KRG 10-K & 10-Q changes, risk factors and insider trading

The following factors, among others, could cause actual results to differ materially from those contained in forward-looking statements made in this Annual Report on Form 10-K and presented elsewhere by management from time to time. These factors, among others, may have a material adverse effect on our business, financial condition, operating results and cash flows, including our ability to make distributions to our shareholders. It is not possible to predict or identify all such factors, and this list should not be considered a complete statement of all potential risks or uncertainties. We have separated the risks into three categories: (i) risks related to our operations; (ii) risks related to our organization and structure; and (iii) risks related to tax matters.

Our primary business is the ownership, operation, acquisition, development, and re/developmentredevelopment of high-quality, open-air, grocery-anchored shopping centers and vibrant mixed-use and lifestyle assets in the United States. Our business, financial condition, results of operations, cash flows, per share trading price of our common shares, and ability to satisfy our debt service obligations and make distributions to our shareholders are subject to, and could be materially and adversely affected by, risks associated with acquiring, owningowning, and operating these types of real estate assets. These risks include events and conditions that are beyond our control, such as periods of economic slowdown or recession, federal government shutdowns, disruptions related to tariffs and other trade or sanction issues, declines in the financial condition of our tenants, natural disasters such as fires, earthquakes, or floods, rising interest rates, difficulty in leasing vacant space and/or renewing existing tenants, a decline in the value of our assets, or the public perception that any of these events may occur. Additionally, certain costs of our business, such as insurance, real estate taxes, utilities, and corporate expenses, are relatively inflexible and generally do not decrease if a property is not fully occupied, rental rates decline, a tenant fails to pay rent, or other circumstances cause our revenues to decrease. If we are unable to lower our operating costs when revenues decline and/or fully recover cost increases from our tenants, our financial condition, operating resultsresults, and cash flows could be materially and adversely impacted. Also, complying with the REIT requirements may cause us to forgo and/or liquidate otherwise attractive investments, which could have the effect of reducing our income and the amount available for distribution to our shareholders. Thus, compliance with the REIT requirements may hinder our ability to make or, in certain cases, maintain ownership of certain attractive investments, which could impact our financial condition, operating results and cash flows.

Ongoing challenges facing our retail tenants, including bankruptcies, financial instabilityinstability, and consolidations, could have a material adverse effect on our business.

We derive the majority of our revenue from retail tenants who lease space from us at our properties; therefore, our ability to generate cash from operations is dependent upon the ability of our tenants to pay the base rent, expense recoveriesrecoveries, and other charges due under their leases on a timely basis. The success of our tenants in operating their businesses continues to be impacted by many current economic challenges, which impact their cost of doing business, including, but not limited to, their ability to rely on external sources to grow and operate their business, inflation, labor shortages, domestic tariff policies, supply chain constraints, retail theft, violent crime, decreaseddecreasing consumer confidence and discretionary spending, and increasedincreasing energy pricesprices, and volatile interest rates. Sustained weakness in certain sectors of the U.S. economy could result in the bankruptcy or weakened financial condition of a number of retailers, including some of our tenants, and an increase in store closures. Tenants may also choose to consolidate, downsizedownsize, or relocate their operations for various reasons, including mergers or other restructurings. These events, or other similar events, and economic conditions are beyond our control and could affect the overall economy as well as specific properties in our portfolio and our overall cash flow and results of operations, including the following, any of which could have a material adverse effect on our business:

•Collections. Tenants may have difficulty paying their rent and other charges due under their lease agreements on a timely basis or request rent deferrals, reductionsreductions, or abatements.abatements as a result of operating challenges.

•Leasing. Tenants may delay or cancel lease commencements, decline to extend or renew leases upon expiration, reduce the size of their leased space, or close certain locationslocations, or declare bankruptcy, which could result in the termination of the tenant’s lease with us and the related loss of rental income. Such terminations or cancellations could result in lease terminations or reductions in rent by certain other tenants in the same shopping center becausedue ofto contractual co-tenancy termination or rent reduction rights contained in some leases.

InflationElevated levels of inflation may adversely affect our financial condition and results of operations.

InflationAlthough inflation has moderated significantly from peak levels experienced twoduring years2022, agoit whenmay the U.S. economy was recovering from the coronavirus pandemic. The slow decline in inflation negatively impacted, and a sharp riseincrease in the future couldas negativelya impact,result of multiple factors, including the tariffs implemented by the U.S. government in 2025 on imported goods from specific countries. These tariffs may lead to higher prices for many of the products that our tenants sell, potentially reducing consumer confidencedemand and spending and negatively impacting our tenants’ sales volume and overall health. This, in turn, has and could in the future put downward pricing pressure on rents that we are able to charge to new or renewing tenants, such that rent spreads and, in some cases, our percentage rents,rents could be adversely impacted. MostMany of our leases contain provisions designed to mitigate the adverse impact of inflation, including stated rent increases and requirements for tenants to pay a share of operating expenses, including common area maintenance, real estate taxes, insurance, or other operating expenses related to the maintenance of our properties, with escalation clauses in most leases. However, the stated rent increases or limits on such a tenant’s obligation to pay its share of operating expenses could be lower than the increase in inflation at any given time. Inflation may also limit our ability to recover all of our operating expenses. In addition, a portion of our leases are based on a fixed amount or fixed percentage that is not subject to adjustment for inflation. Increased inflation could have a more pronounced negative impact on our interest and general and administrative expenses, as these costs could increase at a higher rate than ourthe rentsrent chargedwe charge to tenants. If we are unable to lower our operating costs when revenues decline and/or fully recover cost increases from our tenants, our financial performance could be materially and adversely affected.

TenantWe bankruptciesmay havebe in the past and could in the future make it difficult for usunable to collect rent or make claims against a tenant in bankruptcy.

Our business and financial condition depend on the financial stability of our tenants and our ability to lease space to them on economically favorable terms. From time to time, certain of our tenants have declared bankruptcy and other tenants may declare bankruptcy in the future. A bankruptcy filing by one of our tenants would legally prohibit us from collecting any unpaid rent from that tenant unless we receive an order from the bankruptcy court permitting us to do so. Such bankruptcies have in the past and could in the future delay, reduce, or ultimately preclude the collection of amounts owed to us, including both past and future rent. A tenant in bankruptcy may attempt to renegotiate their lease or request significant rent concessions. If a lease is assumed by a tenant in bankruptcy, all pre-bankruptcy amounts owed under the lease must be paid in full to us. However, if a lease is rejected by a tenant in bankruptcy, we would have only a general unsecured claim for damages that would be paid only to the extent that funds are available and in the same percentage as is paid to all other holders of unsecured claims. As a result, it is likely that we would recover substantially less than the full valueamount of any unsecured claim we hold from a tenant in bankruptcy, if at all, which would reduce our cash flows and could have a material adverse effect on us.

Many retailers have made e-commerce a vital piece of their business. Any consumer shifts towards online shopping may cause declines in brick-and-mortar sales generated by certain of our tenants face increasing competition from e-commerce,tenants, which could affect decisions made by current and prospective tenants inregarding leasing space and how they compete and innovate in a rapidly changing retail environment, including potentially reducing the size or number of their retail locations in the future. We cannot predict with certainty how changes in e-commerce will impact the demand for space or the revenue generated at our properties in the future. We continue to respond to these trends and are heavily focused on anchoring and diversifying our properties with tenants whose businesses are either more resistant to,to or synergistic with,with e-commerce, as well as adapting our properties to allow our tenants to serve as last-mile fulfillment centers. In addition, changes in consumer buying practices and shopping trends may also impact the financial condition of retailers that do not adapt to changes in market conditions.conditions, which may impact their ability to pay rent. The risks associated with e-commerce could have a material adverse effect on the business outlook and financial results of our current and future tenants, which, in turn, could have a material adverse effect on us.

We face significant competition in leasing space at our properties, which may impact our rental rates, leasing termsterms, and expenditures for capital improvements.

We compete for tenants with numerousmany public and private real estate companies, including developers, owners,owners and operators of retail shopping centers and regional and outlet malls, including institutional investors and other REITs, many of whom own properties similar to, and in the same sub-markets as, our properties. As of December 31, 2024,2025, leases representing approximately 8.1%7.0% of our total retail ABR were scheduled to expire in 2025.2026. Some of our competitors may have greater capital resources than we do or may be willing to offer lower rental rates or more favorable terms to tenants, such as substantial rent reductions or abatements, tenant allowances or other improvements, and/or early termination rights. These accommodations may pressure us to reduce our rental rates, undertake unexpected capital improvements, or offer other terms less favorable to us, which could adversely affect our financial condition. Additionally, if retailers or consumers perceive that shopping at other locations owned by our competitors is more convenient, cost-effective, or otherwise more attractive, our revenues and results of operations may also suffer.

The economic conditions in markets where our properties are concentrated can greatly influence our financial performance. The specific markets in which we operate may face challenging economic conditions that could persist into the future. As of December 31, 2024,2025, rents from our retail properties in the states of Texas, Florida, Maryland,Indiana, North Carolina,Virginia, and VirginiaMaryland comprised 26.7%,28.1%, 11.7%,11.4%, 5.9%,6.5%, 5.7%,6.5%, and 5.4%5.7% of our ABR, respectively. This level of concentration could expose us to greater market-dependent economic risks than if we owned properties in more geographic regions. Adverse economic or real estate trends in these states or the surrounding regions or any decrease in demand for retail space resulting from the local regulatory environment, business climate, or fiscal problems in these states could have a material adverse effect on usour financial condition and limit our ability to meet our financial obligations.

We do not carry insurance for generally uninsurable losseslosses, such as lossthose from riots, warwar, or acts of God and, in some cases, floods. In addition,Furthermore, insurance companies may nostop longer offerproviding coverage against certain types of losseslosses, such as environmental liabilities or other catastrophic eventsevents, or,or if offered, the expense of obtaining suchthat coverage may not be justified. Some of our insurance policies, such as those covering losses due to terrorism and floods, like the flood we experienced in July 2025 at Eastgate Crossing, are insured subject to limitations, and in the future, we may be unable to renew our current insurance coverage or initiate new coverage at adequate levels or at reasonable prices. Given the continued increase in severe climate-related events, we have continued to experienceexperienced a significant increase in insurance rates for property insurance and may continue to do so in the future. The rates for casualty insurance have also continued to increase significantly due to an increase in litigation. In addition, tenants generally are required to indemnify and hold us harmless from liabilities resulting from injury to persons or damage to personal or real property on the leased premises due to activities conducted by them (including, without limitation, any environmental contamination). Tenants are also required, at their expense, to obtain and keep in full force during the term of thetheir lease liability and property damage insurance policies.insurance. However, some tenants may not properly maintain their insurance policies or have the ability to pay the deductibles associated with them.them, in which case we would have to cover the cost to repair any property damage. If we experience a loss that is either uninsured or exceeds our policy limits, we could lose all or a portion of the capital we have invested in the damaged property, asalong well aswith the anticipated future cash flows, butwhile remainstill being obligated for any recourse indebtednessindebtedness, even if the property wasis irreparably damaged. Inflation, changes in building codes and ordinances, environmental considerations, and other factors might also make it impractical or undesirable for us to use insurance proceeds to replace a property after it has been damaged or destroyed. As a result, our financial condition, operating resultsresults, and cash flows could be materially and adversely affected.

As of December 31, 2024,2025, we had a development projectsproject under construction at The Corner – IN and One Loudoun Expansion.Downtown in the Washington, D.C. MSA consisting of the retail and office portions of the expansion project (the “One Loudoun Expansion”). Based on our current plans and estimates, we anticipate that it will requirecost approximately $65.0 million to $75.0 million of investment from us to complete these projects.complete. We also hadhave eightnine redevelopment opportunities currently in the planning stage, including de-leasing space and evaluating development plans and costs with potential tenants and partners. Some of these plans include non-retail uses such as multifamily housing and a hotel. New development and redevelopment projects are subject to a number of risks, including the following:

•higher than estimated construction or operating costs, particularly labor and material costs, including as a result of inflation and domestic tariff policies;

•inability to complete construction on schedule due to a number of factors, including labor and supply chain disruptions and shortages, inclement weather, or natural disasters such as fires, earthquakesearthquakes, or floods;

•significant time lag between commencement and stabilization resulting in delayed returns and greater risks due to fluctuations in the general economy, shifts in demographicsdemographics, and competition;

•decrease in customer traffic during the development or redevelopment periodperiod, causing a decrease in tenant sales;

•suspension of development projects after construction has begun due to changes in economic conditions or other factors that may result in the write-off of costs, payment of additional costscosts, or increases in overall costs if the project is restarted.

As part of our investment decision to develop or redevelop a particular property, we make certain assumptions regarding the expected future performance of that property, which, if not met, could materially and adversely affect our financial performance. If a development or redevelopment project is unsuccessful, ourOur entire investment could be at risk for loss, or an impairment charge could occur.occur if a development or redevelopment project is unsuccessful. In addition, new development and significant redevelopment activities, regardless of whether they are ultimately successful, typically require substantial time and attention from management.

A future public health crisis could have significant repercussions across domestic and global economies, including the retail sector within the U.S., and contribute to volatility and negative pressure in the financial markets. FactorsGovernment thatresponses mayto such crises, including quarantines or other restrictions, as well as changes in consumer behavior, and business continuity disruptions and delays, could negatively affect our tenants and their ability to operate their businesses, which could impact our ability to operatecollect successfullyon ascurrent or past due rent payments or fully recover amounts due under the terms of a resultlease agreement in the event of a default by a tenant. The direct and indirect impacts of a pandemic or other public health crises include,could amongadversely others:affect our financial condition, operating results, and cash flows.

We and our tenants rely extensively on information technology (“IT”) systems to process transactions and manage our respective businesses; as a result, we are at risk from, and may be impacted by, cybersecurity incidents. CybersecurityThese incidents could include (i) unintentional or malicious attempts to gain unauthorized access to, or acquisition of, our data and/or IT systems by individuals, including employees or contractors, or sophisticated organizations using advanced hacking tools and techniques suchthat asleverage artificial intelligence; (ii“AI”), failuresto duringgain routineunauthorized operationsaccess suchto asour systemdata upgradesand orIT usersystems. errors; (iii) network or hardware failures; or (iv) the introduction of malicious or disruptive software. Such cybersecurityCybersecurity incidents may involve social engineering, business email compromise,engineering/phishing, cyber extortion,attacks (including ransomware, malware attacks, unauthorized access attempts, and denial of service,service and other unintentional intrusions or malicious cyber attacks), cyber extortion or other fraudulent schemes, or attempts to exploit vulnerabilities, or may be predicated by geopolitical events, natural disasters, failures or impairments of telecommunications networks, or other catastrophic events. Further, new technologies such as AI may be more capable of evading these safeguards, and threat actors may use AI tools to automate and enhance cybersecurity attacks against us. If we, our vendors, or third parties experience an actual or perceived privacy or security incident because of the use of AI, we could lose valuable intellectual property and confidential information, and our reputation and the public perception of the effectiveness of our security measures could be harmed.

A cybersecurity incident could compromise the confidential information of our employees, tenants, and vendors; disrupt the proper functioning of our networks; result in misstated financial reports, violations of loan covenants, and/or missed reporting deadlines; impede our ability to maintain the building systems that our tenants rely on for the efficient use of their leased space; require significant management attention to remedy any damages; result in reputational damage to ourselves or our tenants; or lead to potential litigation or regulatory investigation, increased oversight, fines, or other penalties. Increased regulation of data collection, use, and retention practices, including self-regulation and industry standards; changes in existing laws and regulations; enactment of new laws and regulations; increased enforcement activity; and changes in the interpretation of laws could increase our cost of compliance and operations, limit our ability to grow our business, or otherwise harm us.

We employ a variety of measures to prevent, detect, respond to, and recover from cybersecurity threatsthreats, including through the use of AI-based tools; however, there is no guarantee such efforts will be successful in preventing or responding to a cybersecurity incident. We have identified, and expect to continue to identify, cyber attacks and other cybersecurity incidents on our IT systems and those of third parties, including through e-mail phishing attempts and scams, but none of the cybersecurity incidents identified as of December 31, 2024 has had a material impact on our business or operations. The interpretation and application of cybersecurity and data protection laws and regulations are often uncertain and evolving. As a result, there can be no assurance that our security measures will be deemed adequate, appropriate, or reasonable by a regulator or court. Moreover, even security measures that are deemed appropriate, reasonable, and/or in accordance with applicable legal requirements may be unable to protect our IT systems or the information we maintain. Additionally, as increased regulatory compliance for cybersecurity protocols and disclosures are required by state or federal authorities, there is no guarantee that the increased amount of resources, both time and expense, will not adversely affect our business.

In addition, we rely on a number of service providers and vendors to provide important software, tools, and services, and operational functions, including payroll, accounting, budgeting, and lease management. As a result, cybersecurity risks at these service providers and vendors create additional risks for our information and business. While we may be entitled to damages if our service providers and vendors fail to satisfy their security-related obligations to us, any award may be insufficient to cover our damages, or we may be unable to recover such an award. A cybersecurity incident impacting us directly or through third parties may result in the disruption of our operations, material harm to our financial condition, cash flows, and the market price of our common shares; misappropriation of our assets; compromise or corruption of confidential information collected while conducting our business; liability for information or assets that were inappropriately accessed, stolen, altered, or made unavailable; compromise of confidential information collected while conducting our business; increased cybersecurity protection and insurance costs; regulatory scrutiny or enforcementaction; litigation; and damage to our stakeholder relationships and reputation. AlthoughDespite we makeour efforts to maintain the security and integrity ofsecure our IT networks and related systems on which we rely,systems, there can be no assurance that our efforts and measures or those of our third-party service providers will be effective or that attempted cyber attacks or disruptions will not be successful or damaging.

To qualify as a REIT, we must distribute to our shareholders at least 90% of our annual “REIT taxable income” (determined before the deduction for dividends paid and excluding net capital gains). Due in part to thethis distribution requirements of a REIT,requirement, we may be unable to fund all of our future capital needs with income from operations. Consequently, we may rely on external sources of capital. Our access to external capital depends on several factors, including general market conditions, our current and potential future earnings, the market’s perception of our growth potential and risk profile, and our cash distributions. Disruptions in the financial markets could impact the overall amount of debt and equity capital available, our ability to access new capital on acceptable terms, and loan-to-value ratios; andthey could causealso alead tighteningto oftighter lender underwriting standards and termsterms, andas well as higher interest rate spreads. As a result, we may be unable to refinance or extend our existing indebtedness on favorable terms or at all. We have $430.0$410.6 million of debt principal scheduled to mature through December 31, 2025, the majority of which we expect will be satisfied with proceeds from the Notes Due 2031 that were issued in August 2024.2026. If we are unable to obtain debt or equity capital on favorable terms or at all, it could have negative effects on our business andcould affectbe negatively affected, including our ability to (i) operate, maintain, or reinvest in our portfolio; (ii) dispose of properties on favorable terms due to an immediate need for capital; (iii) repay or refinance our indebtedness on or before maturity; (iv) acquire or develop properties when strategic opportunities exist; or (v) make distributions to our shareholders, all of which could have a material adverse effect on our business. If economic conditions deteriorate in any of our markets, we may have to seek less attractive, alternative sources of financing and adjust our business plan accordingly.

We have a significant amount of indebtedness outstandingoutstanding, and high interest rates could materially adversely affect us.

As of December 31, 2024,2025, we had approximately $3.2$3.0 billion of consolidated indebtedness outstanding, of which $169.6$497.2 million bore interest at variable rates after giving effect to interest rate swaps.rates. Due to the high inflationinflationary environment we experienced overfrom themid-2021 pastthrough three years,2022, the U.S. Federal Reserve sharply raised short-term interest rates in 2022 and 2023 to curtail the high inflation, which resulted in higher incremental borrowing costs for us. The U.S. Federal Reserve cut interest rates by 1.00% in 2024 and an additional 0.75% in 2025 as the inflationary pressures have eased due to stronger economic data and an improving economic growth outlook. If the U.S. Federal Reserve raises interest rates in the future, the U.S. economy could be adversely impacted, including slowing economic growth and potentially causing a recession. In addition, increases in interest rates negatively affect the terms under which we are able to refinance our outstanding debt as it matures, to the extent we have not hedged our exposure to changes in interest rates. If our interest expense increased significantly, it could materially adversely affect us. For example, if market rates of interest on our variable rate debt outstanding as of December 31, 2024, net of interest rate swaps,2025 increased by 1%, the increase in interest expense on our unhedged variable rate debt would decrease our future cash flows by approximately $1.7$5.0 million annually.

We may incur additional debt in connection with various development and redevelopment projects and uponwhen thewe acquisition ofacquire operating properties. Our organizational documents do not limit the amount of indebtedness that we may incur. In addition, we may increase our mortgage debt by obtaining loans secured by some or all of the real estate properties we develop or acquire. We may also borrow funds, if necessary, to satisfy the requirement that we distribute to our shareholders at least 90% of our annual “REIT taxabledistribution income” (determined before the deduction for dividends paid and excluding net capital gains)requirements or otherwise as is necessary to ensure we maintain our qualification as a REIT for U.S. federal income tax purposes or avoid paying taxes that can be eliminated through distributions to our shareholders.

Our substantial debt could materially and adversely affect our business in other ways, including (i) requiring us to use a substantial portion of our cash flow to service our indebtedness, which would reduce the cash available to fund general corporate purposes and distributions; (ii) limiting our ability to obtain additional financing to fund our working capital needs, capital expenditures, acquisitions, other debt service requirements, or other purposes; (iii) increasing our costscost of incurring additional debt and our exposure to variable interest rates; (iv) increasing our vulnerability to economic and industry downturns and reducing our flexibility in responding to changing business and economic conditions; and (v) placing us at a competitive disadvantage compared to other real estate investors that are not as highly leveraged. The impact of any of these potential adverse consequences could have a material adverse effect on us.

Our Revolving Facility, senior unsecured term loansloans, and unsecured notes require compliance with certain financial and operating covenants, including, among others, certain leverage and interest coverage ratios and limitations on our ability to incur debt, make dividend payments, sell all or substantially all of our assetsassets, and engage in mergers, consolidationsconsolidations, and certain acquisitions. These covenants may limit our operating and financial flexibility and our ability to respond to changes in our business or pursue strategic opportunities in the future, including theour ability to obtain additional financing needed to address cash shortfalls or pursue growth opportunities or other accretive transactions. Further, our Revolving Facility is priced, in part, on a leverage grid that resets quarterly. DeteriorationA deterioration in our leverage covenant calculation could lead to a higher credit spread component within the applicable interest rate for this debt agreement andand, therefore, result in higher interest expense.

In the event of a default under any of our debt agreements, our lenders or noteholders have various rights, including, but not limited to, the ability to require the acceleration of payment of all principal and interest then due and/or to terminate the agreements, which could have a material adverse effect on our business, limit our ability to make distributions to our shareholders, and prevent us from obtaining additional financing to address cash shortfalls or pursue growth opportunities. In addition, our debt agreements contain cross-defaults to certain other material indebtedness (including recourse indebtedness at various amounts between $40.0 million and $75.0 million, depending on the agreement) such that an “Event of Default” under one of these agreementsagreement could trigger an “Event of Default” under the other debt obligations. These provisions could allow our lenders and noteholders to accelerate the amount due under the loans and notes. If payment is accelerated, our liquid assets may not be sufficient to repay such debt in full. As of December 31, 2024,2025, we believe we were in compliance with all applicable covenants under our debt agreements, although there can be no assurance that we will continue to remain in compliance in the future.

Our creditworthiness is rated by nationally recognized credit rating agencies. The credit ratings assigned to us are based on our operating performance, liquidity and leverage ratios, financial condition and prospects, and other factors viewed by the credit rating agencies as relevant to our industry and the general economic outlook. Our credit rating can affect the amount of capital we access and the interest rate we receive, as well as the terms of certain existing and potential future debt financings. Since we depend on debt financing to fund the growth of our business, anAn adverse change in our credit rating,rating including changes in ouror credit outlook, or even the initiation of a review of our credit rating that could result in an adverse change, could have a material adverse effect on us.our business, particularly since we rely on debt financing for growth of our business. Furthermore, certain of our senior unsecured term loans are priced, in part, on our credit rating. A downgrade of our credit rating could result in a higher credit spread component within the applicable interest rate for those debt agreements andand, therefore, higher interest expense.

We use a combination of interest rate protectionhedging agreements,arrangements, including interest rate swaps and treasury locks, to manage theour risksexposure associated withto interest rate volatility. These hedging agreementsarrangements involve risk, including the risk that counterparties may faildefault to honoron their obligations under the hedging arrangementsobligations and that these arrangements may not be effectiveineffective in reducing our exposure to interest rate changes. Developing and implementing an effective strategy for managing interest rate risk management strategy is complex, and no strategy can completely insulate us from the risks associated with fluctuations in interest rates. There can be no assurance that our hedging arrangements will qualify for hedge accounting or that our hedging activities will have the desired beneficial impact on our results of operations or financial condition. Further, should we choose to terminate a hedging agreement, there could be significant costs and cash requirements involved to fulfill our initial obligation under the agreement.

As of December 31, 2024,2025, we owned interests in various joint venture investments, including interests in Delray Marketplace and a residential building at One Loudoun Downtown through consolidated joint ventures and interests in the following through unconsolidated joint ventures: a three-property retail portfolio consisting of Livingston Shopping Center, Plaza VolenteVolente, and Tamiami Crossing; the hotel component at Eddy Street Commons; and the mixed-use development project at The Corner – IN.IN; Legacy West, a mixed-use asset in the Dallas/Ft. Worth MSA; and a three-property retail portfolio consisting of Denton Crossing, Parkway Towne Crossing, and The Landing at Tradition. We may pursue co-investing with third parties through other joint ventures in the future. Our joint ventures and the value and performance of suchthe investmentsjointly owned properties may involve risks not present with respect to our wholly owned properties, including (i) shared decision-making authority, which may prevent us from taking actions that are in our best interest; (ii) restrictions on our ability to sell our interests in the joint ventures without the other partner’s consent; (iii) potential conflicts of interest or other disputes, including potential litigation or arbitration that would prevent management from focusing their time and effort on our business; (iv) potential losses or increased costs or expenses arising from actions taken in respect of the joint ventures; (v) actions by our partners that could jeopardize our REIT status, require us to pay taxestaxes, or subject the properties owned by the joint venture to liabilities greater than those contemplated by the terms of the joint venture agreements; and (vi) joint venture agreements may contain buy-sell provisions pursuant to which one partner may initiate procedures requiring us to buy the other partner’s interest, all of which could affect our business, financial condition, results of operationsoperations, and cash flows. In addition, some of our joint venture partners are foreign entities, which are subject to U.S. laws governing foreign investments. Changes to these laws, including the Foreign Investment in Real Property Tax Act (“FIRPTA”) or CFIUS regulations, could increase tax burdens, impose new compliance obligations, delay or restrict transactions, or limit the foreign entity’s ability to participate in the joint venture. Any such changes could negatively affect the joint venture’s structure, operations, or returns and may negatively impact our business and financial results.

We continue to evaluate the market for potential acquisitions and may acquire properties when we believe strategic opportunities exist. When we pursue acquisitions, we may face competition from other real estate investors, some of whichwhom may have substantial capital and a willingness to accept more risk than we do, which could (i) limit our ability to acquire properties, (ii) increase the purchase price we are required to pay, thus reducing the return to our shareholders, and (iii) cause us to agree to material restrictions or limitations in the acquisitionpurchase and sale agreements. In addition, properties we acquire in the future may fail to successfully integrate into our existing operating platform or achieve the expected occupancy and/or rental rates within the projected time frame, if at all, which may result in the properties’ failure to achieve the expected investment returns. In certain circumstances, we may abandon a potential acquisition after spending significant resources to pursue the opportunity. These factors and any others could impede our growth and materially and adversely affect our financial condition and results of operations.

We may be unable to sell properties at the time we desire, on favorable termsterms, or at all, which could limit our ability to access capital through dispositions.

Real estate investments are relatively illiquid and generally cannot be sold quickly. Our ability to dispose of properties on advantageous terms depends upon many factors that are beyond our control, and we cannot predict the various market conditions affecting real estate investments that will exist in the future. We may be unable to dispose ofsell any of our properties on terms that are favorable to us or at all, and each individual sale will depend upon, among other things, (i) general economic and market conditions, (ii) competition from other sellers, (iii) increases in market capitalization rates, (iv) individual asset characteristics, and (v) the availability of attractive financing for potential buyers of our properties.real estate. Further, we may incur expenses and transaction costs in connection with dispositions.

In addition, the Internal Revenue Code of 1986, as amended (the “Code”), generally imposes a 100% penalty tax on gains recognized by REITs upon the disposition of assets if the assets are held primarily for sale in the ordinary course of business rather than for investment, which could cause us to forgo or defer sales of properties that might otherwise be in our best interest to sell. This in turn may limit our ability to appropriately adjust our portfolio mix in response to market conditions. We will also be subject to income taxes on gains from the sale of any properties owned by any taxable REIT subsidiary (“TRS”).

Our real estate properties are carried at cost unless circumstances indicate that the carrying value of these assets may not be recoverable through future operations. We periodically evaluate whether there are any indicators, including declines in property operating performance and general market conditions, that the carrying value of our real estate assets may be impaired. Changes in our disposition strategy or in the marketplace may alter the holding period of an asset or group of assets, which may result in an impairment loss that could be material to our financial condition or operating performance. To the extent the carrying value of the asset exceeds the estimated future undiscounted property cash flows, an impairment loss is recognized equal to the excess of the carrying value over the estimated fair value, which is highly subjective and involves a significant degree of management judgment regarding various assumptions. During the years ended December 31, 2025, 2024 and 2023, we recognized impairment charges oftotaling $54.4 million, $66.2 millionmillion, and $0.5 million, respectively. We did not recognize any impairment during the year ended December 31, 2022. There can be no assurance that we will not recognize additional impairment charges in the future related to our assets, which could have a material adverse effect on our results of operations in the period in which the impairment charge is recognized.

As of December 31, 2024,2025, we had 10nine properties in our portfolio that are either completely or partially on land that is owned by third parties and leased to us pursuant to ground leases. If we are found to be in breach of a ground lease and that breach cannot be curedcured, or we are unable to extend the lease terms or purchase the fee interest in the underlying land prior to expiration, for which no assurance can be given, we could lose our interest in the improvements and the right to operate the property. As a result, we would be unable to derive income from such property, which could materially and adversely affect us. Assuming we exercise all available options to extend the terms, our ground leases will expire between 2045 and 2115. In certain cases, our ability to exercise the extension option is subject to the condition that we are not in default under the terms of the ground lease at the time we exercise such option, and we can provide no assurances that we will be able to exercise the extension options at such times.

A significant number of our properties are located in areas that are susceptible to, or have been affected by, natural disasters and severe weather conditions such as hurricanes, tropical storms, tornadoes, earthquakes, floodsfloods, and wildfires. Changing weather patterns and climatic conditions, primarily as a result of climate change, may affect the predictability and frequency of natural disasters and severe weather conditions in some parts of the world and create additional uncertainty as to future trends and exposures, including certain areas in which our portfolio is concentrated, such as the states of Texas, Florida, and North Carolina and the MSAs of New York, Atlanta, Seattle, Chicago, and Washington, D.C. Over time, the occurrence of naturalNatural disasters, severe weather conditions,weather, and changingclimate climaticchange conditions canmay delay new development and redevelopment projects, increase the costs toof repairrepairing or replacereplacing damaged propertiesproperties, andraise future operating and insurance costs,expenses, lead to population migration, and negatively impact the demand for retail space in the affected areas, orareas; in extreme cases, these factors may affect our ability to operate the properties at all.altogether.

In addition, changes in federal, state, and local laws and regulations on climate may require us to (i) make additional investments in our properties, resulting in increased capital expenditures and operating costs, (ii) implement new or additional processes and controls to facilitate compliance, and/or (iii) pay additional energy, insurance, and real estate taxes, or potentially result inpay fines for noncompliance. For example, “green” building codes may seek to reduce emissions by imposing certain standards for design, construction materials, water and energy usage and efficiency, and waste management. These developments could increase the costs of maintaining or improving our properties and could also result in increased compliance costs or additional operating restrictions that could adversely impact our tenants’ businesses and their ability to pay rent, which could adversely affect our financial condition, results of operationsoperations, and cash flows.

Under various laws, ordinances, and regulations, as an owner or operator of real property, we may be or may become liable for the costs of investigation, removal, or remediation of releases of certain hazardous or toxic substances (including petroleum products) atreleased on, from or fromin our currentlyproperties or(potentially formerlyincluding ownedformer or operated properties,properties), or for property damage or bodily injury (including third-party claims), fines, liens, or natural resource damages arising from the presence of such hazardous or toxic substances. In addition, we could be liable for the costs of investigating or remediating contamination at off-site waste disposal facilities to which we have arranged for the disposal or treatment of hazardous or toxic substances. Under certain laws, such liability may be imposed withoutregardless regardof toour knowledge, whether or not we knew of, or caused,released the presence of these hazardous or toxic substances, or whether we compliedcompliance with environmental laws,laws; and the liability may be joint and several. Some properties in our portfolio contain, may have contained, or are adjacent to or near other properties that have contained or currently contain underground storage tanks for petroleum products or other hazardous or toxic substances, and some of our properties have tenants that may use hazardous or toxic substances in the course of their business. Indemnities in our lease agreements may not fully protect us if a tenant responsible for environmental noncompliance or contamination becomes insolvent. As is the case with many community and neighborhood shopping centers, many of our properties hadhave or havehad on-site dry cleaners and/or gas stations, the prior or current use of which could potentially increase our environmental liability exposure. The costcosts ofassociated investigationwith investigating and removalremoving or remediation of suchremediating hazardous or toxic substancessubstances, oras well as other contamination-related liabilitiesliabilities, may be substantial and could exceed the valueproperty’s ofvalue. the property, andAdditionally, the presence of these hazardous or toxic substancessubstances, or the failure to properly remediate themthem, may adverselynegatively affectimpact our ability to sell or lease a contaminated property, borrow funds using the property as collateral, or increase future development costs, or may result in operational restrictions on the property.

Certain of our properties have confirmed ACBM, and other properties may contain such materials. Environmental laws require that ACBM be properly managed and maintained, and fines and penalties may be imposed on building owners or operators for failure to comply with these requirements. In addition,Furthermore, third parties may be allowed to seek recovery from owners or operators for personal injury associated with exposure to asbestos fibers.

Federal, state, and local governments impose environmental laws and regulations that govern our operations and those of our tenants, including with respect to air emissions, wastewater, stormwater, and the use, storage, and disposal of hazardous and toxic substances and petroleum products. We evaluate our properties for compliance with applicable environmental laws on a limited basis. The cost toof complycomplying with such laws and regulations may be significant, and suchthose laws may become more stringent over time. If we failFailure to comply with suchenvironmental laws, including if we failneglecting to obtain any required permits or licenses, we could faceresult in substantial fines or possible revocationloss of ouroperational authority to conduct some of our operations.authority.

We can provide no assurance that existing environmental studies with respect to our properties reveal all potential environmental liabilities or that current or future uses, conditions, or changes in environmental laws and regulations, including those related to climate change, will not result in environmental liabilities, additional costs, or operating restrictions on our properties or adverselynegatively affect our ability to sell or develop our properties or borrow funds using our properties as collateral.

Compliance with the ADA and fire, safetysafety, and other regulations may require us to make significant capital expenditures.

All of the properties in our portfolio are required to comply with Title III of the ADA to the extent that they are public accommodations as defined by the ADA. Compliance with the ADA requirements may requirenecessitate the removal ofremoving access barriers, and noncompliance could result in orders requiring uslead to make substantialsignificant capital expenditures and legal fees to cure violations and pay attorneys’ fees or other amounts.violations. Although we believe our properties substantially comply with the present requirements of the ADA, we have not conducted an audit or investigation of all ourof propertiesthem to determine our compliance. While our tenants are typically obligated to cover costs associated with compliance, if required changes involve greater expenditures or faster timelines than anticipated, the ability of some of our tenants to cover these costs could be limited. In addition, we are required to operate our properties in compliance with applicable fire and safety regulations, building codes, and other land use regulations as they are adopted by governmental entities and become applicable to our properties.entities. We may be required to make substantial capital expenditures to comply with these regulations, and we may be restricted in our ability to renovate theaffected properties subjectcould tobe these requirements,restricted, which could affect our cash flows and results of operations.

As with many technological innovations, the use of artificial intelligence, including generative and agentic AI tools (“AI”),tools, presents risks and challenges that could adversely affect our business. We are evaluating AI solutions to assist our employees with research, content generation, data synthesis, and decision support. Our vendors may incorporate AI tools into their services and deliverables without disclosing this totelling us, and the providerscompanies ofthat provide these AI tools may not meet existing or rapidly evolving regulatory or industry standards with respect to security, privacy, and data protection. IfFurther, we,we ourmay vendors,not be able to control how third-party AI technologies that we use are developed or maintained, how data we input is used or disclosed, even where we have sought contractual protections with respect to these matters, or how these third parties experiencecomply anwith actualevaluating regulatory or perceivedindustry privacystandards orgoverning securityAI. incidentIn because ofaddition, the use of AI,AI wetools couldmay loseintroduce valuableerrors intellectualor propertyinadequacies andthat confidentialare information,not andeasily ourdetectable, reputationincluding anddeficiencies, inaccuracies, or biases in the publicdata perceptionused for AI training or in the content, analyses, or recommendations generated by AI applications. Because of the effectiveness of our security measures could be harmed. In addition, AI or machine learning models may create incomplete, inaccurate, or otherwise flawed outputs, some of which may appear correct. Due to these issues,problems, these models could lead us to make flawed decisions that could result in adverse consequences to us, including reputational and competitive harm, loss of customers, and legal liability. Moreover, uncertainty in the regulatory environment related to AI may require significant resources to modify and maintain business practices to comply with applicable law, the nature of which continues to evolve and may prevent or limit our ability to use AI in our business, lead to regulatory fines or penalties, or require us to change our business practices. If we cannot use AI, or that use is restricted, our business may be less efficient, or we may be at a competitive disadvantage, which could adversely affect our business. In addition,Furthermore, investments in AI maymight not realizeyield the benefitsexpected that were anticipated.benefits.

The following discussion should be read in conjunction with the accompanying audited consolidated financial statements and related notes thereto and Item 1A.1A, “Risk FactorsFactors,” appearing elsewhere in this Annual Report on Form 10-K. In this discussion, unless the context suggests otherwise, referencesthe toterms “ourthe Company,” “we,” “us,” and “our” meanrefer to Kite Realty Group Trust and its direct and indirect subsidiaries, including Kite Realty Group, L.P.

Kite Realty Group Trust is a publicly held REIT that, through its majority-owned subsidiary, Kite Realty Group, L.P., owns interests in various operating subsidiaries and joint ventures engaged in the ownership, operation, acquisition, development, and redevelopment of high-quality, open-air, grocery-anchored shopping centers and vibrant mixed-use assets that are primarily located in high-growth Sun Belt markets and select strategic gateway markets in the United States. Following our merger with RPAI in 2021, we became a top-five open-air shopping center REIT based upon market capitalization. We derive our revenue primarily from the collection of contractual rents and reimbursement payments from tenants under existing lease agreements at each of our properties. Therefore, our operating results depend materially on, among other things, the ability of our tenants to make required lease payments, the health and resilience of the U.S. retail sector, particularly in light of increased tariffs in 2025, interest rate volatility, stability in the banking sector, job growth, the real estate market, and overall economic conditions.

As of December 31, 2024,2025, we own interests in 179a portfolio of 167 operating retail/mixed-use properties, including 159 wholly owned properties and eight properties owned through four unconsolidated joint ventures, totaling approximately 27.726.9 million square feet, excluding one(i) two operating retail propertyproperties classified as held for sale as of December 31, 2024,2025, (ii) Eastgate Crossing, a 152,682 square foot multi-tenant retail property in the Durham-Chapel Hill MSA that was reclassified from our operating portfolio in September 2025 due to significant disruption caused by severe flooding as a result of Tropical Storm Chantal, and (iii) two standalone office properties with 0.4 million square feet. Of the 179167 operating retail/mixed-use properties, 10 contain an office component. We also own interests in twoone development projectsproject that is under construction as of December 31, 20242025 and an additional two properties with future redevelopment opportunities.

Inflation and Tariffs

We continue to monitor the impact of inflation and tariffs on our operating and financial performance. Although inflation has moderated significantly from peak levels experienced during 2022, inflation may increase in the future as a result of multiple factors, including the tariffs implemented by the U.S. government in 2025 on imported goods from specific countries. These tariffs may lead to higher prices for many of the products that our tenants sell, potentially reducing consumer demand and spending and negatively impacting our tenants’ sales volume and overall health. This, in turn, has and could in the future put downward pricing pressure on rents that we are able to charge to new or renewing tenants, such that rent spreads and, in some cases, our percentage rents could be adversely impacted. Additionally, uncertainty regarding the scope and duration of the current and potential tariffs can lead to significant business uncertainty, affecting our tenants’ strategic planning and store expansion plans. Many of our leases contain provisions designed to mitigate the adverse impact of inflation, including stated rent increases and requirements for tenants to pay a share of operating expenses, including common area maintenance, real estate taxes, insurance, or other operating expenses related to the maintenance of our properties, with escalation clauses in certainmost leases. Over the past twofew years, we have made significant progress in executing leases that include higher fixed-rent bumpsincreases while also including CPI-based,consumer price index-based, anti-gouging protection for tenants. However, the stated rent increases or limits on such tenant’s obligation to pay its share of operating expenses could be lower than the increase in inflation at any given time. Inflation may also increase labor or other general and administrative expenses, which cannot be easily reduced.

Historically, economic indicators such as GDP growth, consumer confidence, and employment have been correlated with demand for certain of our tenants’ products and services. If anAn economic recession returns, it could, among other impacts, increase the number of our tenants that are unable to meet their lease obligations to us and limit the demand from new tenants for space in our properties.

Over the past two years, demand for open-air retail real estate has been strong due to the limited availability of desirable retail space and limited new construction over the previous 15 years. As a result, in 20242024, we experienced our highest annual leasing activity in the Company’s history with approximately 5.0 million square feet of leasing volume.volume, and in 2025, we leased approximately 4.6 million square feet at 13.8% comparable blended cash leasing spreads. Open-air centers are thriving for a variety of reasons, including their ability to function as last-mile fulfillment centers and their convenient and affordable nature for retailers and consumers. ThisTheir appeal includes conveniently located and easily accessible parking fields, lower operating costsexpenses as compared to other retail formats, and essential anchors that drive daily trips. In addition, the Company’s property types are particularly suited for retailers’ current and evolving needs, including curbside pick-up and buying online and picking up in store (“BOPIS”), which we believe will benefit from tenant demand for additional space. The strength of the Company’s real estate is further evidenced by our continued strong cash leasing spreads and ABR for the retail portfolio of $21.15$22.63 per square foot as of December 31, 2024.2025.

In evaluating potential acquisition, development, and redevelopment opportunities, we look for strong sub-markets where average household income, educational attainment, population density, traffic counts, and daytime workforce populations are above the broader market average. We also focus on locations that are benefiting from current population migratory patterns, namely major cities in business-friendly states with no or relatively low income taxes and mild or temperate climates. In our largest sub-markets,submarkets, household incomes are significantly higher,higher and state income taxes are relatively lower than the medians for the broader markets.

In addition to targeting sub-marketssubmarkets with strong consumer demographics, we focus on having the most desirable tenant mix at each shopping center. We have aggressively targeted and executed leases with prominent grocers, including Lidl, Aldi, Whole Foods, Trader Joe’s, Sprouts Farmers Market, and BJ’s Wholesale Club,Club; expanding retailers such as Nordstrom Rack, Homesense, Ross Dress for Less, Burlington, Sierra, J.Crew Factory, and pOpshelf,Boot Barn; service and restaurant retailers,retailers; and other retailers such as Ulta Beauty, Barnes & Noble, REI, Five Below, L.L.Bean, and Total Wine & More. Additionally, we have identified cost-efficient ways to relocate, re-tenant, and renegotiate leases at several of our properties, which allows us to attract more suitable tenants.

In 2024,2025, we maintained a conservative balance sheet and ample liquidity to fund future growth. We ended 20242025 with approximately $1.6$1.0 billion of combined cash and borrowing capacity on the Revolving Facility. In addition, as of December 31, 2024,2025, we had $430.0$410.6 million of debt principal scheduled to mature through December 31, 2025,2026, which we expect will be satisfied through a combination of proceeds from the Notes Due 2031 that were issued in August 2024, cash flows generated from operations, capital markets transactions, and borrowings on the Revolving Facility.

The three investment-grade credit ratings we maintain provide us with access to the unsecured public bond market, which we may continue to use in the future to finance acquisitions, repay maturing debt, and fixmaintain steady interest rates.

As of December 31, 2024,2025, we own interests in 179a portfolio of 167 operating retail/mixed-use properties, excluding two operating retail properties, excluding one operating retail propertyproperties classified as held for sale as of December 31, 2024,2025 and Eastgate Crossing, which was reclassified from our operating portfolio in September 2025 due to significant disruption caused by severe flooding as a result of Tropical Storm Chantal. We also own interests in two standalone office properties, twoone development projectsproject that areis currently under construction, and two additional properties with future redevelopment opportunities. The following table sets forth the total operating properties and development projects we own as of December 31, 2024,2025, 20232024 and 20222023:

(1)Included within the operating retail/mixed-use properties are 10, 10, and 1110 properties that contain an office component as of December 31, 2024,2025, 20232024 and 2022, respectively.2023.

The comparability of results of operations for the year ended December 31, 2024 is affected by ourOur development, redevelopment, and operating property acquisition and disposition activities between 20222023 throughand 2024.2025 affect the comparability of our results of operations for the year ended December 31, 2025. Therefore, we believe it is most useful to review the comparisons of our results of operations for these years (as set forth below under “Comparison of Operating Results for the Years Ended December 31, 20242025 and 20232024”) in conjunction with the discussion of our activities during those periods, which is set forth below.

In addition, during the year ended December 31,January 2024, the joint venture that owned Glendale Center Apartments, of which we have an 11.5% ownership interest, sold the 267-unit property to a third party. Glendale Center Apartments is adjacent to our Glendale Town Center operating retail property in the Indianapolis MSA.

(4)ApproximatelyIn January 2022, we sold approximately half of the Hamilton Crossing site was sold in January 2022 to Republic Airways Inc. and in August 2025, we sold an additional 36,895 square feet to Republic Airways. In addition to the sale, the Company entered into a development and construction management agreement for the development of a corporate campus for Republic Airways. Phase I of the corporate campus was completed in 2023.

In addition, during the year endedin December 31, 2024, the Company disposed of the first phase of a land parcel and the rights to develop 24 residential units at the One Loudoun Expansion in the Washington, D. C.D.C. MSA. The Company is under contract to sell the remaining land and the rights to develop an additional 54 residential units, which are expected to close in phases through 2026. Subsequent to December 31, 2025, the Company closed on the sale of the second phase of a land parcel and the rights to develop 14 residential units at the One Loudoun Expansion for a sales price of $3.7 million.

The net increase of $22.8$14.6 million in rental income for properties that were fully operational during 20232024 and 20242025 is primarily due to increases in the following: (i) base minimum rent of $13.5 million due to changes via contractual raterent increaseschanges and an increase in leasing spreads,spreads and (ii) tenant reimbursements of $11.1$4.4 million due to higher recoverable common area maintenance expenses, and (iii) ancillary income of $0.5 million.expenses. These variances were partially offset by an increase in bad debt expense of $1.3$2.0 million and decreases in overage rent of $0.8 million and lease termination income of $0.6 million and overage rent of $0.4 million. The occupancy of the fully operational properties decreased from 92.0%91.8% for 20232024 to 91.6%91.4% for 2024.2025.

We continued to experience strong leasing volumes in 20242025 and generate higher base rent on new leases and renewals. The average base rentsrent for new comparable leases signed in 20242025 was $27.29$29.78 per square foot compared to the average expiring base rentsrent of $20.69$23.96 per square foot in that period. The average base rentsrent for renewals signed in 20242025 was $17.27$17.62 per square foot compared to the average expiring base rentsrent of $16.19$16.41 per square foot in that period. For the entire portfolio, the spread between leased and occupied square footage is approximately 240340 basis points and represents approximately $27.3$37.0 million of NOI, the majority of which is expected to come online in 2025.2026. In addition, the ABR per square foot of our operating retail portfolio continued to improve, as it increased to $22.63 per square foot as of December 31, 2025 from $21.15 per square foot as of December 31, 2024 from $20.70 per square foot as of December 31, 2023.2024.

Other property-related revenue primarily consists of parking revenues, gains on the sale of land,revenues and other miscellaneous activity. This revenue increased by $2.1$3.1 million primarily as a result of higherthe gains on salesreceipt of land of $2.7$3.6 million recognized during the year ended December 31, 2024,2025 partiallyrelated offsetto bythe decreasesair rights lease at Eddy Street Commons in miscellaneousthe incomeSouth ofBend, $0.5IN million and parking revenue of $0.1 million.MSA.

We recorded fee income of $4.7$4.2 million and $4.4$4.7 million during the years ended December 31, 20242025 and 2023,2024, respectively, from property management and development services provided to third parties and unconsolidated joint ventures. The increasedecrease in fee income is primarily relateddue to development fees earned during the year ended December 31, 2024 related to the development of a hotel on the Pan Am Plaza site duringthat 2024,did not reoccur in 2025, partially offset by a decrease in developmentmanagement fees earned during 2025 related to the developmentLegacy ofWest aJoint corporateVenture campus for Republic Airways at Hamilton Crossing Centre in 2024 due toand the completionSeed ofAsset PhaseJoint I of the corporate campus in 2023.Venture.

The net increase of $8.2$3.5 million in property operating expenses for properties that were fully operational during 20232024 and 20242025 is primarily due to increases in the following: (i) $4.8snow millionremoval inexpenses insuranceof expenses,$1.0 million, (ii) $2.5 million in landscaping and repairsparking andlot maintenanceexpenses expenses,of $0.5 million, (iii) $0.8 million in non-recoverable operating expenses,expenses of $0.4 million, the majority of which relates to vacancies caused by retailer bankruptcies, and (iv) $0.3utilities millionof in$0.4 million, (v) administrative expenses of $0.4 million, and (vi) security expenses. These variances were partially offset by a decrease in utilitiesexpenses of $0.3 million. As a percentage of revenue, property operating expenses increased from 13.1%13.6% to 13.5%13.8%, primarily due to an increase in expenses in 2024.2025.

The net increase of $2.6$2.4 million in real estate taxes for properties that were fully operational during 20232024 and 20242025 is primarily due to higher real estate tax assessments at certain properties in the portfolio in 2024, most notably for certain of our Illinois and Indiana properties, and higher real estate tax consulting fees, partially offset by higherlower capitalized real estate tax expenses related to signed leasestaxes at certain properties in the portfolio in 2024.2025, along with a decrease in real estate tax refunds received during the year ended December 31, 2025. The majority of real estate tax expenses are recoverable from tenantstenants, and such recovery is reflected within “Rental income” in the accompanying consolidated statements of operations and comprehensive income.income (loss).

General, administrative and other expenses decreasedincreased $3.6$2.9 million, or 6.4%,5.5%, primarily due to loweran compensationincrease expensesin payroll expenses, consulting fees, and astate decreaseand inlocal consultingincome fees in 2024,taxes, partially offset by higherlower marketingcorporate expenses.communication expenses in 2025.

The net increase of $4.8$0.6 million in depreciation and amortization at properties under redevelopment or acquired during 20232024 and/or 20242025 is primarily due to the acquisitions of Prestonwood Place in September 2023 and Parkside West Cobb in August 2024 alongand withVillage the reclassification of Edwards Multiplex – Ontario into redevelopmentCommons in March 2023 and depreciation and amortization recorded for Carillon medical office building through December 2024.2025. The net decrease of $26.7$4.3 million in depreciation and amortization at properties that were fully operational during 20232024 and 20242025 is primarily due to the timing of placing assets in service and writing-offwriting off tenant-related assets as a result of tenant move-outs along with certain assets acquired in the October 2021 merger with RPAI that became fully depreciated during the year.move-outs.

Based on a reduction in the expectedresults futureof holdour periodevaluations for impairment (see Note 4 to the accompanying consolidated financial statements), we recorded a $66.2$51.8 million of impairment chargecharges during the year ended December 31, 20242025 relatedon tothe following properties: (i) $12.5 million impairment charge on Coram Plaza, a retail operating property in the New York MSA; (ii) $17.0 million impairment charge on City Center, a retail operating property in the New York MSA; thatand is(iii) classified$22.3 asmillion heldimpairment forcharge saleon asthe Carillon medical office building and retail portion of Decemberthe 31,property 2024.located in the Washington, D.C. MSA. During the year ended December 31, 2023,2024, we recorded a $0.5$66.2 million impairment charge onrelated Eastside,to aCity retail operating property in the Dallas/Ft. Worth MSA that was sold on October 24, 2023.Center.

We recorded a net gain on sales of operating properties of $292.0 million for the year ended December 31, 2025 on the sales of 13 operating retail properties and the contribution of three previously wholly owned properties to the Seed Asset Joint Venture compared to a net loss on sales of operating properties of $0.9 million for the year ended December 31, 2024 primarily on the sale of Ashland & Roosevelt, which loss was offset by the receipt of a $0.6 million escrow related to the sale of Reisterstown Road Plaza that previously closed on September 11, 2023. During the year ended December 31, 2023, we recorded a net gain on sales of operating properties of $22.6 million on the sale of Kingwood Commons, the undeveloped land and related parking garage at Pan Am Plaza, Reisterstown Road Plaza, and Eastside.

TheDuring the year ended December 31, 2024, we recognized a $2.3 million gain on sale of unconsolidated property representsrelated to our share of the gain on the sale of Glendale Center Apartments recognized during the year ended December 31, 2024.Apartments. No such gain was recorded during the year ended December 31, 2023.2025.

Other income, net increaseddecreased $15.9$8.8 millionmillion, or 49.4%, primarily due to a decrease in interest income earned on the proceeds from the Notes Due 2034 and the Notes Due 2031, which were invested in short-term deposits at various points during the year ended December 31, 2024.2025 compared to the prior year.

Management’s discussion of the financial condition, changes in financial conditioncondition, and results of operations for the year ended December 31, 2023,2024, with comparison to the year ended December 31, 2022,2023, was included in Item 7. “Management’s Discussion and Analysis of Financial Condition and Results of Operations” of our Annual Report on Form 10-K for the year ended December 31, 2023.2024.

We use property net operating income (“NOI”), a non-GAAP financial measure, to evaluate the performance of our properties. We also use total property NOI, which is defined as NOI plus net gains from outlot sales. We define NOI as income from our real estate, including lease termination fees received from tenants, less our property operating expenses. NOI excludes amortization of capitalized tenant improvement costs and leasing commissions and certain corporate-level expenses, including merger and acquisition costs. We believe that NOI is helpful to investors as a measure of our operating performance because it excludes various items included in net income that do not relate to or are not indicative of our operating performance, such as depreciation and amortization, interest expense, and impairment, if any.

We also use same property NOI (“Same Property NOI”), a non-GAAP financial measure, to evaluate the performance of our properties. Same Property NOI is net income excluding properties that have not been owned for the full periods presented. Same Property NOI also excludes (i) net gains from outlot sales, (ii) straight-line rent revenue, (iii) lease termination income in excess of lost rent, (iv) amortization of lease intangibles, and (v) significant prior period expense recoveries and adjustments, if any. When we receive payments in excess of any accounts receivable for terminating a lease, Same Property NOI will include such excess payments as monthly rent until the earlier of the expiration of 12 months or the start date of a replacement tenant. We believe that Same Property NOI is helpful to investors as a measure of our operating performance because it includes only the NOI of properties that have been owned for the full periods presented. We believe such presentation eliminates disparities in net income due to the acquisition or disposition of properties during the particular periods presented and thus provides a more consistent metric for the comparison of our properties. Same Property NOI includes the results of properties that have been owned for the entire current and prior year reporting periods. Same Property NOI for all periods presented includes 52% of the NOI from the three previously wholly owned properties that were contributed to the Seed Asset Joint Venture in June 2025.

•The Landing at TraditionCorner – Phase II,IN, which was reclassified from active redevelopmentdevelopment into our operating portfolio in JuneMarch 20232025;

•our active development and redevelopment projectsproject at The Corner – IN and One Loudoun Expansion;

•standalone office properties, including the Carillon medical office building, which was reclassified from active redevelopment into our office portfolio in December 2024.

(1)Same Property NOI excludes the following: (i) properties acquired or placed in service during 20232024 and 20242025; (ii) The Landing at TraditionCorner – Phase II,IN, which was reclassified from active redevelopmentdevelopment into our operating portfolio in JuneMarch 20232025; (iii) Eastgate Crossing, which was reclassified from our operating portfolio in September 2025 due to significant disruption caused by severe flooding as a result of Tropical Storm Chantal; (iv) our active development and redevelopment projectsproject at The Corner – IN and One Loudoun Expansion; (ivv) Hamilton Crossing Centre and Edwards Multiplex – Ontario, which were reclassified from our operating portfolio into redevelopment in June 2014 and March 2023, respectively; (vvi) properties sold or classified as held for sale during 20232024 and 20242025; and (vivii) standalone office properties, including the Carillon medical office building, which was reclassified from active redevelopment into our office portfolio in December 2024.

Our Same Property NOI increased 3.0%2.9% in 20242025 compared to 20232024 primarily due to contractual rent growth,growth and higher base rent driven by positive new and renewal leasing spreads, and an increase in specialty leasing income from certain tenants, partially offset by higher bad debt expense.

NAREIT Funds From Operations

NAREIT Funds fromFrom Operations (“FFO”) is a widely used performance measure for real estate companies and is provided here as a supplemental measure of our operating performance. We calculate FFO, a non-GAAP financial measure, in accordance with the best practices described in the April 2002 National Policy Bulletin of the National Association of Real Estate Investment Trusts (“NAREIT”), as restated in 2018. The NAREIT white paper defines FFO as net income (calculated in accordance with GAAP), excluding (i) depreciation and amortization related to real estate, (ii) gains and losses from the sale of certain real estate assets, (iii) gains and losses from change in control, and (iv) 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.

Considering the nature of our business as a real estate owner and operator, thewe Company believesbelieve that FFO is helpful to investors in measuring our operational performance because it excludes various items included in net income that do not relate to or are not indicative of our operating performance, such as gains or losses from sales of depreciated property and depreciation and amortization, which can make periodic and peer analyses of operating performance more difficult. FFO (a) should not be considered as an alternative to net income (calculated in accordance with GAAP) for the purpose of measuring our financial performance, (b) is not an alternative to cash flows from operating activities (calculated in accordance with GAAP) as a measure of our liquidity, and (c) is not indicative of funds available to satisfy our cash needs, including our ability to make distributions. Our computation of FFO may not be comparable to FFO reported by other REITs that do not define the term in accordance with the current NAREIT definition or that interpret the current NAREIT definition differently than we do.

From time to time, the Companywe may report or provide guidance with respect to “FFO, as adjusted,” which removes the impact of certain non-recurring and non-operating transactions or other items the Company does not consider to be representative of its core operating resultsresults, including, without limitation, (i) gains or losses associated with the early extinguishment of debt, (ii) gains or losses associated with litigation involving the Company that is not in the normal course of business, (iii) merger and acquisition costs, (iv) the impact on earnings from significant and non-recurring employee severance,severance costs and recruiting expenses, including sign-on bonuses and search fees, (v) the excess of redemption value over carrying value of preferred stock redemption, and (vi) the impact of prior period bad debt or the collection of accounts receivable previously written off (“prior period collection impact”) due to the recovery from the COVID-19 pandemic,, which are not otherwise adjusted in the Company’sour calculation of FFO.

Core Funds From Operations (“Core FFO”) is a non-GAAP financial measure of operating performance that modifies FFO for certain non-cash transactions that result in recording income or expense and impact the Company’sour period-over-period performance, including (i) amortization of deferred financing costs, (ii) non-cash compensation expense and other, (iii) straight-line rent related to minimum rent and common area maintenance, (iv) market rent amortization income, and (v) amortization of debt discounts, premiums and hedge instruments.instruments, Theand Companyincludes believesadjustments related to our pro rata share from unconsolidated joint ventures for these categories as applicable. We believe that Core FFO is useful to investors in evaluating theour core cash flow-generating operations of the Company by adjusting for items that we do not consider to be part of our core business operations, allowing for comparison of our core operating performance of the Company between periods. Core FFO should not be considered as an alternative to net income as an indicator of the Company’sour performance or as an alternative to cash flow as a measure of liquidity or the Company’sour ability to make distributions. The Company’sOur computation of Core FFO may differ from the methodology for calculating Core FFO used by other REITs, and therefore, may not be comparable to such other REITs.

Our calculations of FFO and reconciliations to net income (loss), FFO, as adjusted, and Core FFO for the years ended December 31, 2024,2025, 20232024 and 20222023 (unaudited) are as follows (dollars in thousands):

•economic, business, banking, real estate and other market conditions, particularly in connection with low or negative growth in the U.S. economy as well as economic uncertainty (including from an economic slowdown or recession, federal government shutdown, disruptions related to tariffs and other trade or sanction issues, geopolitical instability in the Middle East,instability, rising interest rates, inflation, unemployment, or limited growth in consumer income or spending);

•financing risks, including the availability of, and costs associated with, sources of liquidityliquidity, and our ability to use offering proceeds for the anticipated purposes;

•risks associated with cyber attackscyberattacks and the loss of confidential information and other business disruptions;

As of MarchJune 31,30, 2026, we own interests in a portfolio of 167163 operating retail/mixed-use properties, including 159155 wholly owned shopping centers and eight properties owned through four unconsolidated joint ventures, totaling approximately 26.926.0 million square feet, excluding (i) one operating retail property classified as held for sale as of March 31, 2026, (ii) Eastgate Crossing, a 152,682 square foot multi-tenant retail property in the Durham-Chapel Hill MSA that was reclassified from our operating portfolio in September 2025 due to significant disruption caused by severe flooding as a result of Tropical Storm Chantal, and (iiiii) two standalone office properties with 0.4 million square feet. Of the 167163 operating retail/mixed-use properties, 1011 contain an office component. We also own interests in one development project under construction as of MarchJune 31,30, 2026 and an additional two properties with future redevelopment opportunities.

We continue to monitor the impact of inflation and tariffs on our operating and financial performance. Although inflation has moderated significantly from peak levels experienced during 2022, inflation may increase in the future as a result of multiple factors, including the tariffs implemented by the U.S. government in 2025 on imported goods from specific countries and inflationary pressures arising from geopolitical instability in the Middle East.instability. These tariffs may lead to higher prices for many of the products that our tenants sell, potentially reducing consumer demand and spending and negatively impacting our tenants’ sales volume and overall health. This, in turn, has and could in the future put downward pricing pressure on rents that we are able to charge to new or renewing tenants, such that rent spreads and, in some cases, our percentage rents could be adversely impacted. Additionally, uncertainty regarding the scope and duration of the current and potential tariffs can lead to significant business uncertainty, affecting our tenants’ strategic planning and store expansion plans. Many of our leases contain provisions designed to mitigate the adverse impact of inflation, including stated rent increases and requirements for tenants to pay a share of operating expenses, including common area maintenance, real estate taxes, insurance, or other operating expenses related to the maintenance of our properties, with escalation clauses in most leases. Over the past few years, we have made significant progress in executing leases that include higher fixed-rent increases while also including consumer price index-based, anti-gouging protection for tenants. However, the stated rent increases or limits on such tenant’s obligation to pay its share of operating expenses could be lower than the increase in inflation at any given time. Inflation may also increase labor or other general and administrative expenses, which cannot be easily reduced.

During the firstsecond quarter of 2026, we executed new and renewal leases on 151128 individual spaces totaling 707,000approximately 1.0 million square feet (13.5%15.9% cash leasing spread on 113103 comparable leases). New leases were signed on 4744 individual spaces for 163,714329,750 square feet of gross leasable area (“GLA”) (31.3%28.4% cash leasing spread on 2629 comparable leases), while non-option renewal leases were signed on 6447 individual spaces for 219,136188,717 square feet of GLA (12.3%17.7% cash leasing spread on 4737 comparable leases) and option renewals were signed on 4037 individual spaces for 324,150476,194 square feet of GLA (7.0%6.6% cash leasing spread). The blended cash spread for comparable new and non-option renewal leases was 19.0%.24.7%. Comparable new and renewal leases are defined as those for which the space was occupied by a tenant within the last 12 months. As of June 30, 2026, the Company’s operating retail portfolio annualized base rent per square foot was $23.41.

Our development, redevelopment, and operating property acquisition and disposition activities during 2025 and 2026 affect the comparability of our results of operations for the three and six months ended MarchJune 31,30, 2026 and 2025. Therefore, we believe it is most useful to review the comparisons of our results of operations for these periods (as set forth below under “Comparison of Operating Results for the Three Months Ended MarchJune 31,30, 2026 to the Three Months Ended MarchJune 31,30, 2025” and “Comparison of Operating Results for the Six Months Ended June 30, 2026 to the Six Months Ended June 30, 2025”) in conjunction with the discussion of our transaction activities during those periods, which is set forth below.

The following operating properties were acquired during the period from January 1, 2025 through MarchJune 31,30, 2026:

The following operating properties were sold during the period from January 1, 2025 through MarchJune 31,30, 2026:

The following properties were under active development or redevelopment at various times during the period from January 1, 2025 through MarchJune 31,30, 2026 and removed from our operating portfolio:

(2)The property is comprised of the development project (which has been excluded from the Company’s same property pool due to the ongoing development) and the remaining retail operating portion of the property (which is included in the Company’s same property pool as of MarchJune 31,30, 2026).

In addition, in January 2026 and April 2026, the Company disposed of the second phaseand third phases of a land parcel and the rights to develop 14 residential units in each phase at the One Loudoun Expansion in the Washington, D.C. MSA. TheSubsequent to June 30, 2026, the Company is under contract to sellsold the remaining land and the rights to develop an additional 4022 residential units,units whichat arethe expectedOne toLoudoun close in phases through 2026.Expansion.

Comparison of Operating Results for the Three Months Ended MarchJune 31,30, 2026 to the Three Months Ended MarchJune 31,30, 2025

The following table reflects changes in the components of our consolidated statements of operations for the three months ended MarchJune 31,30, 2026 and 2025 (in thousands):

The net increase of $7.8$3.5 million in rental income for properties that were fully operational during 2025 and 2026 is primarily due to aincreases $3.4in base minimum rent of $4.3 million from contractual rent changes and an increase in leasing spreads and tenant reimbursements of $1.4 million from higher recoverable common area maintenance expenses and real estate taxes,taxes. $2.8These millionvariances were partially offset by a decrease in lease termination income,income aof $0.6$2.2 million decrease in bad debt expense, and $0.5 million increases in both base minimum rent from contractual rent changes and overage rent.million. The occupancy of the fully operational properties decreased from 92.2%91.0% for the three months ended MarchJune 31,30, 2025 to 91.1%90.9% for the three months ended MarchJune 31,30, 2026.

Other property-related revenue primarily consists of parking revenues and other miscellaneous activity. This revenue decreasedincreased by $0.1$0.2 million primarily due to aan decreaseincrease in miscellaneousparking income.revenue.

We recorded fee income of $1.3$1.4 million and $0.4$0.9 million during the three months ended MarchJune 31,30, 2026 and 2025, respectively, from property management and development services provided to third parties and unconsolidated joint ventures. The increase in fee income is primarily due to management fees earned during the three months ended MarchJune 31,30, 2026 related to the Legacy West Joint Venture and the Seed Asset Joint Venture.

Property operating expenses increaseddecreased $1.3$0.4 million, or 4.3%,1.3%, due to the following (in thousands):

The net increase of $3.0$2.3 million in property operating expenses for properties that were fully operational during 2025 and 2026 is primarily due to increases in the following: (i) a $0.7$0.8 million increasein insurance expenses; (ii) $0.6 million in both snow removal expenses and repairs and maintenance expenses, (ii) a $0.6 million increase in insurance expenses, andexpenses; (iii) a $0.4 million increase in both landscaping and parking lot expenses; and (iv) $0.4 million in nonrecoverable expenses. As a percentage of revenue, property operating expenses increased from 13.5% to 15.5%14.5% due to an increase in expenses in 2026.

The net increase of $0.3$0.9 million in real estate taxes for properties that were fully operational during 2025 and 2026 is primarily due to higher real estate tax assessments at certain properties in the portfolio in 2026,2026 partiallyand offset by an increase inlower real estate tax refunds received during the three months ended MarchJune 31,30, 2026. The majority of real estate tax expenses are recoverable from tenants, and such recovery is reflected within “Rental income” in the accompanying consolidated statements of operations and comprehensive income.

General, administrative and other expenses increased $1.7$1.2 million, or 13.8%,8.6%, primarily due to an increase in payroll expenses,expenses and share-based compensation, and state and local income taxescompensation in 2026.

Interest expense decreased $1.3$2.3 million, or 3.8%,6.8%, primarily due to the payoffs of the following in 2025: (i) $350.0 million in aggregate principal balance of the 4.00% senior unsecured notes that matured in March 2025, (ii) $150.0 million unsecured term loan in June 2025,2025 and (iii)the $80.0 million principal balance of the 4.47% senior unsecured notes that matured in September 2025, as well as a decrease in borrowings on the unsecured revolving line of credit, partially offset by interest incurred on the $300.0 million in aggregate principal amount of the 5.20% senior unsecured notes issued in June 2025.

We recorded a net gain from outlot sales of $1.0$1.4 million for the three months ended MarchJune 31,30, 2026 primarily on the sale of a land parcel and the rights to develop 14 residential units at the One Loudoun Expansion in the Washington, D.C. MSA. We did not sell any land parcels during the three months ended MarchJune 31,30, 2025.

OtherEquity income,in netloss of unconsolidated joint ventures decreased $2.2$1.9 million, or 45.8%,58.5%, primarily due to aimproved decreaseoperating inperformance interestat incomecertain earnedjoint venture properties during the three months ended MarchJune 31,30, 2026 compared to the prior year.

We believe that Same Property NOI is helpful to investors as a measure of our operating performance because it includes only the NOI of properties that have been owned for the full periods presented. We believe such presentation eliminates disparities in net income due to the acquisition or disposition of properties during the particular periods presented and thus provides a more consistent metric for the comparison of our properties. Additionally, because results from the Company’s insurance captive are driven by insurance underwriting, loss experience, and actuarial assumptions and therefore do not reflect the operating performance of our real estate properties, we believe excluding the impacts of the insurance captive improves transparency and comparability for our investors. Same Property NOI includes the results of properties that have been owned for the entire current and prior year reporting periods. Same Property NOI for all periods presented includes (i) 52% of the NOI from three previously wholly owned properties that were contributed to the Seed Asset Joint Venture in June 2025 and (ii) 55% of the NOI from the One Loudoun Phase 1 Apartments (which 55% represents the Company’s expected final ownership percentage) and excludes the results of the Company’s insurance captive.

For the three and six months ended MarchJune 31,30, 2026, the Same Property Pool excludes the following:

•Chastain Market and Founders Square, which were acquired in May 2026, and Village Commons and Legacy West, which were acquired in 2025January and April 2025, respectively;

•our active development projectprojects at One Loudoun Expansion;

The following table presents Same Property NOI and a reconciliation to net income attributable to common shareholders for the three and six months ended MarchJune 31,30, 2026 and 2025 (dollars in thousands):