phoenix 2009 323,026 88 % 6,662 23.44 23.57 Williams Trace Plaza Houston 1983 129,222 89 % 2,514 21.86 31.80 Windsor Park San Antonio 2012 196,458 85 % 1,739 10.41 10.98 Woodlake Plaza Houston 1974 106,169 58 % 1,101 17.88 18.74 Total/Weighted Average - Whitestone Properties 4,995,190 94 % 106,974 22.78 23.35 Development Properties: Total/Weighted Average - Development Properties — — — — — Land Held for Development: BLVD Phase II-B Houston N/A — — — — — Dana Park Development Phoenix N/A — — — — — Eldorado Plaza Development Dallas N/A — — — — — Fountain Hills Phoenix N/A — — — — — Market Street at DC Ranch Phoenix N/A — — — — — Total/Weighted Average - Land Held For Development (4) — — — — — Grand Total/Weighted Average - Whitestone Properties 4,995,190 94 % $ 106,974 $ 22.78 $ 23.35 (1) Calculated as the tenant’s actual December 31, 2023 base rent (defined as cash base rents including abatements) multiplied by 12.
Biggest change(3) Whitestone Properties: Ahwatukee Plaza Phoenix 1979 72,650 87 % $ 863 $ 13.65 $ 15.71 Anderson Arbor Austin 2001 89,746 93 % 2,026 24.27 24.68 Anthem Marketplace Phoenix 2000 113,293 97 % 1,773 16.13 16.08 Anthem Marketplace Phase II Phoenix 2019 6,853 100 % 255 37.21 33.85 Arcadia Towne Center Phoenix 1966 69,503 100 % 1,782 25.64 26.88 BLVD Place Houston 2014 216,944 100 % 9,993 46.06 46.41 The Citadel Phoenix 2013 28,547 95 % 628 23.16 21.31 City View Village San Antonio 2005 17,870 90 % 550 34.20 33.95 Dana Park Pad Phoenix 2002 12,000 100 % 335 27.92 29.00 Davenport Village Austin 1999 128,934 96 % 3,702 29.91 29.42 Eldorado Plaza Dallas 2004 219,287 99 % 3,745 17.25 17.48 Fountain Square Phoenix 1986 118,209 88 % 1,999 19.22 19.08 Fulton Ranch Towne Center Phoenix 2005 120,575 94 % 2,373 20.94 21.50 Garden Oaks Shopping Center Houston 1956 106,858 96 % 1,806 17.61 18.13 Gilbert Tuscany Village Phoenix 2009 49,415 100 % 1,076 21.77 22.10 Heritage Dallas 2006 70,431 86 % 1,657 27.36 26.56 HQ Village Dallas 2009 89,134 93 % 2,684 32.38 31.04 Keller Place Dallas 2001 93,541 95 % 1,139 12.82 12.69 Kempwood Plaza Houston 1974 91,302 95 % 1,397 16.11 15.58 La Mirada Phoenix 1997 147,209 99 % 3,858 26.47 27.53 Lake Woodlands Crossing Houston 2018 60,246 94 % 1,900 33.55 33.96 Lakeside Market Dallas 2000 164,899 95 % 4,582 29.25 30.62 Las Colinas Dallas 2000 104,919 98 % 3,137 30.51 30.67 Lion Square Houston 1980 117,592 93 % 2,086 19.07 19.60 The MarketPlace at Central Phoenix 2012 111,130 99 % 1,201 10.92 11.13 Market Street at DC Ranch Phoenix 2003 244,888 96 % 6,400 27.22 28.34 Paradise Plaza Phoenix 1983 125,898 90 % 1,867 16.48 17.00 Parkside Village North Austin 2005 27,045 100 % 940 34.76 35.27 Parkside Village South Austin 2012 90,101 100 % 2,703 30.00 31.92 Pinnacle of Scottsdale Phoenix 1991 113,108 98 % 2,772 25.01 25.58 Pinnacle Phase II Phoenix 2017 27,063 100 % 857 31.67 32.63 The Promenade at Fulton Ranch Phoenix 2007 98,792 93 % 1,473 16.03 17.97 Quinlan Crossing Austin 2012 109,892 97 % 2,831 26.56 27.06 Scottsdale Commons Phoenix 1980 69,482 93 % 1,733 26.82 28.57 Seville Phoenix 1990 90,042 90 % 2,935 36.22 37.11 Shaver Houston 1978 21,926 100 % 395 18.02 17.83 Shops at Pecos Ranch Phoenix 2009 78,767 97 % 2,087 27.32 26.69 Shops at Starwood Dallas 2006 55,385 100 % 1,961 35.41 34.96 The Shops at Williams Trace Houston 1985 132,991 98 % 2,418 18.55 18.61 Starwood Phase II Dallas 2016 35,351 97 % 1,360 39.66 39.78 The Strand at Huebner Oaks San Antonio 2000 73,920 100 % 2,004 27.11 29.00 SugarPark Plaza Houston 1974 95,032 100 % 1,525 16.05 15.26 Sunset at Pinnacle Peak Phoenix 2000 41,530 100 % 1,143 27.52 25.23 Terravita Marketplace Phoenix 1997 102,733 99 % 1,615 15.88 15.64 Town Park Houston 1978 43,526 93 % 1,060 26.19 26.19 Village Shops at Dana Park Phoenix 2002 10,128 100 % 354 34.95 21.43 21 Table of Contents Whitestone REIT and Subsidiaries Property Details As of December 31, 2024 Village Square at Dana Park Phoenix 2009 323,026 87 % 6,816 24.25 25.96 Williams Trace Plaza Houston 1983 129,222 97 % 2,775 22.14 24.68 Windsor Park San Antonio 2012 196,458 85 % 2,188 13.10 13.13 Woodlake Plaza Houston 1974 106,169 57 % 1,110 18.34 18.09 Total/Weighted Average - Whitestone Properties 4,863,562 94 % 109,869 24.03 24.51 Land Held for Development: Anderson Arbor PAD Austin N/A — — — — — BLVD Phase II-B Houston N/A — — — — — Dana Park Development Phoenix N/A — — — — — Eldorado Plaza Development Dallas N/A — — — — — Market Street at DC Ranch Phoenix N/A — — — — — Total/Weighted Average - Land Held For Development (4) — — — — — Grand Total/Weighted Average - Whitestone Properties 4,863,562 94 % $ 109,869 $ 24.03 $ 24.51 (1) Calculated as the tenant’s actual December 31, 2024 base rent (defined as cash base rents including abatements) multiplied by 12.
(3) Represents (i) the contractual base rent for leases in place as of December 31, 2023, adjusted to a straight-line basis to reflect changes in rental rates throughout the lease term and amortize free rent periods and abatements, but without regard to tenant improvement allowances and leasing commissions, divided by (ii) square footage under commenced leases of December 31, 2023.
(3) Represents (i) the contractual base rent for leases in place as of December 31, 2024, adjusted to a straight-line basis to reflect changes in rental rates throughout the lease term and amortize free rent periods and abatements, but without regard to tenant improvement allowances and leasing commissions, divided by (ii) square footage under commenced leases of December 31, 2024.
Whitestone REIT and Subsidiaries Property Details As of December 31, 2023 Average Percent Annualized Base Base Rental Average Net Effective Year Built/ Gross Leasable Occupied at Rental Revenue Revenue Per Annual Base Rent Per Community Name Location Renovated Square Feet 12/31/2023 (in thousands) (1) Sq. Ft. (2) Leased Sq. Ft.
Whitestone REIT and Subsidiaries Property Details As of December 31, 2024 Average Percent Annualized Base Base Rental Average Net Effective Year Built/ Gross Leasable Occupied at Rental Revenue Revenue Per Annual Base Rent Per Community Name Location Renovated Square Feet 12/31/2024 (in thousands) (1) Sq. Ft. (2) Leased Sq. Ft.
(4) As of December 31, 2023, these parcels of land were held for development and, therefore, had no gross leasable area. 22 Table of Contents Significant Tenants The following table sets forth information about our 15 largest tenants as of December 31, 2023, based upon consolidated annualized rental revenues at December 31, 2023.
(4) As of December 31, 2024, these parcels of land were held for development and, therefore, had no gross leasable area. 22 Table of Contents Significant Tenants The following table sets forth information about our 15 largest tenants as of December 31, 2024, based upon consolidated annualized rental revenues at December 31, 2024.
Annualized Rental Percentage of Total Revenue Annualized Base Rental Tenant Name Location (in thousands) Revenues (1) Initial Lease Date Year Expiring Whole Foods Market Houston $ 2,247 2.1 % 9/3/2014 2035 Albertsons Companies, Inc.
Annualized Rental Percentage of Total Revenue Annualized Base Rental Tenant Name Location (in thousands) Revenues (1) Initial Lease Date Year Expiring Whole Foods Market Houston $ 2,471 2.2 % 9/3/2014 2035 Albertsons Companies, Inc.
The annualized rental revenue for the lease that commenced on July 1, 2000, and is scheduled to expire in 2025, was $353,000, which represents approximately 0.3% of our total annualized base rental revenue.
The annualized rental revenue for the lease that commenced on July 1, 2000, and is scheduled to expire in 2030, was $353,000, which represents approximately 0.3% of our total annualized base rental revenue.
The annualized rental revenue for the lease that commenced on August 10, 1999, and is scheduled to expire in 2025, was $88,000, which represents approximately 0.1% of our total annualized base rental revenue.
The annualized rental revenue for the lease that commenced on August 10, 1999, and is scheduled to expire in 2030, was $88,000, which represents approximately 0.1% of our total annualized base rental revenue.
The following table summarizes certain information relating to our properties as of December 31, 2023: Average Average Annualized Base Annualized Base Occupancy as of Rental Revenue Rental Revenue Commercial Properties GLA 12/31/2023 (in thousands) (1) Per Sq. Ft.
The following table summarizes certain information relating to our properties as of December 31, 2024: Average Average Annualized Base Annualized Base Occupancy as of Rental Revenue Rental Revenue Commercial Properties GLA 12/31/2024 (in thousands) (1) Per Sq. Ft.
Source: Bureau of Labor Statistics 20 Table of Contents General Physical and Economic Attributes The following table sets forth certain information relating to each of our properties owned as of December 31, 2023.
Source: Bureau of Labor Statistics 20 Table of Contents General Physical and Economic Attributes The following table sets forth certain information relating to each of our properties owned as of December 31, 2024.
(2) As of December 31, 2023, we had five leases with the same tenant occupying space at properties located in Phoenix and Austin. The annualized rental revenue for the lease that commenced on April 1, 2014, and is scheduled to expire in 2034, was $1,047,000, which represents approximately 1.0% of our total annualized base rental revenue.
(2) As of December 31, 2024, we had five leases with the same tenant occupying space at properties located in Phoenix and Austin. The annualized rental revenue for the lease that commenced on April 1, 2014, and is scheduled to expire in 2034, was $1,099,000, which represents approximately 1.0% of our total annualized base rental revenue.
Excludes vacant space as of December 31, 2023. Because annualized base rental revenue is not derived from historical results that were accounted for in accordance with generally accepted accounting principles, historical results differ from the annualized amounts. Total abatements for leases in effect as of December 31, 2023 equaled approximately $361,000 for the month ended December 31, 2023.
Excludes vacant space as of December 31, 2024. Because annualized base rental revenue is not derived from historical results that were accounted for in accordance with generally accepted accounting principles, historical results differ from the annualized amounts. Total abatements for leases in effect as of December 31, 2024 equaled approximately $420,000 for the month ended December 31, 2024.
(2) Calculated as annualized base rent divided by gross leasable area leased as of December 31, 2023. Excludes vacant space as of December 31, 2023.
(2) Calculated as annualized base rent divided by gross leasable area leased as of December 31, 2024. Excludes vacant space as of December 31, 2024.
The annualized rental revenue for the lease that commenced on November 8, 2009, and is scheduled to expire in 2027, was $156,000, which represents approximately 0.1% of our total annualized base rental revenue. 24 Table of Contents Lease Expirations The following table lists, on an aggregate basis, all of our consolidated scheduled lease expirations over the next 10 years.
The annualized rental revenue for the lease that commenced on August 8, 2016, and is scheduled to expire in 2027, was $84,000, which represents approximately 0.1% of our total annualized base rental revenue. 24 Table of Contents Lease Expirations The following table lists, on an aggregate basis, all of our consolidated scheduled lease expirations over the next 10 years.
The annualized rental revenue for the lease that commenced on April 1, 2014, and is scheduled to expire in 2024, was $44,000, which represents less than 0.1% of our annualized base rental revenue.
The annualized rental revenue for the lease that commenced on April 1, 2014, and is scheduled to expire in 2029, was $46,000, which represents less than 0.1% of our annualized base rental revenue.
(2) Calculated as annualized base rent divided by GLA leased as of December 31, 2023. Excludes vacant space as of December 31, 2023. Our largest property, BLVD Place, a retail community purchased on May 26, 2017 and located in Houston, Texas, accounted for 10.5% of our total revenues for the year ended December 31, 2023.
(2) Calculated as annualized base rent divided by GLA leased as of December 31, 2024. Excludes vacant space as of December 31, 2024. Our largest property, BLVD Place, a retail community purchased on May 26, 2017 and located in Houston, Texas, accounted for 9.6% of our total revenues for the year ended December 31, 2024.
Item 2. Properties. General As of December 31, 2023, we wholly-owned 55 commercial properties, including 12 properties in Houston, nine properties in Dallas-Fort Worth, three properties in San Antonio, five properties in Austin, and 26 properties in the Scottsdale and Phoenix, Arizona metropolitan areas. Our tenants consist of national, regional and local businesses.
Item 2. Properties. General As of December 31, 2024, we wholly-owned 55 commercial properties, including 12 properties in Houston, nine properties in Dallas-Fort Worth, three properties in San Antonio, six properties in Austin, and 25 properties in the Scottsdale and Phoenix, Arizona metropolitan areas. Our tenants consist of national, regional and local businesses.
The annualized rental revenue for the lease that commenced on August 24, 1996, and is scheduled to expire in 2056, was $298,000, which represents approximately 0.3% of our total annualized rental revenue. (5) As of December 31, 2023, we had four leases with the same tenant occupying space at properties located in Phoenix and Houston.
The annualized rental revenue for the lease that commenced on August 24, 1996, and is scheduled to expire in 2056, was $298,000, which represents approximately 0.3% of our total annualized rental revenue. (6) As of December 31, 2024, we had five leases with the same tenant occupying space at properties in Houston and Phoenix.
Because annualized base rental revenue is not derived from historical results that were accounted for in accordance with Generally Accepted Accounting Principles ("GAAP"), historical results differ from the annualized amounts. Total abatements for leases in effect as of December 31, 2023 equaled approximately $361,000 for the month ended December 31, 2023.
Because annualized base rental revenue is not derived from historical results that were accounted for in accordance with Generally Accepted Accounting Principles (“GAAP”), historical results differ from the annualized amounts. Total abatements for leases in effect as of December 31, 2024 equaled approximately $420,000 for the month ended December 31, 2024.
Location of Properties Of our 55 wholly-owned properties, 12 are located in the greater Houston metropolitan statistical area. These properties represent 25% of our revenue for the year ended December 31, 2023.
Location of Properties Of our 55 wholly-owned properties, 12 are located in the greater Houston metropolitan statistical area. These properties represent 26% of our revenue for the year ended December 31, 2024.
The annualized rental revenue for the lease that commenced on October 19, 2016, and is scheduled to expire in 2025, was $425,000, which represents approximately 0.4% of our total annualized base rental revenue. 23 Table of Contents (3) As of December 31, 2023, we had two leases with the same tenant occupying space at properties located in Phoenix.
The annualized rental revenue for the lease that commenced on October 19, 2016, and is scheduled to expire in 2030, was $425,000, which represents approximately 0.4% of our total annualized base rental revenue. 23 Table of Contents (3) As of December 31, 2024, we had two leases with the same tenant occupying space at properties located in Houston and San Antonio.
Dec National (1) 3.5 % 3.8 % 3.8 % 3.8 % 3.7 % 3.7 % Houston (2) 4.8 % 4.9 % 4.4 % 4.1 % 3.8 % 3.8 % (P) Phoenix (2) 4.2 % 4.0 % 3.8 % 3.9 % 3.5 % 3.4 % (P) (1) Seasonally adjusted. (2) Not seasonally adjusted. (P) Represents preliminary estimates.
National (1) 4.2 % 4.2 % 4.1 % 4.1 % 4.2 % 4.1 % Houston (2) 4.9 % 4.7 % 4.4 % 4.5 % 4.5 % 4.1 % (P) Phoenix (2) 3.9 % 3.5 % 3.4 % 3.3 % 3.5 % 3.1 % (P) (1) Seasonally adjusted. (2) Not seasonally adjusted. (P) Represents preliminary estimates.
We also believe daily sales of basic items are less sensitive to fluctuations in the business cycle than higher priced retail items. Our largest tenant represented only 2.1% of our total revenues for the year ended December 31, 2023, and no single tenant exceeded 2.1%.
We also believe daily sales of basic items are less sensitive to fluctuations in the business cycle than higher priced retail items. Our largest tenant represented only 2.2% of our total revenues for the year ended December 31, 2024.
The annualized rental revenue for the lease that commenced on November 2, 1987, and is scheduled to expire in 2027, was $188,000, which represents approximately 0.2% of our total annualized base rental revenue.
The annualized rental revenue for the lease that commenced on November 8, 2009, and is scheduled to expire in 2027, was $156,000, which represents approximately 0.1% of our total annualized base rental revenue.
The annualized rental revenue for the lease that commenced on January 27, 2006, and is scheduled to expire in 2028, was $140,000, which represents approximately 0.1% of our total annualized base rental revenue.
The annualized rental revenue for the lease that commenced on July 1, 1997, and is scheduled to expire in 2028, was $59,000, which represents approximately 0.1% of our total annualized base rental revenue.
The annualized rental revenue for the lease that commenced on December 17, 2009, and is scheduled to expire in 2025, was $118,000, which represents approximately 0.1% of our total annualized base rental revenue.
The annualized rental revenue for the lease that commenced on July 8, 1999, and is scheduled to expire in 2025, was $96,000, which represents approximately 0.1% of our total annualized base rental revenue.
The annualized rental revenue for the lease that commenced on April 1, 2009, and is scheduled to expire in 2029, was $729,000, which represents approximately 0.7% of our total annualized base rental revenue (4) As of December 31, 2023, we had four leases with the same tenant occupying space at properties located in Phoenix and Houston.
The annualized rental revenue for the lease that commenced on April 5, 2024, and is scheduled to expire in 2035, was $139,000, which represents approximately 0.1% of our total annualized base rental revenue. (7) As of December 31, 2024, we had six leases with the same tenant occupying space at properties in Dallas and Phoenix.
BLVD also accounted for 15.9% of our real estate assets, net of accumulated depreciation, for the year ended December 31, 2023. As of December 31, 2023, approximately $136.7 million of our total debt of $640.5 million was secured by five of our properties with a combined net book value of $212.3 million.
BLVD also accounted for 15.8% of our real estate assets, net of accumulated depreciation, for the year ended December 31, 2024. As of December 31, 2024, approximately $136.3 million of our total debt of $632.5 million was secured by four of our properties with a combined net book value of $221.6 million.
The annualized rental revenue for the lease that commenced on February 1, 2004, and is scheduled to expire in 2024, was $38,000, which represents less than 0.1% of our total annualized base rental revenue.
The annualized rental revenue for the lease that commenced on April 8, 2022, and is scheduled to expire in 2029, was $28,000, which represents approximately less than 0.1% of our total annualized base rental revenue.
The annualized rental revenue for the lease that commenced on October 9, 2004, and is scheduled to expire in 2024, was $281,000, which represents approximately 0.3% of our total annualized base rental revenue.
The annualized rental revenue for the lease that commenced on November 29, 2022, and is scheduled to expire in 2039, was $971,000, which represents approximately 0.9% of our total annualized base rental revenue.
The annualized rental revenue for the lease that commenced on May 1, 2014, and is scheduled to expire in 2024, was $749,000, which represents approximately 0.7% of our total annualized rental revenue. (6) As of December 31, 2023, we had four leases with the same tenant occupying space at properties in Houston and Phoenix.
The annualized rental revenue for the lease that commenced on December 4, 2024, and is scheduled to expire in 2040, was $828,000, which represents approximately 0.8% of our total annualized base rental revenue (4) As of December 31, 2024, we had six leases with the same tenant occupying space at properties located in Phoenix.
The annualized rental revenue for the lease that commenced on August 16, 1994, and is scheduled to expire in 2038, was $24,000, which represents less than 0.1% of our total annualized base rental revenue.
The annualized rental revenue for the lease that commenced on August 8, 2018, and is scheduled to expire in 2028, was $115,000, which represents approximately 0.1% of our total annualized base rental revenue.
Dallas 483 0.5 % 12/15/2000 2027 Regus Corporation Houston 479 0.4 % 5/23/2014 2025 Capital Area Multispecialty Providers Austin 451 0.4 % 5/23/2014 2026 $ 15,477 14.4 % (1) Annualized Base Rental Revenues represents the monthly base rent as of December 31, 2023 for each applicable tenant multiplied by 12.
Dallas 483 0.4 % 12/15/2000 2027 Capital Area Multispecialty Providers Austin 458 0.4 % 5/23/2014 2026 Original Ninfas LP Houston 437 0.4 % 8/29/2018 2029 $ 15,722 14.2 % (1) Annualized Base Rental Revenues represents the monthly base rent as of December 31, 2024 for each applicable tenant multiplied by 12.
(2) Whitestone 4,995,190 94 % $ 106,974 $ 22.78 (1) Calculated as the tenant’s actual December 31, 2023 base rent (defined as cash base rents including abatements) multiplied by 12. Excludes vacant space as of December 31, 2023.
(2) Whitestone 4,863,562 94 % $ 109,869 $ 24.51 (1) Calculated as the tenant’s actual December 31, 2024 base rent (defined as cash base rents including abatements) multiplied by 12. Excludes vacant space as of December 31, 2024.
An additional 26 of our wholly-owned properties are located in the greater Phoenix metropolitan statistical area and represent 42% of our revenue for the year ended December 31, 2023. According to the United States Census Bureau, Houston and Phoenix ranked fifth and twelfth, respectively, in the largest United States metropolitan statistical areas as of December 31, 2023.
An additional 25 of our wholly-owned properties are located in the greater Phoenix metropolitan statistical area and represent 42% of our revenue for the year ended December 31, 2024.
(4) Houston and Phoenix 955 0.9 % 11/14/1982, 11/2/1987, 8/24/1996 and 11/3/1996 2027, 2027, 2056 and 2056 Verizon Wireless (5) Houston and Phoenix 952 0.9 % 8/16/1994, 2/1/2004, 1/27/2006 and 5/1/2014 2024, 2024, 2028 and 2038 Alamo Drafthouse Cinema Austin 740 0.7 % 2/1/2012 2031 Total Wine Houston 564 0.5 % 11/27/2018 2029 Dollar Tree (6) Houston and Phoenix 543 0.5 % 8/10/1999, 6/29/2001, 11/8/2009, and 12/17/2009 2025, 2025, 2026 and 2027 Paul's Ace Hardware Phoenix 490 0.5 % 3/1/2008 2033 Kroger Co.
(5) Houston and Phoenix 767 0.7 % 11/14/1982, 8/24/1996 and 11/3/1996 2027, 2056 and 2056 Alamo Drafthouse Cinema Austin 740 0.7 % 2/1/2012 2031 Dollar Tree (6) Houston and Phoenix 679 0.6 % 6/29/2001, 11/8/2009, 8/8/2018, 8/10/1999, and 04/05/2024 2026, 2027, 2028, 2030 and 2035 Total Wine Houston 564 0.5 % 11/27/2018 2029 Starbucks Corporation (7) Dallas and Phoenix 491 0.4 % 8/8/2016, 5/29/2003, 7/1/1997, 7/14/2004, 7/8/1999 and 10/15/2001 2027, 2028, 2028, 2029, 2025, 2034 Regus Corporation Houston 488 0.4 % 5/23/2014 2025 Kroger Co.
The following table sets forth information about the unemployment rate in Houston, Phoenix and nationally during the last six months of 2023. July Aug. Sept. Oct. Nov.
According to the preliminary report from the United States Census Bureau, Houston and Phoenix ranked fifth and eleventh, respectively, in the largest United States metropolitan statistical areas as of December 31, 2024. The following table sets forth information about the unemployment rate in Houston, Phoenix and nationally during the last six months of 2024. July Aug. Sept. Oct. Nov. Dec.
(2) Austin and Phoenix 2,214 2.1 % 5/8/1991, 7/1/2000, 4/1/2014, 4/1/2014 and 10/19/16 2024, 2025, 2025, 2026 and 2034 Frost Bank Houston 2,067 1.9 % 7/1/2014 2029 Newmark Real Estate of Houston LLC Houston 1,311 1.2 % 10/1/2015 2026 Bashas' Inc.
(2) Austin and Phoenix 2,268 2.1 % 5/8/1991, 4/1/2014, 7/1/2000, 10/19/2016 and 4/1/2014 2026, 2029, 2030, 2030 and 2034 Frost Bank Houston 1,961 1.8 % 7/1/2014 2029 Fitness Alliance, LLC (3) Houston and San Antonio 1,800 1.6 % 11/29/2022 and 12/04/2024 2039 and 2040 Newmark Real Estate of Houston LLC Houston 1,337 1.2 % 10/1/2015 2026 Soul Concepts, LLC (4) Phoenix 778 0.8 % 10/25/2011, 10/15/2018, 07/13/2020, 10/13/2021, 04/08/2022 and 06/23/2023 2030, 2030, 2026, 2028, 2029 and 2026 Walgreens & Co.
Annualized Base Rent GLA as of December 31, 2023 Number of Approximate Percent of Amount Percent of Year Leases Square Feet Total (in thousands) Total 2024 460 818,659 16.4 % $ 17,586,663 16.4 % 2025 231 821,892 16.5 % 16,906,175 15.8 % 2026 187 605,398 12.1 % 13,445,391 12.6 % 2027 172 601,031 12.0 % 14,308,142 13.4 % 2028 165 570,799 11.4 % 13,634,675 12.7 % 2029 79 444,024 8.9 % 9,715,921 9.1 % 2030 38 113,300 2.3 % 3,695,021 3.5 % 2031 31 140,975 2.8 % 3,959,087 3.7 % 2032 30 143,183 2.9 % 3,555,790 3.3 % 2033 22 135,856 2.7 % 2,860,072 2.7 % Total 1,415 4,395,117 88.0 % $ 99,666,937 93.2 % Insurance We believe that we have property and liability insurance with reputable, commercially rated companies.
Annualized Base Rent GLA as of December 31, 2024 Number of Approximate Percent of Amount Percent of Year Leases Square Feet Total (in thousands) Total 2025 463 750,523 15.4 % $ 17,715,094 16.1 % 2026 194 653,031 13.4 % 14,321,063 13.0 % 2027 202 649,649 13.4 % 16,031,485 14.6 % 2028 169 566,053 11.6 % 14,133,294 12.9 % 2029 160 628,572 12.9 % 15,261,505 13.9 % 2030 92 390,087 8.0 % 8,664,199 7.9 % 2031 34 150,952 3.1 % 4,333,676 3.9 % 2032 36 179,518 3.7 % 4,537,987 4.1 % 2033 20 103,729 2.1 % 2,521,401 2.3 % 2034 32 208,084 4.3 % 4,578,776 4.2 % Total 1,402 4,280,198 87.9 % $ 102,098,480 92.9 % Insurance We believe that we have property and liability insurance with reputable, commercially rated companies.
Removed
(3) Phoenix 1,010 0.9 % 10/9/2004 and 4/1/2009 2024 and 2029 Fitness Alliance, LLC Houston 971 0.9 % 11/29/2022 2039 Walgreens & Co.
Added
The annualized rental revenue for the lease that commenced on October 25, 2011, and is scheduled to expire in 2030, was $269,000, which represents approximately 0.2% of our total annualized base rental revenue.
Added
The annualized rental revenue for the lease that commenced on October 15, 2018, and is scheduled to expire in 2030, was $151,000, which represents approximately 0.1% of our total annualized base rental revenue.
Added
The annualized rental revenue for the lease that commenced on July 13, 2020, and is scheduled to expire in 2026, was $152,000, which represents approximately 0.1% of our total annualized base rental revenue.
Added
The annualized rental revenue for the lease that commenced on October 13, 2021, and is scheduled to expire in 2028, was $136,000, which represents approximately 0.1% of our total annualized base rental revenue.
Added
The annualized rental revenue for the lease that commenced on June 23, 2023, and is scheduled to expire in 2026, was $42,000, which represents less than 0.1% of our total annualized base rental revenue. (5) As of December 31, 2024, we had three leases with the same tenant occupying space at properties located in Phoenix and Houston.
Added
The annualized rental revenue for the lease that commenced on October 15, 2001, and is scheduled to expire in 2034, was $135,000, which represents approximately 0.1% of our total annualized base rental revenue.
Added
The annualized rental revenue for the lease that commenced on May 29, 2003, and is scheduled to expire in 2028, was $58,000, which represents approximately 0.1% of our total annualized base rental revenue.
Added
The annualized rental revenue for the lease that commenced on July 14, 2004, and is scheduled to expire in 2029, was $59,000, which represents approximately 0.1% of our total annualized base rental revenue.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

5 edited+0 added−0 removed3 unchanged
Biggest changeOn March 1, 2024, the closing price of our common shares reported on the NYSE was $12.22 per share. Our current quarterly distribution is $0.12 per share. On March 5, 2024, we announced an increase in our quarterly distribution to $0.12375 per share and OP unit, beginning with the April 2024 distribution.
Biggest changeOn March 11, 2025, the closing price of our common shares reported on the NYSE was $14.09 per share. Our current quarterly distribution is $0.12375 per share. On December 4, 2024, we announced an increase of our quarterly distribution to $0.135 per common share and OP unit, equal to a monthly distribution of $0.045, beginning with the January 2025 distribution.
The graph assumes that the value of the investment in our common shares and in the S&P 500 Index, the FTSE NAREIT Equity REITs Index and the FTSE NAREIT Equity Shopping Centers Index was $100 at December 31, 2018, and all dividends were reinvested.
The graph assumes that the value of the investment in our common shares and in the S&P 500 Index, the FTSE NAREIT Equity REITs Index and the FTSE NAREIT Equity Shopping Centers Index was $100 at December 31, 2019, and all dividends were reinvested.
Performance Graph The following graph compares the total shareholder returns of the Company's common shares to the Standard & Poor's 500 Index (“S&P 500 Index”), the Financial Times Stock Exchange (“FTSE”) National Association of Real Estate Investment Trusts (“NAREIT”) Equity REITs Index (“FTSE NAREIT Equity REITs Index”), and to the FTSE NAREIT Equity Shopping Centers Index from December 31, 2018 to December 31, 2023.
Performance Graph The following graph compares the total shareholder returns of the Company's common shares to the Standard & Poor's 500 Index (“S&P 500 Index”), the Financial Times Stock Exchange (“FTSE”) National Association of Real Estate Investment Trusts (“NAREIT”) Equity REITs Index (“FTSE NAREIT Equity REITs Index”), and to the FTSE NAREIT Equity Shopping Centers Index from December 31, 2019 to December 31, 2024.
The closing price of our common shares on December 31, 2018 (on which the graph is based) was $12.26. The past shareholder return shown on the following graph is not necessarily indicative of future performance.
The closing price of our common shares on December 31, 2019 (on which the graph is based) was $13.62. The past shareholder return shown on the following graph is not necessarily indicative of future performance.
Item 5. Market for Registrant ’ s Common Equity, Related Shareholder Matters and Issuer Purchases of Equity Securities. Market Information Common Shares Our common shares are traded on the NYSE under the ticker symbol “WSR.” As of March 1, 2024, we had 49,958,381 common shares of beneficial interest outstanding held by a total of 762 shareholders of record.
Item 5. Market for Registrant ’ s Common Equity, Related Shareholder Matters and Issuer Purchases of Equity Securities. Market Information Common Shares Our common shares are traded on the NYSE under the ticker symbol “WSR.” As of March 11, 2025, we had 50,894,945 common shares of beneficial interest outstanding held by a total of 709 shareholders of record.

Item 7. Management's Discussion & Analysis

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

102 edited+41 added−22 removed103 unchanged
Biggest changeThe decrease of $1,715,000 was primarily the result of the following: Sources of Cash • Net proceeds from sale of properties of $19,847,000 for the year ended December 31, 2023 compared to $33,723,000 for the year ended December 31, 2022; • Cash flow from operations of $47,600,000 for the year ended December 31, 2023 compared to cash flow from operations of $44,431,000 for the year ended December 31, 2022; Uses of Cash • Acquisition of real estate of $25,474,000 compared to $16,992,000; • Acquisition of ground lease of $0 compared to $9,786,000; • Additions to real estate of $17,055,000 compared to $13,659,000; • Escrowed loan repayment on behalf of real estate partnership of $13,633,000 compared to $0. • Payment of dividends and distributions to common shareholders and OP unit holders of $24,016,000 compared to $23,304,000; • Payments of notes payable of $30,945,000 compared to $3,468,000; • Repurchase of common shares of $525,000 compared to $537,000; • Net (proceeds from) payment of credit facility of ($42,500,000) compared to $16,000,000; • Payment of loan originations cost of $0 compared to $3,632,000; • Payment of exchange offering cost of $0 compared to $335,000; and • Payment of finance lease liability of $14,000 compared to $0; We place all cash in short-term, highly liquid investments that we believe provide appropriate safety of principal. 32 Table of Contents Debt Debt consisted of the following as of the dates indicated (in thousands): Description December 31, 2023 December 31, 2022 Fixed rate notes $265.0 million, 3.18% plus 1.45% to 2.10% Note, due January 31, 2028 (1) $ 265,000 $ 265,000 $80.0 million, 3.72% Note, due June 1, 2027 80,000 80,000 $19.0 million 4.15% Note, due December 1, 2024 17,658 18,016 $20.2 million 4.28% Note, due June 6, 2023 — 17,375 $14.0 million 4.34% Note, due September 11, 2024 12,427 12,709 $14.3 million 4.34% Note, due September 11, 2024 13,257 13,520 $15.1 million 4.99% Note, due January 6, 2024 13,350 13,635 $2.6 million 5.46% Note, due October 1, 2023 — 2,236 $50.0 million, 5.09% Note, due March 22, 2029 42,857 50,000 $50.0 million, 5.17% Note, due March 22, 2029 50,000 50,000 $50.0 million, 3.71% plus 1.50% to 2.10% Note, due September 16, 2026 (2) 50,000 — Floating rate notes Unsecured line of credit, SOFR plus 1.50% to 2.10%, due September 16, 2026 96,000 103,500 Total notes payable principal 640,549 625,991 Less deferred financing costs, net of accumulated amortization (377 ) (564 ) Total notes payable $ 640,172 $ 625,427 (1) Promissory note includes an interest rate swap that fixed the SOFR portion of the term loan at an interest rate of 2.16% through October 28, 2022, 2.76% from October 29, 2022 through January 31, 2024, and 3.32% beginning February 1, 2024 through January 31, 2028.
Biggest changeWe place all cash in short-term, highly liquid investments that we believe provide appropriate safety of principal. 32 Table of Contents Debt Debt consisted of the following as of the dates indicated (in thousands): Description December 31, 2024 December 31, 2023 Fixed rate notes $265.0 million, 3.18% plus 1.45% to 2.10% Note, due January 31, 2028 (1) $ 265,000 $ 265,000 $20.0 million, 3.67% plus 1.50% Note, due January 31, 2028 (3) 20,000 — $80.0 million, 3.72% Note, due June 1, 2027 80,000 80,000 $19.0 million, 4.15% Note, due December 1, 2024 — 17,658 $14.0 million, 4.34% Note, due September 11, 2024 — 12,427 $14.3 million, 4.34% Note, due September 11, 2024 — 13,257 $15.1 million, 4.99% Note, due January 6, 2024 — 13,350 $50.0 million, 5.09% Note, due March 22, 2029 (Series A) 35,714 42,857 $50.0 million, 5.17% Note, due March 22, 2029 (Series B) 50,000 50,000 $2.5 million, 7.79% Note, due February 28, 2025 429 — $50.0 million, 3.71% plus 1.50% to 2.10% Note, due September 16, 2026 (2) 50,000 50,000 $56.3 million, 6.23% Note, due July 31, 2031 56,340 — Floating rate notes Unsecured line of credit, SOFR plus 1.50% to 2.10%, due September 16, 2026 75,000 96,000 Total notes payable principal 632,483 640,549 Less deferred financing costs, net of accumulated amortization (965 ) (377 ) Total notes payable $ 631,518 $ 640,172 (1) Promissory note includes an interest rate swap that fixed the SOFR portion of the term loan at an interest rate of 2.16% through October 28, 2022, 2.76% from October 29, 2022 through January 31, 2024, and 3.32% beginning February 1, 2024 through January 31, 2028.
Those needs may include specialty retail, grocery and restaurants as well as medical, educational and financial services. Our goal is for each property to become a Whitestone-branded business center or retail community that serves a neighboring five-mile radius around our property. Property Acquisitions.
Those needs may include specialty retail, grocery and restaurants as well as medical, educational and financial services. Our goal is for each property to become a Whitestone-branded business center or retail community that serves a neighboring five-mile radius around each property. Property Acquisitions.
In addition, many of our leases are for terms of less than five years, which allows us to adjust rental rates to reflect inflation and other changing market conditions when the leases expire. Consequently, increases due to inflation, as well as ad valorem tax rate increases, generally do not have a significant adverse effect upon our operating results.
In addition, many of our leases are for terms of less than five years, which allows us to adjust rental rates to reflect inflation and other changing market conditions when the leases expire. Consequently, increases due to inflation, as well as ad valorem tax rate increases, generally do not currently have a significant adverse effect upon our operating results.
The impact of a 1% increase or decrease in interest rates on our non-hedged variable rate debt would result in a decrease or increase of annual net income of approximately $1.0 million, respectively. Refer to “ Item 1A - Risk Factors ” in this Annual Report on Form 10-K for additional information.
The impact of a 1% increase or decrease in interest rates on our non-hedged variable rate debt would result in a decrease or increase of annual net income of approximately $0.8 million, respectively. Refer to “ Item 1A - Risk Factors ” in this Annual Report on Form 10-K for additional information.
Market conditions, including new supply of properties, and macroeconomic conditions in our markets and nationally affecting tenant income, such as employment levels, business conditions, interest rates, tax rates, fuel and energy costs and other matters, could adversely impact our renewal rate and/or the rental rates we are able to negotiate.
Market conditions, including new supply of properties and competition, and macroeconomic conditions in our markets and nationally affecting tenant income, such as employment levels, business conditions, interest rates, tax rates, fuel and energy costs and other matters, could adversely impact our renewal rate and/or the rental rates we are able to negotiate.
As discussed in Note 2 to the accompanying consolidated financial statements, pursuant to the terms of our $15.1 million 4.99% Note, due January 6, 2024 (see Note 8 to the accompanying consolidated financial statements), which is collateralized by our Anthem Marketplace property, we were required by the lenders thereunder to establish a cash management account controlled by the lenders to collect all amounts generated by our Anthem Marketplace property in order to collateralize such promissory note.
As discussed in Note 2 to the accompanying consolidated financial statements, pursuant to the terms of our $15.1 million 4.99% Note, due January 6, 2024 (see Note 8 to the accompanying consolidated financial statements), which was collateralized by our Anthem Marketplace property, we were required by the lenders thereunder to establish a cash management account controlled by the lenders to collect all amounts generated by our Anthem Marketplace property in order to collateralize such promissory note.
Liquidity and Capital Resources Our short-term liquidity requirements consist primarily of distributions to holders of our common shares and OP units, including those required to maintain our REIT status and satisfy our current quarterly distribution target of $0.12 per share and OP unit, recurring expenditures, such as repairs and maintenance of our properties, non-recurring expenditures, such as capital improvements and tenant improvements, debt service requirements, and, potentially, acquisitions of additional properties.
Liquidity and Capital Resources Our short-term liquidity requirements consist primarily of distributions to holders of our common shares and OP units, including those required to maintain our REIT status and satisfy our current quarterly distribution target of $0.135 per share and OP unit, recurring expenditures, such as repairs and maintenance of our properties, non-recurring expenditures, such as capital improvements and tenant improvements, debt service requirements, and, potentially, acquisitions of additional properties.
Our cash flow hedges are determined using Level 2 inputs under ASC 820. Level 2 inputs represent quoted prices in active markets for similar assets or liabilities; quoted prices in markets that are not active; and model-derived valuations whose inputs are observable. As of December 31, 2023, we consider our cash flow hedges to be highly effective. Recent Accounting Pronouncements.
Our cash flow hedges are determined using Level 2 inputs under ASC 820. Level 2 inputs represent quoted prices in active markets for similar assets or liabilities; quoted prices in markets that are not active; and model-derived valuations whose inputs are observable. As of December 31, 2024, we consider our cash flow hedges to be highly effective. Recent Accounting Pronouncements.
Our loans contain restrictions that would require the payment of prepayment penalties for the acceleration of outstanding debt and are secured by deeds of trust on certain of our properties and by assignment of the rents and leases associated with those properties. As of December 31, 2023, we were in compliance with all loan covenants.
Our loans contain restrictions that would require the payment of prepayment penalties for the acceleration of outstanding debt and are secured by deeds of trust on certain of our properties and by assignment of the rents and leases associated with those properties. As of December 31, 2024, we were in compliance with all loan covenants.
If impairment is indicated, a loss will be recorded for the amount by which the carrying value of the property exceeds its fair value. Management has determined that there has been no impairment in the carrying value of our real estate assets as of December 31, 2023. Accrued Rents and Accounts Receivable.
If impairment is indicated, a loss will be recorded for the amount by which the carrying value of the property exceeds its fair value. Management has determined that there has been no impairment in the carrying value of our real estate assets as of December 31, 2024. Accrued Rents and Accounts Receivable.
Although the Texas Margin Tax is not an income tax, Financial Accounting Standards Board (“FASB”) ASC 740, “ Income Taxes ” (“ASC 740”) applies to the Texas Margin Tax. As of December 31, 2023, 2022 and 2021, we recorded a margin tax provision of $0.5 million, $0.4 million and $0.4 million, respectively. Fair Value of Financial Instruments.
Although the Texas Margin Tax is not an income tax, Financial Accounting Standards Board (“FASB”) ASC 740, “ Income Taxes ” (“ASC 740”) applies to the Texas Margin Tax. As of December 31, 2024, 2023 and 2022, we recorded a margin tax provision of $0.5 million, $0.5 million and $0.4 million, respectively. Fair Value of Financial Instruments.
Although management is not aware of any factors that would significantly affect the fair value amounts, such amounts have not been comprehensively revalued for purposes of these financial statements since December 31, 2023, and current estimates of fair value may differ significantly from the amounts presented herein. Derivative Instruments and Hedging Activities.
Although management is not aware of any factors that would significantly affect the fair value amounts, such amounts have not been comprehensively revalued for purposes of these financial statements since December 31, 2024, and current estimates of fair value may differ significantly from the amounts presented herein. Derivative Instruments and Hedging Activities.
(3) We define “Same Stores” as properties that have been owned during the entire period being compared. For purposes of comparing the twelve months ended December 31, 2023 to the twelve months ended December 31, 2022, Same Stores include properties owned before January 1, 2022 and not sold before December 31, 2023.
(3) We define “Same Stores” as properties that have been owned during the entire period being compared. For purposes of comparing the twelve months ended December 31, 2024 to the twelve months ended December 31, 2023, Same Stores include properties owned before January 1, 2023 and not sold before December 31, 2024.
Base Rate means, for any day, the higher of: (a) the Administrative Agent’s prime commercial rate, (b) the sum of (i) the rate per annum equal to the weighted average of the rates on overnight federal funds transactions with members of the Federal Reserve System, as published by the Federal Reserve Bank of New York for such day, plus (ii) 0.50%, or (c) the sum of (i) Adjusted Term SOFR for a one-month tenor in effect on such day plus (ii) 1.10%.
“Base Rate” means, for any day, the higher of: (a) the Administrative Agent’s prime commercial rate, (b) the sum of (i) the rate per annum equal to the weighted average of the rates on overnight federal funds transactions with members of the Federal Reserve System, as published by the Federal Reserve Bank of New York for such day, plus (ii) 0.50%, or (c) the sum of (i) Adjusted Term SOFR for a one-month tenor in effect on such day plus (ii) 1.10%.
Straight line rent adjustments, above/below market rents, and lease termination fees are excluded. 46 Table of Contents Year Ended December 31, 2022 Compared to Year Ended December 31, 2021 For a discussion and comparison of the results of our operations for the year ended December 31, 2022 with the year ended December 31, 2021, refer to “Management's Discussion and Analysis of Financial Conditions and Results of Operations” in our Form 10-K for the year ended December 31, 2022 filed with the SEC on March 8, 2023. 47 Table of Contents Reconciliation of Non-GAAP Financial Measures Funds From Operations (NAREIT) ( “ FFO ” ) and Core FFO The National Association of Real Estate Investment Trusts (“NAREIT”) defines FFO as net income (loss) available to common shareholders computed in accordance with GAAP, excluding depreciation and amortization related to real estate, gains or losses from the sale of certain real estate assets, gains and losses from change in control, and impairment write-downs of certain real estate assets and investments in entities when the impairment is directly attributable to decreases in the value of depreciable real estate held by the entity.
Straight line rent adjustments, above/below market rents, and lease termination fees are excluded. 47 Table of Contents Year Ended December 31, 2023 Compared to Year Ended December 31, 2022 For a discussion and comparison of the results of our operations for the year ended December 31, 2023 with the year ended December 31, 2022, refer to “Management's Discussion and Analysis of Financial Conditions and Results of Operations” in our Form 10-K for the year ended December 31, 2023 filed with the SEC on March 13, 2024. 48 Table of Contents Reconciliation of Non-GAAP Financial Measures Funds From Operations (NAREIT) ( “ FFO ” ) and Core FFO The National Association of Real Estate Investment Trusts (“NAREIT”) defines FFO as net income (loss) available to common shareholders computed in accordance with GAAP, excluding depreciation and amortization related to real estate, gains or losses from the sale of certain real estate assets, gains and losses from change in control, and impairment write-downs of certain real estate assets and investments in entities when the impairment is directly attributable to decreases in the value of depreciable real estate held by the entity.
The following is a summary of the Company’s leasing activity for the year ended December 31, 2023: Number of Leases Signed GLA Signed Weighted Average Lease Term (2) TI and Incentives per Sq. Ft. (3) Contractual Rent Per Sq. Ft. (4) Prior Contractual Rent Per Sq. Ft.
The following is a summary of the Company’s leasing activity for the year ended December 31, 2024: Number of Leases Signed GLA Signed Weighted Average Lease Term (2) TI and Incentives per Sq. Ft. (3) Contractual Rent Per Sq. Ft. (4) Prior Contractual Rent Per Sq. Ft.
We recorded a gain on sale of $5.0 million. On November 30, 2022, we completed the sale of Pima Norte, located in Carefree, Arizona, for $3.3 million. We recorded a loss on sale of $4.0 million. On November 21, 2022, we completed the sale of Spoerlein Commons Pad, located in Buffalo Grove, Illinois, for $2.2 million.
On November 30, 2022, we completed the sale of Pima Norte, located in Carefree, Arizona, for $3.3 million. We recorded a loss on sale of $4.0 million. On November 21, 2022, we completed the sale of Spoerlein Commons Pad, located in Buffalo Grove, Illinois, for $2.2 million. We recorded a gain on sale of $0.7 million.
We recorded a gain on sale of $0.7 million. On November 16, 2022, we completed the sale of Desert Canyon, located in Scottsdale, Arizona, for $9.3 million. We recorded a gain on sale of $5.1 million. On November 14, 2022, we completed the sale of Gilbert Tuscany Village Hard Corner, located in Scottsdale, Arizona, for $2.5 million.
On November 16, 2022, we completed the sale of Desert Canyon, located in Scottsdale, Arizona, for $9.3 million. We recorded a gain on sale of $5.1 million. On November 14, 2022, we completed the sale of Gilbert Tuscany Village Hard Corner, located in Scottsdale, Arizona, for $2.5 million. We recorded a gain on sale of $0.8 million.
We recorded a gain on sale of $0.8 million. On November 10, 2022, we completed the sale of South Richey, located in Houston, Texas, for $13.1 million. We recorded a gain on sale of $9.9 million. On October 31, 2022, we completed the sale of Bissonnet Beltway Plaza, located in Houston, Texas, for $5.4 million.
On November 10, 2022, we completed the sale of South Richey, located in Houston, Texas, for $13.1 million. We recorded a gain on sale of $9.9 million. On October 31, 2022, we completed the sale of Bissonnet Beltway Plaza, located in Houston, Texas, for $5.4 million. We recorded a gain on sale of $4.4 million.
For purposes of comparing the twelve months ended December 31, 2023 to the twelve months ended December 31, 2022, Non-Same Stores include properties acquired between January 1, 2022 and December 31, 2023 and properties sold between January 1, 2022 and December 31, 2023, but not included in discontinued operations.
For purposes of comparing the twelve months ended December 31, 2024 to the twelve months ended December 31, 2023, Non-Same Stores include properties acquired between January 1, 2023 and December 31, 2024 and properties sold between January 1, 2023 and December 31, 2024, but not included in discontinued operations.
As of December 31, 2023, subject to any potential future paydowns or increases in the borrowing base, we have $104.0 million remaining availability under the revolving credit facility. 30 Table of Contents Our ability to access the capital markets will be dependent on a number of factors as well, including general market conditions for REITs and market perceptions about our Company.
As of December 31, 2024, subject to any potential future paydowns or increases in the borrowing base, we have $125.0 million remaining availability under the revolving credit facility. 30 Table of Contents Our ability to access the capital markets will be dependent on a number of factors as well, including general market conditions for REITs and market perceptions about our Company.
We recorded a loss on sale of $0.7 million. On June 30, 2023, we completed the sale of Westchase, located in Houston, Texas, for $7.8 million. We recorded a gain on sale of $4.6 million. On June 30, 2023, we completed the sale of Sunridge, located in Houston, Texas, for $6.7 million.
On June 30, 2023, we completed the sale of Westchase, located in Houston, Texas, for $7.8 million. We recorded a gain on sale of $4.6 million. On June 30, 2023, we completed the sale of Sunridge, located in Houston, Texas, for $6.7 million. We recorded a gain on sale of $5.0 million.
Actual sales will depend on a variety of factors determined by us from time to time, including (among others) market conditions, the trading price of our common shares, capital needs and our determinations of the appropriate sources of funding for us, and will be made in transactions that will be deemed to be “at-the-market” offerings as defined in Rule 415 under the Securities Act.
Actual sales will depend on a variety of factors determined by us from time to time, including (among others) market conditions, the trading price of our common shares, capital needs and our determinations of the appropriate sources of funding for us, and will be made in transactions that will be deemed to be “at-the-market” offerings as defined in Rule 415 under the Securities Act of 1933, as amended (the “Securities Act”).
See Note 4 to the accompanying consolidated financial statements for information related to our guarantees of our real estate partnership’s debt as of December 31, 2023 and 2022.
See Note 4 to the accompanying consolidated financial statements for information related to our guarantees of our real estate partnership’s debt as of December 31, 2024 and 2023.
For purposes of comparing the year ended December 31, 2023 to the year ended December 31, 2022, Same Stores include properties owned during the entire period from January 1, 2022 to December 31, 2023.
For purposes of comparing the year ended December 31, 2024 to the year ended December 31, 2023, Same Stores include properties owned during the entire period from January 1, 2023 to December 31, 2024.
Because Pillarstone OP financial statements as of December 31, 2023 and 2022 have not been made available to us, we have estimated depreciation and amortization, loss (gain) on sale or disposal of properties or assets of real estate partnership, and default interest on debt of real estate partnership based on the information available to us at the time of this report.
Because Pillarstone OP financial statements as of and for the years ended December 31, 2024, 2023 and 2022 have not been made available to us, we have estimated depreciation and amortization, loss (gain) on sale or disposal of properties or assets of real estate partnership, and default interest on debt of real estate partnership based on the information available to us at the time of this report.
As of December 31, 2023, we had an aggregate of 1,453 tenants. We have a diversified tenant base with our largest tenant comprising only 2.1% of our total revenues for the year ended December 31, 2023. Lease terms for our properties range from less than one year for smaller tenants to more than 15 years for larger tenants.
As of December 31, 2024, we had an aggregate of 1,445 tenants. We have a diversified tenant base with our largest tenant comprising only 2.2% of our total revenues for the year ended December 31, 2024. Lease terms for our properties range from less than one year for smaller tenants to more than 15 years for larger tenants.
Please refer to Note 4 (Investment in Real Estate Partnership) to the accompanying consolidated financial statements for more information regarding our investment in Pillarstone OP. 44 Table of Contents Same Store net operating income.
Please refer to Note 4 (Investment in Real Estate Partnership) to the accompanying consolidated financial statements for more information regarding our former investment in Pillarstone OP. 45 Table of Contents Same Store net operating income.
Our acquisition targets are properties that fit our Community Centered Properties® strategy, primarily in and around Phoenix, Dallas-Fort Worth, San Antonio and Houston. We may acquire properties in other high growth cities in the future.
Our acquisition targets are properties that fit our Community Centered Properties® strategy, primarily in and around Phoenix, Dallas-Fort Worth, San Antonio and Houston. We may acquire properties in other high growth metropolitan areas in the future.
(3) For an explanation and reconciliation of property net operating income, a non-GAAP metric, to net income, see “Property Net Operating Income” below. 41 Table of Contents We define “Same Stores” as properties that have been owned for the entire period being compared.
(2) For an explanation and reconciliation of property net operating income, a non-GAAP metric, to net income, see “Property Net Operating Income” below. 42 Table of Contents We define “Same Stores” as properties that have been owned for the entire period being compared.
In addition, the 2022 Facility contains certain financial covenants including the following: • maximum total indebtedness to total asset value ratio of 0.60 to 1.00; • maximum secured debt to total asset value ratio of 0.40 to 1.00; • minimum EBITDA (earnings before interest, taxes, depreciation, amortization or extraordinary items) to fixed charges ratio of 1.50 to 1.00; • maximum other recourse debt to total asset value ratio of 0.15 to 1.00; and • maintenance of a minimum tangible net worth (adjusted for accumulated depreciation and amortization) of $449 million plus 75% of the net proceeds from additional equity offerings (as defined therein).
In addition, the 2022 Facility contains certain financial covenants including the following: • maximum total indebtedness to total asset value ratio of 0.60 to 1.00; • maximum secured debt to total asset value ratio of 0.40 to 1.00; • minimum EBITDA (earnings before interest, taxes, depreciation, amortization or extraordinary items) to fixed charges ratio of 1.50 to 1.00; • maximum other recourse debt to total asset value ratio of 0.15 to 1.00; • maintenance of a minimum tangible net worth (adjusted for accumulated depreciation and amortization) of $449 million plus 75% of the net proceeds from additional equity offerings (as defined therein); • minimum adjusted property net operating income to implied unencumbered debt service of 1.50 to 1.00; and • maximum unsecured indebtedness to unencumbered asset pool value ratio of 0.60 to 1.00.
Because Pillarstone OP financial statements as of December 31, 2023 and 2022 have not been made available to us, we have estimated (equity) deficit in earnings and pro rata share of NOI of real estate partnership based on the information available to us at the time of this report.
Because Pillarstone OP financial statements as of and for the years ended December 31, 2024, 2023 and 2022 have not been made available to us, we have estimated deficit in earnings and pro rata share of NOI of real estate partnership based on the information available to us at the time of this report.
Because Pillarstone OP financial statements as of December 31, 2023 and 2022 have not been made available to us, we have estimated equity in earnings and pro rata share of NOI of real estate partnership based on the information available to us at the time of this report.
Because Pillarstone OP financial statements as of and for the years ended December 31, 2024 and 2023 have not been made available to us, we have estimated equity in earnings and pro rata share of NOI of real estate partnership based on the information available to us at the time of this report.
On May 20, 2022, our universal shelf registration statement on Form S-3 was declared effective by the SEC, which registers the issuance and sale by us of up to $500 million in securities from time to time, including common shares, preferred shares, debt securities, depositary shares and subscription rights.
On May 20, 2022, our universal shelf registration statement on Form S-3 (File No. 333-264881) was declared effective by the SEC (the “Registration Statement”), which registers the issuance and sale by us of up to $500 million in securities from time to time, including common shares, preferred shares, debt securities, depositary shares and subscription rights.
As of December 31, 2023, subject to any potential future paydowns or increases in the borrowing base, we have $104.0 million remaining availability under the 2022 Revolver.
As of December 31, 2024, subject to any potential future paydowns or increases in the borrowing base, we have $125.0 million remaining availability under the 2022 Revolver.
As of December 31, 2023 and 2022, we had an allowance for uncollectible accounts of $13.6 million and $13.8 million, respectively. For the years ending December 31, 2023, 2022 and 2021, we recorded an adjustment to rental revenue in the amount of $1.0 million, $1.2 million and $(0.1) million, respectively.
As of December 31, 2024 and 2023, we had an allowance for uncollectible accounts of $14.7 million and $13.6 million, respectively. For the years ending December 31, 2024, 2023 and 2022, we recorded an adjustment to rental revenue in the amount of $1.0 million, $1.0 million and $1.2 million, respectively.
If an event of default occurs and is continuing under the 2022 Facility, the lenders may, among other things, terminate their commitments under the 2022 Facility and require the immediate payment of all amounts owed thereunder. 35 Table of Contents As of December 31, 2023, our $136.7 million in secured debt was collateralized by five properties with a carrying value of $212.3 million.
If an event of default occurs and is continuing under the 2022 Facility, the lenders may, among other things, terminate their commitments under the 2022 Facility and require the immediate payment of all amounts owed thereunder. 35 Table of Contents As of December 31, 2024, our $136.3 million in secured debt was collateralized by four properties with a carrying value of $221.6 million.
Included in our adjustments to rental revenue for the years ending December 31, 2023 and 2022, were bad debt adjustments of $0.3 million and $0.6 million, respectively, and a straight-line rent reserve adjustments of $(0.002) million and $0.3 million, respectively, related to credit loss for the conversion of 20 and 80 tenants, respectively, to cash basis revenue as a result of collectability analysis.
Included in our adjustments to rental revenue for the years ending December 31, 2024 and 2023, were bad debt adjustments of $0.2 million and $0.3 million, respectively, and a straight-line rent reserve adjustments of $0.05 million and $(0.002) million, respectively, related to credit loss for the conversion of 11 and 20 tenants, respectively, to cash basis revenue as a result of collectability analysis.
As of December 31, 2023, $411.0 million was drawn on the 2022 Facility and our unused borrowing capacity was $104.0 million, assuming that we use the proceeds of the 2022 Facility to acquire properties, or to repay debt on properties, that are eligible to be included in the unsecured borrowing base.
As of December 31, 2024, $410.0 million was drawn on the 2022 Facility and our unused borrowing capacity was $125.0 million, assuming that we use the proceeds of the 2022 Facility to acquire properties, or to repay debt on properties, that are eligible to be included in the unsecured borrowing base.
The capitalization of such costs ceases when the property, or any completed portion, becomes available for occupancy. For the year ended December 31, 2023, approximately $ 552,000 and $ 262,000 in interest expense and real estate taxes, respectively, were capitalized.
The capitalization of such costs ceases when the property, or any completed portion, becomes available for occupancy. For the year ended December 31, 2024, approximately $ 564,000 and $ 182,000 in interest expense and real estate taxes, respectively, were capitalized.
On June 12, 2023, we acquired Arcadia Towne Center, a property that meets our Community Centered Property® strategy, for $25.5 million in cash and net prorations. Arcadia Towne Center, a 69,503 square foot property, was 100% leased at the time of purchase and is located in Phoenix, Arizona.
On June 12, 2023, we acquired Arcadia Towne Center, a property that meets our Community Centered Property® strategy, for $25.5 million in cash and net prorations. Arcadia Towne Center, a 69,503 square foot property, was 100% leased at the time of purchase and is located in Phoenix, Arizona. The funding for this acquisition was provided by the Company’s credit facility.
The information in the table above reflects our projected obligations for our unsecured credit facility based on our December 31, 2023 balance of $411.0 million.
The information in the table above reflects our projected obligations for our unsecured credit facility based on our December 31, 2024 balance of $410.0 million.
As of December 31, 2023, the interest rate on the 2022 Revolver was 7.05%. Based on our current leverage ratio, the revolver has initial interest rate of SOFR plus 1.60% and a 10 basis point credit spread adjustment. In addition, we entered into interest rate swaps to fix the interest rates on the Term Loan.
As of December 31, 2024, the interest rate on the 2022 Revolver was 6.12%. Based on our current leverage ratio, the revolver has initial interest rate of SOFR plus 1.45% and a 10 basis point credit spread adjustment. In addition, we entered into interest rate swaps to fix the interest rates on the Term Loan.
The variable interest rate payments are based on SOFR plus 1.60% and a 10 basis point spread adjustment which reflects our new interest rates under our 2022 Facility. The information in the table above reflects our projected interest rate obligations for the floating rate payments based on one-month SOFR as of December 31, 2023, of 5.40%.
The variable interest rate payments are based on SOFR plus 1.45% and a 10 basis point spread adjustment which reflects our new interest rates under our 2022 Facility. The information in the table above reflects our projected interest rate obligations for the floating rate payments based on one-month SOFR as of December 31, 2024, of 4.49%.
How We Derive Our Revenue Substantially all of our revenue is derived from rents received from leases at our properties. We had total revenues of approximately $ 146,969,000 for the year ended December 31, 2023 as compared to $ 139,421,000 for the year ended December 31, 2022, an increase of $ 7,548,000, or 5%.
How We Derive Our Revenue Substantially all of our revenue is derived from rents received from leases at our properties. We had total revenues of approximately $ 154,282,000 for the year ended December 31, 2024 as compared to $ 146,969,000 for the year ended December 31, 2023, an increase of $ 7,313,000, or 5%.
Scheduled Lease Expirations We tend to lease space to smaller businesses that desire shorter term leases. As of December 31, 2023, approximately 33% of our GLA was subject to leases that expire prior to December 31, 2025. Over the last three years, we have renewed expiring leases with respect to approximately 68% of our GLA.
Scheduled Lease Expirations We tend to lease space to smaller businesses that desire shorter term leases. As of December 31, 2024, approximately 29% of our GLA was subject to leases that expire prior to December 31, 2026. Over the last three years, we have renewed expiring leases with respect to approximately 69% of our GLA.
As of December 31, 2023, we wholly-owned 55 commercial properties consisting of: Consolidated Operating Portfolio • 50 properties that meet our Community Centered Properties® strategy; and containing approximately 5.0 million square feet of GLA and having a total carrying amount (net of accumulated depreciation) of $970.3 million; and Redevelopment, New Acquisitions Portfolio • five parcels of land held for future development that meet our Community Centered Properties® strategy having a total carrying amount of $21.4 million.
As of December 31, 2024, we wholly-owned 55 commercial properties consisting of: Consolidated Operating Portfolio • 50 properties that meet our Community Centered Properties® strategy; and containing approximately 4.9 million square feet of GLA and having a total carrying amount (net of accumulated depreciation) of $978.9 million; and Redevelopment, New Acquisitions Portfolio • five parcels of land held for future development that meet our Community Centered Properties® strategy having a total carrying amount of $22.8 million.
However, NOI should not be viewed as a measure of our overall financial performance since it does not reflect general and administrative expenses, depreciation and amortization, interest expense, interest income, provision for income taxes and gain or loss on sale or disposition of assets, the level of capital expenditures and leasing costs necessary to maintain the operating performance of our properties. 49 Table of Contents Below is the calculation of NOI and the reconciliation to net income, which we believe is the most comparable GAAP financial measure (in thousands): Year Ended December 31, PROPERTY NET OPERATING INCOME (“NOI”) 2023 2022 2021 Net income attributable to Whitestone REIT $ 19,180 $ 35,270 $ 12,048 General and administrative expenses 20,653 18,066 22,625 Depreciation and amortization 32,966 31,707 28,950 (Equity) deficit in earnings of real estate partnership (1) 3,155 (239 ) (609 ) Interest expense 32,866 27,193 24,564 Interest, dividend and other investment income (51 ) (65 ) (116 ) Provision for income taxes 450 422 385 Gain on sale of properties, net (9,006 ) (16,950 ) (266 ) Gain on sale of property from discontinued operations — — (1,833 ) Management fee, net of related expenses 16 112 331 Loss on disposal of assets, net 522 192 90 NOI of real estate partnership (pro rata) (1) 2,553 3,023 3,833 Net income attributable to noncontrolling interests 270 530 205 NOI $ 103,574 $ 99,261 $ 90,207 (1) We rely on reporting provided to us by our third-party partners for financial information regarding the Company's investment in Pillarstone OP.
However, NOI should not be viewed as a measure of our overall financial performance since it does not reflect general and administrative expenses, depreciation and amortization, interest expense, interest income, provision for income taxes and gain or loss on sale or disposition of assets, the level of capital expenditures and leasing costs necessary to maintain the operating performance of our properties. 50 Table of Contents Below is the calculation of NOI and the reconciliation to net income, which we believe is the most comparable GAAP financial measure (in thousands): Year Ended December 31, PROPERTY NET OPERATING INCOME (“NOI”) 2024 2023 2022 Net income attributable to Whitestone REIT $ 36,893 $ 19,180 $ 35,270 General and administrative expenses 23,189 20,653 18,066 Depreciation and amortization 34,894 32,966 31,707 Deficit (equity) in earnings of real estate partnership (1) 28 3,155 (239 ) Interest expense 34,035 32,866 27,193 Interest, dividend and other investment income (87 ) (51 ) (65 ) Provision for income taxes 450 450 422 Gain on sale of properties, net (22,125 ) (9,006 ) (16,950 ) Management fee, net of related expenses — 16 112 Loss on disposal of assets, net 547 522 192 NOI of real estate partnership (pro rata) (1) 183 2,553 3,023 Net income attributable to noncontrolling interests 480 270 530 NOI $ 108,487 $ 103,574 $ 99,261 (1) We rely on reporting provided to us by our third-party partners for financial information regarding the Company's investment in Pillarstone OP.
The fair value of our long-term debt, consisting of fixed rate secured notes, variable rate secured notes and an unsecured revolving credit facility aggregate to approximately $612.4 million and $579.7 million as compared to the book value of approximately $640.5 million and $626.0 million as of December 31, 2023 and 2022, respectively.
The fair value of our long-term debt, consisting of fixed rate secured notes, variable rate secured notes and an unsecured revolving credit facility aggregate to approximately $614.3 million and $612.4 million as compared to the book value of approximately $632.5 million and $640.5 million as of December 31, 2024 and 2023, respectively.
During the year ended December 31, 2023, our cash provided from operating activities was $47.6 million and our total dividends and distributions paid were $24.0 million. Therefore, we had cash flow from operations in excess of distributions of approximately $23.6 million. The 2022 Facility included a $250 million unsecured borrowing capacity under a revolving credit facility.
During the year ended December 31, 2024, our cash provided from operating activities was $58.2 million and our total dividends and distributions paid were $24.9 million. Therefore, we had cash flow from operations in excess of distributions of approximately $33.3 million. The 2022 Facility included a $250 million unsecured borrowing capacity under a revolving credit facility.
Bank National Association, as co-lead arrangers and joint book runners. The 2022 Facility amended and restated the Company's previous unsecured revolving credit facility, dated January 31, 2019 (the “2019 Facility”).
Bank National Association, as co-lead arrangers and joint book runners (as amended from time to time, the “Credit Agreement”). The 2022 Facility replaced the Company’s previous unsecured revolving credit facility, dated January 31, 2019 (the “2019 Facility”).
Included in the adjustment to rental revenue for the years ending December 31, 2023, 2022 and 2021, was a bad debt adjustment of $0.3 million, $0.6 million, and $0.1 million, respectively, and a straight-line rent reserve adjustment of $(0.002) million, $0.3 million, and $0.9 million, respectively, related to credit loss for the conversion of 20, 80, and 59 tenants, respectively. 39 Table of Contents Unamortized Lease Commissions and Loan Costs.
Included in the adjustment to rental revenue for the years ending December 31, 2024, 2023 and 2022, was a bad debt adjustment of $0.2 million, $0.3 million, and $0.6 million, respectively, and a straight-line rent reserve adjustment of $0.05 million, $(0.002) million, and $0.3 million, respectively, related to credit loss for the conversion of 11, 20, and 80 tenants, respectively, to cash basis revenue. 40 Table of Contents Unamortized Lease Commissions and Loan Costs.
The 2022 Facility is comprised of the following two tranches: • $250.0 million unsecured revolving credit facility with a maturity date of September 16, 2026 (the “2022 Revolver”); • $265.0 million unsecured term loan with a maturity date of January 31, 2028 (“Term Loan”). 34 Table of Contents Borrowings under the 2022 Facility accrue interest (at the Operating Partnership's option) at a Base Rate or an Adjusted Term Secured Overnight Financing Rate (“SOFR”) plus an applicable margin based upon our then existing leverage.
The 2022 Facility is comprised of the following three tranches: • $250.0 million unsecured revolving credit facility with a maturity date of September 16, 2026 (the “2022 Revolver”); • $265.0 million unsecured term loan with a maturity date of January 31, 2028 (“Term Loan”); and • $20.0 million unsecured term loan with a maturity date of January 31, 2028 (the “Series One Incremental Term Loan”), effective October 7, 2024. 34 Table of Contents Borrowings under the 2022 Facility accrue interest (at the Operating Partnership's option) at a Base Rate or an Adjusted Term Secured Overnight Financing Rate (“SOFR”) plus an applicable margin based upon our then existing total leverage as set forth in the Credit Agreement.
On March 4, 2024, Pillarstone REIT authorized and filed the Chapter 11 bankruptcy of itself, Pillarstone OP, and the remainder of its special purpose entities in the United States Bankruptcy Court for the Northern District of Texas.
On March 4, 2024, Pillarstone Capital REIT (“Pillarstone REIT”) authorized and filed a Chapter 11 bankruptcy of itself, Pillarstone OP, and all of its remaining special purpose entities in the United States Bankruptcy Court for the Northern District of Texas (the “Pillarstone Bankruptcies”).
Any distributions we make will be at the discretion of our board of trustees and we cannot provide assurance that our distributions will be made or sustained in the future. 37 Table of Contents On February 10, 2021, the Company announced an increase to its quarterly distribution to $0.1075 per common share and OP units, equal to a monthly distribution of $0.035833, beginning with the March 2021 distribution.
Any distributions we make will be at the discretion of our board of trustees and we cannot provide assurance that our distributions will be made or sustained in the future. 37 Table of Contents On February 22, 2022, the Company announced an increase to its quarterly distribution to $0.12 per commons share and OP unit, equal to a monthly distribution of $0.04, beginning with the April 2022 distribution.
The fair value of our loan guarantee to Pillarstone OP is estimated on a Level 3 basis (as provided by ASC 820, “ Fair Value Measurements and Disclosures ”), using a probability-weighted discounted cash flow analysis based on a discount rate, discounting the loan balance.
The fair value of our loan guarantee to Pillarstone OP is estimated on a Level 3 basis (as provided by ASC 820), using a probability-weighted discounted cash flow analysis based on a discount rate, discounting the loan balance. The fair value and book value of the loan guarantee were both $0 as of December 31, 2024 and 2023.
Although our calculation of FFO is consistent with that of NAREIT, there can be no assurance that FFO and Core FFO presented by us is comparable to similarly titled measures of other REITs. 48 Table of Contents Below are the calculations of FFO and Core FFO and the reconciliations to net income, which we believe is the most comparable GAAP financial measure (in thousands): Year Ended December 31, FFO (NAREIT) AND CORE FFO 2023 2022 2021 Net income attributable to Whitestone REIT $ 19,180 $ 35,270 $ 12,048 Adjustments to reconcile to FFO: (1) Depreciation and amortization of real estate assets 32,811 31,538 28,806 Depreciation and amortization of real estate assets of real estate partnership (pro rata) (2) 1,613 1,613 1,674 Loss on disposal of assets, net 522 192 90 Gain on sale of properties, net (9,006 ) (16,950 ) (266 ) Gain on sale of property from discontinued operations — — (1,833 ) Gain on sale or disposal of properties or assets of real estate partnership (pro rata) (2) — — (19 ) Net income attributable to noncontrolling interests 270 530 205 FFO (NAREIT) $ 45,390 $ 52,193 $ 40,705 Early debt extinguishment costs — 147 — Default interest on debt of real estate partnership (pro rata) (1)(2) 1,375 — — Core FFO $ 46,765 $ 52,340 $ 40,705 (1) Includes pro-rata share attributable to real estate partnership.
Although our calculation of FFO is consistent with that of NAREIT, there can be no assurance that FFO and Core FFO presented by us is comparable to similarly titled measures of other REITs. 49 Table of Contents Below are the calculations of FFO and Core FFO and the reconciliations to net income, which we believe is the most comparable GAAP financial measure (in thousands): Year Ended December 31, FFO (NAREIT) AND CORE FFO 2024 2023 2022 Net income attributable to Whitestone REIT $ 36,893 $ 19,180 $ 35,270 Adjustments to reconcile to FFO: (1) Depreciation and amortization of real estate assets 34,811 32,811 31,538 Depreciation and amortization of real estate assets of real estate partnership (pro rata) (2) 111 1,613 1,613 Loss on disposal of assets, net 547 522 192 Gain on sale of properties, net (22,125 ) (9,006 ) (16,950 ) Net income attributable to noncontrolling interests 480 270 530 FFO (NAREIT) $ 50,717 $ 45,390 $ 52,193 Early debt extinguishment costs — — 147 Default interest on debt of real estate partnership (pro rata) (1)(2) — 1,375 — Proxy contest costs 1,757 — — Core FFO $ 52,474 $ 46,765 $ 52,340 (1) Includes pro-rata share attributable to real estate partnership.
On September 9, 2022, we entered into eleven equity distribution agreements for an at-the-market equity distribution program (the “2022 equity distribution agreements”) providing for the issuance and sale of up to an aggregate of $100 million of the Company’s common shares pursuant to our Registration Statement on Form S-3 (File No. 333-264881).
On September 9, 2022, we entered into eleven equity distribution agreements with certain sales agents names therein for an at-the-market equity distribution program (the “2022 equity distribution agreements”) providing for the issuance and sale of up to an aggregate of $100 million of the Company’s common shares pursuant to our Registration Statement.
On September 16, 2022 , we, through our Operating Partnership, entered into an unsecured credit facility (the “2022 Facility”) with the lenders party thereto, Bank of Montreal, as administrative agent (the “Administrative Agent”), Truist Bank, as syndication agent, and BMO Capital Markets Corp., Truist Bank, Capital One, National Association, and U.S.
On September 16, 2022, we, through our Operating Partnership, entered into an unsecured credit facility (the “2022 Facility”) pursuant to that certain Third Amended and Restated Credit Agreement, by and among the Operating Partnership, the Company and certain subsidiaries of the Company, as guarantors signatory thereto, the lenders party thereto, Bank of Montreal, as administrative agent (the “Administrative Agent”), Truist Bank, as syndication agent, and BMO Capital Markets Corp., Truist Bank, Capital One, National Association, and U.S.
Estimates regarding Pillarstone OP ’ s financial condition and results of operations and guarantee. We rely on the reports furnished by our third-party partners for financial information regarding the Company’s investment in Pillarstone OP. As of December 31, 2023 and 2022, Pillarstone OP’s financial statements have not been made accessible to us.
We relied on the reports furnished by our third-party partners for financial information regarding the Company’s investment in Pillarstone OP. As of December 31, 2023, and 2022, Pillarstone OP’s financial statements were not made accessible to us. Consequently, we estimated its financial condition and results of operations based on the information available to us.
The Lender also claimed that an additional sum of $4.6 million was due which included default interest of approximately $6.3 million and net credits from escrowed funds and other charges of approximately $1.7 million. The default interest charges are in dispute, and we believe that the value of Uptown Tower exceeds the total amount claimed by the Lender.
The Lender also claimed that an additional sum of $4.6 million was due which included default interest of approximately $6.3 million and net credits from escrowed funds and other charges of approximately $1.7 million.
For the year ended December 31, 2022, approximately $455,000 and $281,000 in interest expense and real estate taxes, respectively, were capitalized. For the year ended December 31, 2021, approximately $414,000 and $291,000 in interest expense and real estate taxes, respectively, were capitalized. Acquired Properties and Acquired Lease Intangibles.
For the year ended December 31, 2023, approximately $552,000 and $262,000 in interest expense and real estate taxes, respectively, were capitalized. For the year ended December 31, 2022, approximately $455,000 and $281,000 in interest expense and real estate taxes, respectively, were capitalized. 39 Table of Contents Acquired Properties and Acquired Lease Intangibles.
On March 5, 2024, the Company announced an increase to its quarterly distribution to $0.12375 per common share and OP unit, equal to a monthly distribution of $0.04125, beginning with the April 2024 distribution. During 2023, we paid distributions to our common shareholders and OP unit holders of $24.0 million, compared to $23.3 million in 2022.
On December 4, 2024, the Company announced an increase to its quarterly distribution to $0.135 per common share and OP unit, equal to a monthly distribution of $0.045, beginning with the January 2025 distribution. During 2024, we paid distributions to our common shareholders and OP unit holders of $24.9 million, compared to $24.0 million in 2023.
On June 30, 2023, we completed the sale of Westchase, located in Houston, Texas, for $7.8 million. We recorded a gain on sale of $4.6 million. On November 30, 2022, we completed the sale of Pima Norte, located in Carefree, Arizona, for $3.3 million. We recorded a loss on sale of $4.0 million.
We recorded a loss on sale of $0.7 million. On June 30, 2023, we completed the sale of Sunridge, located in Houston, Texas, for $6.7 million. We recorded a gain on sale of $5.0 million. On June 30, 2023, we completed the sale of Westchase, located in Houston, Texas, for $7.8 million.
In light of the dynamics in the capital markets impacted by macro economic factors and economic uncertainty, our access to capital may be diminished. Despite these potential challenges, we believe we have sufficient access to capital for the foreseeable future, but we can provide no assurance that such capital will be available to us on attractive terms or at all.
Despite these potential challenges, we believe we have sufficient access to capital for the foreseeable future, but we can provide no assurance that such capital will be available to us in the future on attractive terms or at all.
Our leases generally include minimum monthly lease payments and tenant reimbursements for taxes, insurance and maintenance. We completed 299 new and renewal leases during 2023, totaling 976,767 square feet and $118.9 million in total lease value. We had 79 employees as of December 31, 2023.
Our leases generally include minimum monthly lease payments and tenant reimbursements for taxes, insurance and maintenance. We completed 298 new and renewal leases during 2024, totaling 1,026,389 square feet and $134.8 million in total lease value. We had 72 employees as of December 31, 2024.
The distributions paid to common shareholders and OP unit holders were as follows (in thousands, except per share data) for the years ended December 31, 2023 and 2022: Common Shares Noncontrolling OP Unit Holders Total Quarter Paid Distributions Per Common Share Amount Paid Distributions Per OP Unit Amount Paid Amount Paid 2023 Fourth Quarter $ 0.1200 $ 5,930 $ 0.1200 $ 83 $ 6,013 Third Quarter 0.1200 5,928 0.1200 83 6,011 Second Quarter 0.1200 5,913 0.1200 83 5,996 First Quarter 0.1200 5,913 0.1200 83 5,996 Total $ 0.4800 $ 23,684 $ 0.4800 $ 332 $ 24,016 2022 Fourth Quarter $ 0.1200 $ 5,909 $ 0.1200 $ 83 $ 5,992 Third Quarter 0.1200 5,901 0.1200 88 5,989 Second Quarter 0.1200 5,880 0.1200 92 5,972 First Quarter 0.1075 5,268 0.1075 83 5,351 Total $ 0.4675 $ 22,958 $ 0.4675 $ 346 $ 23,304 Summary of Critical Accounting Policies and Estimates Our discussion and analysis of our financial condition and results of operations are based on our consolidated financial statements.
The distributions paid to common shareholders and OP unit holders were as follows (in thousands, except per share data) for the years ended December 31, 2024 and 2023: Common Shares Noncontrolling OP Unit Holders Total Quarter Paid Distributions Per Common Share Amount Paid Distributions Per OP Unit Amount Paid Amount Paid 2024 Fourth Quarter $ 0.1238 $ 6,247 $ 0.1238 $ 81 $ 6,328 Third Quarter 0.1238 6,194 0.1238 80 6,274 Second Quarter 0.1238 6,162 0.1238 80 6,242 First Quarter 0.1200 5,969 0.1200 80 6,049 Total $ 0.4914 $ 24,572 $ 0.4914 $ 321 $ 24,893 2023 Fourth Quarter $ 0.1200 $ 5,930 $ 0.1200 $ 83 $ 6,013 Third Quarter 0.1200 5,928 0.1200 83 6,011 Second Quarter 0.1200 5,913 0.1200 83 5,996 First Quarter 0.1200 5,913 0.1200 83 5,996 Total $ 0.4800 $ 23,684 $ 0.4800 $ 332 $ 24,016 Summary of Critical Accounting Policies and Estimates Our discussion and analysis of our financial condition and results of operations are based on our consolidated financial statements.
Rising Interest Rates As of December 31, 2023, $96.0 million, or approximately 15% of our outstanding debt, was subject to floating interest rates of SOFR plus 1.60% and a 10 basis point credit spread adjustment and not currently subject to a hedge.
Rising Interest Rates As of December 31, 2024, $75.0 million, or approximately 12% of our outstanding debt, was subject to floating interest rates of Secured Overnight Financing Rate (“SOFR”) plus 1.50% to 2.10% and a 10 basis point credit spread adjustment and not currently subject to a hedge.
Scheduled maturities of our outstanding debt as of December 31, 2023 were as follows (in thousands): Year Amount Due 2024 $ 63,834 2025 17,143 2026 163,143 2027 97,143 2028 282,143 Thereafter 17,143 Total $ 640,549 Capital Expenditures We continually evaluate our properties’ performance and value.
Scheduled maturities of our outstanding debt as of December 31, 2024 were as follows (in thousands): Year Amount Due 2025 $ 17,572 2026 142,143 2027 97,414 2028 302,823 2029 17,867 Thereafter 54,664 Total $ 632,483 Capital Expenditures We continually evaluate our properties’ performance and value.
The Notes have not been and will not be registered under the Securities Act of 1933, as amended (the “Securities Act”), and may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements of the Securities Act.
The Notes have not been and will not be registered under the Securities Act and may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements of the Securities Act. The Notes were sold in reliance on the exemption from registration provided by Section 4(a)(2) of the Securities Act.
On February 22, 2022, the Company announced an increase to its quarterly distribution to $0.12 per commons share and OP unit, equal to a monthly distribution of $0.04, beginning with the April 2022 distribution.
On March 5, 2024, the Company announced an increase to its quarterly distribution to $0.12375 per common share and OP unit, equal to a monthly distribution of $0.04125, beginning with the April 2024 distribution.
Some of our properties that we own (the “non-core properties”) may not fit our Community Centered Property® strategy, and we may look for opportunities to dispose of these properties as we continue to execute our strategy. On December 20, 2023 we completed the sale of Spoerlein Commons, located in Buffalo Grove, Illinois, for $7.4 million.
Some of our properties that we own (the “non-core properties”) may not fit our Community Centered Property® strategy, and we may look for opportunities to dispose of these properties as we continue to execute our strategy. On November 6, 2024, we completed the sale of Providence, located in Houston, Texas, for $16.3 million.
Our estimated equity in earnings of real estate partnership, which is generated from our 81.4% ownership of Pillarstone OP, decreased $3,394,000 from an equity position of $239,000 for the year ended December 31, 2022 to a deficit of $3,155,000 for the year ended December 31, 2023.
For the year ended December 31, 2024, our estimated deficit in earnings from the real estate partnership, which was generated through our 81.4% ownership of Pillarstone OP up to the redemption date, decreased $3,127,000 from $3,155,000 for the year ended December 31, 2023 to $28,000 for the year ended December 31, 2024.
The primary components of other expenses (income) for the year ended December 31, 2023 and 2022 are detailed in the table below (in thousands, except percentages): Year Ended December 31, Other Expenses (Income) 2023 2022 Change % Change Interest expense (1) $ 32,866 $ 27,193 $ 5,673 21 % Gain on sale of properties, net (2) (9,006 ) $ (16,950 ) 7,944 (47) % Loss on disposal of assets, net 522 $ 192 330 172 % Interest, dividend and other investment income (51 ) (65 ) 14 (22 )% Total other expense $ 24,331 $ 10,370 $ 13,961 135 % (1) The $5,673,000 increase in interest expense is attributable to rising interest rates, which led to an increase in our effective interest rate to 5.00% for the year ended 2023 as compared to 4.07% for the year ended 2022 resulting in an increase of $5,900,000 in interest expense and a decrease in our average outstanding notes payable balance of $1,702,000, resulting in a $69,000 decrease in interest expense and $147,000 of extinguishment of debt costs for 2022 offset the increase in interest expense.
The primary components of other expenses (income) for the year ended December 31, 2024 and 2023 are detailed in the table below (in thousands, except percentages): Year Ended December 31, Other Expenses 2024 2023 Change % Change Interest expense (1) $ 34,035 $ 32,866 $ 1,169 4 % Gain on sale of properties, net (2) (22,125 ) (9,006 ) (13,119 ) 146 % Loss on disposal of assets, net 547 522 25 5 % Interest, dividend and other investment income (87 ) (51 ) (36 ) 71 % Total other expenses $ 12,370 $ 24,331 $ (11,961 ) (49 )% (1) The $1,169,000 increase in interest expense is attributable to rising interest rates, which led to an increase in our effective interest rate to 5.12% for the year ended 2024 as compared to 5.00% for the year ended 2023 resulting in an increase of $778,000 in interest expense and an increase in our average outstanding notes payable balance of $7,423,000, resulting in a $391,000 increase in interest expense.
As an internally managed REIT, we bear our own expenses of operations, including the salaries, benefits and other compensation of our employees, office expenses, legal, accounting and investor relations expenses and other overhead costs.
As an internally managed REIT, we bear our own expenses of operations, including the salaries, benefits and other compensation of our employees, office expenses, legal, accounting and investor relations expenses and other overhead costs. Real Estate Partnership As of December 31, 2024, our ownership in Pillarstone OP no longer represents a majority interest.
(2) On December 20, 2023, we completed the sale of Spoerlein Commons, located in Buffalo Grove, Illinois, for $7.4 million. We recorded a loss on sale of $0.7 million. On June 30, 2023, we completed the sale of Sunridge, located in Houston, Texas, for $6.7 million. We recorded a gain on sale of $5.0 million.
On March 27, 2024, we completed the sale of Mercado at Scottsdale Ranch, located in Phoenix, Arizona, for $26.5 million. We recorded a gain on sale of $6.6 million. On December 20, 2023 we completed the sale of Spoerlein Commons, located in Buffalo Grove, Illinois, for $7.4 million. We recorded a loss on sale of $0.7 million.
(2) A portion of the unsecured line of credit includes an interest rate swap to fix the SOFR portion of the loan at 3.71%.
(2) A portion of the unsecured line of credit includes an interest rate swap to fix the SOFR portion of the loan at 3.71%. (3) Series One Incremental Term Loan includes an interest rate swap that fixed the term loan rate at 5.165% through January 31, 2028.
The fair value of the loan guarantee is $0 and $0.1 million as compared to the book value of approximately $0 and $0.1 million as of December 31, 2023 and 2022, respectively. Disclosure about fair value of financial instruments is based on pertinent information available to management as of December 31, 2023 and 2022.
Disclosure about fair value of financial instruments is based on pertinent information available to management as of December 31, 2024 and 2023.
In accordance with Accounting Standards Update (“ASU”) 2014-09 (“Topic 606”) and Accounting Standards Codification (“ASC”) 610, “ Other Income-Gains and Losses from the Derecognition of Nonfinancial Assets ,” the Company recognizes its investment in Pillarstone OP under the equity method. Development Properties. Land, buildings and improvements are recorded at cost.
In compliance with Accounting Standards Update (“ASU”) 2014-09 (“Topic 606”) and Accounting Standards Codification (“ASC”) 610, “Other Income-Gains and Losses from the Derecognition of Nonfinancial Assets,” the Company previously accounted for its investment in Pillarstone OP using the equity method.
We paid the DPO amount and will be entitled to assert a subrogation claim against Pillarstone OP. We recorded the DPO amount as an asset in our financial statement line escrows and deposits.
We paid the DPO amount and will be entitled to assert a subrogation claim against Pillarstone OP. As of December 31, 2024, the DPO amount was recorded as an asset in our financial statement line receivable due from related party. Accounting treatment of the redemption of our OP units in Pillarstone OP.

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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 changeOur total outstanding fixed interest rate debt has an average effective interest rate as of December 31, 2023 of approximately 4.70% per annum with expirations ranging from 2024 to 2029 (see Note 8 to our accompanying consolidated financial statements for further detail).
Biggest changeOur total outstanding fixed interest rate debt has an average effective interest rate as of December 31, 2024 of approximately 4.89% per annum with expirations ranging from 2025 to 2031 (see Note 8 to our accompanying consolidated financial statements for further detail).
The impact of a 1% increase or decrease in interest rates on our floating rate debt would result in a decrease or increase, respectively, of annual net income of approximately $1.0 million.
The impact of a 1% increase or decrease in interest rates on our floating rate debt would result in a decrease or increase, respectively, of annual net income of approximately $0.8 million.
Holding other variables constant, a 1% increase or decrease in interest rates would cause an $15.1 million decline or increase in the fair value for our fixed rate debt.
Holding other variables constant, a 1% increase or decrease in interest rates would cause an $13.6 million decline or increase in the fair value for our fixed rate debt.
Variable Interest Rate Debt As of December 31, 2023, $96.0 million, or approximately 15%, of our outstanding debt was subject to floating interest rates of SOFR plus 1.50% to 2.10% and not currently subject to a hedge.
Variable Interest Rate Debt As of December 31, 2024, $75.0 million, or approximately 12%, of our outstanding debt was subject to floating interest rates of SOFR plus 1.50% to 2.10% and not currently subject to a hedge.
All of our financial instruments were entered into for other than trading purposes. 50 Table of Contents Fixed Interest Rate Debt As of December 31, 2023, $544.5 million, or approximately 85%, of our outstanding debt was subject to fixed interest rates, which limit the risk of fluctuating interest rates.
All of our financial instruments were entered into for other than trading purposes. 51 Table of Contents Fixed Interest Rate Debt As of December 31, 2024, $557.5 million, or approximately 88%, of our outstanding debt was subject to fixed interest rates, which limit the risk of fluctuating interest rates.

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