Urban Edge Properties : Quarterly Report for Quarter Ending June 30, 2026 (Form 10-Q)

About this update from Urban Edge Properties

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS Certain statements contained herein constitute forward-looking statements as such term is defined in Section 27A of the Securities Act of 1933, as amended (the "Securities Act"), and Section 21E of the Securities Exchange Act of 1934, as amended (the "Exchange Act"). Forward-looking statements are not guarantees of future performance. They represent our intentions, plans, expectations and beliefs and are subject to numerous assumptions, risks and uncertainties. Our future results, financial condition, business and targeted occupancy may differ materially from those expressed in these forward-looking statements. You can identify many of these statements by words such as "approximates," "believes," "expects," "anticipates," "estimates," "intends," "plans," "would," "may" or other similar expressions in this Quarterly Report on Form 10-Q. Many of the factors that will determine the outcome of forward-looking statements are beyond our ability to control or predict and include, among others: (i) macroeconomic conditions, including geopolitical conditions and instability, and international trade disputes, including any related tariffs, which may lead to rising inflation, adverse impacts to supply chains, and disruption of, or lack of access to, the capital markets, as well as potential volatility in the Company's share price; (ii) the economic, political and social impact of, and uncertainty relating to, epidemics and pandemics; (iii) the loss or bankruptcy of major tenants; (iv) the ability and willingness of the Company's tenants to renew their leases with the Company upon expiration and the Company's ability to re-lease its properties on the same or better terms, or at all, in the event of non-renewal or in the event the Company exercises its right to replace an existing tenant; (v) the impact of e-commerce on our tenants' business; (vi) the Company's success in implementing its business strategy and its ability to identify, underwrite, finance, consummate and integrate diversifying acquisitions and investments; (vii) changes in general economic conditions or economic conditions in the markets in which the Company competes, and their effect on the Company's revenues, earnings and funding sources, and on those of its tenants; (viii) increases in the Company's borrowing costs as a result of changes in interest rates, rising inflation, and other factors; (ix) the Company's ability to pay down, refinance, hedge, restructure or extend its indebtedness as it becomes due and potential limitations on the Company's ability to borrow funds under its existing credit facility as a result of covenants relating to the Company's financial results; (x) potentially higher costs associated with the Company's development, redevelopment and anchor repositioning projects, and the Company's ability to lease the properties at projected rates; (xi) the Company's liability for environmental matters; (xii) damage to the Company's properties from catastrophic weather and other natural events, and the physical effects of climate change; (xiii) the Company's ability and willingness to maintain its qualification as a REIT in light of economic, market, legal, tax and other considerations; (xiv) information technology security breaches; (xv) the loss of key executives; and (xvi) the accuracy of methodologies and estimates regarding our environmental, social and governance (collectively, our Corporate Responsibility or "CR") metrics, goals and targets, tenant willingness and ability to collaborate towards reporting CR metrics and meeting CR goals and targets, and the impact of governmental regulation on our CR efforts. For further discussion of factors that could materially affect the outcome of our forward-looking statements, see "Risk Factors" in Part I, Item 1A, of the Company's Annual Report on Form 10-K for the year ended December 31, 2025 and the other documents filed by the Company with the Securities and Exchange Commission (the "SEC"), including the information contained in this Quarterly Report on Form 10-Q. We claim the protection of the safe harbor for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995 for any forward-looking statements included in this Quarterly Report on Form 10-Q. You are cautioned not to place undue reliance on forward-looking statements, which speak only as of the date of this Quarterly Report on Form 10-Q. All subsequent written and oral forward-looking statements attributable to us or any person acting on our behalf are expressly qualified in their entirety by the cautionary statements contained or referred to in this section. We do not undertake any obligation to release publicly any revisions to our forward-looking statements to reflect events or circumstances occurring after the date of this Quarterly Report on Form 10-Q. The following discussion should be read in conjunction with the consolidated financial statements and notes thereto included in Part I, Item 1 of this Quarterly Report on Form 10-Q. Overview Urban Edge Properties ("UE", "Urban Edge" or the "Company") (NYSE: UE) is a Maryland real estate investment trust that owns, manages, acquires, develops, and redevelops retail real estate, primarily in the Washington, D.C. to Boston corridor. Urban Edge Properties LP ("UELP" or the "Operating Partnership") is a Delaware limited partnership formed to serve as UE's majority-owned partnership subsidiary and to own, through affiliates, all of the Company's real estate properties and other assets. Unless the context otherwise requires, references to "we", "us" and "our" refer to Urban Edge Properties and UELP and their consolidated entities/subsidiaries. The Operating Partnership's capital includes general and common limited partnership interests ("OP Units"). As of June 30, 2026, Urban Edge owned approximately 94.6% of the outstanding common OP Units with the remaining limited OP Units held by members of management and the Board of Trustees, and contributors of property interests acquired. Urban Edge serves as the sole general partner of the Operating Partnership. As of June 30, 2026, our portfolio consisted of 70 shopping centers, two outlet centers and two malls totaling approximately 16.1 million square feet of gross leasable area with a consolidated occupancy of 96.5%. Critical Accounting Estimates The Company's Annual Report on Form 10-K for the fiscal year ended December 31, 2025 contains a description of our critical accounting estimates, including valuing acquired assets and liabilities, and impairments. For the six months ended June 30, 2026, there were no material changes to these estimates. Recent Accounting Pronouncements Refer to Note 3 to the unaudited consolidated financial statements in Part I, Item 1 of this Quarterly Report on Form 10-Q for information regarding recent accounting pronouncements that may affect us. Results of Operations We derive substantially all of our revenue from rents received from tenants under existing leases on each of our properties. This revenue includes fixed base rents, recoveries of expenses that we have incurred and that we pass through to the individual tenants and percentage rents that are based on specified percentages of tenants' revenue, in each case as provided in the respective leases. Our primary cash expenditures consist of property operating and capital costs, general and administrative expenses, and interest and debt expense. Property operating expenses include: real estate taxes, repairs and maintenance, management expenses, insurance and utilities; general and administrative expenses include payroll, professional fees, information technology, office expenses and other administrative expenses; and interest and debt expense primarily consists of interest on our mortgage debt, unsecured line of credit and term loans. In addition, we incur substantial non-cash charges for depreciation and amortization on our properties. We also capitalize certain expenses, such as taxes, interest and salaries related to properties under development or redevelopment until the property is ready for its intended use. Our consolidated results of operations often are not comparable from period to period due to the impact of property acquisitions, dispositions, developments, redevelopments and changes in accounting policies. The results of operations of any acquired properties are included in our financial statements as of the date of acquisition. Our results of operations are affected by national, regional and local economic conditions, as well as macroeconomic conditions, which are at times subject to volatility and uncertainty such as the recent market volatility resulting from changes in tariff policies and the geopolitical climate. Increased tariffs on foreign imports and inflationary pressures could have a material impact on the cost of certain raw materials and goods and adversely affect the results of our operations or the operations of our tenants, and could temper consumer spending. While most of our leases require tenants to pay their share of operating expenses, including common area maintenance, real estate taxes and insurance, thereby reducing our exposure to increases in costs and operating expenses, there is no guarantee that we will be able to recoup all such amounts, and some larger tenants have capped the amount of these operating expenses they are responsible for under their lease. We continue to monitor the impacts of inflation, interest rates and broader macroeconomic conditions on our operations. Following a series of rate reductions in the latter part of 2025, the Federal Reserve has held its target range for the federal funds rate steady at 3.50% to 3.75%, maintaining that range for the fourth consecutive meeting. Inflation reaccelerated during the first half of 2026, rising to a rate of 3.5% as of June 30, 2026, driven in part by higher energy prices and heightened geopolitical tensions. The current inflation rate remains elevated compared to the Federal Reserve's long-term target of 2%, and interest rates may rise further should inflationary pressures persist. These conditions have contributed to volatility in financial markets and continued uncertainty with respect to access to capital and pricing dynamics. There can be no assurance that inflationary pressures, interest rates, or related market volatility will moderate, and such conditions may persist in the near-term or over a longer period. We occasionally utilize interest rate derivative agreements to hedge the effect of changing interest rates on our variable rate debt. As of June 30, 2026, all of our outstanding mortgage debt is fixed rate or hedged with interest rate derivative agreements, and our only variable rate exposure is related to our unsecured line of credit which had an outstanding balance of $55 million and is indexed to SOFR plus an applicable margin per the credit agreement. There were no amounts drawn on either of the 5-year or 7-year term loans. As of June 30, 2026, we were counterparty to three interest rate swap agreements, all of which qualify for, and are designated as, hedging instruments to manage our exposure to changes in the interest rate environment. We are actively managing our business to respond to any economic and social impacts from events and circumstances such as those described above, however, the extent and duration of these impacts remain uncertain and could adversely affect our operating results, financial condition and liquidity. See "Risk Factors" in Part I, Item 1A, of the Company's Annual Report on Form 10-K for the year ended December 31, 2025. The following provides an overview of our key financial metrics, including non-GAAP measures, based on our consolidated results of operations (refer to Net Operating Income ("NOI"), same-property NOI and Funds From Operations ("FFO") applicable to diluted common shareholders described later in this section): Three Months Ended June 30, Six Months Ended June 30, (Amounts in thousands) 2026 2025 2026 2025 Net income $ 18,647 $ 60,793 $ 42,194 $ 69,175 FFO applicable to diluted common shareholders (1) 53,395 43,779 109,052 89,237 NOI (1) 78,973 73,031 151,999 144,603 Same-property NOI (1) 66,004 63,977 130,139 126,615 (1) Refer to pages 36-37 for a reconciliation to the most directly comparable generally accepted accounting principles ("GAAP") measure. Comparison of the Three Months Ended June 30, 2026 to the Three Months Ended June 30, 2025 Net income for the three months ended June 30, 2026 was $18.6 million, compared to net income of $60.8 million for the three months ended June 30, 2025. The following table summarizes certain line items from our consolidated statements of income and comprehensive income that we believe are important in understanding our operations and/or those items that significantly changed in the three months ended June 30, 2026 as compared to the same period in 2025: Three Months Ended June 30, (Amounts in thousands) 2026 2025 $ Change Total revenue $ 122,781 $ 114,084 $ 8,697 Depreciation and amortization 35,036 32,602 2,434 Real estate taxes 16,875 16,582 293 Property operating expenses 19,317 18,874 443 General and administrative expenses 9,680 11,717 (2,037) Gain on sale of real estate - 49,462 (49,462) Interest and debt expense 19,801 19,537 264 Loss on extinguishment of debt - (175) 175 Total revenue increased by $8.7 million to $122.8 million in the second quarter of 2026 from $114.1 million in the second quarter of 2025. The increase is primarily attributable to: • $2.5 million increase in property rentals and tenant reimbursements due to rent commencements and contractual rent increases; • $2.2 million increase in lease termination income; • $2.0 million increase as a result of property acquisitions, net of dispositions since the second quarter of 2025; • $1.4 million increase in non-cash revenues driven by the acceleration and write-off of below-market lease intangibles in the second quarter of 2026; • $0.3 million increase in percentage rent primarily due to the timing of recognition as compared to the second quarter of 2025; and • $0.3 million decrease in rental revenue deemed uncollectible. Depreciation and amortization increased by $2.4 million to $35.0 million in the second quarter of 2026 from $32.6 million in the second quarter of 2025. The increase is primarily attributable to: • $1.4 million increase as a result of property acquisitions, net of dispositions since the second quarter of 2025; and • $1.0 million increase due to accelerated depreciation and write-off of tenant improvements related to tenant vacates. Real estate tax expense increased by $0.3 million to $16.9 million in the second quarter of 2026 from $16.6 million in the second quarter of 2025. The increase is primarily attributable to: • $0.2 million increase due to higher tax assessments across multiple properties in the second quarter of 2026, net of successful tax appeals and lower assessments; and • $0.1 million increase as a result of property acquisitions, net of dispositions since the second quarter of 2025. Property operating expenses increased by $0.4 million to $19.3 million in the second quarter of 2026 from $18.9 million in the second quarter of 2025. The increase is primarily attributable to: • $0.3 million increase due to higher insurance premiums and third-party service fees, partially offset by lower common area maintenance due to the timing of repairs as compared to the second quarter of 2025; and • $0.1 million increase as a result of property acquisitions, net of dispositions since the second quarter of 2025. General and administrative expenses decreased by $2.0 million to $9.7 million in the second quarter of 2026 from $11.7 million in the second quarter of 2025. The decrease is primarily attributable to severance expenses incurred in the second quarter of 2025. We recognized a gain on sale of real estate of $49.5 million in the second quarter of 2025 related to the sale of two non-core properties and one property parcel. Interest and debt expense increased by $0.3 million to $19.8 million in the second quarter of 2026 from $19.5 million in the second quarter of 2025. The increase is primarily attributable to: • $1.4 million increase as a result of new financings since the second quarter of 2025, net of loan repayments; and • $0.1 million increase in amortization of deferred financing costs; offset by • $0.8 million increase in capitalized interest expense due to the commencement of development, redevelopment, and anchor repositioning projects, offset by project completions; and • $0.4 million decrease due to a lower average balance and lower interest rate on our unsecured line of credit. In the second quarter of 2025, we recognized a $0.2 million loss on extinguishment of debt related to the prepayment of the mortgage loan secured by the Plaza at Woodbridge. Comparison of the Six Months Ended June 30, 2026 to the Six Months Ended June 30, 2025 Net income for the six months ended June 30, 2026 was $42.2 million, compared to net income of $69.2 million for the six months ended June 30, 2025. The following table summarizes certain line items from our consolidated statements of income and comprehensive income that we believe are important in understanding our operations and/or those items that significantly changed in the six months ended June 30, 2026 as compared to the same period in 2025: Six Months Ended June 30, (Amounts in thousands) 2026 2025 $ Change Total revenue $ 255,405 $ 232,249 $ 23,156 Depreciation and amortization 67,348 69,797 (2,449) Real estate taxes 33,477 32,940 537 Property operating expenses 48,255 42,933 5,322 General and administrative expenses 18,816 21,248 (2,432) Gain on sale of real estate - 49,462 (49,462) Interest and debt expense 38,520 39,292 (772) Gain on extinguishment of debt (212) 323 (535) Total revenue increased by $23.2 million to $255.4 million in the six months ended June 30, 2026 from $232.2 million in the six months ended June 30, 2025. The increase is primarily attributable to: • $10.8 million increase in property rentals and tenant reimbursements due to rent commencements, contractual rent increases and higher operating expenses; • $8.3 million increase in other income related to the reimbursement of environmental remediation costs received in the first quarter of 2026; • $2.3 million increase as a result of property acquisitions, net of dispositions; • $2.2 million increase in lease termination income; • $0.5 million increase in non-cash revenues primarily driven by the acceleration and write-off of below-market lease intangibles in the first six months of 2026, net of straight-line write-offs for tenants moved to the cash basis of accounting; and • $0.2 million increase in percentage rent primarily due to the timing of recognition as compared to 2025; offset by • $1.1 million increase in rental revenue deemed uncollectible. Depreciation and amortization decreased by $2.4 million to $67.3 million in the six months ended June 30, 2026 from $69.8 million in the six months ended June 30, 2025. The decrease is primarily attributable to: • $4.3 million decrease primarily related to accelerated depreciation of in-place leases in the first six months of 2025, net of accelerated depreciation and write-off of tenant improvements in the first six months of 2026; offset by • $1.9 million increase as a result of property acquisitions, net of dispositions. Real estate tax expense increased by $0.5 million to $33.5 million in the six months ended June 30, 2026 from $32.9 million in the six months ended June 30, 2025. The increase is primarily attributable to: • $0.5 million increase due to higher tax assessments across multiple properties, net of successful tax appeals and lower assessments; and • $0.1 million increase as a result of property acquisitions, net of dispositions; offset by • $0.1 million increase in capitalized real estate taxes due to the commencement of development, redevelopment, and anchor repositioning projects, offset by project completions. Property operating expenses increased by $5.3 million to $48.3 million in the six months ended June 30, 2026 from $42.9 million in the six months ended June 30, 2025. The increase is primarily attributable to: • $5.0 million increase in common area maintenance expenses, primarily driven by snow removal in the first quarter of 2026 and higher insurance premiums; and • $0.3 million increase as a result of property acquisitions, net of dispositions. General and administrative expenses decreased by $2.4 million to $18.8 million in the six months ended June 30, 2026 from $21.2 million in the six months ended June 30, 2025. The decrease is primarily attributable to severance expenses incurred in the first six months of 2025. We recognized a $49.5 million gain on sale of real estate during the six months ended June 30, 2025 related to the sale of two non-core properties and one property parcel. Interest and debt expense decreased by $0.8 million to $38.5 million in the six months ended June 30, 2026 from $39.3 million in the six months ended June 30, 2025. The decrease is primarily attributable to: • $1.7 million increase in capitalized interest expense due to the commencement of development, redevelopment, and anchor repositioning projects, net of project completions; and • $1.1 million decrease due to a lower average balance and lower interest rate on our unsecured line of credit; offset by • $1.7 million increase as a result of new financings and refinancings, net of loan repayments; and • $0.3 million increase in amortization of deferred financing costs. We recognized a $0.2 million loss on extinguishment of debt for the six months ended June 30, 2026 related to the write-off of deferred financing fees for the amendment and restatement of our unsecured line of credit. During the six months ended June 30, 2025, we recognized a $0.5 million gain on extinguishment of debt for the return of escrow funds related to the Kingswood Center foreclosure, partially offset by a $0.2 million loss on extinguishment of debt related to the prepayment of the mortgage loan secured by the Plaza at Woodbridge. Non-GAAP Financial Measures We use NOI internally to make investment and capital allocation decisions and to compare the unlevered performance of our properties to our peers. Further, we believe NOI is useful to investors as a performance measure because, when compared across periods, NOI reflects the impact on operations from trends in occupancy rates, rental rates, operating costs and acquisition and disposition activity on an unleveraged basis, providing perspective not immediately apparent from net income. The most directly comparable GAAP financial measure to NOI is net income. NOI excludes certain components from net income in order to provide results that are more closely related to a property's results of operations. We calculate NOI by adjusting net income to add back depreciation and amortization expense, general and administrative expenses, casualty and real estate impairment losses, interest and debt expense, income tax expense and non-cash lease expense, and deduct management and development fee income from non-owned properties, gains on sale of real estate, interest income, non-cash rental income resulting from the straight-lining of rents and amortization of acquired below market leases net of above market leases. NOI should not be considered a substitute for net income and may not be comparable to similarly titled measures employed by others. We calculate same-property NOI using net income as defined by GAAP reflecting only those income and expense items that are reflected in NOI (as described above) and excluding properties that were under development, redevelopment or that involve anchor repositioning where a substantial portion of the gross leasable area is taken out of service, and also excluding properties acquired, sold, held for sale, or that are in the foreclosure process during the periods being compared, and results of our captive insurance program. We also exclude the following items in calculating same-property NOI: lease termination fees, bankruptcy settlement income, and income and expenses that we do not believe are representative of ongoing operating results, if any. As such, same-property NOI assists in eliminating disparities in net income due to the development, redevelopment, acquisition, disposition or foreclosure of properties, and results of our captive insurance program during the periods presented, and thus provides a more consistent performance measure for the comparison of the operating performance of the Company's properties, which the Company believes to be useful to investors. Same-property NOI should not be considered a substitute for net income and may not be comparable to similarly titled measures employed by others. Throughout this section, we have provided certain information on a "same-property" basis which includes the results of operations that were owned and operated for the entirety of the reporting periods being compared, totaling 65 properties for the three and six months ended June 30, 2026 and 2025. Information provided on a same-property basis excludes properties that were under development, redevelopment or that involve anchor repositioning where a substantial portion of the gross leasable area is taken out of service and also excludes properties acquired, sold, held for sale, or that are in the foreclosure process during the periods being compared, and results of our captive insurance program. While there is judgment surrounding changes in designations, a property is removed from the same-property pool when a property is considered to be a redevelopment property because it is undergoing significant renovation or retenanting pursuant to a formal plan and is expected to have a significant impact on property operating income based on the retenanting that is occurring. A development or redevelopment property is moved back to the same-property pool once a substantial portion of the NOI growth expected from the development or redevelopment is reflected in both the current and comparable prior year period, generally one year after at least 80% of the expected NOI from the project is realized on a cash basis. Acquisitions are moved into the same-property pool once we have owned the property for the entirety of the comparable periods and the property is not under significant development or redevelopment. Same-property NOI increased by $2.0 million, or 3.2%, for the three months ended June 30, 2026 compared to the three months ended June 30, 2025 and increased by $3.5 million, or 2.8%, for the six months ended June 30, 2026 compared to the six months ended June 30, 2025. Same-property NOI including properties in redevelopment increased by $2.3 million, or 3.2%, for the three months ended June 30, 2026 compared to the three months ended June 30, 2025 and increased by $4.2 million, or 3.0%, for the six months ended June 30, 2026 compared to the six months ended June 30, 2025. The following table reconciles net income to NOI, same-property NOI, and same-property NOI including properties in redevelopment for the three and six months ended June 30, 2026 and 2025: Three Months Ended June 30, Six Months Ended June 30, (Amounts in thousands) 2026 2025 2026 2025 Net income $ 18,647 $ 60,793 $ 42,194 $ 69,175 Depreciation and amortization 35,036 32,602 67,348 69,797 Interest and debt expense 19,801 19,537 38,520 39,292 General and administrative expense 9,680 11,717 18,816 21,248 Gain on sale of real estate - (49,462) - (49,462) Loss (gain) on extinguishment of debt - 175 212 (323) Other expense (income) 435 455 (7,631) 922 Income tax expense 749 643 1,127 1,262 Interest income (599) (667) (992) (1,274) Non-cash revenue and expenses (4,776) (2,762) (7,595) (6,034) NOI 78,973 73,031 151,999 144,603 Adjustments: Sunrise Mall net operating loss 45 340 524 635 Tenant bankruptcy settlement income and lease termination income (2,315) (8) (2,315) (69) Non-same property NOI and other (1) (10,699) (9,386) (20,069) (18,554) Same-property NOI $ 66,004 $ 63,977 $ 130,139 $ 126,615 NOI related to properties being redeveloped 6,820 6,578 13,403 12,727 Same-property NOI including properties in redevelopment $ 72,824 $ 70,555 $ 143,542 $ 139,342 (1) Non-same property NOI includes NOI related to properties being redeveloped and properties acquired, disposed, held for sale, or that are in the foreclosure process during the periods being compared, and results of the Company's captive insurance program. Funds From Operations FFO applicable to diluted common shareholders was $53.4 million for the three months ended June 30, 2026 compared to $43.8 million for the three months ended June 30, 2025, and $109.1 million for the six months ended June 30, 2026 compared to $89.2 million for the six months ended June 30, 2025. We calculate FFO in accordance with the National Association of Real Estate Investment Trusts' ("Nareit") definition. Nareit defines FFO as net income (computed in accordance with GAAP), excluding gains (or losses) from sales of depreciable real estate and land when connected to the main business of a REIT, impairments on depreciable real estate or land related to a REIT's main business, earnings from consolidated partially owned entities, and rental property depreciation and amortization expense. We believe FFO is a meaningful non-GAAP financial measure useful in comparing our levered operating performance from period to period both internally and among our peers because this non-GAAP measure excludes net gains on sales of depreciable real estate, real estate impairment losses, rental property depreciation and amortization expense which implicitly assumes that the value of real estate diminishes predictably over time rather than fluctuating based on market conditions. We believe the presentation of comparable period operating results generated from FFO provides useful information to investors because the definition excludes items included in net income that do not relate to, or are not, indicative of our operating and financial performance, such as depreciation and amortization related to real estate, and items which can make periodic and peer analyses of operating and financial performance more difficult, such as gains (or losses) from sales of depreciable real estate and land when connected to the main business of a REIT and impairments on depreciable real estate or land related to a REIT's main business. FFO does not represent cash flows from operating activities in accordance with GAAP, should not be considered an alternative to net income as an indication of our performance, and is not indicative of cash flow as a measure of liquidity or our ability to make cash distributions. FFO may not be comparable to similarly titled measures employed by others. The following table reflects the reconciliation of net income to FFO for the three and six months ended June 30, 2026 and 2025: Three Months Ended June 30, Six Months Ended June 30, (Amounts in thousands) 2026 2025 2026 2025 Net income $ 18,647 $ 60,793 $ 42,194 $ 69,175 Less net (income) loss attributable to noncontrolling interests in: Consolidated subsidiaries 205 243 480 491 Operating partnership (930) (3,058) (2,107) (3,490) Net income attributable to common shareholders 17,922 57,978 40,567 66,176 Adjustments: Rental property depreciation and amortization 34,543 32,205 66,378 69,033 Limited partnership interests in operating partnership (1) 930 3,058 2,107 3,490 Gain on sale of real estate - (49,462) - (49,462) FFO applicable to diluted common shareholders $ 53,395 $ 43,779 $ 109,052 $ 89,237 (1) Represents earnings allocated to LTIP and OP unitholders for unissued common shares. LTIP and OP Units are excluded for purposes of calculating earnings per diluted share when their effect is anti-dilutive. Liquidity and Capital Resources Due to the nature of our business, the cash generated from operations is primarily paid to our shareholders and unitholders of the Operating Partnership in the form of distributions. Our status as a REIT requires that we generally distribute at least 90% of our REIT's ordinary taxable income each year. Our Board of Trustees declared a quarterly dividend of $0.21 per common share and OP Unit for the first and second quarters of 2026 , or an annual rate of $0.84. Historically, we have paid regular cash dividends; however, the timing, declaration, amount and payment of distributions to shareholders and unitholders of the Operating Partnership fall within the discretion of our Board of Trustees. Our Board of Trustees' decisions regarding the payment of dividends depend on many factors, such as maintaining our REIT status, our financial condition, earnings, capital requirements, debt service obligations, limitations under our financing arrangements, industry practice, legal requirements, regulatory constraints, and other factors. Property rental income is our primary source of cash flow and is dependent on a number of factors, including our occupancy level and rental rates, as well as our tenants' ability to pay rent. Our properties have historically prov ided us with a relatively consistent stream of cash flow that enables us to pay operating expenses, debt service and recurring capital expenditures. Other sources of liquidity to fund cash requirements include proceeds from financings, equity offerings and asset sales. On January 22, 2026, we amended and restated the credit agreement for our unsecured line of credit which reduced the facility size by $100 million to $700 million and extended the maturity date to June 28, 2030 with two six-month extension options. In conjunction with the amendment and restatement of the unsecured line of credit we executed agreements for two term loans aggregating $250 million which includes a 5-year maturity and a 7-year maturity of $125 million each, both of which have a 12-month delayed-draw feature (collectively, the "term loans"). As of June 30, 2026, there was $55 million outstanding under the unsecured line of credit bearing interest at SOFR plus an applicable margin per the credit agreement and no amounts drawn on either of the 5-year or 7-year term loans. The Company has obtained seven letters of credit issued under the unsecured line of credit, aggregating $20.5 million. The letters of credit were provided to mortgage lenders and other entities to secure its obligations in relation to certain reserves and capital requirements and have reduced the amount available under the facility commensurate with their face values. As of June 30, 2026, the letters of credit remain undrawn and no separate liability has been recorded in association with them. As of June 30, 2026 we had an available remaining capacity of $624.5 million under the unsecured line of credit, including undrawn letters of credit, and $250 million available under the term loans, aggregating $874.5 million of capacity under the unsecured line of credit and term loans. See Note 6 to the consolidated financial statements included in Part I, Item 1 of this Quarterly Report on Form 10-Q for more information regarding the unsecured line of credit and delayed-draw term loans. In August 2025, in connection with the launch of the ATM Program, the Company entered into an equity distribution agreement with various financial institutions acting as agents, forward sellers, and forward purchasers (the "Equity Distribution Agreement"). Pursuant to the Equity Distribution Agreement, the Company may from time to time offer and sell, through the agents and forward sellers, the Company's common shares, par value $0.01 per share, having an aggregate offering price of up to $250 million (the "ATM Program"). The ATM Program replaced the Company's previous at-the-market program established on August 15, 2022. During the six months ended June 30, 2026 and 2025, the Company did not issue any common shares under the current or prior ATM Program. See Note 14 , Equity and Noncontrolling Interest in Part I, Item 1 of this Quarterly Report on Form 10-Q for more information regarding the ATM Program. Our short-term cash requirements consist of normal recurring operating expenses, lease obligations, regular debt service requirements, general and administrative expenses, expenditures related to leasing activity and distributions to shareholders and unitholders of the Operating Partnership. Our long-term capital requirements consist primarily of maturities under our long-term debt agreements, development and redevelopment costs and potential acquisitions. As of the date of this filing, we have approximately $237.9 million of debt maturing within the next 12 months related to mortgage loans encumbering six of our properties and are actively exploring our options to repay or refinance the loans. At June 30, 2026, we had cash and cash equivalents, including restricted cash, of $82.1 million and approximately $874.5 million available under our unsecured line of credit and term loans . The available balance under our unsecured line of credit, term loans and cash on hand are readily available to fund the debt obligations discussed above which are coming due within the next year. Summary of Cash Flows Cash and cash equivalents, including restricted cash, was $82.1 million at June 30, 2026, compared to $78.9 million at December 31, 2025 and $118.2 million at June 30, 2025, an increase of $3.3 million and a decrease of $36.1 million, respectively. Our cash flow activities are summarized as follows: Six Months Ended June 30, (Amounts in thousands) 2026 2025 $ Change Net cash provided by operating activities $ 105,833 $ 76,039 $ 29,794 Net cash (used in) provided by investing activities (148,216) 19,810 (168,026) Net cash provided by (used in) financing activities 45,666 (68,288) 113,954 Operating Activities Net cash flow provided by operating activities primarily consists of cash inflows from rental revenue and cash outflows for property operating expenses, general and administrative expenses and interest and debt expense. Net cash provided by operating activities of $105.8 million for the six months ended June 30, 2026 increased by $29.8 million from $76.0 million for the six months ended June 30, 2025. The increase is due to higher rental revenue for tenant rent commencements, reimbursement for previously incurred environmental remediation costs, lease termination income, real estate tax refunds received in the first two quarters of 2026, and the timing of cash receipts and payments related to tenant collections and operating expenses. Investing Activities Net cash flow used in or provided by investing activities is impacted by the timing and extent of our real estate development, capital improvements, and acquisition and disposition activities during the period. Net cash used in investing activities of $148.2 million for the six months ended June 30, 2026 increased by $168.0 million from cash provided by investing activities of $19.8 million for the six months ended June 30, 2025. The change in investing activity cash flows is primarily due to: • $64.9 million increase in cash used for the acquisition of real estate and the purchase of a leasehold interest in the first six months of 2026; • $64.4 million decrease in cash provided by the sale of real estate driven by dispositions in the second quarter of 2025; and • $38.7 million increase in cash used for real estate development and capital improvements in the first six months of 2026. The Company had 19 active development, redevelopment or anchor repositioning projects with total estimated costs of $155.0 million, of which $88.3 million had been incurred and $66.7 million remained to be funded as of June 30, 2026. The following summarizes capital expenditures presented on a cash basis for the six months ended June 30, 2026 and 2025: Six Months Ended June 30, (Amounts in thousands) 2026 2025 Capital expenditures: Redevelopment and repositioning $ 33,373 $ 19,530 New development and outparcels 35,908 7,195 Maintenance capital expenditures 3,752 10,845 Tenant improvements and leasing landlord work 10,212 6,973 Total capital expenditures $ 83,245 $ 44,543 Financing Activities Net cash flow provided by or used in financing activities is impacted by the timing and extent of issuances of debt and equity securities, distributions paid to common shareholders and unitholders of the Operating Partnership, as well as principal and other payments associated with our outstanding indebtedness. Net cash provided by financing activities of $45.7 million for the six months ended June 30, 2026 increased by $114.0 million from cash used in financing activities of $68.3 million for the six months ended June 30, 2025. The change in financing activity cash flows is primarily due to: • $84.4 million decrease in debt repayments; • $42.5 million increase in mortgage proceeds and credit facility borrowings; and • $1.3 million increase in cash contributed by noncontrolling interests; offset by • $8.2 million increase in debt issuance costs driven by the amendment and extension of our unsecured line of credit and the Plaza at Woodbridge mortgage financing in the first six months of 2026; and • $6.0 million increase in distributions to shareholders and unitholders of the Operating Partnership. Contractual Obligations We have contractual obligations related to our mortgage loans, unsecured line of credit and term loans that are both fixed and variable. As of June 30, 2026, our only variable rate exposure was related to our unsecured line of credit that bears interest at a floating rate based on SOFR plus an applicable margin of 1.00%. Further information on our mortgage loans, unsecured line of credit and term loans can be found in Note 6 to the consolidated financial statements included in Part I, Item 1 of this Quarterly Report on Form 10-Q. In addition, we have contractual obligations for certain properties that are subject to long-term ground and building leases where a third party owns and has leased the underlying land to us. We also have non-cancelable operating leases pertaining to office space from which we conduct our business. Additional contractual obligations that are not considered to be long-term, fixed in amount or easily determinable include: • Obligations related to construction and development contracts. Such contracts or obligations will generally be due over the next two years; • Obligations related to maintenance contracts, which can typically be canceled upon 30 to 60 days' notice without penalty; • Obligations related to employment contracts with certain executive officers which are subject to cancellation by either the Company or the executive without cause upon notice; • Obligations related to letters of credit issued under our unsecured line of credit; and • Recorded debt premiums or discounts. We believe that cash flows from our current operations, cash on hand, unsecured line of credit, term loans, the potential to refinance our loans and our general ability to access the capital markets will be sufficient to finance our operations and fund our obligations in both the short-term and long-term.

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