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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549 
FORM 10-K
ANNUAL REPORT PURSUANT TO THE SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended December 31, 2023
OR
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from              to             

Commission file number: 1-07533 (Federal Realty Investment Trust)
Commission file number: 333-262016-01 (Federal Realty OP LP) 

FEDERAL REALTY INVESTMENT TRUST
FEDERAL REALTY OP LP
(Exact Name of Registrant as Specified in its charter) 
Maryland (Federal Realty Investment Trust)
 87-3916363
Delaware (Federal Realty OP LP)
52-0782497
(State of Organization) (IRS Employer Identification No.)
909 Rose Avenue, Suite 200, North Bethesda, Maryland 20852
(Address of Principal Executive Offices) (Zip Code)
(301) 998-8100
(Registrant’s Telephone Number, Including Area Code) 
Securities registered pursuant to Section 12(b) of the Act:
Federal Realty Investment Trust
Title of Each ClassTrading SymbolName of Each Exchange On Which Registered
Common Shares of Beneficial InterestFRTNew York Stock Exchange
$.01 par value per share, with associated Common Share Purchase Rights
Depositary Shares, each representing 1/1000 of a shareFRT-CNew York Stock Exchange
of 5.00% Series C Cumulative Redeemable Preferred Stock, $.01 par value per share
Federal Realty OP LP
Title of Each ClassTrading SymbolName of Each Exchange On Which Registered
NoneN/AN/A
Securities registered pursuant to Section 12(g) of the Act: None
Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.
Federal Realty Investment Trust       Yes      No
Federal Realty OP LP           Yes      No
Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act.
Federal Realty Investment Trust       Yes      No
Federal Realty OP LP           Yes      No
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
Federal Realty Investment Trust      Yes      No
Federal Realty OP LP              Yes      No


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Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).
Federal Realty Investment Trust      Yes      No
Federal Realty OP LP              Yes      No
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and "emerging growth company" in Rule 12b-2 of the Exchange Act:
Federal Realty Investment Trust
Large accelerated filerAccelerated filer
Non-accelerated filerSmaller reporting company
Emerging growth company
Federal Realty OP LP
Large accelerated filerAccelerated filer
Non-accelerated filerSmaller reporting company
Emerging growth company
If an emerging growth company, indicate by checkmark if the registrant has elected not use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.
Indicate by check mark whether the registrant has filed a report on and attestation to its management's assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report.
Federal Realty Investment Trust
Federal Realty OP LP
If securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant included in the filing reflect the correction of an error to previously issued financial statements.
Federal Realty Investment Trust
Federal Realty OP LP
Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation received by any of the registrant’s executive officers during the relevant recovery period pursuant to § 240.10D-1(b).
Federal Realty Investment Trust
Federal Realty OP LP
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act).
Federal Realty Investment Trust      Yes      No
Federal Realty OP LP              Yes      No

The aggregate market value of the registrant's common shares held by non-affiliates of the registrant, based upon the closing sales price of the registrant's common shares on June 30, 2023:    
Federal Realty Investment Trust: $7.9 billion
Federal Realty OP LP: N/A

The number of Federal Realty Investment Trust's common shares outstanding on February 7, 2024 was 82,989,879.


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DOCUMENTS INCORPORATED BY REFERENCE
Portions of Federal Realty Investment Trust’s Proxy Statement to be filed with the Securities and Exchange Commission (the "SEC") for its annual meeting of shareholders to be held in May 2024 will be incorporated by reference into Part III hereof.

EXPLANATORY NOTE
This report combines the annual reports on Form 10-K for the year ended December 31, 2023, of Federal Realty Investment Trust and Federal Realty OP LP. Unless stated otherwise or the context otherwise requires, references to "Federal Realty Investment Trust," the "Parent Company" or the "Trust" mean Federal Realty Investment Trust; and references to "Federal Realty OP LP" or the "Operating Partnership" mean Federal Realty OP LP. The term "the Company," "we," "us," and "our" refer to the Parent Company and its business and operations conducted through its directly and indirectly owned subsidiaries, including the Operating Partnership. References to "shares" and "shareholders" refer to the shares and shareholders of the Parent Company and not the limited partnership interests for limited partners of the Operating Partnership.
The Parent Company is a real estate investment trust ("REIT") that owns 100% of the limited liability company interests of, is the sole member of, and exercises exclusive control over Federal Realty GP LLC (the "General Partner"), which is the sole general partner of the Operating Partnership. As of December 31, 2023, the Parent Company owned 100% of the outstanding partnership units (the "OP Units") in the Operating Partnership.
The Company believes combining the annual reports on Form 10-K of the Parent Company and the Operating Partnership into this single report provides the following benefits:
Enhances investors' understanding of the Parent Company and the Operating Partnership by enabling investors to view the businesses as a whole in the same manner as management views and operates the business;
Eliminates duplicate disclosure and provides a more streamlined and readable presentation; and
Creates time and cost efficiencies through the preparation of one combined report instead of two separate reports.
Management operates the Parent Company and the Operating Partnership as one business. Since the Operating Partnership is managed by the Parent Company, and the Parent Company conducts substantially all of its operations through the Operating Partnership, the management of the Parent Company consists of the same individuals as the management of the Operating Partnership.
We believe it is important to understand the few differences between the Parent Company and the Operating Partnership in the context of how the Parent Company and the Operating Partnership operate as a consolidated company. The Parent Company is a REIT, whose only material asset is its direct and indirect interest in the Operating Partnership. As a result, the Parent Company does not conduct business itself other than issuing public equity from time to time. The Parent Company is not expected to incur any material indebtedness. The Operating Partnership holds substantially all of our assets and retains the ownership interests in the Company's joint ventures. Except for net proceeds from public equity issuances by the Parent Company, which are contributed to the Operating Partnership in exchange for OP Units, the Operating Partnership generates all capital required by the Company’s business. Sources of this capital include the Operating Partnership’s operations, its direct or indirect incurrence of indebtedness, and the issuance of partnership units.
Shareholders' equity, partner capital, and non-controlling interests are the primary areas of difference between the Consolidated Financial Statements of the Parent Company and those of the Operating Partnership. The Operating Partnership’s capital currently includes OP Units owned by the Parent, and may in the future include OP Units owned by third parties. OP Units owned by third parties, if any, are accounted for in capital in the Operating Partnership’s financial statements and in non-controlling interests in the Parent Company’s financial statements.
The Parent Company consolidates the Operating Partnership for financial reporting purposes, and the Parent Company does not have assets other than its investment in the Operating Partnership. Therefore, while shareholders’ equity and partners' capital differ as discussed above, the assets and liabilities of the Parent Company and the Operating Partnership are the same on their respective financial statements.
In order to highlight the differences between the Parent Company and the Operating Partnership, there are sections in this report that separately discuss the Parent Company and the Operating Partnership, including separate financial statements (but combined footnotes), separate controls and procedures sections, and separate Exhibit 31 and 32 certifications. In the sections that combine disclosure for the Parent Company and the Operating Partnership, this report refers to actions or holdings as being actions or holdings of the Company.


Table of Contents
FEDERAL REALTY INVESTMENT TRUST
FEDERAL REALTY OP LP
ANNUAL REPORT ON FORM 10-K
FISCAL YEAR ENDED DECEMBER 31, 2023
TABLE OF CONTENTS
PART I
Item 1.Business
Item 1A.Risk Factors
Item 1B.Unresolved Staff Comments
Item 1C.Cyber Security
Item 2.Properties
Item 3.Legal Proceedings
Item 4.Mine Safety Disclosures
PART II
Item 5.Market for Our Common Equity and Related Shareholder Matters and Issuer Purchases of Equity Securities
Item 6.Reserved
Item 7.Management’s Discussion and Analysis of Financial Condition and Results of Operations
Item 7A.Quantitative and Qualitative Disclosures About Market Risk
Item 8.Financial Statements and Supplementary Data
Item 9.Changes In and Disagreements with Accountants on Accounting and Financial Disclosure
Item 9A.Controls and Procedures
Item 9B.Other Information
PART III
Item 10.Trustees, Executive Officers and Corporate Governance
Item 11.Executive Compensation
Item 12.Security Ownership of Certain Beneficial Owners and Management and Related Shareholder Matters
Item 13.Certain Relationships and Related Transactions, and Trustee Independence
Item 14.Principal Accountant Fees and Services
PART IV
Item 15.Exhibits and Financial Statement Schedules
Item 16.Form 10-K Summary
SIGNATURES
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PART I


Forward-Looking Statements

Certain statements included in this Annual Report on Form 10-K are forward-looking statements. Those statements include statements regarding the intent, belief or current expectations of Federal Realty Investment Trust and Federal Realty OP LP (together, “we” “our” or “us”) and members of our management team, as well as the assumptions on which such statements are based, and generally are identified by the use of words such as “may,” “will,” “seeks,” “anticipates,” “believes,” “estimates,” “expects,” “plans,” “intends,” “should” or similar expressions. Actual results may differ materially from those contemplated by such forward-looking statements. Further, forward-looking statements speak only as of the date they are made, and we undertake no obligation to update or revise forward-looking statements to reflect changed assumptions, the occurrence of unanticipated events or changes to future operating results over time, unless required by law.

The following are some of the risks and uncertainties, although not all risks and uncertainties, that could cause our actual results to differ materially from those presented in our forward-looking statements:

risks that our tenants will not pay rent, may vacate early or may file for bankruptcy or that we may be unable to renew leases or re-let space at favorable rents as leases expire or to fill existing vacancy;
risks that we may not be able to proceed with or obtain necessary approvals for any development, redevelopment or renovation project, and that completion of anticipated or ongoing property development, redevelopment, or renovation projects that we do pursue may cost more, take more time to complete or fail to perform as expected;
risks normally associated with the real estate industry, including risks that occupancy levels at our properties and the amount of rent that we receive from our properties may be lower than expected, that new acquisitions may fail to perform as expected, that competition for acquisitions could result in increased prices for acquisitions, that costs associated with the periodic maintenance and repair or renovation of space, insurance and other operations may increase, that environmental issues may develop at our properties and result in unanticipated costs, and, because real estate is illiquid, that we may not be able to sell properties when appropriate;
risks that our growth will be limited if we cannot obtain additional capital, or if the costs of capital we obtain are significantly higher than historical levels;
risks associated with general economic conditions, including inflation and local economic conditions in our geographic markets;
risks of financing on terms which are acceptable to us, our ability to meet existing financial covenants and the limitations imposed on our operations by those covenants, and the possibility of increases in interest rates that would result in increased interest expense;
risks related to our status as a real estate investment trust, commonly referred to as a REIT, for federal income tax purposes, such as the existence of complex tax regulations relating to our status as a REIT, the effect of future changes in REIT requirements as a result of new legislation, and the adverse consequences of the failure to qualify as a REIT; and
risks related to natural disasters, climate change and public health crises (such as the outbreak and worldwide spread of COVID-19), and the measures that international, federal, state and local governments, agencies, law enforcement and/or health authorities implement to address them, may precipitate or materially exacerbate one or more of the above-mentioned risks, and may significantly disrupt or prevent us from operating our business in the ordinary course for an extended period.

In addition, we describe risks and uncertainties that could cause actual results and events to differ materially in “Risk Factors” (Part I, Item 1A of this Annual Report on Form 10-K), “Quantitative and Qualitative Disclosures about Market Risk” (Part II, Item 7A), and “Management’s Discussion and Analysis of Financial Conditions and Results of Operations” (Part II, Item 7).
ITEM 1.    BUSINESS
General
Federal Realty Investment Trust (the "Parent Company" or the "Trust") is an equity real estate investment trust ("REIT"). Federal Realty OP LP (the "Operating Partnership") is the entity through which the Trust conducts substantially all of its operations and owns substantially off of its assets. The Trust owns 100% of the limited liability company interest of, is sole
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member of, and exercises exclusive control over Federal Realty GP LLC (the "General Partner"), which in turn, is the sole general partner of the Operating Partnership. Unless stated otherwise or the context otherwise requires, "we," "our," and "us" means the Trust and its business and operations conducted through its directly and indirectly owned subsidiaries, including the Operating Partnership. We specialize in the ownership, management, and redevelopment of high quality retail and mixed-use properties located primarily in communities where we believe retail demand exceeds supply, in strategically selected metropolitan markets in the Mid-Atlantic and Northeast regions of the United States, California, and South Florida. As of December 31, 2023, we owned or had a majority interest in community and neighborhood shopping centers and mixed-use properties which are operated as 102 predominantly retail real estate projects comprising approximately 26.0 million commercial square feet. In total, the real estate projects were 94.2% leased and 92.2% occupied at December 31, 2023. Our revenue is primarily generated from lease agreements with tenants. We have paid quarterly dividends to our shareholders continuously since our founding in 1962 and have increased our dividends per common share for 56 consecutive years.
We were founded in 1962 as a REIT under the laws of the District of Columbia and re-formed as a REIT in the state of Maryland in 1999. In January of 2022, we consummated the UPREIT reorganization described in the Explanatory Note at the beginning of this Annual Report. We operate in a manner intended to qualify as a REIT for tax purposes pursuant to provisions of the Internal Revenue Code of 1986, as amended (the “Code”). Our principal executive offices are located at 909 Rose Avenue, North Bethesda, Maryland 20852. Our telephone number is (301) 998-8100. Our website address is www.federalrealty.com. The information contained on our website is not a part of this report and is not incorporated herein by reference.
Business Objectives and Strategies
Our primary business objective is to own, manage, acquire and redevelop a portfolio of high quality retail focused properties that will:
provide increasing cash flow for distribution to shareholders;
generate higher internal growth than the shopping center industry over the long term;
provide potential for capital appreciation; and
protect investor capital.
Our portfolio includes, and we continue to acquire and redevelop, high quality retail in many formats ranging from regional, community and neighborhood shopping centers that often are anchored by grocery stores to mixed-use properties that are typically centered around a retail component but also include residential, office, and/or hotel components.
Operating Strategies
We continuously evaluate and assess our operating strategies to ensure they are effective and put us in the best position to address changes in the market. We actively manage our properties to maximize rents and maintain occupancy levels by attracting and retaining a strong and diverse base of tenants and replacing less relevant, weaker, underperforming tenants with stronger ones. Our properties are generally located in some of the most densely populated and affluent areas of the country. These strong demographics help our tenants generate higher sales, which has generally enabled us to maintain higher occupancy rates, charge higher rental rates, and maintain steady rent growth, all of which increase the value of our portfolio. Our operating strategies also include:
increasing rental rates through the negotiation of contractual rental increases during the term of the lease, the renewal of expiring leases or the leasing of space to new tenants at higher rental rates while limiting vacancy and down-time;
maintaining a diversified tenant base, thereby limiting exposure to any one tenant’s financial or operating difficulties;
monitoring the merchandising mix of our tenant base to achieve a balance of strong national and regional tenants with local specialty tenants;
minimizing overhead and operating costs;
monitoring the physical appearance of our properties and the construction quality, condition and design of the buildings and other improvements located on our properties to maximize our ability to attract customers and thereby generate higher rents and occupancy rates;
managing our properties to take into account their impact on climate change and their resilience in the face of climate change;
developing local and regional market expertise in order to capitalize on market and retailing trends;
leveraging the contacts and experience of our management team to build and maintain long-term relationships with tenants;
providing exceptional customer service; and
creating an experience at many of our properties that is identifiable, unique and serves the surrounding communities to help insulate these properties and the tenants at these properties from the impact of on-line retailing.

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Investing Strategies
Our investment strategy is to deploy capital at risk-adjusted rates of return that exceed our long-term weighted average cost of capital in projects that have potential for future income growth and increased value. Our investments primarily fall into one of the following four categories:
renovating, expanding, reconfiguring and/or retenanting our existing properties to take advantage of under-utilized land or existing square footage to increase revenue;
renovating or expanding tenant spaces for tenants capable of producing higher sales, and therefore, paying higher rents;
acquiring quality retail and mixed-use properties located in densely populated and/or affluent areas where barriers to entry for further development are high, and that have possibilities for enhancing operating performance and creating value through renovation, expansion, reconfiguration and/or retenanting; and
developing the retail portions of mixed-use properties and developing or otherwise investing in non-retail portions of mixed-use properties we already own in order to capitalize on the overall value created in these properties.
Investment Criteria
When we evaluate potential redevelopment, retenanting, expansion, acquisition and development opportunities, we consider such factors as:
the expected returns in relation to our short and long-term cost of capital as well as the anticipated risk we will face in achieving the expected returns;
the anticipated growth rate of operating income generated by the property;
the ability to increase the long-term value of the property through redevelopment and retenanting;
the tenant mix at the property, tenant sales performance and the creditworthiness of those tenants;
the geographic area in which the property is located, including the population density, household incomes, education levels, as well as the population and income trends in that geographic area. This may from time to time include the evaluation of new markets;
competitive conditions in the vicinity of the property, including gross leasable area (GLA) per capita, competition for tenants and the ability of others to create competing properties through redevelopment, new construction or renovation;
access to and visibility of the property from existing roadways and the potential for new, widened or realigned, roadways within the property’s trade area, which may affect access and commuting and shopping patterns;
the level and success of our existing investments in the market area;
the current market value of the land, buildings and other improvements and the potential for increasing those market values; and
the physical condition of the land, buildings and other improvements, including the structural and environmental condition.
Financing Strategies
Our financing strategies are designed to enable us to maintain an investment grade balance sheet while retaining sufficient flexibility to fund our operating and investing activities in the most cost-efficient way possible. Our financing strategies include:
maintaining a prudent level of overall leverage and an appropriate pool of unencumbered properties that is sufficient to support our unsecured borrowings;
managing our exposure to variable-rate debt;
maintaining sufficient levels of cash and available line of credit to fund operating and investing needs on a short-term basis;
taking advantage of market opportunities to refinance existing debt, reduce interest costs and manage our debt maturity schedule so that a significant portion of our debt relative to our size does not mature in any one year;
selling properties that have limited growth potential or are not a strategic fit within our overall portfolio and redeploying the proceeds to redevelop, renovate, retenant and/or expand our existing properties, acquire new properties or reduce debt; and
utilizing the most advantageous long-term source of capital available to us to finance redevelopment and acquisition opportunities, which may include:
the sale of our equity or debt securities through public offerings, including our at-the-market ("ATM") equity program in which we may from time to time offer and sell common shares including through forward sales contracts, or private placements,
the incurrence of indebtedness through unsecured or secured borrowings including exchangeable debt,
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the issuance of units in our operating partnership (generally issued in exchange for a tax deferred contribution of property); these units typically receive the same distributions as our common shares and the holders of these units have the right to exchange their units for cash or common shares at our option, or
the use of joint venture arrangements.
Human Capital
At February 7, 2024, we had 297 full-time employees and 7 part-time employees. None of our employees are represented by a collective bargaining unit. We believe that our relationship with our employees is good.
Diversity and Inclusion
We are an Equal Opportunity/Affirmative action employer, and strive to maintain a workplace that is free from discrimination on the basis of race, color, religion, sex, sexual orientation, nationality, disability, or protected Veteran status.
Health, Safety, and Wellness
We are committed to the health, safety, and wellness of our employees, and foster an environment that allows our people to succeed while balancing work and life. We provide our employees with access to health and wellness programs, which includes benefits that support both physical and mental health. We have also transitioned to a hybrid work model.
Compensation and Benefits
We provide competitive pay and benefits including health, dental, vision, short and long-term disability, life insurance and a 401(k) retirement program, as well as a generous paid time off program that includes vacation, sick, and personal leave. In addition to our equity awards program, we also offer a quarterly recognition program, as well as rewarding employees with spot bonuses for stellar performance or going above and beyond the base requirements of their job description.
Talent Development
Employees have access to a variety of different training courses, books, book summaries and audio books, and an array of source materials covering a myriad of different business and soft skills training subjects. Additionally, we provide reimbursement for tuition and professional licensures.
Community Involvement
Giving back to the community is an integral part of who we are and what we do. We provide ample ways to give back through programs at our properties or charitable endeavors and volunteer opportunities that also serve as team building exercises for our employees.
Tax Status
We elected to be taxed as a REIT under the federal income tax laws when we filed our 1962 tax return. As a REIT, we are generally not subject to federal income tax on taxable income that we distribute to our shareholders. Under the Code, REITs are subject to numerous organizational and operational requirements, including the requirement to generally distribute at least 90% of taxable income each year. We will be subject to federal income tax on our taxable income (including, for our taxable years ending on or prior to December 31, 2017, any applicable alternative minimum tax) at regular corporate rates if we fail to qualify as a REIT for tax purposes in any taxable year, or to the extent we distribute less than 100% of our taxable income. We will also generally not qualify for treatment as a REIT for federal income tax purposes for four years following the year during which qualification is lost. Even if we qualify as a REIT for federal income tax purposes, we may be subject to certain state and local income and franchise taxes and to federal income and excise taxes on our undistributed taxable income.
We have elected to treat certain of our subsidiaries as taxable REIT subsidiaries, which we refer to as a TRS. In general, a TRS may engage in any real estate business and certain non-real estate businesses, subject to certain limitations under the Code. A TRS is subject to federal and state income taxes. Our TRS activities have not been material.
General Economic Conditions
The heightened levels of inflation, higher interest rates, and the potentially worsening of economic conditions presents risks for our business and our tenants. We continue to monitor and address risks related to the general state of the economy. The extent of the future effects on our business, results of operations, cash flows, and growth strategies is highly uncertain and will ultimately depend on future developments, none of which can be predicted.
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Governmental Regulations Affecting Our Properties
We and our properties are subject to a variety of federal, state and local environmental, health, safety and similar laws. Please see Item 1A. "Risk Factors - Risk Factors Related to our REIT Status and Other Laws and Regulations" for further discussion of potential material effects of our compliance with government regulation, including environmental regulations and the rules governing REITs.
The application of these laws to a specific property that we own depends on a variety of property-specific circumstances, including the current and former uses of the property, the building materials used at the property and the physical layout of the property. Under certain environmental laws, we, as the owner or operator of properties currently or previously owned, may be required to investigate and clean up certain hazardous or toxic substances, asbestos-containing materials, or petroleum product releases at the property, we may be held liable for property damage and for investigation and clean up costs incurred in connection with the contamination, and we may be liable under common law to third parties for damages and injuries resulting from environmental contamination emanating from the real estate. Such costs or liabilities could exceed the value of the affected real estate. The presence of contamination or the failure to remediate contamination may adversely affect our ability to sell or lease real estate or to borrow using the real estate as collateral.
Neither existing environmental, health, safety and similar laws nor the costs of our compliance with these laws has had a material adverse effect on our financial condition or results of operations, and management does not believe they will in the future. In addition, we have not incurred, and do not expect to incur, any material costs or liabilities due to environmental contamination at properties we currently own or have owned in the past. However, we cannot predict the impact of new or changed laws or regulations on properties we currently own or may acquire in the future. We have no current plans for substantial capital expenditures with respect to compliance with environmental, health, safety and similar laws and we carry environmental insurance which covers a number of environmental risks for most of our properties.
Energy and Emissions Regulations Affecting Our Properties
Some jurisdictions in which we own property have enacted or may enact legislation that requires use of only certain types of energy sources, limits energy usage on site, or limits allowable emissions from buildings with fines or other costs being imposed for exceeding those limits. This type of legislation typically includes an extended period of time from adoption to implementation to allow property owners ample opportunity to make investments and take other actions to comply with the legislation. Any investments we believe we will need to make to comply with laws that have been passed to date are being included as part of our ordinary capital improvement planning process for our properties. We also address the potential effects of these types of laws in our energy reduction and energy efficient efforts that are described in more detail in Item 7. "Management's Discussion and Analysis of Financial Condition and Results of Operations - Corporate Responsibility." These types of laws have not had a material adverse effect on our financial condition or results of operations and management does not believe they will have a material adverse effect in the future. We cannot, however, predict the impact of new or changed laws or regulations on properties we currently own or may acquire in the future
Competition
Numerous commercial developers and real estate companies compete with us with respect to the leasing and the acquisition of properties. Some of these competitors may possess greater capital resources than we do, although we do not believe that any single competitor or group of competitors in any of the primary markets where our properties are located are dominant in that market. This competition may:
reduce the number of properties available for acquisition;
increase the cost of properties available for acquisition;
interfere with our ability to attract and retain tenants, leading to increased vacancy rates and/or reduced rents; and
adversely affect our ability to minimize expenses of operation.
Retailers at our properties also face increasing competition from online retailers, outlet stores, discount shopping clubs, superstores, and other forms of sales and marketing of goods and services, such as direct mail. This competition could contribute to lease defaults and insolvency of tenants.
Available Information
Copies of our Annual Report on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K, and amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934 (the “Exchange Act”) are available free of charge through the Investors section of our website at www.federalrealty.com as soon as reasonably practicable after we electronically file the material with, or furnish the material to, the Securities and Exchange Commission, or the SEC.
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Our Corporate Governance Guidelines, Code of Business Conduct, Code of Ethics applicable to our Chief Executive Officer and senior financial officers, Whistleblower Policy, organizational documents and the charters of our audit committee, compensation and human capital committee and nominating and corporate governance committee are all available in the Corporate Governance section of the Investors section of our website.
Amendments to the Code of Ethics or Code of Business Conduct or waivers that apply to any of our executive officers or our senior financial officers will be disclosed in the Corporate Governance section of our website as well.

ITEM 1A.    RISK FACTORS
This Annual Report on Form 10-K contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, Section 21E of the Exchange Act and the Private Securities Litigation Reform Act of 1995. Also, documents that we “incorporate by reference” into this Annual Report on Form 10-K, including documents that we subsequently file with the SEC will contain forward-looking statements. When we refer to forward-looking statements or information, sometimes we use words such as “may,” “will,” “could,” “should,” “plans,” “intends,” “expects,” “believes,” “estimates,” “anticipates” and “continues.” In particular, the below risk factors describe forward-looking information. The risk factors describe risks that may affect these statements but are not all-inclusive, particularly with respect to possible future events. Many things can happen that can cause actual results to be different from those we describe. These factors include, but are not limited to the following:
Risk Factors Related to our Real Estate Investments and Operations
Revenue from our properties may be reduced or limited if the retail operations of our tenants are not successful.
Revenue from our properties depends primarily on the ability of our tenants to pay the full amount of rent and other charges due under their leases on a timely basis. Some of our leases provide for the payment, in addition to base rent, of additional rent above the base amount according to a specified percentage of the gross sales generated by the tenants and generally provide for reimbursement of real estate taxes and expenses of operating the property. Economic, legal, and/or competitive conditions, as well as public health concerns, may impact the success of our tenants’ retail operations and therefore the amount of rent and expense reimbursements we receive from our tenants. Any reduction in our tenants' abilities to pay base rent, percentage rent, or other charges on a timely basis, including the closing of stores prior to the end of the lease term or the filing by any of our tenants for bankruptcy protection, will adversely affect our financial condition and results of operations. In the event of default by a tenant, we may experience delays and unexpected costs in enforcing our rights as landlord under lease terms, which may also adversely affect our financial condition and results of operations.
Our net income depends on the success and continued presence of our “anchor” tenants.
Our net income could be adversely affected in the event of a downturn in the business, or the bankruptcy or insolvency, of any anchor store or anchor tenant. Anchor tenants generally occupy large amounts of square footage, pay a significant portion of the total rents at a property and contribute to the success of other tenants by drawing significant numbers of customers to a property. The closing of one or more anchor stores at a property could adversely affect that property and result in lease terminations by, or reductions in rent from, other tenants whose leases may permit termination or rent reduction in those circumstances or whose own operations may suffer as a result. Over the past several years, we have seen higher levels of anchor turnover and closings in some markets, which has caused an oversupply of larger retail spaces. Therefore, tenant demand for certain of our anchor spaces may decrease and as a result, we may see an increase in vacancy and/or a decrease in rents for those spaces that could have a negative impact to our net income. As of December 31, 2023, our anchor tenant space is 96.0% leased and 93.9% occupied.

A shift in retail shopping from brick and mortar stores to online shopping may have an adverse impact on our cash flow, financial condition and results of operations.
Many retailers operating brick and mortar stores have made online sales a vital piece of their business. The shift to online shopping may cause declines in brick and mortar sales generated by certain of our tenants and may cause certain of our tenants to reduce the size or number of their retail locations in the future. This risk is partially mitigated by our strategy of maintaining a diverse portfolio of retail properties. The trend of retailers utilizing brick and mortar locations for ‘showroom’ and on-line sales distribution purposes (particularly at shopping centers in densely populated areas like ours) may further mitigate this risk. However, there can be no assurance that our shopping centers will not be further impacted by the shift to online shopping. As a result, our cash flow, financial condition, and results of operations could be adversely affected.

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We have properties that are geographically concentrated, and adverse economic or real estate market declines in these areas could have a material adverse effect on us.
As of December 31, 2023, our tenants operated in 12 states and the District of Columbia. Any adverse situation that disproportionately affects the the markets where our properties are concentrated may have a magnified adverse effect on our portfolio. Refer to “Properties” (Item 2 of this Annual Report on Form 10-K) for additional discussion of the geographic concentration. Real estate markets are subject to economic downturns, as they have been in the past, and we cannot predict how economic conditions will impact this market in both the short and long term.
Declines in the economy or a decline in the real estate market in these states could hurt our financial performance and the value of our properties. Factors that may negatively affect economic conditions in these states include:
    
business layoffs or downsizing;
industry slowdowns;
elevated levels of inflation over an extended period of time;
increasing interest rates;
increased business restrictions due to health crises;
relocations of businesses;
changing demographics;
increased telecommuting and use of alternative work places;
infrastructure quality;
any oversupply of, or reduced demand for, real estate;
concessions or reduced rental rates under new leases for properties where tenants defaulted; and
increased operating costs including insurance premiums and real estate taxes.
We may be unable to collect balances due from tenants that file for bankruptcy protection.
If a tenant or lease guarantor files for bankruptcy, we may not be able to collect all pre-petition amounts owed by that party. In addition, a tenant that files for bankruptcy protection may terminate our lease in which event we would have a general unsecured claim that would likely be for less than the full amount owed to us for the remainder of the lease term, which could adversely affect our financial condition and results of operations.
We may experience difficulty or delay in renewing leases or re-leasing space.
We derive most of our revenue directly or indirectly from rent received from our tenants. We are subject to the risks that, upon expiration or termination of leases, whether by their terms, as a result of a tenant bankruptcy, general economic conditions or otherwise, leases for space in our properties may not be renewed, space may not be re-leased, or the terms of renewal or re-lease, including the cost of required renovations or concessions to tenants, may be less favorable than current lease terms and may include decreases in rental rates. As a result, our net income could be reduced.
Our development activities have inherent risks.
The ground-up development of improvements on real property, as opposed to the renovation and redevelopment of existing improvements, presents substantial risks. We generally do not look to acquire raw land for future development; however, we do intend to complete the development and construction of future phases of projects we already own. We may undertake development of these and other projects on our own or bring in third parties if it is justifiable on a risk-adjusted return basis. We may also choose to delay completion of a project if market conditions do not allow an appropriate return. If conditions arise and we are not able or decide not to complete a project or if the expected cash flows of our project do not exceed the book value, an impairment of the project may be required. If additional phases of any of our existing projects or if any new projects are not successful, it may adversely affect our financial condition and results of operations.
In addition to the risks associated with real estate investment in general, as described elsewhere and the specific risks above, the risks associated with our remaining development activities include:
contractor changes may delay the completion of development projects and increase overall costs;
significant time lag between commencement and stabilization subjects us to greater risks due to fluctuations in the general economy;
delivery of residential product into uncertain residential environments may result in lower rents or longer time periods to reach economic stabilization;
substantial amount of our investment is related to infrastructure and the overall value of the project may be negatively impacted if we do not complete subsequent phases;
failure or inability to obtain construction or permanent financing on favorable terms;
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expenditure of money and time on projects that may never be completed;
difficulty securing key anchor or other tenants may impact occupancy rates and projected revenue;
inability to achieve projected rental rates or anticipated pace of lease-up;
higher than estimated construction or operating costs, including labor and material costs; and
possible delay in completion of a project because of a number of factors, including COVID-19, supply chain disruptions and shortages, inflation, weather, labor disruptions, construction delays or delays in receipt of zoning or other regulatory approvals, acts of terror or other acts of violence, or acts of God (such as fires, earthquakes or floods).
Redevelopments and acquisitions may fail to perform as expected.
Our investment strategy includes the redevelopment and acquisition of high quality, retail focused properties in densely populated areas with high average household incomes and significant barriers to adding competitive retail supply. The redevelopment and acquisition of properties entail risks that include the following, any of which could adversely affect our results of operations and our ability to meet our obligations:
our estimate of the costs to improve, reposition or redevelop a property may prove to be too low, or the time we estimate to complete the improvement, repositioning or redevelopment may be too short. As a result, the property may fail to achieve the returns we have projected, either temporarily or for a longer period;
we may not be able to identify suitable properties to acquire or may be unable to complete the acquisition of the properties we identify;
we may not be able to integrate an acquisition into our existing operations successfully;
properties we redevelop or acquire may fail to achieve the occupancy or rental rates we project, within the time frames we project, at the time we make the decision to invest, which may result in the properties’ failure to achieve the returns we projected;
our pre-acquisition evaluation of the physical condition of each new investment may not detect certain defects or identify necessary repairs until after the property is acquired, which could significantly increase our total acquisition costs or decrease cash flow from the property; and
our investigation of a property or building prior to our acquisition, and any representations we may receive from the seller of such building or property, may fail to reveal various liabilities, which could reduce the cash flow from the property or increase our acquisition cost.
Our performance and value are subject to general risks associated with the real estate industry.
Our economic performance and the value of our real estate assets, and consequently, the value of our investments, are subject to the risk that if our properties do not generate revenues sufficient to meet our operating expenses, including debt service and capital expenditures, our cash flow and ability to pay distributions to our shareholders will be adversely affected. As a real estate company, we are susceptible to the following real estate industry risks:
economic downturns in general, or in the areas where our properties are located;
adverse changes in local real estate market conditions, such as an oversupply or reduction in demand;
changes in tenant preferences that reduce the attractiveness of our properties to tenants;
zoning or regulatory restrictions;
decreases in market rental rates;
weather conditions that may increase or decrease energy costs and other weather-related expenses;
costs associated with the need to periodically repair, renovate and re-lease space; and
increases in the cost of adequate maintenance, insurance and other operating costs, including real estate taxes, associated with one or more properties, which may occur even when circumstances such as market factors and competition cause a reduction in revenues from one or more properties, although real estate taxes typically do not increase upon a reduction in such revenues.
Each of these risks could result in decreases in market rental rates and increases in vacancy rates, which could adversely affect our financial condition and results of operation.
Many real estate costs are fixed, even if income from our properties decreases.
Our financial results depend primarily on leasing space in our properties to tenants on terms favorable to us. Costs associated with real estate investment, such as real estate taxes, insurance and maintenance costs, generally are not reduced even when a property is not fully occupied, rental rates decrease, or other circumstances cause a reduction in income from the property. As a result, cash flow from the operations of our properties may be reduced if a tenant does not pay its rent or we are unable to rent our properties on favorable terms. Under those circumstances, we might not be able to enforce our rights as landlord without delays and may incur substantial legal costs. Additionally, new properties that we may acquire or redevelop may not produce
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any significant revenue immediately, and the cash flow from existing operations may be insufficient to pay the operating expenses and debt service associated with such new properties until they are fully occupied.
Competition may limit our ability to purchase new properties and generate sufficient income from tenants.
Numerous commercial developers and real estate companies compete with us in seeking tenants for our existing properties and properties for acquisition. This competition may:
reduce properties available for acquisition;
increase the cost of properties available for acquisition;
reduce rents payable to us;
interfere with our ability to attract and retain tenants;
lead to increased vacancy rates at our properties; and
adversely affect our ability to minimize expenses of operation.
Retailers at our properties also face increasing competition from online retailers, outlet stores, discount shopping clubs and other forms of sales and marketing of goods, such as direct mail. This competition could contribute to lease defaults and insolvency of tenants. If we are unable to continue to attract appropriate retail tenants to our properties, or to purchase new properties in our geographic markets, it could materially affect our ability to generate net income, service our debt and make distributions to our shareholders.
We may be unable to sell properties when appropriate because real estate investments are illiquid.
Real estate investments generally cannot be sold quickly. In addition, there are some limitations under federal income tax laws applicable to real estate and to REITs in particular that may limit our ability to sell our assets. We may not be able to alter our portfolio promptly in response to changes in economic or other conditions including being unable to sell a property at a return we believe is appropriate due to the economic environment. Our inability to respond quickly to adverse changes in the performance of our investments could have an adverse effect on our ability to meet our obligations and make distributions to our shareholders.
We may have limited flexibility in dealing with our jointly owned investments.
Our organizational documents do not limit the amount of funds that we may invest in properties and assets owned jointly with other persons or entities. As of December 31, 2023, we held 19 predominantly retail real estate projects jointly with other persons in addition to properties owned in a “downREIT” structure. Additionally, as of December 31, 2023, we owned an interest in the hotel component of Assembly Row. We may make additional joint investments in the future. Our existing and future joint investments may subject us to special risks, including the possibility that our partners or co-investors might become bankrupt, that those partners or co-investors might have economic or other business interests or goals which are unlike or incompatible with our business interests or goals, that those partners or co-investors might be in a position to take action contrary to our suggestions or instructions, or in opposition to our policies or objectives, and that disputes may develop with our joint venture partners over decisions affecting the property or the joint venture, which may result in litigation or arbitration or some other form of dispute resolution. Although as of December 31, 2023, we held the controlling interests in all of our existing co-investments (except the hotel investment discussed above, the investment in the La Alameda shopping center acquired in 2017, and the investment in the Chandler Festival and Chandler Gateway shopping centers acquired in 2022), we generally must obtain the consent of the co-investor or meet defined criteria to sell or to finance these properties. Joint ownership gives a third party the opportunity to influence the return we can achieve on some of our investments and may adversely affect our ability to make distributions to our shareholders. We may also be liable for the actions of our co-investors.
Our insurance coverage on our properties may be inadequate.
We currently carry comprehensive insurance on all of our properties, including insurance for liability, fire, flood, earthquake, environmental matters, rental loss and acts of terrorism. All of these policies contain coverage limitations. We believe these coverages are of the types and amounts customarily obtained for or by an owner of similar types of real property assets located in the areas where our properties are located. We intend to obtain similar insurance coverage on subsequently acquired properties.
The availability of insurance coverage may decrease and the prices for insurance may increase as a consequence of significant losses incurred by the insurance industry and other factors outside our control. As a result, we may be unable to renew or duplicate our current insurance coverage in adequate amounts or at reasonable prices. In addition, insurance companies may no longer offer coverage against certain types of losses, such as losses due to terrorist acts, pandemics, and toxic mold, or, if offered, the expense of obtaining these types of insurance may not be justified. We therefore may cease to have insurance coverage against certain types of losses and/or there may be decreases in the limits of insurance available. If an uninsured loss
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or a loss in excess of our insured limits occurs, we could lose all or a portion of the capital we have invested in a property, as well as the anticipated future revenue from the property, but still remain obligated for any mortgage debt or other financial obligations related to the property. We cannot guarantee that material losses in excess of insurance proceeds will not occur in the future. If any of our properties were to experience a catastrophic loss, it could seriously disrupt our operations, delay revenue and result in large expenses to repair or rebuild the property. Also, due to inflation, changes in codes and ordinances, environmental considerations and other factors, it may not be feasible to use insurance proceeds to replace a building after it has been damaged or destroyed. Further, we may be unable to collect insurance proceeds if our insurers are unable to pay or contest a claim. Events such as these could adversely affect our results of operations and our ability to meet our obligations, including distributions to our shareholders.
Natural disasters, climate change and health crises, could have an adverse impact on our cash flow and operating results.
Climate change may add to the unpredictability and frequency of natural disasters and severe weather conditions, impact the availability of natural resources, and create additional uncertainty as to future trends and exposures. Certain of our operations are located in areas that are subject to natural disasters and severe weather conditions such as hurricanes, earthquakes, droughts, snow storms, floods and fires.  The impact of climate change or the occurrence of natural disasters can delay new development projects, increase investment costs to repair or replace damaged properties, increase operating costs, create additional investment costs to make improvements to existing properties to comply with climate change regulations, increase future property insurance costs, impact the availability of water and other natural resources, and negatively impact the tenant demand for space.  If insurance is unavailable to us or is unavailable on acceptable terms, or if our insurance is not adequate to cover business interruption or losses from these events, our earnings, liquidity or capital resources could be adversely affected.
In addition, our business is subject to risks related to the effects of public health crises, epidemics, and pandemics. Such events could:
inhibit global, national and local economic activity;
drive inflation, adversely affect trading activity in securities markets, which could negatively impact the trading prices of our common shares and debt securities and our ability to access the securities markets as a source of liquidity;
adversely affect our tenants’ financial condition by limiting foot traffic and staffing at their businesses, which could affect their ability to pay rent and willingness to make new leasing commitments;
reduce our cash flow, which could impact our ability to pay dividends at the current rate and in the current format or at all or to service our debt;
temporarily or permanently reduce the demand for retail or office space;
interfere with our business operations by requiring our personnel to work remotely;
increase the frequency of cyber-attacks;
disrupt supply chains that could be important in our development and redevelopment activities;
result in labor shortages;
interfere with potential purchases and sales of properties;
impact our ability to pay dividends at the current rate and in the current format or at all; and
have other direct and indirect effects that are difficult to predict.
Such risks depend upon the nature and severity of the public health concern, as well as the extent and duration of government-mandated orders and personal decisions to limit travel, economic activity and personal interaction, none of which can be predicted with confidence. In particular, we cannot predict the impact of stay-at-home and other government orders instituted in response to a public health concern, which may vary by jurisdiction, or a public health concerns' short and long term economic effects, each of which could have a material adverse effect on our business.

An increased focus on metrics and reporting related to corporate responsibility, specifically related to environmental, social and governance ("ESG") factors, may impose additional costs and expose us to new risks.
Investors and other stakeholders have become more focused on understanding how companies address a variety of ESG factors. Many of those investors and shareholders look to ESG rating systems, or disclosure frameworks that have been developed by third party groups to allow comparisons between companies on ESG factors as they evaluate investment decisions as well as to company disclosures.
Although we participate in many of these ratings systems, or disclosure frameworks, and generally score relatively well in those in which we do participate, we do not participate in, and would not necessarily score well in, all of the available ratings systems. Further, the criteria used in these ratings systems change frequently, and we cannot guaranty that we will be able to score well as criteria change. We supplement our participation in ratings systems with corporate disclosures of our ESG activities but many investors and stakeholders may look for specific disclosures that we do not provide. Failure to participate in certain of the third party ratings systems, failure to score well in those ratings systems or failure to provide certain ESG
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disclosures could result in reputational harm when investors or others compare us against similar companies in our industry and could cause certain investors to be unwilling to invest in our stock which could adversely impact our ability to raise capital.
For more information about the Trust's Corporate Responsibility initiatives, see Item 7. "Management's Discussion and Analysis of Financial Condition and Results of Operations - Corporate Responsibility."

Risk Factors Related to our Funding Strategies and Capital Structure
The amount of debt we have and the restrictions imposed by that debt could adversely affect our business and financial condition.
As of December 31, 2023, we had approximately $4.6 billion of debt outstanding. Of that outstanding debt, approximately $519.1 million was secured by all or a portion of 8 of our real estate projects. As of December 31, 2023, approximately 87.0% of our debt is fixed rate or is fixed via interest rate swap agreements, which includes all of our property secured debt and our unsecured senior notes. Our organizational documents do not limit the level or amount of debt that we may incur. The amount of our debt outstanding from time to time could have important consequences to our shareholders. For example, it could:
require us to dedicate a substantial portion of our cash flow from operations to payments on our debt, thereby reducing funds available for operations, property acquisitions, redevelopments and other appropriate business opportunities that may arise in the future;
limit our ability to make distributions on our outstanding common shares and preferred shares;
make it difficult to satisfy our debt service requirements;
require us to dedicate increased amounts of our cash flow from operations to payments on debt upon refinancing or on our variable rate, unhedged debt, if interest rates rise;
limit our flexibility in planning for, or reacting to, changes in our business and the factors that affect the profitability of our business;
limit our ability to obtain any additional debt or equity financing we may need in the future for working capital, debt refinancing, capital expenditures, acquisitions, redevelopments or other general corporate purposes or to obtain such financing on favorable terms; and/or
limit our flexibility in conducting our business, which may place us at a disadvantage compared to competitors with less debt or debt with less restrictive terms.
Our ability to make scheduled principal payments of, to pay interest on, or to refinance our indebtedness will depend primarily on our future performance, which to a certain extent is subject to economic, financial, competitive and other factors beyond our control. There can be no assurance that our business will continue to generate sufficient cash flow from operations in the future to service our debt or meet our other cash needs. If we are unable to generate this cash flow from our business, we may be required to refinance all or a portion of our existing debt, sell assets or obtain additional financing to meet our debt obligations and other cash needs, including the payment of dividends required to maintain our status as a real estate investment trust. We cannot assure you that any such refinancing, sale of assets or additional financing would be possible on terms that we would find acceptable.
We are obligated to comply with financial and other covenants pursuant to our debt obligations that could restrict our operating activities, and the failure to comply with such covenants could result in defaults that accelerate payment under our debt agreements.
Our revolving credit facility, unsecured term loan, and certain series of notes include financial covenants that may limit our operating activities in the future. We are also required to comply with additional covenants that include, among other things, provisions:
relating to the maintenance of property securing a mortgage;
restricting our ability to pledge assets or create liens;
restricting our ability to incur additional debt;
restricting our ability to amend or modify existing leases at properties securing a mortgage;
restricting our ability to enter into transactions with affiliates; and
restricting our ability to consolidate, merge or sell all or substantially all of our assets.
As of December 31, 2023, we were in compliance with all of our default related financial covenants. If we were to breach any of our default related debt covenants, including the covenants listed above, and did not cure the breach within any applicable cure period, our lenders could require us to repay the debt immediately, and, if the debt is secured, could immediately begin proceedings to take possession of the property securing the loan. Many of our debt arrangements, including our public notes and our revolving credit facility, are cross-defaulted, which means that the lenders under those debt arrangements can put us in default and require immediate repayment of their debt if we breach and fail to cure a default under certain of our other debt
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obligations. As a result, any default under our debt covenants could have an adverse effect on our financial condition, our results of operations, our ability to meet our obligations and the market value of our shares.
Adverse changes in our credit rating could affect our borrowing capacity and borrowing terms.
Our credit worthiness is rated by nationally recognized credit rating agencies. The credit ratings assigned 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 economic outlook in general. Our credit rating can affect the amount of capital we access, as well as the terms of certain existing and future financing we obtain. Since we depend on debt financing to fund the growth of our business, an adverse change in our credit rating, including actual changes in outlook, or even the initiation of review of our credit rating that could result in an adverse change, could have a material adverse effect on us.
Our ability to grow will be limited if we cannot obtain additional capital.
Our growth strategy is focused on the development and redevelopment of properties we already own and the acquisition of additional properties. We believe that it will be difficult to fund our expected growth with cash from operating activities because, in addition to other requirements, we are generally required to distribute to our shareholders at least 90% of our taxable income each year to continue to qualify as a REIT for federal income tax purposes. As a result, we must rely primarily upon the availability of debt or equity capital, which may or may not be available on favorable terms or at all. Debt could include the sale of debt securities and mortgage loans from third parties. If economic conditions and conditions in the capital markets are not favorable at the time we need to raise capital, we may need to obtain capital on less favorable terms. Additionally, we cannot guarantee that additional financing, refinancing or other capital will be available in the amounts we desire or on favorable terms. Our access to debt or equity capital depends on a number of factors, including the market’s perception of our growth potential and risk profile, our ability to pay dividends, and our current and potential future earnings. Depending on the outcome of these factors as well as the impact of the economic environment, we could experience delay or difficulty in implementing our growth strategy on satisfactory terms, or be unable to implement this strategy.
Rising interest rates could adversely affect our cash flow and the market price of our outstanding debt and preferred shares.
Of our $4.6 billion of debt outstanding as of December 31, 2023, approximately $853.6 million bears interest at a variable rate, of which, $600.0 million is our unsecured term loan that bears interest at a variable rate of SOFR plus 85 basis points plus 0.10%. The remaining $253.6 million is comprised of a $200.0 million mortgage payable that bears interest at a variable rate of SOFR plus 95 basis points, which is effectively fixed by three interest rate swap agreements through the initial maturity date, and $53.6 million in mortgages payable that bear interest at a variable rate of SOFR plus 195 basis points and are effectively fixed by two interest rate swap agreements. We also have a $1.25 billion revolving credit facility, on which no balance was outstanding at December 31, 2023, that bears interest at SOFR plus 77.5 basis points, plus 0.10%. We may borrow additional funds at variable interest rates in the future. Increases in interest rates would increase the interest expense on our variable rate debt and reduce our cash flow, which could adversely affect our ability to service our debt and meet our other obligations and also could reduce the amount we are able to distribute to our shareholders. We may enter into additional hedging arrangements or other transactions for all or a portion of our variable rate debt to limit our exposure to rising interest rates. However, the amounts we are required to pay under variable rate debt to which hedging or similar arrangements relate may increase in the event of non-performance by the counterparties to any such hedging arrangements. In addition, an increase in market interest rates may lead purchasers of our debt securities and preferred shares to demand a higher annual yield, which could adversely affect the market price of our outstanding debt securities and preferred shares and the cost and/or timing of refinancing or issuing additional debt securities or preferred shares.
Hedging activity may expose us to risks, including the risks that a counterparty will not perform and that the hedge will not yield the economic benefits we anticipate, which may adversely affect us.
We may use derivative instruments to manage exposure to variable interest rate risk. We generally enter into interest rate swaps to manage our exposure to variable interest rate risk and treasury locks to manage the risk of interest rates rising prior to the issuance of debt. These and similar hedging arrangements involve risks, including the risks that counterparties may fail to honor their obligations under these arrangements, that these arrangements may not be effective in reducing our exposure to interest rate changes, that the amount of income we earn from hedging transactions may be limited by federal tax provisions governing REITs, and that these arrangements may reduce the benefits to us if interest rates decline. Developing and implementing an interest rate risk strategy is complex, and there can be no assurance that our hedging activities will be completely effective at insulating us from risks associated with interest rate fluctuations.
Additionally, in connection with our offering in January 2024 of 3.25% Exchangeable Senior Notes due 2029, we have entered into capped call transactions with certain option counterparties. The capped call transactions cover, subject to customary
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adjustments, the number of common shares initially underlying the notes. The capped call transactions are expected generally to reduce the potential dilution to our common shares upon any exchange of notes and/or offset any cash payments we are required to make in excess of the principal amount of exchanged notes, as the case may be, with such reduction and/or offset subject to a cap. The option counterparties are financial institutions, and we are subject to the risk that any or all of them might default under the capped call transactions. Our exposure to the credit risk of the option counterparties is not secured by any collateral. Global economic conditions have resulted in the actual or perceived failure or financial difficulties of certain financial institutions and could adversely impact the option counterparties’ performance under the capped call transactions. If an option counterparty becomes subject to insolvency proceedings, we will become an unsecured creditor in those proceedings with a claim equal to the termination amount at that time as determined pursuant to the capped call documentation with such option counterparty. Our exposure will depend on many factors but, generally, an increase in our exposure will be correlated to an increase in the market price and in the volatility of the common shares. In addition, upon a default by an option counterparty, we may suffer adverse tax consequences and more dilution than we currently anticipate with respect to the common shares. We can provide no assurances as to the financial stability or viability of the option counterparties.
Risk Factors Related to our REIT Status and Other Laws and Regulations
Environmental laws and regulations could reduce the value or profitability of our properties.
All real property and the operations conducted on real property are subject to federal, state and local laws, ordinances and regulations relating to hazardous materials, environmental protection and human health and safety. Under various federal, state and local laws, ordinances and regulations, we and our tenants may be responsible for the disposal or treatment of hazardous or toxic substances released on or in properties we own or operate, as well as certain other potential costs relating to hazardous or toxic substances (including governmental fines and injuries to persons and property). This liability may be imposed whether or not we knew about, or were responsible for, the presence of hazardous or toxic substances. Further, the presence of contamination on our properties or the failure to properly remediate contamination at any of our properties may adversely affect our ability to sell or lease those properties or to borrow funds by using those properties as collateral. The costs or liabilities could exceed the value of the affected real estate. We are not aware of any environmental condition with respect to any of our properties that management believes would have a material adverse effect on our business, assets or results of operations taken as a whole.

In addition, changes in government legislation and regulation on climate change could result in increased capital expenditures to improve the energy efficiency of our existing properties and could also require us to spend more on our development or redevelopment projects without a corresponding increase in revenues, which may adversely affect our financial condition, results of operations and cash flows.
The Americans with Disabilities Act of 1990 could require us to take remedial steps with respect to existing or newly acquired properties.
Our existing properties, as well as properties we may acquire, as commercial facilities, are required to comply with Title III of the Americans with Disabilities Act of 1990. Investigation of a property may reveal non-compliance with this Act. The requirements of this Act, or of other federal, state or local laws or regulations, also may change in the future and restrict further renovations of our properties with respect to access for disabled persons. Future compliance with this Act may require expensive changes to the properties.
The revenues generated by our tenants could be negatively affected by various federal, state and local laws to which they are subject.
We and our tenants are subject to a wide range of federal, state and local laws and regulations, such as local licensing requirements, consumer protection laws and state and local fire, life-safety and similar requirements that affect the use of the properties. The leases typically require that each tenant comply with all laws and regulations. Failure to comply could result in fines by governmental authorities, awards of damages to private litigants, or restrictions on the ability to conduct business on such properties. Non-compliance of this sort could reduce our revenues from a tenant, could require us to pay penalties or fines relating to any non-compliance, and could adversely affect our ability to sell or lease a property.
Failure to qualify as a REIT for federal income tax purposes would cause the Parent Company to be taxed as a corporation, which would substantially reduce funds available for payment of distributions.
We believe that we are organized and qualified as a REIT for federal income tax purposes and currently intend to operate in a manner that will allow us to continue to qualify as a REIT under the Code. However, we cannot assure you that we will remain qualified as such in the future.
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Qualification as a REIT involves the application of highly technical and complex Code provisions and applicable income tax regulations that have been issued under the Code. Certain facts and circumstances not entirely within our control may affect our ability to qualify as a REIT. For example, in order to qualify as a REIT, at least 95% of our gross income in any year must be derived from qualifying rents and certain other income. Satisfying this requirement could be difficult, for example, if defaults by tenants were to reduce the amount of income from qualifying rents. As a REIT, we must generally make annual distributions to shareholders of at least 90% of our taxable income. In addition, new legislation, new regulations, new administrative interpretations or new court decisions may significantly change the tax laws with respect to qualification as a REIT or the federal income tax consequences of such qualification. Any modification in the tax treatment of REITs could have a significant adverse impact to our net income.
If we fail to qualify as a REIT:
we would not be allowed a deduction for distributions to shareholders in computing taxable income;
we would be subject to federal income tax at regular corporate rates;
unless we are entitled to relief under specific statutory provisions, we could not elect to be taxed as a REIT for four taxable years following the year during which we were disqualified;
we could be required to pay significant income taxes, which would substantially reduce the funds available for investment or for distribution to our shareholders for each year in which we failed or were not permitted to qualify; and
we would no longer be required by law to make any distributions to our shareholders.
To maintain our status as a REIT, we limit the amount of shares any one shareholder of the Parent Company can own.
The Code imposes certain limitations on the ownership of the stock of a REIT. For example, not more than 50% in value of our outstanding shares of capital stock may be owned, directly or indirectly, by five or fewer individuals (as defined in the Code) during the last half of any taxable year. To protect our REIT status, the Parent Company's declaration of trust prohibits any one shareholder from owning (actually or constructively) more than 9.8% in value of the outstanding common shares or of any class or series of outstanding preferred shares. The constructive ownership rules are complex. Shares of the Parent Company's capital stock owned, actually or constructively, by a group of related individuals and/or entities may be treated as constructively owned by one of those individuals or entities. As a result, the acquisition of less than 9.8% in value of the outstanding common shares and/or a class or series of preferred shares (or the acquisition of an interest in an entity that owns common shares or preferred shares) by an individual or entity could cause that individual or entity (or another) to own constructively more than 9.8% in value of the outstanding capital stock. If that happens, either the transfer of ownership would be void or the shares would be transferred to a charitable trust and then sold to someone who can own those shares without violating the 9.8% ownership limit.
The Board of Trustees may waive these restrictions on a case-by-case basis. In addition, the Board of Trustees and two-thirds of our shareholders eligible to vote at a shareholder meeting may remove these restrictions if they determine it is no longer in our best interests for the Parent Company to attempt to qualify, or to continue to qualify, as a REIT. The 9.8% ownership restrictions may delay, defer or prevent a transaction or a change of our control that might involve a premium price for the common shares or otherwise be in the shareholders’ best interest.
Legislative, administrative, regulatory or other actions affecting REITs, including positions taken by the IRS, could have a material adverse effect on us and our investors.
The rules dealing with U.S. federal income taxation are constantly under review by persons involved in the legislative process, and by the Internal Revenue Service (“IRS”) and the U.S. Department of the Treasury (“Treasury”). Changes to the tax laws or interpretations thereof by the IRS and the Treasury, with or without retroactive application, could materially and adversely affect us and our investors. No prediction can be made as to the likelihood of passage of new tax legislation or other provisions, or the direct or indirect effect on us and our shareholders. Accordingly, such new legislation, Treasury regulations, administrative interpretations or court decisions could significantly and negatively affect our ability to qualify to be taxed as a REIT and/or the U.S. federal income tax consequences to us and our investors of such qualification.
Certain tax and anti-takeover provisions of the Parent Company's declaration of trust and bylaws, and certain restrictions in the Partnership's limited partnership agreement, may inhibit a change of our control.
Certain provisions contained in the Parent Company's declaration of trust and bylaws and the Maryland General Corporation Law, as applicable to Maryland REITs, may discourage a third party from making a tender offer or acquisition proposal to us. If this were to happen, it could delay, deter or prevent a change in control or the removal of existing management. These provisions also may delay or prevent the shareholders from receiving a premium for their common shares over then-prevailing market prices. These provisions include:
the REIT ownership limit described above;
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authorization of the issuance of our preferred shares with powers, preferences or rights to be determined by the Board of Trustees;
special meetings of our shareholders may be called only by the chairman of the board, the chief executive officer, the president, by one-third of the trustees or by shareholders possessing no less than 25% of all the votes entitled to be cast at the meeting;
the Board of Trustees, without a shareholder vote, can classify or reclassify unissued shares of beneficial interest, including the reclassification of common shares into preferred shares and vice-versa;
a two-thirds shareholder vote is required to approve some amendments to the declaration of trust; and
advance-notice requirements for proposals to be presented at shareholder meetings.
In addition, if we elect to be governed by it in the future, the Maryland Control Share Acquisition Law could delay or prevent a change in control. Under Maryland law, unless a REIT elects not to be subject to this law, “control shares” acquired in a “control share acquisition” have no voting rights except to the extent approved by shareholders by a vote of two-thirds of the votes entitled to be cast on the matter, excluding shares owned by the acquirer and by officers or trustees who are employees of the REIT. “Control shares” are voting shares that would entitle the acquirer to exercise voting power in electing trustees within specified ranges of voting power. A “control share acquisition” means the acquisition of control shares, with some exceptions.
The Parent Company's bylaws state that the Maryland control share acquisition law will not apply to any acquisition by any person of our common shares. This bylaw provision may be repealed, in whole or in part, at any time, whether before or after an acquisition of control shares, by a vote of a majority of the shareholders entitled to vote, and, upon such repeal, may, to the extent provided by any successor bylaw, apply to any prior or subsequent control share acquisition.
In addition, certain provisions in the Partnership’s limited partnership agreement (the “Partnership Agreement”) may delay or make more difficult unsolicited acquisitions of us or changes in our control. These provisions could discourage third parties from making proposals involving an unsolicited acquisition of us or change of our control, although some shareholders might consider such proposals, if made, desirable. These provisions also make it more difficult for third parties to alter the management structure of the Partnership without the concurrence of our Board of Trustees. These provisions include, among others:
redemption rights of limited partners and certain assignees of units of limited partnership interest ("OP Units");
transfer restrictions on OP Units and restrictions on admissions of partners;
a requirement that the General Partner may not be removed as the general partner of the Partnership without its consent;
the ability of the General Partner to issue preferred partnership interests in the Partnership with terms that it may determine, without the approval or consent of any Limited Partner; and
restrictions on the ability of the General Partner, the Partnership or the Parent Company to transfer its interests in the Partnership or otherwise engage in certain extraordinary transactions, including, among others, certain mergers, business combinations, sales of all or substantially all of their assets and recapitalizations.
We may be required to incur additional debt to qualify as a REIT.
As a REIT, we must generally make annual distributions to shareholders of at least 90% of our taxable income. We are subject to income tax on amounts of undistributed taxable income and net capital gain. In addition, we would be subject to a 4% excise tax if we fail to distribute sufficient income to meet a minimum distribution test based on our ordinary income, capital gain and aggregate undistributed income from prior years. We intend to make distributions to shareholders to comply with the Code’s distribution provisions and to avoid federal income and excise tax. We may need to borrow funds to meet our distribution requirements because:
our income may not be matched by our related expenses at the time the income is considered received for purposes of determining taxable income; and
non-deductible capital expenditures, creation of reserves, or debt service requirements may reduce available cash but not taxable income.
In these circumstances, we might have to borrow funds on terms we might otherwise find unfavorable and we may have to borrow funds even if our management believes the market conditions make borrowing financially unattractive. Current tax law also allows us to pay a portion of our distributions in shares instead of cash.

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General Risk Factors
The market value of our debt and equity securities is subject to various factors that may cause significant fluctuations or volatility.
As with other publicly traded securities, the market price of our debt and equity securities depends on various factors, which may change from time to time and/or may be unrelated to our financial condition, operating performance or prospects that may cause significant fluctuations or volatility in such prices. These factors include, among others:
general economic and financial market conditions;
level and trend of interest rates;
our ability to access the capital markets to raise additional capital;
the issuance of additional equity or debt securities;
changes in our funds from operations (“FFO”) or earnings estimates;
changes in our credit or analyst ratings;
our financial condition and performance;
market perception of our business compared to other REITs; and
market perception of REITs, in general, compared to other investment alternatives.
We cannot assure you we will continue to pay dividends in the current composition or at historical rates.
Our ability to continue to pay dividends on our common shares at historical rates or to increase our common share dividend rate, and our ability to pay preferred share dividends and service our debt securities, will depend on a number of factors, including, among others, the following:
our financial condition and results of future operations;
the performance by our tenants under their contractual lease agreements;
the terms of our loan covenants; and
our ability to acquire, finance, develop or redevelop and lease additional properties at attractive rates.
If we do not maintain or increase, or if we change the composition of the dividend on our common shares, it could have an adverse effect on the market price of our common shares and other securities. Any preferred shares we may offer in the future may have a fixed dividend rate that would not increase with any increases in the dividend rate of our common shares. Conversely, payment of dividends on our common shares may be subject to payment in full of the dividends on any preferred shares and payment of interest on any debt securities we may offer.
The Parent Company is a holding company with no direct operations, and it will rely on funds received from the Partnership to pay its obligations and make distributions to its shareholders.
The Parent Company is a holding company and expects to conduct substantially all of its operations through the Partnership. The Parent Company will not have, apart from an interest in the Partnership, any independent operations. As a result, the Parent Company will rely on distributions from the Partnership to make any distributions we declare on our common shares. The Parent Company will also rely on distributions from the Partnership to meet its obligations, including any tax liability on taxable income allocated to the Parent Company from the Partnership. Through its ownership and control of the General Partner, the Parent Company exercises exclusive control over the Partnership, including the authority to cause the Partnership to make distributions, subject to certain limited approval and voting rights of the Partnership’s Limited Partners as described in the Partnership Agreement. In addition, because the Parent Company is a holding company, your claims as shareholders are structurally subordinated to all existing and future liabilities and obligations to preferred equity holders of the Partnership and its subsidiaries. Therefore, in the event of a bankruptcy, insolvency, liquidation or reorganization of the Partnership or its subsidiaries, assets of the Partnership or the applicable subsidiary will be available to satisfy any claims of our shareholders only after such liabilities and obligations have been satisfied in full.
We currently own 100% of the OP Units issued by the Partnership and are its sole Limited Partner. However, in connection with our future acquisition activities or otherwise, we may issue additional OP Units to third parties and admit additional Limited Partners. Such issuances would reduce the Parent Company’s percentage ownership in the Partnership.

Loss of our key management could adversely affect performance and the value of our common shares.
We are dependent on the efforts of our key management. Although we believe qualified replacements could be found for any departures of key executives, the loss of their services could adversely affect our performance and the value of our common shares.

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We may adjust our business policies without shareholder approval.
We may modify our approach to investment, financing, borrowing, and other operating strategies without shareholder approval. A change in the approach to any of these items could adversely affect our financial condition and results of operations, and the market price of our securities.
Our current business plan focuses on our investment in high quality retail based properties that are typically neighborhood and community shopping centers or mixed-use properties, principally through redevelopments and acquisitions. If this business plan is not successful, it could have a material adverse effect on our financial condition and results of operations.
Given these uncertainties, readers are cautioned not to place undue reliance on any forward-looking statements that we make, including those in this Annual Report on Form 10-K. Except as may be required by law, we make no promise to update any of the forward-looking statements as a result of new information, future events or otherwise. You should carefully review the above risks and the risk factors.
We face risks relating to cyber threats that could cause loss of confidential information and other business disruptions.
We rely extensively on information technology systems to process transactions and manage our business, and our business is at risk from and may be impacted by cybersecurity incidents. These could include attempts to gain unauthorized access to our data and computer systems as well as attacks on third party's information technology systems that we rely on to provide important information technology services relating to key business functions, such as payroll. Cyber attacks can be both individual and/or highly organized attempts by very sophisticated hacking organizations. A cyber attack could compromise the confidential information of our employees, tenants, and vendors. A successful attack could adversely affect our business operations, results of operations, or financial condition by, among other things, disrupting our collection of revenue, interfering with our ability to satisfy our financial obligations by restricting access to our assets, or causing inaccuracies in our financial reporting. We employ a number of measures to prevent, detect, and mitigate these threats, which include password encryption, multi-factor authentication, frequent password change events, firewall detection systems, anti-virus software in-place, frequent backups, a redundant data system for core applications, and penetration testing; however, there is no guarantee such efforts will be successful in preventing a material cybersecurity incident.

ITEM 1B.    UNRESOLVED STAFF COMMENTS
None.

ITEM 1C.    CYBER SECURITY
Please see Item 7. "Managements's Discussion and Analysis of Financial Condition and Results of Operations - Cyber Security" for discussion regarding the cyber security policies of the Company.
ITEM 2.    PROPERTIES
General
As of December 31, 2023, we owned or had a majority ownership interest in community and neighborhood shopping centers and mixed-used properties which are operated as 102 predominantly retail real estate projects comprising approximately 26.0 million commercial square feet. These properties are located primarily in densely populated and affluent communities in strategic metropolitan markets in the Northeast and Mid-Atlantic regions of the United States, California, and South Florida. No single commercial or residential property accounted for over 10% of our 2023 total revenue. We believe that our properties are adequately covered by commercial general liability, fire, flood, earthquake, terrorism and business interruption insurance provided by reputable companies, with commercially reasonable exclusions, deductibles and limits.
Tenant Diversification
As of December 31, 2023, we had approximately 3,300 commercial leases and 3,100 residential leases, with tenants ranging from sole proprietors to major national and international retailers. No one tenant or affiliated group of tenants accounted for more than 2.7% of our annualized base rent as of December 31, 2023. As a result of our tenant diversification, we believe our exposure to any one bankruptcy filing has not been and will not be significant, however, multiple filings by a number of tenants could have a significant impact.
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Geographic Diversification
Our 102 real estate projects are located in 12 states and the District of Columbia. The following table shows the number of projects, the gross leasable area (“GLA”) of commercial space and the percentage of total portfolio gross leasable area of commercial space in each state as of December 31, 2023.
 
StateNumber of
Projects
Gross Leasable
Area
Percentage
of Gross
Leasable
Area
 (In square feet)
California21 6,376,000 24.5 %
Maryland17 4,471,000 17.2 %
Virginia19 4,092,000 15.7 %
Pennsylvania1,853,000 7.1 %
Massachusetts2,230,000 8.6 %
New Jersey1,890,000 7.3 %
New York1,426,000 5.5 %
Florida1,287,000 4.9 %
Illinois799,000 3.1 %
Arizona947,000 3.6 %
Connecticut398,000 1.5 %
Michigan216,000 0.8 %
District of Columbia54,000 0.2 %
Total102 26,039,000 100.0 %
Leases, Lease Terms and Lease Expirations
Our leases are classified as operating leases and typically are structured to require the monthly payment of minimum rents in advance, subject to periodic increases during the term of the lease, percentage rents based on the level of sales achieved by tenants, and reimbursement of a majority of on-site operating expenses and real estate taxes. These features in our leases generally reduce our exposure to higher costs and allow us to participate in improved tenant sales.
Commercial property leases generally range from three to ten years; however, certain leases, primarily with anchor tenants, may be longer. Many of our leases contain tenant options that enable the tenant to extend the term of the lease at expiration at pre-established rental rates that often include fixed rent increases, consumer price index adjustments or other market rate adjustments from the prior base rent. Leases on residential units are generally for a period of one year or less and, in 2023, represented approximately 9.7% of total rental income.
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The following table sets forth the schedule of lease expirations for our commercial leases in place as of December 31, 2023 for each of the 10 years beginning with 2024 and after 2033 in the aggregate assuming that none of the tenants exercise future renewal options. Annualized base rents reflect in-place contractual rents as of December 31, 2023.
 
Year of Lease ExpirationLeased
Square
Footage
Expiring
Percentage of
Leased Square
Footage
Expiring
Annualized
Base Rent
Represented by
Expiring Leases
Percentage of  Annualized Base Rent  Represented by Expiring Leases
20241,881,000 %$54,591,000 %
20253,400,000 14 %90,760,000 12 %
20262,118,000 %73,469,000 10 %
20273,003,000 12 %103,735,000 14 %
20282,689,000 11 %88,072,000 11 %
20292,942,000 12 %93,294,000 12 %
20301,165,000 %35,242,000 %
20311,165,000 %38,993,000 %
20322,228,000 %75,410,000 10 %
20331,374,000 %44,473,000 %
Thereafter2,049,000 %60,832,000 %
Total24,014,000 100 %$758,871,000 100 %
During 2023, we signed leases for a total of 2,091,000 square feet of retail space including 2,027,000 square feet of comparable space leases (leases for which there was a prior tenant) at an average rental increase of 10% on a cash basis. New leases for comparable spaces were signed for 1,016,000 square feet at an average rental increase of 13% on a cash basis. Renewals for comparable spaces were signed for 1,011,000 square feet at an average rental increase of 8% on a cash basis. Tenant improvements and incentives for comparable spaces were $29.84 per square foot, of which, $56.95 per square foot was for new leases and $2.60 per square foot was for renewals in 2023.
During 2022, we signed leases for a total of 2,048,000 square feet of retail space including 1,985,000 square feet of comparable space leases (leases for which there was a prior tenant) at an average rental increase of 6% on a cash basis. New leases for comparable spaces were signed for 757,000 square feet at an average rental increase of 8% on a cash basis. Renewals for comparable spaces were signed for 1,228,000 square feet at an average rental increase of 4% on a cash basis. Tenant improvements and incentives for comparable spaces were $31.65 per square foot, of which, $75.12 per square foot was for new leases and $4.86 per square foot was for renewals in 2022.
The rental increases associated with comparable spaces generally include all leases signed for retail space in arms-length transactions reflecting market leverage between landlords and tenants during the period, excluding leases at properties sold or under contract to be sold. The comparison between the rent for expiring leases and new leases is determined by including contractual rent on the expiring lease, including percentage rent, and the comparable annual rent and in some instances, projections of percentage rent, to be paid on the new lease. In atypical circumstances, management may exercise judgment as to how to most effectively reflect the comparability of spaces reported in this calculation. The change in rental income on comparable space leases is impacted by numerous factors including current market rates, location, individual tenant creditworthiness, use of space, market conditions when the expiring lease was signed, capital investment made in the space and the specific lease structure. Tenant improvements and incentives include the total dollars committed for the improvement (fit out) of a space as it relates to a specific lease. Incentives include amounts paid to tenants as an inducement to sign a lease that do not represent building improvements. Costs related to tenant improvements require judgement by management in determining what are costs specific to the tenant and not deferred maintenance on the space.
Historically, we have executed comparable space leases for 1.4 to 2.0 million square feet of retail space each year and expect the volume for 2024 will be in line with these historical averages. Although we expect overall positive increases in annual rent for comparable spaces, changes in annual rent for any individual lease or combinations of individual leases reported in any particular period may be positive or negative and we can provide no assurance that the annual rents on comparable space leases will continue to increase at historical levels, if at all. The current economic conditions could adversely impact our volume of leasing activity and the amount of rent we are able to charge to new or renewing tenants.
The leases signed in 2023 generally become effective over the following two years though some may not become effective until 2026 and beyond. Further, there is risk that some new tenants will not ultimately take possession of their space and that tenants for both new and renewal leases may not pay all of their contractual rent due to operating, financing or other matters. However,
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our historical increases in rental rates do provide information about the tenant/landlord relationship and the potential increase we may achieve in rental income over time.
Retail and Residential Properties
The following table sets forth information concerning all real estate projects in which we owned an equity interest, had a leasehold interest, or otherwise controlled and are consolidated as of December 31, 2023. Except as otherwise noted, we are the sole owner of our real estate projects. Principal tenants are the largest tenants in the project based on square feet leased or are tenants important to a project’s success due to their ability to attract retail customers.
Property, City, State, Zip CodeYear CompletedYear AcquiredSquare Feet(1) /Apartment UnitsAverage Base Rent Per Square Foot(2)Percentage Leased(3)Principal Tenant(s)
Arizona
Camelback Colonnade
   Phoenix, AZ 85016(4)
1977, 20192021642,000$18.4790%Fry's Food & Drug
Marshalls
Nordstrom Last Chance
Best Buy
Floor & Décor
Chandler Festival
   Chandler, AZ 85224(5)(6)
20002022355,000$18.2089%Ross Dress for Less
Nordstrom Rack
TJ Maxx
Ulta
Chandler Gateway
   Chandler, AZ 85226(5)(6)
20012022262,000$11.15100%Walmart
Hobby Lobby
Petco
Hilton Village
   Scottsdale, AZ 85250(4)(7)
1982, 19892021/2022305,00033.9294%CVS
Houston's
California
Azalea
   South Gate, CA 90280(4)(6)
20142017226,000$30.13100%Marshalls
Ross Dress for Less
Ulta
Michaels
Bell Gardens
   Bell Gardens, CA 90201(4)(6)(7)
1990, 2003, 20062017/2018330,000$23.7497%Food 4 Less
Marshalls
Ross Dress for Less
Bob's Discount Furniture
Colorado Blvd
   Pasadena, CA 91103(7)
1905-1988199842,000$59.9873%Banana Republic
True Food Kitchen
Crow Canyon Commons
   San Ramon, CA 94583
1980, 1998,
2006
2005/2007239,000$35.4985%Sprouts
Total Wine & More
Alamo Ace Hardware
East Bay Bridge
   Emeryville & Oakland, CA 94608
1994-2001,
2011, 2012
2012440,000$20.45100%Pak-N-Save
Target
Home Depot
Nordstrom Rack
Ulta
Michaels
Escondido Promenade
   Escondido, CA 92029
19871996/2010298,000$30.4798%TJ Maxx
Dick's Sporting Goods
Ross Dress for Less
Bob's Discount Furniture
Fourth Street
   Berkeley, CA 94710(4)
1948, 1975201771,000$33.5781%CB2
Ingram Book Group
Bellwether Coffee
Freedom Plaza
   Los Angeles, CA 90002(4)(7)
20202018114,000$31.2196%Smart & Final
Nike
Blink Fitness
Ross Dress for Less
Grossmont Center
   La Mesa, CA 91942(4)
1961, 1963, 1982-1983, 20022021877,000$14.7597%Target
Walmart
Barnes & Noble
Macy's
CVS
Hastings Ranch Plaza
   Pasadena, CA 91107(7)
1958, 1984, 2006, 20072017273,000$9.15100%Marshalls
HomeGoods
CVS
Hollywood Blvd
   Hollywood, CA 90028
1929, 19911999181,000$36.5886%Target
Marshalls
L.A. Fitness
CVS
Kings Court
   Los Gatos, CA 95032(7)(8)
1960199881,000$44.4598%Lunardi's
CVS
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Property, City, State, Zip CodeYear CompletedYear AcquiredSquare Feet(1) /Apartment UnitsAverage Base Rent Per Square Foot(2)Percentage Leased(3)Principal Tenant(s)
La Alameda
   Walnut Park, CA 90255(5)(6)(7)
20082017245,000$27.8695%Marshalls
Ross Dress for Less
CVS
Petco
Old Town Center
   Los Gatos, CA 95030
1962, 1998199798,000$45.1585%Anthropologie
Sephora
Arhaus Furniture
Teleferic Barcelona
Olivo at Mission Hills
   Mission Hills, CA 91345(4)
20182017156,000$34.13100%Target
24 Hour Fitness
Ross Dress for Less
Ulta
Plaza Del Sol
   South El Monte, CA 91733(4)
2009201748,000$24.0796%Marshalls
Plaza El Segundo / The Point
   El Segundo, CA 90245 (6)
2006-2007, 20162011/2013502,000$48.9798%Whole Foods
Nordstrom Rack
HomeGoods
Dick's Sporting Goods
Multiple Restaurants
San Antonio Center
   Mountain View, CA 94040(7)(8)
1958,
1964-1965,
1974-1975,
1995-1997
2015/2019213,000$17.46100%Trader Joe's
Walmart
24 Hour Fitness
Santana Row
   San Jose, CA 95128(7)(10)
2002, 2009, 2016, 202019971,206,000$57.9899%Crate & Barrel
Container Store
H&M Best Buy
Splunk
Net App
Multiple Restaurants
Santana Row Residential
   San Jose, CA 95128
2003-2006,
2011, 2014
1997/2012662 units N/A97%
Sylmar Towne Center
   Sylmar, CA 91342(4)
19732017148,000$17.8993%Food 4 Less
CVS
Third Street Promenade
   Santa Monica, CA 90401
1888-20001996-2000185,000$81.9369%adidas
John Reed Fitness
Multiple Restaurants
Westgate Center
   San Jose, CA 95129
1960-19662004648,000$20.2691%Target
Nordstrom Rack
Nike Factory
TJ Maxx
Ross Dress for Less
Connecticut
Bristol Plaza
   Bristol, CT 06010
19591995264,000$15.2088%Stop & Shop
TJ Maxx
Burlington
Darien Commons
   Darien, CT 06820
1920-2009, 20232013/201899,000$46.8792%Equinox
Walgreens
Multiple Restaurants
Darien Commons Residential
   Darien, CT 06820
20222013/2018124 units N/A98%
Greenwich Avenue
   Greenwich Avenue, CT 06830
1968199535,000$96.19100%Saks Fifth Avenue
District of Columbia
Friendship Center
   Washington, DC 20015
1998200154,000$28.43100%Marshalls
Maggiano's
Florida
CocoWalk
   Coconut Grove, FL 33133(4)(11)
1990/1994,
1922-1973,
2018-2021
2015-2017277,000$46.70100%Cinepolis Theaters
Youfit Health Club
Multiple Restaurants
Del Mar Village
   Boca Raton, FL 33433
1982, 1994
& 2007
2008/2014187,000$24.3598%Winn Dixie
CVS
L.A. Fitness
Shops at Pembroke Gardens
   Pembroke Pines, FL 33027
20072022392,000$32.4394%Nike Factory
Old Navy
DSW
Barnes & Noble
Tower Shops
   Davie, FL 33324
1989, 20172011/2014431,000$28.0899%Trader Joe's
TJ Maxx
Ross Dress for Less
Best Buy
Ulta
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Property, City, State, Zip CodeYear CompletedYear AcquiredSquare Feet(1) /Apartment UnitsAverage Base Rent Per Square Foot(2)Percentage Leased(3)Principal Tenant(s)
Illinois
Crossroads
   Highland Park, IL 60035
19591993168,000$23.7296%L.A. Fitness
Ulta
Binny's
Ferguson's Bath, Kitchen, & Lighting Gallery
Finley Square
   Downers Grove, IL 60515
19741995281,000$20.3553%Michaels
Five Below
Portillo's
Garden Market
   Western Springs, IL 60558
19581994139,000$14.9296%Mariano's Fresh Market
Walgreens
Riverpoint Center
   Chicago, IL 60614
1989, 20122017211,000$22.1495%Jewel Osco
Marshalls
Old Navy
Maryland
Bethesda Row
   Bethesda, MD 20814(6)(7)
1945-1991
2001, 2008
1993-2006/
2008/2010
529,000$58.7892%Giant Food
Apple
Equinox
Anthropologie
Nike Live
Multiple Restaurants
Bethesda Row Residential
   Bethesda, MD 20814 (6)
20081993180 units N/A95%
Congressional Plaza
   Rockville, MD 20852(4)
19651965325,000$42.8289%The Fresh Market
Ulta
Barnes & Noble
Container Store
Buy Buy Baby
Congressional Plaza Residential
   Rockville, MD 20852(4)
2003, 20161965194 units N/A99%
Courthouse Center
   Rockville, MD 20852
1975199737,000$26.1573%
Federal Plaza
   Rockville, MD 20852
19701989249,000$37.2693%Trader Joe's
TJ Maxx
Micro Center
Ross Dress for Less
Gaithersburg Square
   Gaithersburg, MD 20878
19661993207,000$31.0697%Marshalls Ross Dress for Less
Ashley Furniture HomeStore
CVS
Governor Plaza
   Glen Burnie, MD 21961
19631985243,000$20.42100%Aldi
Dick's Sporting Goods
Ross Dress for Less
Petco
Bob's Discount Furniture
Laurel
   Laurel, MD 20707
19561986364,000$24.3696%Giant Food
Marshalls
L.A. Fitness
HomeGoods
Montrose Crossing
   Rockville, MD 20852
1960-1979,
1996, 2011
2011/2013369,000$34.3399%Giant Food
Marshalls
Home Depot Design Center
Old Navy
Burlington
Perring Plaza
   Baltimore, MD 21134
19631985397,000$17.2988%Home Depot
Dick's Sporting Goods
Micro Center
Pike & Rose
   North Bethesda, MD 20852(10)
1963, 2014, 2018, 20201982/2007/
2012
792,000$45.07100%Porsche
Uniqlo
REI
H&M
L.L. Bean
Choice Hotels
Multiple Restaurants
Pike & Rose Residential
   North Bethesda, MD 20852
2014, 2016, 20181982/2007765 units N/A95%
Plaza Del Mercado
   Silver Spring, MD 20906
19692004116,000$33.9793%Aldi
CVS
L.A. Fitness
Quince Orchard
   Gaithersburg, MD 20877(7)
19751993271,000$26.2281%Aldi
HomeGoods
L.A. Fitness
Staples
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Property, City, State, Zip CodeYear CompletedYear AcquiredSquare Feet(1) /Apartment UnitsAverage Base Rent Per Square Foot(2)Percentage Leased(3)Principal Tenant(s)
THE AVENUE at White Marsh
   Baltimore, MD 21236(8)
19972007315,000$29.0896%AMC
Ulta
Old Navy
Nike
The Shoppes at Nottingham Square
   Baltimore, MD 21236
2005-2006200733,000$54.10100%
White Marsh Other
   Baltimore, MD 21236
1985200756,000$36.8787%
White Marsh Plaza
   Baltimore, MD 21236
1987200780,000$24.0998%Giant Food
Wildwood
   Bethesda, MD 20814
1958196988,000$106.73100%Balducci's
CVS
Multiple Restaurants
Massachusetts
Assembly Row/
Assembly Square Marketplace
   Somerville, MA 02145(10)
2005, 2014, 2018, 20212005-2011/
2013
1,212,000$39.6396%Trader Joe's
TJ Maxx
AMC
Nike
PUMA
Multiple Restaurants
Assembly Row Residential
   Somerville, MA 02145
2018, 20212005-2011947 units N/A95%
Campus Plaza
   Bridgewater, MA 02324
19702004114,000$17.9494%Roche Bros.
Burlington
Five Below
Chelsea Commons
   Chelsea, MA 02150(6)
1962,1969,
2008
2006-2008230,000$14.79100%Home Depot
Planet Fitness
CVS
Burlington
Dedham Plaza
   Dedham, MA 02026
19591993/2016/
2019
253,000$22.3991%Star Market
Planet Fitness
Linden Square
   Wellesley, MA 02481
1960, 20082006224,000$50.8198%Roche Bros.
CVS
Multiple Restaurants
7 units N/A86%
North Dartmouth
   North Dartmouth, MA 02747
2004200648,000$17.22100%Stop & Shop
Queen Anne Plaza
   Norwell, MA 02061
19671994149,000$20.5599%Big Y Foods
TJ Maxx
HomeGoods
Michigan
Gratiot Plaza
   Roseville, MI 48066
19641973216,000$13.4378%Kroger
Best Buy
DSW
New Jersey
Brick Plaza
   Brick Township, NJ 08723(7)
19581989407,000$22.3994%Trader Joe's
AMC
HomeGoods
Ulta Burlington
Brook 35
   Sea Grit, NJ 08750(4)(6)(8)
1986, 2004201498,000$39.9789%Banana Republic
Gap
Williams-Sonoma
Ellisburg
   Cherry Hill, NJ 08034
19591992260,000$17.8398%Whole Foods
Five Below
RH Outlet
Buy Buy Baby
Hoboken
   Hoboken, NJ 07030(4)(6)(12)
1887-20062019/2020/2022171,000$58.8199%Nike Live
CVS
New York Sports Club
Sephora
Multiple Restaurants
129 units N/A100%
Mercer on One (formerly Mercer Mall)
   Lawrenceville, NJ 08648(7)
19752003/2017/2023551,000$27.1394%Shop Rite
Nike
Ross Dress for Less
Nordstrom Rack
REI
Tesla
The Grove at Shrewsbury
   Shrewsbury, NJ 07702(4)(6)(8)
1988, 1993
& 2007
2014193,000$50.9895%Lululemon
Anthropologie
Pottery Barn
Williams-Sonoma
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Table of Contents
Property, City, State, Zip CodeYear CompletedYear AcquiredSquare Feet(1) /Apartment UnitsAverage Base Rent Per Square Foot(2)Percentage Leased(3)Principal Tenant(s)
Troy Hills
   Parsippany-Troy, NJ 07054
19661980210,000$23.0798%Target
L.A. Fitness Michaels
New York
Fresh Meadows
   Queens, NY 11365
19491997408,000$39.9698%Island of Gold
AMC
Kohl's
Planet Fitness
Georgetowne Shopping Center
   Brooklyn, NY 11234
1969, 2006, 20152019147,000$42.7291%Foodway
Five Below
IHOP
Greenlawn Plaza
   Greenlawn, NY 11743
1975, 20042006103,000$19.1479%Greenlawn Farms
Planet Fitness
Hauppauge
   Hauppauge, NY 11788
19631998134,000$26.8394%Shop Rite
TJ Maxx
Five Below
Huntington
   Huntington, NY 11746
19621988/2007/ 2015138,000$34.4791%Petsmart
Michaels
REI
Ulta
Huntington Square
   East Northport, NY 11731
1980, 20072010/2023243,000$22.8298%Barnes & Noble
At Home
AMC
Melville Mall
   Huntington, NY 11747(7)
19742006253,000$29.83100%Uncle Giuseppe's Marketplace
Marshalls
Dick's Sporting Goods
Macy's Backstage
Public Lands
Pennsylvania
Andorra
   Philadelphia, PA 19128
19531988270,000$14.9987%Acme Markets
TJ Maxx Kohl's
L.A. Fitness
Five Below
Bala Cynwyd
   Bala Cynwyd, PA 19004
19551993174,000$37.0497%Acme Markets
Michaels
L.A. Fitness
Bala Cynwyd Residential
   Bala Cynwyd, PA 19004
2020199387 units N/A97%
Flourtown
   Flourtown, PA 19031
19571980158,000$22.4296%Giant Food
Movie Tavern
Lancaster
   Lancaster, PA 17601(7)
19581980126,000$19.2899%Giant Food
AutoZone
Langhorne Square
   Levittown, PA 19056
19661985223,000$18.8999%Redner's Warehouse Markets
Marshalls
Planet Fitness
Lawrence Park
   Broomall, PA 19008
19721980/2017357,000$24.3997%Acme Markets
TJ Maxx
HomeGoods
Barnes & Noble
Lankenau Medical Center
Northeast
   Philadelphia, PA 19114
19591983214,000$22.6181%Marshalls
Ulta
Skechers
Crunch Fitness
Willow Grove
   Willow Grove, PA 19090
1953198485,000$24.2098%Marshalls
Five Below
Wynnewood
   Wynnewood, PA 19096
19481996246,000$32.0976%Giant Food
Old Navy
DSW
9 units N/A100%
Virginia
29th Place
   Charlottesville, VA 22091
1975-20012007168,000$20.6198%HomeGoods
DSW
Staples
Barcroft Plaza
   Falls Church, VA 22041
1963, 1972, 1990, & 20002006/2007/ 2016113,000$29.25100%Harris Teeter
Barracks Road
   Charlottesville, VA 22905
19581985495,000$28.5588%Harris Teeter
Kroger
Anthropologie
Old Navy
Ulta
Michaels
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Property, City, State, Zip CodeYear CompletedYear AcquiredSquare Feet(1) /Apartment UnitsAverage Base Rent Per Square Foot(2)Percentage Leased(3)Principal Tenant(s)
Birch & Broad
   Falls Church, VA 22046
1960/19621967/1972144,000$38.63100%Giant Food
CVS
Staples
Chesterbrook
   McLean, VA 22101(4)
1967202189,000$27.0181%Safeway
Starbucks
Fairfax Junction
   Fairfax, VA 22030(8)
1981, 1986, 20002019/2020124,000$25.8094%Aldi
CVS
Planet Fitness
Graham Park Plaza
   Falls Church, VA 22042
19711983133,000$38.9290%Giant Food
Idylwood Plaza
   Falls Church, VA 22030
1991199473,000$48.1898%Whole Foods
Kingstowne Towne Center
   Kingstowne, VA 22315
1996, 2001, 20062022410,000$27.6799%Giant Food
Safeway
TJ Maxx
HomeGoods
Five Below
Ross Dress for Less
Mount Vernon/South Valley/
   7770 Richmond Hwy
   Alexandria, VA 22306(8)
1966,
1972,1987
& 2001
2003/2006/2021565,000$20.7998%Shoppers Food Warehouse
TJ Maxx
Home Depot
Old Navy
Petsmart
Old Keene Mill
   Springfield, VA 22152
1968197690,000$45.9095%Walgreens
Planet Fitness
Pan Am
   Fairfax, VA 22031
19791993228,000$24.4991%Safeway
Micro Center
CVS
Michaels
Pike 7 Plaza
   Vienna, VA 22180
19681997/2015172,000$48.2897%Lidl
TJ Maxx
DSW
Ulta
Tower Shopping Center
   Springfield, VA 22150
19601998112,000$28.4597%L.A. Mart
Total Wine & More
Talbots
Twinbrooke Shopping Centre
   Fairfax, VA 22032
19772021101,000$27.4093%Safeway
Walgreens
Tyson's Station
   Falls Church, VA 22043
1954197848,000$51.3688%Trader Joe's
Village at Shirlington
   Arlington, VA 22206(7)
1940,
2006-2009
1995267,000$40.9588%Harris Teeter
CVS AMC
Multiple Restaurants
Westpost
   Arlington, VA 22202
2001-20021998/2010298,000$32.7499%Harris Teeter
Target
TJ Maxx
Ulta
Walgreens
DSW
Willow Lawn
   Richmond, VA 23230
19571983462,000$22.4699%Kroger
Old Navy
Ross Dress for Less
Gold's Gym
Dick's Sporting Goods
Ulta
Total — Commercial (9)26,039,000$31.6094%
Total —Residential3,104 units96%
 _____________________
(1)Represents the GLA of the commercial portion of the property. Some of our properties include office space which is included in this square footage.
(2)Average base rent per square foot is calculated as the aggregate, annualized in-place contractual (defined as cash basis excluding rent abatements) minimum rent for all occupied spaces divided by the aggregate GLA of all occupied spaces. Average base rent is for commercial spaces only.
(3)Percentage leased is expressed as a percentage of rentable commercial square feet occupied or subject to a lease. Residential percentage leased is expressed as a percentage of units occupied or subject to a lease.
(4)We own the controlling interest in this property.
(5)We own a noncontrolling interest in this property.
(6)All or a portion of this property is encumbered by a mortgage loan.
(7)All or a portion of this property is owned pursuant to a ground lease.
(8)We own all or a portion of this property in a “downREIT” partnership, of which a wholly owned subsidiary of the Trust is the sole general partner, with third party partners holding operating partnership units.
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(9)Aggregate information is calculated on a GLA weighted-average basis, excluding Chandler Festival, Chandler Gateway, and La Alameda, which are all unconsolidated properties at December 31, 2023.
(10)Portion of property is currently under development. See further discussion in Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations.
(11)This property includes interests in four nearby buildings.
(12)This property includes 40 buildings primarily along Washington Street and 14th Street in Hoboken, New Jersey.

ITEM 3.    LEGAL PROCEEDINGS
We are involved from time-to-time in various legal and regulatory proceedings that arise in the ordinary course of our business, including, but not limited to, commercial disputes, environmental matters, and litigation in connection with transactions such as acquisitions and divestitures. We believe that our current proceedings will not have a material adverse effect on our financial condition, liquidity or results of operations. See Note 7 to the consolidated financial statements for further discussions.

ITEM 4.    MINE SAFETY DISCLOSURES
Not applicable.
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PART II
ITEM 5.    MARKET FOR OUR COMMON EQUITY AND RELATED SHAREHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES
Our common shares trade on the New York Stock Exchange under the symbol “FRT.” Listed below are the high and low sales prices of our common shares as reported on the New York Stock Exchange and the dividends declared for each of the periods indicated.
 
 Price Per ShareDividends
Declared
Per Share
HighLow
2023
Fourth quarter$107.61 $85.59 $1.090 
Third quarter$104.58 $89.90 $1.090 
Second quarter$100.67 $85.27 $1.080 
First quarter$115.08 $90.44 $1.080 
2022
Fourth quarter$112.34 $87.79 $1.080 
Third quarter$113.61 $86.43 $1.080 
Second quarter$128.13 $92.02 $1.070 
First quarter$140.51 $113.10 $1.070 
On February 7, 2024, there were 2,034 holders of record of our common shares.
Our ongoing operations generally will not be subject to federal income taxes as long as we maintain our REIT status and distribute to shareholders at least 100% of our taxable income. Under the Code, REITs are subject to numerous organizational and operational requirements, including the requirement to generally distribute at least 90% of taxable income.
Future distributions will be at the discretion of our Board of Trustees and will depend on our actual net income available for common shareholders, financial condition, capital requirements, the annual distribution requirements under the REIT provisions of the Code and such other factors as the Board of Trustees deems relevant. We have paid quarterly dividends to our shareholders continuously since our founding in 1962 and have increased our regular annual dividend rate for 56 consecutive years.
Our total annual dividends paid per common share for 2023 and 2022 were $4.33 per share and $4.29 per share, respectively. The annual dividend amounts are different from dividends as calculated for federal income tax purposes. Distributions to the extent of our current and accumulated earnings and profits for federal income tax purposes generally will be taxable to a shareholder as ordinary dividend income. Distributions in excess of current and accumulated earnings and profits will be treated as a nontaxable reduction of the shareholder’s basis in such shareholder’s shares, to the extent thereof, and thereafter as taxable capital gain. Distributions that are treated as a reduction of the shareholder’s basis in its shares will have the effect of increasing the amount of gain, or reducing the amount of loss, recognized upon the sale of the shareholder’s shares. No assurances can be given regarding what portion, if any, of distributions in 2024 or subsequent years will constitute a return of capital for federal income tax purposes. During a year in which a REIT earns a net long-term capital gain, the REIT can elect under Section 857(b)(3) of the Code to designate a portion of dividends paid to shareholders as capital gain dividends. If this election is made, then the capital gain dividends are generally taxable to the shareholder as long-term capital gains.
The following table reflects the income tax status of distributions per share paid to common shareholders:
 
 Year Ended
December 31,
20232022
Ordinary dividend$3.551 $3.518 
Capital gain0.130 0.772 
Return of capital0.649 — 
$4.330 $4.290 
Distributions on our 5.417% Series 1 Cumulative Convertible Preferred Shares were paid at the rate of $1.354 per share per annum commencing on the issuance date of March 8, 2007. Distributions on our 5.0% Series C Cumulative Redeemable
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Preferred Shares were paid at the rate of $1.250 per depositary share per annum, commencing on the issuance date of September 29, 2017. We do not believe that the preferential rights available to the holders of interest in our preferred shares or the financial covenants contained in our debt agreements had or will have an adverse effect on our ability to pay dividends in the normal course of business to our common shareholders or to distribute amounts necessary to maintain our qualification as a REIT.
Total Stockholder Return Performance
The following performance graph compares the cumulative total shareholder return on Federal Realty's common shares with the S&P 500 Index and the index of equity real estate investment trusts prepared by the National Association of Real Estate Investment Trusts ("NAREIT") for the five fiscal years commencing December 31, 2018, and ending December 31, 2023, assuming an investment of $100 and the reinvestment of all dividends into additional common shares during the holding period. Equity real estate investment trusts are defined as those that derive more than 75% of their income from equity investments in real estate assets. The FTSE NAREIT Equity REIT Total Return Index includes all tax qualified real estate investment trusts listed on the NYSE, NYSE MKT, or the NASDAQ National Market. Stock performance for the past five years is not necessarily indicative of future results.
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Recent Sales of Unregistered Shares
Under the terms of various operating partnership agreements of certain of our affiliated limited partnerships, the interest of limited partners in those limited partnerships may be redeemed, subject to certain conditions, for cash or an equivalent number of our common shares, at our option. During the three months ended December 31, 2023, we did not issue any common shares in connection with the redemption of downREIT operating partnership units. Any equity securities sold by us during 2023 that were not registered have been previously reported in a Quarterly Report on Form 10-Q.
Purchases of Equity Securities by the Issuer and Affiliated Purchasers
During 2023, 5,930 restricted common shares were forfeited by former employees.
From time to time, we could be deemed to have repurchased shares as a result of shares withheld for tax purposes upon a stock compensation related vesting event.
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ITEM 6.    RESERVED
None.
ITEM 7.    MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
This section generally discusses 2023 and 2022 items and year-to-year comparisons between 2023 and 2022. Discussions of 2021 items and year-to-year comparisons between 2022 and 2021 that are not included in this Form 10-K can be found in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in Part II, Item 7 of our Annual Report on Form 10-K for the fiscal year ended December 31, 2022 filed with the Securities and Exchange Commission on February 8, 2023.

Forward-Looking Statements
Certain statements in this section or elsewhere in this report may be deemed “forward-looking statements”. See “Item 1A. Risk Factors” in this report for important information regarding these forward-looking statements and certain risk and uncertainties that may affect us. The following discussion should be read in conjunction with the consolidated financial statements and notes thereto appearing in “Item 8. Financial Statements and Supplementary Data” of this report.
Overview
Federal Realty Investment Trust (the "Parent Company" or the "Trust") is an equity real estate investment trust ("REIT"). Federal Realty OP LP (the "Operating Partnership") is the entity through which the Trust conducts substantially all of its operations and owns substantially all of its assets. The Trust owns 100% of the limited liability company interest of, is sole member of, and exercises exclusive control over Federal Realty GP LLC (the "General Partner"), which in turn, is the sole general partner of the Operating Partnership. Unless stated otherwise or the context otherwise requires, "we," "our," and "us" means the Trust and its business and operations conducted through its directly and indirectly owned subsidiaries, including the Operating Partnership. We specialize in the ownership, management, and redevelopment of high quality retail and mixed-use properties located primarily in communities where we believe demand exceeds supply, in strategically selected metropolitan markets in the Northeast and Mid-Atlantic regions of the United States, California, and South Florida. As of December 31, 2023, we owned or had a majority interest in community and neighborhood shopping centers and mixed-use properties which are operated as 102 predominantly retail real estate projects comprising approximately 26.0 million commercial square feet. In total, the real estate projects were 94.2% leased and 92.2% occupied at December 31, 2023. We have paid quarterly dividends to our shareholders continuously since our founding in 1962 and have increased our dividends per common share for 56 consecutive years.
General Economic Conditions
The heightened levels of inflation, higher interest rates, and the potentially worsening of economic conditions presents risks for our business and our tenants. We continue to monitor and address risks related to the general state of the economy. We believe that the actions we have taken to improve our financial position and maximize our liquidity will continue to mitigate the impact to our cash flow caused by tenants not timely paying contractual rent.
Additional discussion of the impact of current economic conditions on our results and long-term operations can be found throughout Item 7 and Item 1A. Risk Factors.
Corporate Responsibility
We actively endeavor to operate and develop our properties in a sustainable, responsible, and effective manner with the objective being to drive long-term growth and aid in value creation for our shareholders, tenants, employees, and local communities. We have aligned our program and efforts with the United Nations Sustainable Development Goals, as described in our ESG Policy and our 2022 Environmental Social and Governance Report, which are provided only for informational purposes on our website and not incorporated by reference herein.
We are committed to implementing sustainable business practices at our operating properties that focus on energy efficiency, water conservation and waste minimization and have established greenhouse gas (GHG) emissions reduction targets in accordance with the Science-Based Targets initiative as well as energy reduction targets. To achieve these targets, we are actively addressing energy efficiency projects on site such as upgrading to LED lighting, procuring green energy, reducing electric consumption, and increasing our onsite solar generation capacity. We have installed on-site solar systems at 26 of our properties with a capacity of 14 MW with more projects actively in progress. We also installed electric vehicle car charging
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stations in numerous properties throughout our portfolio. We currently have over 400 charging stations in operation with more under construction.
We also understand that we face risks presented by climate change and are working to evaluate our risk exposure. In our 2022 Sustainability report, we provided a disclosure pursuant to the Task Force on Climate Related Financial Disclosure and we intend to provide that disclosure annually.
We are also highly committed to our employees and fostering a work environment that promotes growth, development and personal well-being. Our four core values are accountability, excellence, innovation and integrity and we seek to attract and retain talented professionals who embrace those values. All of our efforts with respect to corporate responsibility are overseen by our Board of Trustees.
Our development activities have been heavily focused on owning, developing and operating properties that are certified under the U.S. Green Building Council’s® (“USGBC”) Leadership in Energy and Environmental Design™ (LEED®) rating system which serves as a third-party verification that a building or community was designed and built to mitigate its environmental footprint. We currently have 21 LEED certified buildings and our Pike & Rose project has achieved LEED for Neighborhood Development Stage 3 Gold certification.
Cyber Security
Our chief information officer, who has over 30 years of experience in managing information systems for real estate companies, heads our internal team of technology professionals who are responsible for managing our cybersecurity risks, which includes identifying our primary areas of risk, establishing processes, procedures, and systems to mitigate those risks and identifying and remediating any breaches that may occur. Cybersecurity risk management falls under our general counsel as part of our overall risk management program, which is ultimately overseen by the Audit Committee of the Board of Trustees. Our team is supported by a third party company that we have retained to act as our chief information security officer based on the third party company's experience in preventing cybersecurity incidents, advising clients about appropriate cybersecurity procedures and processes, and assessing the integrity of those procedures and processes. The assessment and management of our cybersecurity risks covers all of our internal systems as well as the systems of third parties who maintain our data.
We rely on our management team's experience in risk management, in consultation with our third party advisor, to appropriately address cybersecurity threats. As part of our processes to manage risks from cybersecurity threats, we have developed and enforce company-wide policies related to password encryption, strength and expiration, we require multi-factor authentication where appropriate, and we conduct regular employee training about our policies and cybersecurity threats. We make use of firewalls, anti-virus software, backups, redundancies, regular penetration testing, and our systems monitor and flag irregularities in how our information systems are accessed or used. Any known cybersecurity incidents would be reported by our chief information officer to our general counsel and disclosure committee for evaluation and remediation, and for a determination of how we might develop further security systems and procedures to address evolving cybersecurity threats. Management provides written and verbal updates to the Audit Committee at least quarterly identifying our primary areas of risk, actions taken or planned to be taken to mitigate those risks, and specific activities undertaken during the quarter, including employee training and the results of that training. Management would also provide updates to seek oversight from the Audit Committee on an ad hoc basis in connection with any material cybersecurity incident, should one occur.
We have not experienced any cybersecurity incident that has had a material impact on our business strategy, results of operations, or financial condition. For more information, see Item 1A. Risk Factors ("We face risks relating to cybersecurity threats that could cause loss of confidential information and other business distributions").
Critical Accounting Policies and Estimates
The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America, referred to as “GAAP”, requires management to make estimates and assumptions that in certain circumstances affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities, and revenues and expenses. These estimates are prepared using management’s best judgment, after considering past and current events and economic conditions. In addition, information relied upon by management in preparing such estimates includes internally generated financial and operating information, external market information, when available, and when necessary, information obtained from consultations with third party experts. Actual results could differ from these estimates. A discussion of possible risks which may affect these estimates is included in “Item 1A. Risk Factors” of this report. Management considers an accounting estimate to be critical if changes in the estimate could have a material impact on our consolidated results of operations or financial condition.
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Our significant accounting policies are more fully described in Note 2 to the consolidated financial statements; however, the most critical accounting policies, which are most important to the portrayal of our financial condition and results of operations, and involve the use of complex estimates and significant assumptions as to future uncertainties and, therefore, may result in actual amounts that differ from estimates, are as follows:
Collectibility of Lease Income
Our leases with our tenants are classified as operating leases. When collection of substantially all lease payments during the lease term is considered probable, the lease qualifies for accrual accounting. When collection of substantially all lease payments during the lease term is not considered probable, total lease revenue is limited to the lesser of revenue recognized under accrual accounting or cash received. Determining the probability of collection of substantially all lease payments during a lease term requires significant judgment. This determination is impacted by numerous factors including our assessment of the tenant’s credit worthiness, economic conditions, tenant sales productivity in that location, historical experience with the tenant and tenants operating in the same industry, future prospects for the tenant and the industry in which it operates, and the length of the lease term. If leases currently classified as probable are subsequently reclassified as not probable, any outstanding lease receivables (including straight-line rent receivables) would be written-off with a corresponding decrease in rental income. For example, in the event that our collectibility determinations were not accurate and we were required to write off additional receivables equaling 1% of rental income, our rental income and net income would decrease by $11.3 million. If leases currently classified as not probable are subsequently changed to probable, any lease receivables (including straight-line rent receivables) are re-instated with a corresponding increase to rental income.
Our collectibility related adjustments for the years ended December 31, 2023 and 2022 resulted in a decrease to rental income of $0.4 million and an increase to rental income of $4.1 million, respectively. As of December 31, 2023 and 2022, the revenue from approximately 28% and 31% of our tenants (based on total commercial leases), respectively, is being recognized on a cash basis. As of December 31, 2023 and 2022, our straight-line rent receivables balance was $138.4 million and $126.6 million, respectively, and is included in "accounts and notes receivable, net" on our consolidated balance sheet.
Real Estate Acquisitions
Upon acquisition of operating real estate properties, we estimate the fair value of assets and liabilities acquired including land, building, improvements, leasing costs, intangibles such as acquired leases, assumed debt, and current assets and liabilities, if any. Based on these estimates, we allocate the purchase price to the applicable assets and liabilities. We utilize methods similar to those used by independent appraisers in estimating the fair value of acquired assets and liabilities. The value allocated to acquired leases is amortized over the related lease term and reflected as rental income in the statement of operations. We consider qualitative and quantitative factors in evaluating the likelihood of a tenant exercising a below market renewal option and include such renewal options in the calculation of in-place lease value when we consider these to be bargain renewal options. If the value of below market lease intangibles includes renewal option periods, we include such renewal periods in the amortization period utilized. If a tenant vacates its space prior to contractual termination of its lease, the unamortized balance of any acquired lease value is written off to rental income.
During 2022 and 2023, we acquired properties included in our consolidated financial statements with a total purchase price of $509.1 million. $3.4 million, or 1% of the total purchase price was allocated to above market lease assets and $39.9 million, or 8% was allocated to below market lease liabilities. If the amounts allocated in 2022 and 2023 to below market lease liabilities and building assets were each reduced by 5% of the total purchase price, annual below market lease liability amortization increasing rental income would decrease by approximately $2.2 million (using the weighted average life of below market liabilities at each respective acquired property) and annual depreciation expense would decrease by approximately $0.7 million (using a depreciable life of 35 years).
Long-Lived Assets and Impairment
There are estimates and assumptions made by management in preparing the consolidated financial statements for which the actual results will be determined over long periods of time. This includes the recoverability of long-lived assets, including our properties that have been acquired or redeveloped and our investment in certain joint ventures. Management’s evaluation of impairment includes review for possible indicators of impairment as well as, in certain circumstances, undiscounted and discounted cash flow analysis. Since most of our investments in real estate are wholly-owned or controlled assets which are held for use, a property with impairment indicators is first tested for impairment by comparing the undiscounted cash flows, taking into account the anticipated hold period, including residual value, to the current net book value of the property. If the undiscounted cash flows are less than the net book value, the property is written down to expected fair value.
The calculation of both discounted and undiscounted cash flows requires management to make estimates of future cash flows including revenues, operating expenses, required maintenance and development expenditures, market conditions, demand for
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space by tenants and rental rates over long periods. Because our properties typically have a long life, the assumptions used to estimate the future recoverability of book value requires significant management judgment. We are also required to estimate the anticipated hold period. A change in the expected holding period from a long term hold to a short term would cause a significant change in the undiscounted cash flows and could result in an impairment charge. Actual results could be significantly different from the estimates. These estimates have a direct impact on net income, because recording an impairment charge results in a negative adjustment to net income.
Recently Adopted and Recently Issued Accounting Pronouncements
See Note 2 to the consolidated financial statements.
2023 Acquisitions and Dispositions
On January 31, 2023, we acquired the 168,000 square foot portion of Huntington Square shopping center that was not previously owned, as well as the fee interest in the land underneath the portion of the shopping center which we controlled under a long-term ground lease for $35.5 million. As a result of this transaction, we now own the entire fee interest in this 243,000 square foot property and the "operating lease right of use assets, net" on our consolidated balance sheet decreased by $5.3 million. Approximately $4.1 million and $1.3 million of net assets acquired were allocated to other assets for "acquired lease costs" and "above market leases," respectively.
On May 26, 2023, we exercised our option and acquired the 22.3% tenancy in common ("TIC") interest from our co-owner at Escondido Promenade for $30.5 million, bringing our ownership interest to 100%. As a result of the transaction, we gained control of this property, and effective May 26, 2023, we have consolidated this property. Approximately $1.8 million and $0.2 million of net assets associated with the 22.3% interest acquired were allocated to other assets for "acquired lease costs" and "above market leases," respectively, and $1.1 million of net assets associated with the 22.3% interest acquired were allocated to other liabilities for "below market leases."
On October 12, 2023, we acquired the fee interest under a portion of our Mercer on One (formerly Mercer Mall) shopping center for $55.0 million pursuant to the purchase option included in the master lease. As a result of this transaction, "finance lease right of use assets, net" of $37.8 million were allocated to "operating real estate" and "finance lease liabilities" decreased by $55.0 million.
During the year ended December 31, 2023, we sold one retail property and one portion of a property for sales prices totaling $30.4 million, resulting in net gains totaling approximately $9.7 million.
2023 Significant Debt and Equity Transactions
For the three months ended December 31, 2023, we sold 1,220,842 common shares (of which, 62,895 settled on January 2, 2024) at a weighted average price per share of $101.30 for net cash proceeds of $122.4 million including paying $1.2 million in commissions and $0.1 million in additional operating expenses related to the sales of these common shares. For the year ended December 31, 2023, we sold 1,372,889 common shares (of which, 62,895 settled on January 2, 2024) at a weighted average price per share of $101.89 for net cash proceeds of $138.3 million including paying $1.4 million in commissions and $0.2 million in additional offering expenses related to the sales of these common shares. As of December 31, 2023, we had the capacity to issue up to $312.1 million in common shares under our ATM equity program.
On April 12, 2023, we issued $350.0 million of fixed rate senior unsecured notes that mature on May 1, 2028 and bear interest at 5.375%. The notes were offered at 99.590% of the principal amount with a yield to maturity of 5.468%. The net proceeds, after issuance discount, underwriting fees, and other costs were $345.7 million. The net proceeds of these notes, or "green bonds," will be allocated to the financing and refinancing of recently completed and future eligible green projects, which includes (i) investments in acquisitions of buildings; (ii) building developments or redevelopments; (iii) renovations in existing buildings; and (iv) tenant improvement projects, in each case that have received, or are expected to receive, in the three years prior to the issuance of the notes or during the term of the notes, a LEED Gold or Platinum certification (or environmentally equivalent successor standards). Net proceeds will be available for repayment of indebtedness, or may be invested in short-term income-producing investments or may be used to temporarily repay current and/or future amounts outstanding under our revolving credit facility.
Effective May 4, 2023, our Declaration of Trust was amended to increase the number of authorized common shares of beneficial interest to 200,000,000.
On June 1, 2023, we repaid our $275.0 million 2.75% senior unsecured notes at maturity.
On December 28, 2023, one of our wholly-owned subsidiaries entered into a $200.0 million mortgage loan, which bears interest at SOFR, plus a 95 basis point spread, matures on December 28, 2025, plus two one-year extensions, at our option, and is
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secured by our Bethesda Row property. The interest rate is effectively fixed at 5.03% through the initial maturity date, as a result of three interest rate swap agreements. Our net proceeds were $199.1 million, after debt issuance costs. Our subsidiary's obligations under the mortgage loan are guaranteed by the Operating Partnership.
2024 Significant Debt Transactions
On January 11, 2024, our Operating Partnership issued $485.0 million aggregate principal amount of 3.25% Exchangeable Senior Notes (the “Notes”) that mature on January 15, 2029, unless earlier exchanged, purchased or redeemed. On or after July 15, 2028, the Notes will be exchangeable for cash up to the principal amount of the Notes and, if applicable, cash, common shares of the Trust, or a combination thereof at our option, in respect of the remainder, if any, of the exchange obligation in excess of the principal amount. The exchange rate initially equals 8.1436 common shares per $1,000 principal amount of the Notes (equivalent to an exchange price of approximately $122.80 per common share). Net proceeds after the initial purchaser’s discount and estimated offering costs were approximately $471 million.
In connection with the Notes, we entered into privately negotiated capped call transactions with certain of the initial purchasers of the notes or their affiliates or other financial institutions. The capped call transactions cover, subject to customary adjustments, the number of our common shares that initially underlie the Notes. The capped call transactions are expected generally to reduce the potential dilution to our common shares upon exchange of any Notes and/or offset any cash payments we are required to make in excess of the principal amount of the Notes, with such reduction and/or offset subject to a cap. The cap price of the capped call transaction initially is approximately $143.26 per share, which represents a premium of approximately 40% over the last reported sale price of our common shares of $102.33 on the New York Stock Exchange on January 8, 2024, and is subject to certain adjustments under the terms of the capped call transactions. A portion of the proceeds from the Notes were used to pay the capped call premium of $19.4 million, which will be recorded in shareholders' equity for the Trust and capital for the Operating Partnership.
On January 16, 2024, we repaid the $600.0 million 3.95% senior unsecured notes at maturity.
Capitalized Costs
Certain external and internal costs directly related to the development, redevelopment and leasing of real estate, including pre-construction costs, real estate taxes, insurance, and construction costs and salaries and related costs of personnel directly involved, are capitalized. We capitalized external and internal costs related to both development and redevelopment activities of $183 million and $10 million, respectively, for 2023 and $278 million and $11 million, respectively, for 2022. We capitalized external and internal costs related to other property improvements of $91 million and $4 million, respectively, for 2023 and $111 million and $4 million, respectively, for 2022. We capitalized external and internal costs related to leasing activities of $20 million and $3 million, respectively, for 2023 and $18 million and $4 million, respectively, for 2022. The amount of capitalized internal costs for salaries and related benefits for development and redevelopment activities, other property improvements, and leasing activities were $9 million, $4 million, and $3 million, respectively, for 2023 and $10 million, $3 million, and $4 million, respectively, for 2022. Total capitalized costs were $312 million for 2023 and $425 million for 2022, respectively.
Outlook
Our long-term growth strategy is focused on growth in earnings, funds from operations, and cash flows primarily through a combination of the following:
growth in our comparable property portfolio,
growth in our portfolio from property redevelopments and expansions, and
expansion of our portfolio through property acquisitions.
Although general economic impacts of elevated levels of inflation and rising interest rates are impacting us in the short-term, our long-term focus has not changed.
Our comparable property growth is primarily driven by increases in rental rates on new leases and lease renewals, changes in portfolio occupancy, and the redevelopment of those assets. Over the long-term, the infill nature and strong demographics of our properties provide a strategic advantage allowing us to maintain relatively high occupancy and generally increase rental rates. We continue to experience strong demand for our commercial space as evidenced by the 2.0 million square feet of comparable space leasing we've completed in 2023, and the 2.0% spread between our leased rate of 94.2% and our occupied rate of 92.2%. During 2023, we have seen an uptick in tenants filing for bankruptcy compared to the prior two years. As a result, approximately 290,000 square feet of anchor space became vacant during the second half of 2023, of which, approximately 38,000 is leased to a replacement tenant. This will negatively impact our occupancy and net income in the short term, however, we expect to be able to re-lease the space at similar or better aggregate rents over the next several quarters, and
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we are actively in negotiations with replacement tenants. Additionally, the effects of high levels of inflation and rising interest rates continue to negatively impact our business with the largest impacts being higher interest costs, increased material costs, and higher operating costs. We continue to see impacts of increased costs for certain construction and other materials that support our development and redevelopment activities. Worsening supply chain disruptions could also result in extended time frames and/or increased costs for completion of our projects and tenant build-outs, which could delay the commencement of rent payments under new leases. Similarly, if our tenants experience significant disruptions in supply chains supporting their own products, staffing issues due to labor shortages, or are otherwise impacted by worsening economic conditions, their ability to pay rent may be adversely affected. We continue to monitor these macroeconomic developments and are working with our tenants and our vendors to limit the overall impact to our business.
We believe the locations and nature of our centers and diverse tenant base partially mitigates any potential negative changes in the economic environment. However, any significant reduction in our tenants' abilities to pay base rent, percentage rent or other charges, will adversely affect our financial condition and results of operations. We seek to maintain a mix of strong national, regional, and local retailers. At December 31, 2023, no single tenant accounted for more than 2.7% of annualized base rent.

We continue to have several development projects in process being delivered as follows:
Phase IV at Pike & Rose is a 276,000 square foot office building (which includes 10,000 square feet of ground floor retail space). Approximately 172,000 square feet of the office space is leased to two tenants, and approximately 8,000 square feet of retail is leased. The building is expected to cost between $185 million and $200 million, and began delivering in late September 2023. As of December 31, 2023, approximately 109,000 square feet of office space is open.
Construction on Santana West includes an eight story 376,000 square foot office building, which is expected to cost between $315 million and $330 million. Approximately 29,000 square feet of space is leased as of December 31, 2023.
Throughout the portfolio, we currently have redevelopment projects underway with a projected total cost of approximately $321 million that we expect to stabilize over the next several years.

The above includes our best estimates based on information currently known, however, the completion of construction, final costs, and the timing of leasing and openings may be further impacted by the current environment including the duration and severity of the economic impacts of broader, as well as local, economic conditions, inflation, higher interest rates, and higher operating costs.
The development of future phases of Assembly Row, Pike & Rose, Santana Row, and other properties will be pursued opportunistically based on, among other things, market conditions, tenant demand, and our evaluation of whether those phases will generate an appropriate financial return.
We continue to review acquisition opportunities that complement our portfolio and provide long-term growth opportunities. Initially, some of our acquisitions do not contribute significantly to earnings growth; however, we believe they provide long-term re-leasing growth, redevelopment opportunities, and other strategic opportunities. Any growth from acquisitions is contingent on our ability to find properties that meet our qualitative standards at prices that meet our financial hurdles. Changes in interest rates may affect our success in achieving earnings growth through acquisitions by affecting both the price that must be paid to acquire a property, as well as our ability to economically finance the property acquisition. Generally, our acquisitions are initially financed by available cash and/or borrowings under our revolving credit facility which may be repaid later with funds raised through the issuance of new equity or new long-term debt. We may also finance our acquisitions through the issuance of common shares, preferred shares, or units in the Operating Partnership, as well as through assumed mortgages and property sales.
At December 31, 2023, the leasable commercial square feet in our properties was 94.2% leased and 92.2% occupied. The leased rate is higher than the occupied rate due to leased spaces that are being redeveloped or improved or that are awaiting permits and, therefore, are not yet ready to be occupied. Our occupancy and leased rates are subject to variability over time due to factors including acquisitions, the timing of the start and stabilization of our redevelopment projects, lease expirations and tenant closings and bankruptcies.
Comparable Properties
Throughout this section, we have provided certain information on a “comparable property” basis. Information provided on a comparable property basis includes the results of properties that we owned and operated for the entirety of both periods being compared except for properties that are currently under development or are being repositioned for significant redevelopment and investment. For the year ended December 31, 2023 and the comparison of 2023 and 2022, all or a portion of 94 properties, were considered comparable properties and eight were considered non-comparable properties. For the year ended December 31, 2023, one property was moved from comparable properties to non-comparable properties, four properties and one portion of a
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property were moved from acquisitions to comparable properties, and one property and one portion of a property were removed from comparable properties, as they were sold, compared to the designations as of December 31, 2022. While there is judgment surrounding changes in designations, we typically move non-comparable properties to comparable properties once they have stabilized, which is typically considered 90% physical occupancy or when the growth expected from the redevelopment has been included in the comparable periods. We typically remove properties from comparable properties when the repositioning of the asset has commenced and has or is expected to have a significant impact to property operating income within the calendar year. Acquisitions are moved to comparable properties once we have owned the property for the entirety of comparable periods and the property is not under development or being repositioned for significant redevelopment and investment.
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YEAR ENDED DECEMBER 31, 2023 COMPARED TO YEAR ENDED DECEMBER 31, 2022
 
   Change
 20232022Dollars%
 (Dollar amounts in thousands)
Rental income$1,131,041 $1,073,292 $57,749 5.4 %
Mortgage interest income1,113 1,086 27 2.5 %
Total property revenue1,132,154 1,074,378 57,776 5.4 %
Rental expenses231,666 228,958 2,708 1.2 %
Real estate taxes131,429 127,824 3,605 2.8 %
Total property expenses363,095 356,782 6,313 1.8 %
Property operating income (1)
769,059 717,596 51,463 7.2 %
General and administrative expense(50,707)(52,636)1,929 (3.7)%
Depreciation and amortization(321,763)(302,409)(19,354)6.4 %
Gain on deconsolidation of VIE— 70,374 (70,374)(100.0)%
Gain on sale of real estate9,881 93,483 (83,602)(89.4)%
Operating income406,470 526,408 (119,938)(22.8)%
Other interest income4,687 1,072 3,615 337.2 %
Interest expense(167,809)(136,989)(30,820)22.5 %
Income from partnerships3,869 5,170 (1,301)(25.2)%
Total other, net(159,253)(130,747)(28,506)21.8 %
Net income247,217 395,661 (148,444)(37.5)%
Net income attributable to noncontrolling interests(10,232)(10,170)(62)0.6 %
Net income attributable to the Trust$236,985 $385,491 $(148,506)(38.5)%
(1) Property operating income is a non-GAAP measure that consists of rental income and mortgage interest income, less rental expenses and real estate taxes. This measure is used internally to evaluate the performance of property operations to the previous period and we consider it be a significant measure. We believe that property operating income is useful to investors in measuring the operating performance of our property portfolio because the definition excludes various items included in operating income that do not relate to, or are not indicative of, the operating performance of our properties, such as general and administrative expenses and depreciation and amortization, and allows us to isolate disparities in operating income caused by acquisitions, dispositions, and stabilization of properties. Property operating income may, therefore, provide a more consistent metric for comparing the operating performance of our real estate between periods. Property operating income should not be considered an alternative measure of operating results or cash flow from operations as determined in accordance with GAAP. The reconciliation of operating income to property operating income for 2023 and 2022 is as follows:
2023
2022
(in thousands)
Operating income$406,470 $526,408 
General and administrative50,707 52,636 
Depreciation and amortization321,763 302,409 
Gain on deconsolidation of VIE— (70,374)
Gain on sale of real estate(9,881)(93,483)
Property operating income$769,059 $717,596 

Property Revenues
Total property revenue increased $57.8 million, or 5.4%, to $1.13 billion in 2023 compared to $1.07 billion in 2022. The percentage occupied at our shopping centers was 92.2% at December 31, 2023 compared to 92.8% at December 31, 2022. Changes in the components of property revenue are discussed below.
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Rental Income
Rental income consists primarily of minimum rent, cost reimbursements from tenants and percentage rent, and is net of collectibility related adjustments. Rental income increased $57.7 million, or 5.4%, to $1.13 billion in 2023 compared to $1.07 billion in 2022 due primarily to the following:
an increase of $25.4 million from 2022 and 2023 acquisitions,
an increase of $23.3 million from comparable properties primarily related to higher rental rates of approximately $16.4 million, higher average occupancy of approximately $5.5 million, and a $5.1 million increase in recoveries from tenants, partially offset by a $2.9 million increase in collectibility related adjustments and a $2.7 million decrease in lease termination fee income,
an increase of $19.2 million from non-comparable properties primarily driven by occupancy increases at Assembly Row Phase III, Darien Commons, Pike & Rose Phases III & IV, and CocoWalk, partially offset by redevelopment related occupancy decreases at Friendship Center, and
an increase of $2.8 million from higher demand at our Pike & Rose hotel,
partially offset by
a decrease of $13.0 million from property sales.
Property Expenses
Total property expenses increased $6.3 million, or 1.8%, to $363.1 million in 2023 compared to $356.8 million in 2022. Changes in the components of property expenses are discussed below.
Rental Expenses
Rental expenses increased $2.7 million, or 1.2%, to $231.7 million in 2023 compared to $229.0 million in 2022. This increase is primarily due to the following:
an increase of $4.4 million from 2022 and 2023 acquisitions,
an increase of $1.6 million from comparable properties due primarily to higher repairs and maintenance costs and other operating costs driven by inflationary impacts, higher insurance costs and utilities, and an increase in management fees on higher revenues, partially offset by lower snow removal costs,
an increase of $0.9 million from non-comparable properties driven by openings at Darien Commons, CocoWalk, and Assembly Row Phase III, partially offset by lower costs associated with the redevelopment of Huntington Shopping Center, and
an increase of $0.7 million in operating expenses at our Pike & Rose hotel as a result of higher occupancy,
partially offset by
a decrease of $5.1 million from property sales.
As a result of the changes in rental income and rental expenses as discussed above, rental expenses as a percentage of rental income decreased to 20.5% for the year ended December 31, 2023 from 21.3% for the year ended December 31, 2022.
Real Estate Taxes
Real estate tax expense increased $3.6 million, or 2.8% to $131.4 million in 2023 compared to $127.8 million in 2022 due primarily to the following:
an increase of $4.1 million from 2022 and 2023 acquisitions, and
an increase of $0.8 million from comparable properties due to higher assessments partially offset by successful tax appeals,
partially offset by
a decrease of $1.5 million from our property sales.

Property Operating Income
Property operating income increased $51.5 million, or 7.2%, to $769.1 million in 2023 compared to $717.6 million in 2022. This increase is primarily driven by higher rental rates and occupancy, the 2022 and 2023 openings at our non-comparable properties, and 2022 and 2023 acquisitions, partially offset by property sales.
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Depreciation and Amortization
Depreciation and amortization expense increased $19.4 million, or 6.4%, to $321.8 million in 2023 from $302.4 million in 2022. This increase is due primarily to property acquisitions, our investment in comparable properties, placing redevelopment properties into service, and the reconsolidation of Escondido Promenade during the second quarter of 2023, partially offset by 2022 property sales.
Gain on Deconsolidation of VIE
The $70.4 million gain on deconsolidation of VIE for the year ended December 31, 2022 is the result of the deconsolidation of Escondido Promenade during the third quarter of 2022 (see Note 3 to the consolidated financial statements for additional information).
Gain on Sale of Real Estate
The $9.9 million gain on sale of real estate for the year ended December 31, 2023 is due primarily to the sale of one retail property and one portion of a property (see Note 3 to the consolidated financial statements for additional information).
The $93.5 million gain on sale of real estate for the year ended December 31, 2022 is due primarily to a net gain of $84.1 million from the sale of two residential properties (including an adjacent retail pad), one retail property, and one parcel of land (see Note 3 to the consolidated financial statements for additional information), and a $9.3 million gain related to the reduction of our liability for estimated condemnation and transaction costs associated with the sale under threat of condemnation in December 2019 at San Antonio Center.
Operating Income
Operating income decreased $119.9 million, or 22.8%, to $406.5 million in 2023 compared to $526.4 million in 2022. This decrease is primarily driven by lower gains on sale of real estate, the prior year gain on the deconsolidation of a VIE, and property sales, partially offset by higher rental rates and occupancy, 2022 and 2023 acquisitions, and the 2022 and 2023 openings at our non-comparable properties.
Other
Other Interest Income
Other interest income increased $3.6 million, or 337.2%, to $4.7 million in 2023 compared to $1.1 million in 2022. This increase is primarily driven by interest earned on the proceeds of our April 2023 senior unsecured note issuance until the June 1, 2023 payoff of our 2.75% senior unsecured notes and higher interest earned on cash balances.
Interest Expense
Interest expense increased $30.8 million, or 22.5%, to $167.8 million in 2023 compared to $137.0 million in 2022. This increase is due primarily to the following:
an increase of $25.4 million due to a higher overall weighted average borrowing rate, and
an increase of $9.3 million due to higher weighted average borrowings,
partially offset by
an increase of $3.9 million in capitalized interest.
Gross interest costs were $190.4 million and $155.7 million in 2023 and 2022, respectively. Capitalized interest was $22.6 million and $18.7 million in 2023 and 2022, respectively.
Income from Partnerships
Income from partnerships decreased $1.3 million or 25.2% to $3.9 million in 2023 compared to $5.2 million in 2022. This decrease is primarily driven by lower income at our restaurant joint ventures largely attributable to higher forgiveness of certain loans in the prior year.
Discussions of year-to-year comparisons between 2022 and 2021 can be found in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in Part II, Item 7 of our Annual Report on Form 10-K for the fiscal year ended December 31, 2022 filed with the Securities and Exchange Commission on February 8, 2023.

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Liquidity and Capital Resources
Due to the nature of our business and strategy, we typically generate significant amounts of cash from operations which is largely paid to our common and preferred shareholders in the form of dividends because as a REIT, the Trust is generally required to make annual distributions to shareholders of at least 90% of our taxable income (cash dividends paid in 2023 were approximately $360.9 million). Remaining cash flow from operations after regular debt service requirements (including debt service relating to additional or replacement debt, as well as scheduled debt maturities) and dividend payments is used to fund recurring and non-recurring capital projects (such as tenant improvements and redevelopments). We maintain an unsecured $1.25 billion revolving credit facility to fund short term cash flow needs and also look to the public and private debt and equity markets, joint venture relationships, and property dispositions to fund capital expenditures on a long-term basis.
On April 12, 2023, we issued $350.0 million of 5.375% senior unsecured notes, on December 28, 2023, we entered into a $200.0 million secured loan that bears interest at 5.03% through the initial maturity date, and on January 11, 2024, we issued $485.0 million of 3.25% exchangeable senior unsecured notes. We also raised $138.3 million from sales of common shares under our ATM equity program. We repaid $275.0 million of 2.75% senior unsecured notes at maturity on June 1, 2023, repaid $600.0 million of 3.95% unsecured notes at maturity on January 16, 2024, and extended the maturity of our $600.0 million term loan to April 2025 (with an additional one year extension at our option still available to further extend the loan to April 2026). For the remainder of 2024, we have no additional debt maturing.
As of December 31, 2023, we had cash and cash equivalents of $250.8 million and no balance outstanding on our $1.25 billion unsecured revolving credit facility. For the year ended 2023, the weighted average amount of borrowings outstanding on our revolving credit facility was $44.7 million, and the weighted average interest rate, before amortization of debt fees, was 5.9%. We also have the capacity to issue up to $312.1 million in common shares under the ATM program.
Our overall capital requirements during 2024 will be impacted by the overall economic environment including impacts of inflation, higher interest rates, and a potential recession, as well as acquisition opportunities and the level and general timing of our redevelopment and development activities. We currently have development and redevelopment projects in various stages of construction with remaining costs of $250 million. We expect to incur the majority of those costs in the next two years. We expect overall capital costs to be at levels slightly reduced from 2023 as we complete current redevelopment projects, prepare vacant space for new tenants, and complete the current phase and prepare for the next phase of our larger mixed use development projects.
We believe cash flow from operations, the cash on our balance sheet, and our $1.25 billion revolving credit facility will allow us to continue to operate our business in the short-term. Given our ability to access the capital markets, we also expect debt or equity to be available to us, although newly issued debt would likely be at higher interest rates than we currently have outstanding. We also have the ability to delay the timing of certain development and redevelopment projects as well as limit future acquisitions, reduce our operating expenditures, or re-evaluate our dividend policy. We expect these sources of liquidity and opportunities for operating flexibility to allow us to meet our financial obligations over the long term. We intend to operate with and to maintain our long term commitment to a conservative capital structure that will allow us to maintain strong debt service coverage and fixed-charge coverage ratios as part of our commitment to investment-grade debt ratings.
Summary of Cash Flows
 
 Year Ended December 31,
 20232022Change
 (In thousands)
Net cash provided by operating activities$555,830 $516,769 $39,061 
Net cash used in investing activities(358,325)(785,998)427,673 
Net cash (used in) provided by financing activities(33,849)190,414 (224,263)
Increase (decrease) in cash and cash equivalents163,656 (78,815)242,471 
Cash, cash equivalents, and restricted cash, beginning of year96,348 175,163 (78,815)
Cash, cash equivalents, and restricted cash, end of year$260,004 $96,348 $163,656 

Net cash provided by operating activities increased $39.1 million to $555.8 million during 2023 from $516.8 million during 2022. The increase was primarily attributable to higher net income after adjusting for non-cash items and gains on sale of real estate, as well as higher collections related to year end recovery billings.
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Net cash used in investing activities decreased $427.7 million to $358.3 million during 2023 from $786.0 million during 2022. The decrease was primarily attributable to:
a $377.9 million decrease in acquisition of real estate primarily due to the January 2023 Huntington Square acquisition and the acquisition of our partner's 22.3% TIC interest in Escondido Promenade (see Note 3 to the consolidated financial statements for additional information), as compared to 2022 property acquisitions,
a $105.6 million decrease in net capital expenditures,
a $23.2 million decrease in investment in partnerships, resulting from the 2022 acquisition of a 47.5% net interest in an unconsolidated joint venture that owns two shopping centers (see Note 3 to the consolidated financial statements for additional information), and
$16.7 million decrease in costs paid relating to the partial sale under threat of condemnation at San Antonio Center in 2019,
partially offset by,
a $105.3 million decrease in net proceeds from the sale of real estate primarily due to $28.5 million of net proceeds from the sale of one retail property and one portion of a property during 2023, as compared to $133.7 million of net proceeds from the sale of two residential properties (one included an adjacent retail pad), one retail property, one parcel of land, and one portion of a property during 2022.
Net cash provided by financing activities decreased $224.3 million to $33.8 million used during 2023 from $190.4 million provided during 2022. The decrease was primarily attributable to:
$298.6 million in net proceeds from our unsecured term loan in October 2022,
$275.0 million from the June 2023 repayment of our $275.0 million 2.75% senior unsecured notes,
a $175.4 million decrease in net proceeds from the issuance of common shares primarily related to issuances under our ATM program for net proceeds of $131.7 million and $306.8 million, respectively, during 2023 and 2022,
a $39.0 million increase in repayment of mortgages, finance leases, and notes payable primarily due to the October 2023 finance lease buyout for $55.0 million (see Note 3 to the consolidated financial statements for additional information), as compared to the $16.1 million mortgage loan repayment on one of the buildings at our Hoboken property in June 2022, and