Regency Centers Corporation (“Regency” or the “Company”) (Nasdaq:
REG) today reported financial and operating results for the period
ended September 30, 2023 and provided updated 2023 earnings
guidance. For the three months ended September 30, 2023 and 2022,
Net Income was $0.50 per diluted share and $0.51 per diluted share,
respectively.
Third Quarter 2023
Highlights
- Reported Nareit
FFO of $1.02 per diluted share, which includes a $0.01 per diluted
share impact for merger transition expense, and Core Operating
Earnings of $0.97 per diluted share
- Raised 2023 full
year Nareit FFO guidance to a range of $4.13 to $4.15 per diluted
share and 2023 full year Core Operating Earnings guidance to a
range of $3.93 to $3.95 per diluted share
- The midpoint of
the updated 2023 Core Operating Earnings guidance represents nearly
6% year-over-year growth, excluding the collection of receivables
reserved during 2020-2021
- Same Property
NOI grew year-over-year by 2.9% in the third quarter, excluding
lease termination fees and the collection of receivables reserved
during 2020-2021
- Increased Same
Property percent leased by 70 basis points year-over-year to 95.4%,
and Same Property percent commenced by 40 basis points
year-over-year to 92.7%
- Increased Same
Property shop percent leased by 180 basis points year-over-year to
93.2%
- Executed 1.8 million square feet of
comparable new and renewal leases during the quarter at blended
rent spreads of +9.3% on a cash basis and +17.2% on a
straight-lined basis
- Completed the previously announced
acquisition of Urstadt Biddle Properties, Inc. (“Urstadt Biddle”)
on August 18, 2023
- Pro-rata net debt and preferred
stock to operating EBITDAre at September 30, 2023 was 5.5x, and was
5.0x as adjusted for the annualized impact of the third quarter
EBITDAre contribution from the acquisition of Urstadt Biddle
assets
- Acquired a 20%
interest in Old Town Square, a Jewel-Osco-anchored shopping center
in in Chicago, IL, for $5.5 million at Regency’s share
Subsequent Highlights
- Subsequent to
quarter end, on October 11, 2023, acquired Nohl Plaza, a
Vons-anchored shopping center in Orange County, CA, for a gross
purchase price of $25.3 million
- Subsequent to quarter end, on
November 2, 2023, Regency’s Board of Directors (the “Board”)
declared a quarterly cash dividend on the Company’s common stock of
$0.67 per share, an increase of approximately 3% from the prior
quarterly dividend
“Our strong results in the third quarter were
supported by continued positive momentum in our business, including
robust tenant demand and further progress building our value
creation pipeline,” said Lisa Palmer, President and Chief Executive
Officer. “Our integration with Urstadt Biddle is progressing
successfully, we acquired two additional shopping centers, and we
raised our dividend once again. With a high-quality portfolio of
grocery-anchored centers in top trade areas, a sector-leading
balance sheet and an exceptional team, Regency remains well
positioned in today’s environment.”
Financial Results
Net Income
- For the three
months ended September 30, 2023, Net Income Attributable to Common
Shareholders (“Net Income”) was $89.1 million, or $0.50 per diluted
share, compared to Net Income of $87.6 million, or $0.51 per
diluted share, for the same period in 2022.
Nareit FFO
- For the three
months ended September 30, 2023, Nareit Funds From Operations
(“Nareit FFO”) was $182.8 million, or $1.02 per diluted share,
compared to $174.2 million, or $1.01 per diluted share, for the
same period in 2022.
- Nareit FFO in
the third quarter of 2023 was impacted by $1.5 million, or $0.01
per diluted share, of merger transition expense related to the
Company’s acquisition of Urstadt Biddle.
Core Operating Earnings
- For the three
months ended September 30, 2023, Core Operating Earnings was $174.0
million, or $0.97 per diluted share, compared to $161.6 million, or
$0.94 per diluted share, for the same period in 2022.
Portfolio Performance
Same Property NOI
- Third quarter
2023 Same Property NOI, excluding lease termination fees and the
collection of receivables reserved during 2020 and 2021, increased
by 2.9% compared to the same period in 2022.
- Third quarter
2023 Same Property Net Operating Income (“NOI”), excluding lease
termination fees, increased by 2.1% compared to the same period in
2022.
- Same Property base rents contributed
3.2% to Same Property NOI growth in the third quarter of 2023.
Occupancy
- As of September
30, 2023, Regency’s wholly-owned portfolio plus its pro-rata share
of co-investment partnerships, was 94.6% leased.
- As of September
30, 2023, Regency’s Same Property portfolio was 95.4% leased, an
increase of 20 basis points sequentially and an increase of 70
basis points compared to September 30, 2022.
- Same Property
shop percent leased, which includes spaces less than 10,000 square
feet, was 93.2%, an increase of 50 basis points sequentially and an
increase of 180 basis points compared to September 30, 2022.
- Same Property
anchor percent leased, which includes spaces greater than or equal
to 10,000 square feet, was 96.7%, an increase of 10 basis points
sequentially and a decline of 10 basis points compared to September
30, 2022.
- As of September
30, 2023, Regency’s Same Property portfolio was 92.7% commenced, no
change sequentially and an increase of 40 basis points compared to
September 30, 2022.
Leasing Activity
- During the three
months ended September 30, 2023, Regency executed approximately 1.8
million square feet of comparable new and renewal leases at a
blended cash rent spread of +9.3% and a blended straight-lined rent
spread of +17.2%.
- During the
trailing twelve months ended September 30, 2023, the Company
executed approximately 6.5 million square feet of comparable new
and renewal leases at a blended cash rent spread of +8.7% and a
blended straight-lined rent spread of +16.8%.
Capital Allocation and Balance Sheet
Developments and Redevelopments
- During the third
quarter, Regency started approximately $32 million of development
and redevelopment projects, at the Company’s share.
- As of September
30, 2023, Regency’s in-process development and redevelopment
projects had estimated net project costs of approximately $440
million at the Company’s share, 46% of which have been incurred to
date.
Property Transactions
- On September 19,
2023, the Company acquired a 20% interest in Old Town Square, a
Jewel-Osco-anchored shopping center in in Chicago, IL, for $5.5
million at Regency’s share.
- On October 11,
2023, the Company acquired Nohl Plaza, a Vons-anchored shopping
center in Orange County, CA, for a gross purchase price of $25.3
million.
Urstadt Biddle Merger
- On August 18,
2023, the Company completed its previously announced acquisition of
Urstadt Biddle in an all-stock transaction, including the
assumption of debt and issuance of preferred stock.
Balance Sheet
- As of September
30, 2023, Regency had nearly $1.2 billion of capacity under its
revolving credit facility.
- As of September
30, 2023, Regency’s pro-rata net debt and preferred stock to
operating EBITDAre ratio was 5.5x on a trailing 12-month basis.
- As of September
30, 2023, Regency’s pro-rata net debt and preferred stock to
operating EBITDAre was 5.0x, as adjusted for the annualized impact
of the third quarter EBITDAre contribution from the acquisition of
Urstadt Biddle assets.
Common and Preferred Dividends
- On November 2,
2023, Regency’s Board declared a quarterly cash dividend on the
Company’s common stock of $0.67 per share, an increase of 3% from
the prior quarterly dividend. The dividend is payable on January 3,
2024, to shareholders of record as of December 14, 2023.
- On November 2, 2023, Regency’s Board
declared a quarterly cash dividend on the Company’s Series A
preferred stock of $0.390625 per share. The dividend is payable on
January 31, 2024, to shareholders of record as of January 16,
2024.
- On November 2, 2023, Regency’s Board declared a quarterly cash
dividend on the Company’s Series B preferred stock of $0.367200 per
share. The dividend is payable on January 31, 2024, to shareholders
of record as of January 16, 2024.
2023 Guidance
Regency Centers has updated its 2023 guidance, as summarized in
the table below. Please refer to the Company’s third quarter 2023
‘Earnings Presentation’ and ‘Quarterly Supplemental’ for additional
detail. All materials are posted on the Company’s website at
investors.regencycenters.com.
Full Year 2023 Guidance (in thousands, except per
share data) |
3Q YTD |
Current Guidance |
Previous Guidance |
Net Income Attributable to Common Shareholders per diluted
share |
$1.56 |
$2.02 - $2.04 |
$2.05 - $2.09 |
Nareit Funds From Operations (“Nareit FFO”) per diluted share |
$3.13 |
$4.13 - $4.15 |
$4.11 - $4.15 |
Core Operating Earnings per diluted share(1) |
$2.96 |
$3.93 - $3.95 |
$3.89 - $3.93 |
Same
property NOI growth without termination fees |
2.0% |
+/- 1.5% |
+1.0% to +1.5% |
Same property NOI growth without termination fees or collection of
2020/2021 reserves |
4.3% |
+/- 3.5% |
+3.0% to +3.5% |
Collection of 2020/2021 reserves(2) |
$3,736 |
+/- $4,000 |
+/- $4,000 |
Certain non-cash items(3) |
$31,226 |
+/- $39,500 |
+/- $37,500 |
G&A expense, net(4) |
$69,370 |
+/- $91,000 |
$88,000 - $91,000 |
Interest expense and Preferred dividends(5) |
$127,636 |
+/- $178,000 |
+/- $168,000 |
Recurring third party fees & commissions |
$19,582 |
+/- $26,000 |
+/- $25,000 |
Development and Redevelopment spend |
$115,719 |
+/- $130,000 |
+/- $130,000 |
Acquisitions |
$5,502 |
$30,830 |
$0 |
Cap rate (weighted average) |
7.4% |
5.6% |
0% |
Dispositions |
$0 |
+/- $10,000 |
+/- $65,000 |
Cap rate (weighted average) |
0.0% |
+/- 7.0% |
+/- 7.0% |
Unit issuance (gross) |
$20,000 |
$20,000 |
$20,000 |
Share repurchase settlement (gross) |
$20,000 |
$20,000 |
$20,000 |
Merger-related transition expenses |
$1,511 |
+/- $5,000 |
$0 |
Note: With the exception of per share data, figures above
represent 100% of Regency's consolidated entities and its pro-rata
share of unconsolidated co-investment partnerships.
(1) Core Operating Earnings excludes certain non-cash items,
including straight-line rents, above/below market rent
amortization, debt and derivative mark-to-market amortization, as
well as transaction related income/expenses and debt extinguishment
charges.(2) Represents the collection of receivables in the Same
Property portfolio reserved in 2020 and 2021; included in
Uncollectible Lease Income.(3) Includes above and below market rent
amortization, straight-line rents, and debt and derivative
mark-to-market amortization.(4) Represents 'General &
administrative, net' before gains or losses on deferred
compensation plan, as reported on supplemental pages 5 and 7 and
calculated on a pro rata basis.(5) Excludes debt and derivative
mark-to-market amortization; included in Certain non-cash
items.
Conference Call Information
To discuss Regency’s third quarter results and
provide further business updates, management will host a conference
call on Friday, November 3rd at 11:00 a.m. ET. Dial-in and webcast
information is below.
Third
Quarter 2023 Earnings Conference Call |
Date: |
Friday, November 3, 2023 |
Time: |
11:00 a.m. ET |
Dial#: |
877-407-0789 or
201-689-8562 |
Webcast: |
3rd Quarter 2023 Webcast
Link |
Replay: Webcast Archive –
Investor Relations page under Events & Webcasts
About Regency Centers Corporation
(Nasdaq: REG)
Regency Centers is a preeminent national owner,
operator, and developer of shopping centers located in suburban
trade areas with compelling demographics. Our portfolio includes
thriving properties merchandised with highly productive grocers,
restaurants, service providers, and best-in-class retailers that
connect to their neighborhoods, communities, and customers.
Operating as a fully integrated real estate company, Regency
Centers is a qualified real estate investment trust (REIT) that is
self-administered, self-managed, and an S&P 500 Index member.
For more information, please visit RegencyCenters.com.
Reconciliation of Net Income
Attributable to Common Shareholders to Nareit FFO and Core
Operating Earnings – Actual (in thousands, except
per share amounts)
For the Periods Ended
September 30, 2023 and 2022 |
Three Months Ended |
|
Year to Date |
|
|
2023 |
|
2022 |
|
|
|
2023 |
|
2022 |
|
|
|
|
|
|
|
Reconciliation of Net
Income to Nareit FFO: |
|
|
|
|
|
|
|
|
|
|
|
Net Income Attributable to
Common Shareholders |
$ |
89,076 |
|
87,578 |
|
|
$ |
273,139 |
|
387,602 |
|
Adjustments to reconcile to Nareit Funds From Operations (1): |
|
|
|
|
|
Depreciation and amortization (excluding FF&E) |
|
94,011 |
|
86,405 |
|
|
|
272,551 |
|
256,273 |
|
Gain on sale of real estate |
|
(827 |
) |
(202 |
) |
|
|
(1,132 |
) |
(119,301 |
) |
Exchangeable operating partnership units |
|
520 |
|
379 |
|
|
|
1,490 |
|
1,694 |
|
|
|
|
|
|
|
Nareit Funds From Operations |
$ |
182,780 |
|
174,160 |
|
|
$ |
546,048 |
|
526,268 |
|
|
|
|
|
|
|
Nareit FFO per share
(diluted) |
$ |
1.02 |
|
1.01 |
|
|
$ |
3.13 |
|
3.05 |
|
Weighted average shares
(diluted) |
|
179,311 |
|
172,267 |
|
|
|
174,621 |
|
172,620 |
|
|
|
|
|
|
|
Reconciliation of
Nareit FFO to Core Operating Earnings: |
|
|
|
|
|
|
|
|
|
|
|
Nareit Funds From
Operations |
$ |
182,780 |
|
174,160 |
|
|
$ |
546,048 |
|
526,268 |
|
Adjustments to reconcile to Core Operating Earnings (1): |
|
|
|
|
|
Not Comparable Items |
|
|
|
|
|
Merger transition costs |
|
1,511 |
|
- |
|
|
|
1,511 |
|
- |
|
Early extinguishment of debt |
|
- |
|
- |
|
|
|
- |
|
176 |
|
Certain Non Cash Items |
|
|
|
|
|
Straight-line rent |
|
(3,142 |
) |
(3,140 |
) |
|
|
(7,315 |
) |
(9,152 |
) |
Uncollectible straight-line rent |
|
92 |
|
(4,156 |
) |
|
|
(2,298 |
) |
(9,610 |
) |
Above/below market rent amortization, net |
|
(7,919 |
) |
(5,191 |
) |
|
|
(22,138 |
) |
(15,906 |
) |
Debt and derivative mark-to-market amortization |
|
667 |
|
(28 |
) |
|
|
667 |
|
(185 |
) |
|
|
|
|
|
|
Core Operating Earnings |
$ |
173,989 |
|
161,645 |
|
|
$ |
516,475 |
|
491,591 |
|
|
|
|
|
|
|
Core Operating Earnings per
share (diluted) |
$ |
0.97 |
|
0.94 |
|
|
$ |
2.96 |
|
2.85 |
|
Weighted average shares
(diluted) |
|
179,311 |
|
172,267 |
|
|
|
174,621 |
|
172,620 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted Average Shares For
Diluted Earnings per Share |
|
178,231 |
|
171,525 |
|
|
|
173,711 |
|
171,870 |
|
|
|
|
|
|
|
Weighted Average Shares For
Diluted FFO and Core Operating Earnings per Share |
|
179,311 |
|
172,267 |
|
|
|
174,621 |
|
172,620 |
|
(1) Includes Regency's consolidated entities and
its pro-rata share of unconsolidated co-investment partnerships,
net of pro-rata share attributable to noncontrolling
interests.
Same Property NOI is a key non-GAAP measure used
by management in evaluating the operating performance of Regency’s
properties. The Company provides a reconciliation of Net Income
Attributable to Common Shareholders to pro-rata Same Property
NOI.
Reconciliation of Net Income
Attributable to Common Shareholders to Pro-Rata Same Property NOI
- Actual (in thousands)
For the Periods Ended
September 30, 2023 and 2022 |
Three Months Ended |
|
Year to Date |
|
|
2023 |
|
2022 |
|
|
|
2023 |
|
2022 |
|
|
|
|
|
|
|
Net income attributable to
common shareholders |
$ |
89,076 |
|
87,578 |
|
|
$ |
273,139 |
|
387,602 |
|
Less: |
|
|
|
|
|
Management, transaction, and other fees |
|
(7,079 |
) |
(5,767 |
) |
|
|
(20,223 |
) |
(18,950 |
) |
Other(1) |
|
(12,016 |
) |
(13,564 |
) |
|
|
(34,317 |
) |
(38,295 |
) |
Plus: |
|
|
|
|
|
Depreciation and amortization |
|
87,505 |
|
80,270 |
|
|
|
253,373 |
|
237,462 |
|
General and administrative |
|
20,903 |
|
20,273 |
|
|
|
71,248 |
|
56,710 |
|
Other operating expense |
|
3,533 |
|
949 |
|
|
|
4,718 |
|
3,739 |
|
Other expense |
|
39,643 |
|
37,356 |
|
|
|
109,192 |
|
12,516 |
|
Equity in income of investments in real estate excluded from NOI
(2) |
|
11,668 |
|
11,754 |
|
|
|
35,266 |
|
23,767 |
|
Net income attributable to noncontrolling interests |
|
1,453 |
|
1,269 |
|
|
|
4,050 |
|
4,048 |
|
Preferred stock dividends |
|
1,644 |
|
- |
|
|
|
1,644 |
|
- |
|
NOI |
|
236,330 |
|
220,118 |
|
|
|
698,090 |
|
668,599 |
|
|
|
|
|
|
|
Less non-same property NOI (3) |
|
(11,570 |
) |
(122 |
) |
|
|
(15,055 |
) |
(1,711 |
) |
|
|
|
|
|
|
Same Property NOI |
$ |
224,760 |
|
219,996 |
|
|
$ |
683,035 |
|
666,888 |
|
% change |
|
2.2 |
% |
|
|
|
2.4 |
% |
|
|
|
|
|
|
|
Same Property NOI without Termination Fees |
$ |
223,723 |
|
219,094 |
|
|
$ |
676,628 |
|
663,098 |
|
% change |
|
2.1 |
% |
|
|
|
2.0 |
% |
|
|
|
|
|
|
|
Same Property NOI without Termination Fees or
Redevelopments |
$ |
191,110 |
|
189,398 |
|
|
$ |
579,772 |
|
572,834 |
|
% change |
|
0.9 |
% |
|
|
|
1.2 |
% |
|
|
|
|
|
|
|
Same Property NOI without Termination Fees or Collection of
2020/2021 Reserves |
$ |
222,674 |
|
216,298 |
|
|
$ |
672,892 |
|
645,268 |
|
% change |
|
2.9 |
% |
|
|
|
4.3 |
% |
|
(1) Includes straight-line rental income and expense, net of
reserves, above and below market rent amortization, other fees, and
noncontrolling interests.(2) Includes non-NOI expenses
incurred at our unconsolidated real estate partnerships, such as,
but not limited to, straight-line rental income, above and
below market rent amortization, depreciation and amortization,
interest expense, and real estate gains and impairments.(3)
Includes revenues and expenses attributable to Non-Same Property,
Projects in Development, corporate activities, and noncontrolling
interests.
Reported results are preliminary and not final
until the filing of the Company’s Form 10-Q with the SEC and,
therefore, remain subject to adjustment.
The Company has published forward-looking
statements and additional financial information in its third
quarter 2023 supplemental package that may help investors estimate
earnings. A copy of the Company’s third quarter 2023 supplemental
package will be available on the Company's website at
investors.regencycenters.com or by written request to: Investor
Relations, Regency Centers Corporation, One Independent Drive,
Suite 114, Jacksonville, Florida, 32202. The supplemental package
contains more detailed financial and property results including
financial statements, an outstanding debt summary, acquisition and
development activity, investments in partnerships, information
pertaining to securities issued other than common stock, property
details, a significant tenant rent report and a lease expiration
table in addition to earnings and valuation guidance assumptions.
The information provided in the supplemental package is unaudited
and includes non-GAAP measures, and there can be no assurance that
the information will not vary from the final information in the
Company’s Form 10-Q for the period ended September 30, 2023.
Regency may, but assumes no obligation to, update information in
the supplemental package from time to time.
Non-GAAP Disclosure
We believe these non-GAAP measures provide
useful information to our Board of Directors, management and
investors regarding certain trends relating to our financial
condition and results of operations. Our management uses these
non-GAAP measures to compare our performance to that of prior
periods for trend analyses, purposes of determining management
incentive compensation and budgeting, forecasting and planning
purposes.
We do not consider non-GAAP measures an
alternative to financial measures determined in accordance with
GAAP, rather they supplement GAAP measures by providing additional
information we believe to be useful to our shareholders. The
principal limitation of these non-GAAP financial measures is they
may exclude significant expense and income items that are required
by GAAP to be recognized in our consolidated financial statements.
In addition, they reflect the exercise of management’s judgment
about which expense and income items are excluded or included in
determining these non-GAAP financial measures. In order to
compensate for these limitations, reconciliations of the non-GAAP
financial measures we use to their most directly comparable GAAP
measures are provided. Non-GAAP financial measures should not be
relied upon in evaluating the financial condition, results of
operations or future prospects of the Company.
Nareit FFO is a commonly used measure of REIT
performance, which the National Association of Real Estate
Investment Trusts (“Nareit”) defines as net income, computed in
accordance with GAAP, excluding gains on sale and impairments of
real estate, net of tax, plus depreciation and amortization, and
after adjustments for unconsolidated partnerships and joint
ventures. Regency computes Nareit FFO for all periods presented in
accordance with Nareit's definition. Since Nareit FFO excludes
depreciation and amortization and gains on sales and impairments of
real estate, it provides a performance measure that, when compared
year over year, reflects the impact on operations from trends in
percent leased, rental rates, operating costs, acquisition and
development activities, and financing costs. This provides a
perspective of the Company’s financial performance not immediately
apparent from net income determined in accordance with GAAP. Thus,
Nareit FFO is a supplemental non-GAAP financial measure of the
Company's operating performance, which does not represent cash
generated from operating activities in accordance with GAAP; and,
therefore, should not be considered a substitute measure of cash
flows from operations. The Company provides a reconciliation of Net
Income Attributable to Common Shareholders to Nareit FFO.
Core Operating Earnings is an additional
performance measure that excludes from Nareit FFO: (i) transaction
related income or expenses; (ii) gains or losses from the early
extinguishment of debt; (iii) certain non-cash components of
earnings derived from above and below market rent amortization,
straight-line rents, and amortization of mark-to-market of debt
adjustments; and (iv) other amounts as they occur. The Company
provides a reconciliation of Net Income to Nareit FFO to Core
Operating Earnings.
Forward-Looking Statements
Certain statements in this document regarding
anticipated financial, business, legal or other outcomes including
business and market conditions, outlook and other similar
statements relating to Regency’s future events, developments, or
financial or operational performance or results such as our 2023
Guidance, are “forward-looking statements” made pursuant to the
safe harbor provisions of the Private Securities Litigation Reform
Act of 1995 and other federal securities laws. These
forward-looking statements are identified by the use of words such
as “may,” “will,” “could,” “should,” “would,” “expect,” “estimate,”
“believe,” “intend,” “forecast,” “project,” “plan,” “anticipate,”
“guidance,” and other similar language. However, the absence of
these or similar words or expressions does not mean a statement is
not forward-looking. While we believe these forward-looking
statements are reasonable when made, forward-looking statements are
not guarantees of future performance or events and undue reliance
should not be placed on these statements. Although we believe the
expectations reflected in any forward-looking statements are based
on reasonable assumptions, we can give no assurance these
expectations will be attained, and it is possible actual results
may differ materially from those indicated by these forward-looking
statements due to a variety of risks and uncertainties. Our
operations are subject to a number of risks and uncertainties
including, but not limited to, those risk factors described in our
Securities and Exchange Commission (“SEC”) filings, our Annual
Report on Form 10-K for the year ended December 31, 2022 (“2022
Form 10-K”) under Item 1A. “Risk Factors”, on Form 10-Q for the
three months ended March 31, 2023 under Part II, Item 1A. “Risk
Factors” and our Form S-4 Registration Statement, filed with the
SEC on July 10, 2023, in connection with our acquisition of Urstadt
Biddle, which contains, without limitation, additional risk factors
in a section of the prospectus entitled “Risks Relating to Regency
After Completion of the Mergers”. When considering an investment in
our securities, you should carefully read and consider these risks,
together with all other information in our Annual Reports on Form
10-K, Quarterly Reports on Form 10-Q and our other filings and
submissions to the SEC. If any of the events described in the risk
factors actually occur, our business, financial condition or
operating results, as well as the market price of our securities,
could be materially adversely affected. Forward-looking statements
are only as of the date they are made, and Regency undertakes no
duty to update its forward-looking statements, whether as a result
of new information, future events or developments or otherwise,
except as to the extent required by law. These risks and events
include, without limitation:
Risk Factors Related to the Company’s
Acquisition of Urstadt Biddle
Combining our business with Urstadt Biddle’s may
be more difficult, costly or time-consuming than expected and we
may fail to realize the anticipated benefits of the acquisition,
which may adversely affect our business results and negatively
affect the market price of our securities.
Risk Factors Related to the Current
Economic Environment
Continued rising interest rates in the current
economic environment may adversely impact our cost to borrow, real
estate valuation, and stock price. Current economic challenges,
including the potential for recession, may adversely impact our
tenants and our business. Unfavorable developments affecting the
banking and financial services industry could adversely affect our
business, liquidity and financial condition, and overall results of
operations. Additionally, macroeconomic and geopolitical risks,
including the current wars in Ukraine, and involving Israel and
Gaza, create challenges that may exacerbate current market and
economic conditions in the United States.
Risk Factors Related to Pandemics or
other Health Crises
Pandemics or other health crises, such as the
COVID-19 pandemic, may adversely affect our tenants’ financial
condition, the profitability of our properties, and our access to
the capital markets and could have a material adverse effect on our
business, results of operations, cash flows and financial
condition.
Risk Factors Related to Operating
Retail-Based Shopping Centers
Economic and market conditions may adversely
affect the retail industry and consequently reduce our revenues and
cash flow and increase our operating expenses. Shifts in retail
trends, sales, and delivery methods between brick-and-mortar
stores, e-commerce, home delivery, and curbside pick-up may
adversely impact our revenues, results of operations, and cash
flows. Changing economic and retail market conditions in geographic
areas where our properties are concentrated may reduce our revenues
and cash flow. Our success depends on the continued presence and
success of our “anchor” tenants. A percentage of our revenues are
derived from “local” tenants and our net income may be adversely
impacted if these tenants are not successful, or if the demand for
the types or mix of tenants significantly change. We may be unable
to collect balances due from tenants in bankruptcy. Many of our
costs and expenses associated with operating our properties may
remain constant or increase, even if our lease income decreases.
Compliance with the Americans with Disabilities Act and other
building, fire, and safety and regulations may have a material
negative effect on us.
Risk Factors Related to Real Estate
Investments
Our real estate assets may decline in value and
be subject to impairment losses which may reduce our net income. We
face risks associated with development, redevelopment and expansion
of properties. We face risks associated with the development of
mixed-use commercial properties. We face risks associated with the
acquisition of properties. We may be unable to sell properties when
desired because of market conditions. Changes in tax laws could
impact our acquisition or disposition of real estate.
Risk Factors Related to the Environment
Affecting Our Properties
Climate change may adversely impact our
properties directly and may lead to additional compliance
obligations and costs as well as additional taxes and fees.
Geographic concentration of our properties makes our business more
vulnerable to natural disasters, severe weather conditions and
climate change. Costs of environmental remediation may adversely
impact our financial performance and reduce our cash flow.
Risk Factors Related to Corporate
Matters
An increased focus on metrics and reporting
relating to environmental, social, and governance (“ESG”) factors
may impose additional costs and expose us to new risks. An
uninsured loss or a loss that exceeds the insurance coverage on our
properties may subject us to loss of capital and revenue on those
properties. Failure to attract and retain key personnel may
adversely affect our business and operations. The unauthorized
access, use, theft or destruction of tenant or employee personal,
financial or other data or of Regency’s proprietary or confidential
information stored in our information systems or by third parties
on our behalf could impact our reputation and brand and expose us
to potential liability and loss of revenues.
Risk Factors Related to Our Partnerships
and Joint Ventures
We do not have voting control over all of the
properties owned in our co-investment partnerships and joint
ventures, so we are unable to ensure that our objectives will be
pursued. The termination of our partnerships may adversely affect
our cash flow, operating results, and our ability to make
distributions to stock and unit holders.
Risk Factors Related to Funding
Strategies and Capital Structure
Our ability to sell properties and fund
acquisitions and developments may be adversely impacted by higher
market capitalization rates and lower NOI at our properties which
may dilute earnings. We depend on external sources of capital,
which may not be available in the future on favorable terms or at
all. Our debt financing may adversely affect our business and
financial condition. Covenants in our debt agreements may restrict
our operating activities and adversely affect our financial
condition. Increases in interest rates would cause our borrowing
costs to rise and negatively impact our results of operations.
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.
Risk Factors Related to the Market Price
for Our Securities
Changes in economic and market conditions may
adversely affect the market price of our securities. There is no
assurance that we will continue to pay dividends at current or
historical rates.
Risk Factors Related to the Company’s
Qualification as a REIT
If the Company fails to qualify as a REIT for
federal income tax purposes, it would be subject to federal income
tax at regular corporate rates. Dividends paid by REITs generally
do not qualify for reduced tax rates. Certain foreign shareholders
may be subject to U.S. federal income tax on gain recognized on a
disposition of our common stock if we do not qualify as a
“domestically controlled” REIT. Legislative or other actions
affecting REITs may have a negative effect on us or our investors.
Complying with REIT requirements may limit our ability to hedge
effectively and may cause us to incur tax liabilities.
Risk Factors Related to the Company’s
Common Stock
Restrictions on the ownership of the Company’s
capital stock to preserve its REIT status may delay or prevent a
change in control. The issuance of the Company's capital stock may
delay or prevent a change in control. Ownership in the Company may
be diluted in the future.
Christy McElroy904 598
7616ChristyMcElroy@regencycenters.com
Regency Centers (NASDAQ:REG)
Historical Stock Chart
From Apr 2024 to May 2024
Regency Centers (NASDAQ:REG)
Historical Stock Chart
From May 2023 to May 2024