Regency Centers Corporation (“Regency” or the “Company”)
(Nasdaq:REG) today reported financial and operating results for the
period ended December 31, 2021. For the three months ended December
31, 2021 and 2020, Net Income was $0.39 per diluted share and $0.23
per diluted share, respectively. For the twelve months ended
December 31, 2021 and 2020, Net Income was $2.12 per diluted share
and $0.26 per diluted share, respectively.
Fourth Quarter and Full Year 2021
Highlights
- Reported Nareit
FFO of $1.01 per diluted share for the fourth quarter, and $4.02
per diluted share for the full year
- Reported that
Same Property Net Operating Income (“NOI”), excluding lease
termination fees, increased 15.4% during the fourth quarter and
16.2% during the full year over the same periods a year ago
- Increased
percent leased by 50 basis points sequentially to 94.3% in the Same
Property portfolio, as of December 31, 2021
- Collected 99% of
fourth quarter pro-rata billed base rent, as of February 7,
2022
- Executed 1.8
million square feet of comparable new and renewal leases during the
fourth quarter at a blended rent spread of +12.9%, and 7.1 million
square feet during the full year at a blended rent spread of
+5.5%
- Completed property acquisitions of
$311 million during the fourth quarter and $489 million during the
full year, both at Regency’s share
- Completed property dispositions of
$87 million during the fourth quarter and $279 million during the
full year, both at Regency’s share
- Achieved
pro-rata net debt-to-operating EBITDAre of 5.1x at December 31,
2021
Subsequent Highlights
- On January 11,
2022, closed on the sale of Costa Verde Center in San Diego, CA for
$125 million
- On January 25,
2022, issued its second annual TCFD Climate Change Risk Report,
illustrating the Company’s continued commitment to responsible
environmental stewardship
- On February 9,
2022, Regency’s Board of Directors (the “Board”) declared a
quarterly cash dividend on the Company’s common stock of $0.625 per
share
- Inclusion for a 3rd year on
Newsweek’s 2022 Most Responsible Companies List, ranked top
100
“We are proud of all that Regency has
accomplished in the last year as we recovered from the disruption
caused by the pandemic, a testament to the resiliency of our
portfolio and the hard work of our people,” said Lisa Palmer,
President and Chief Executive Officer. “As we look ahead from a
position of strength, we’ve pivoted from a recovery mindset to a
focus on growth.”
Financial Results
Net Income
- For the three
months ended December 31, 2021, Net Income Attributable to Common
Stockholders (“Net Income”) was $67.9 million, or $0.39 per diluted
share, compared to Net Income of $38.5 million, or $0.23 per
diluted share, for the same period in 2020.
- Net Income in
the fourth quarter of 2021 includes an impairment charge of $85.2
million, or $0.49 per diluted share, primarily related to Potrero
Center.
- Net Income in
the fourth quarter of 2021 also includes a gain on sale of real
estate of $61.9 million, or $0.36 per diluted share, primarily
related to the sale of Sequoia Station.
- For the twelve
months ended December 31, 2021, Net Income was $361.4 million, or
$2.12 per diluted share, compared to $44.9 million, or $0.26 per
diluted share, for the same period in 2020.
Nareit FFO
- For the three
months ended December 31, 2021, Nareit Funds From Operations
(“Nareit FFO”) was $174.2 million, or $1.01 per diluted share,
compared to $129.5 million, or $0.76 per diluted share, for the
same period in 2020.
- Nareit FFO in
the fourth quarter of 2021 includes positive uncollectible lease
income of $6.0 million at Regency’s share, or $0.04 per diluted
share, favorably impacted by the collection of revenues reserved in
prior periods. Additional detail on uncollectible lease income is
on page 33 of the fourth quarter 2021 supplemental package.
- Nareit FFO in
the fourth quarter of 2021 includes positive uncollectible
straight-line rent of $6.1 million, or $0.04 per diluted share,
which benefitted from the reversal of straight-line rent reserves
triggered by the conversion of some cash basis tenants back to
accrual accounting. Straight-line rent is excluded from the
calculation of Core Operating Earnings.
- For the twelve
months ended December 31, 2021, Nareit FFO was $688.7 million, or
$4.02 per diluted share, compared to $502.0 million, or $2.95 per
diluted share, for the same period in 2020.
- Nareit FFO in
the full year 2021 includes positive uncollectible lease income of
$25.7 million at Regency’s share, or $0.15 per diluted share.
- Nareit FFO in
the full year 2021 includes positive uncollectible straight-line
rent of $6.0 million, or $0.03 per diluted share.
Core Operating Earnings
- For the three
months ended December 31, 2021, Core Operating Earnings was $159.0
million, or $0.92 per diluted share, compared to $125.1 million, or
$0.73 per diluted share, for the same period in 2020.
- For the twelve
months ended December 31, 2021, Core Operating Earnings was $631.2
million, or $3.68 per diluted share, compared to $505.2 million, or
$2.97 per diluted share, for the same period in 2020.
Portfolio Performance
Same Property NOI
- Fourth quarter
2021 Same Property NOI, excluding lease termination fees, increased
by 15.4% compared to the same period in 2020.
- Full year 2021
Same Property NOI, excluding lease termination fees, increased by
16.2% compared to the same period in 2020.
Leased Occupancy
- As of December
31, 2021, Regency’s wholly-owned portfolio plus its pro-rata share
of co-investment partnerships, was 94.1% leased.
- As of December
31, 2021, Regency’s Same Property portfolio was 94.3% leased, an
increase of 50 basis points sequentially.
- Same Property
anchor percent leased, which includes spaces greater than or equal
to 10,000 square feet, was 96.9%, an increase of 40 basis points
sequentially.
- Same Property
shop percent leased, which includes spaces less than 10,000 square
feet, was 89.9%, an increase of 60 basis points sequentially
Leasing Activity
- During the three
months ended December 31, 2021, Regency executed approximately 1.8
million square feet of comparable new and renewal leases at blended
rent spreads of +12.9%.
- During the
twelve months ended December 31, 2021, approximately 7.1 million
square feet of comparable new and renewal leases were executed at
blended rents spreads of +5.5%.
COVID-19 Update
- As of February
7, 2022, the Company collected 99% of fourth quarter 2021 pro-rata
base rent.
- Additional
information regarding COVID-19 impacts can be found in the
“Business Update” presentation posted on the Company’s website at
investors.regencycenters.com, as well as on pages 33 and 34 of the
fourth quarter 2021 supplemental package.
Portfolio Enhancement and Capital
Allocation
Developments and Redevelopments
- As of December
31, 2021, Regency’s in-process development and redevelopment
projects had estimated net project costs of approximately $307
million and estimated remaining costs to complete of $127 million,
each at the Company’s share.
- During the
fourth quarter, Regency completed one development and three
redevelopment projects with combined costs of approximately $23
million, at the Company’s share.
Property Transactions
- As previously
disclosed, during the full year 2021, the Company completed
acquisitions for a combined total of $489 million, at Regency’s
share, and completed dispositions for a combined total of $279
million, at Regency’s share.
- During the
fourth quarter of 2021, the Company completed acquisitions for a
combined total of $311 million, including Blakeney Shopping Center
for $181 million and a portfolio of four grocery-anchored
neighborhood centers on Long Island for $130 million.
- During the
fourth quarter of 2021, the Company completed the disposition of
two properties for a combined total of $87 million, at Regency’s
share.
- As previously
disclosed, subsequent to year-end on January 11, 2022, the Company
closed on the sale of its wholly-owned Costa Verde Center in San
Diego, California for $125 million.
Balance Sheet
- As of December
31, 2021, Regency had full capacity available under its $1.2
billion revolving credit facility.
- As of December
31, 2021, Regency’s pro-rata net debt-to-operating EBITDAre ratio
was 5.1x.
- As previously
disclosed, in the second quarter of 2021, Regency entered into
forward sale agreements in connection with its ATM program to sell
an aggregate of approximately 2.3 million shares of common stock.
As of December 31, 2021, the Company has approximately 1.0 million
shares that remain unsettled, at an average gross price of $65.78
per share.
Dividend
- On February 9,
2022, Regency’s Board declared a quarterly cash dividend on the
Company’s common stock of $0.625 per share. The dividend is payable
on April 5, 2022, to shareholders of record as of March 15,
2022.
2022 Guidance
Regency Centers provided initial 2022 guidance,
as summarized in the table below. Please refer to the Company’s
“Business Update” presentation for additional detail on guidance
disclosure. Additional guidance details may also be found in the
fourth quarter 2021 supplemental package. All materials are posted
on the Company’s website at investors.regencycenters.com.
Full Year
2022 Guidance |
All figures pro-rata
and in thousands, except per share data |
|
|
|
|
|
|
|
Initial 2022 Guidance |
|
2021 Actual |
Net Income Attributable to Common Stockholders per diluted
share |
|
$1.78 - $1.86 |
|
$2.12 |
Nareit Funds From Operations (“Nareit FFO”) per diluted share |
|
$3.72 - $3.80 |
|
$4.02 |
Core Operating Earnings per diluted share (1) |
|
$3.56 - $3.64 |
|
$3.68 |
Same Property Net Operating Income (“SP NOI”) Growth (ex.
Termination Fees) |
|
-1.25% to +0.25% |
|
+16.2% |
Same Property Net Operating Income (“SP NOI”) Growth (ex.
Termination Fees, ex. Collection of Prior Year Reserves) |
|
+2.75% to +4.25% |
|
+9.9% |
Collection of Prior Year Reserves (2) |
|
+/- $13,000 |
|
$46,255 |
Certain Non-Cash Items (3) |
|
+/- $28,000 |
|
$44,102 |
Includes Impact from Reversal of Uncollectible Straight-Line Rent
Receivables (conversions to accrual) (4) |
|
as converted |
|
$12,863 |
Net G&A Expense |
|
$82,500 - $85,500 |
|
$73,987 |
Net Interest Expense |
|
$163,500 - $164,500 |
|
$165,419 |
Recurring Third Party Fees & Commissions |
|
$24,000 - $25,000 |
|
$25,665 |
Transaction Income (JV Promote) |
|
$0 |
|
$13,589 |
Development and Redevelopment Spend |
|
+/- $150,000 |
|
$106,185 |
Acquisitions |
|
+/- $30,000 |
|
$488,582 |
Cap rate (weighted average) |
|
+/- 5.0% |
|
5.1% |
Dispositions |
|
+/- $150,000 |
|
$279,115 |
Cap rate (weighted average) (5) |
|
2.25% - 2.50% |
|
5.2% |
Forward ATM Settlement (gross) |
|
+/- $65,000 |
|
$84,869 |
|
|
|
|
|
(1) Core Operating Earnings excludes certain non-cash items,
including straight-line rents, above/below market rent
amortization, and amortization of mark-to-market debt, as well
as transaction related income/expenses and debt extinguishment
charges. |
(2) Represents the expected collection in 2022 of revenues reserved
in 2020 and 2021, and the actual collection in 2021 of revenues
reserved in 2020. Included in Uncollectible Lease Income. |
(3) Includes above and below market rent amortization,
straight-line rents, and amortization of mark-to-market debt
adjustments. |
|
(4) Positive impact on Uncollectible Straight Line Rent from the
conversion of cash basis tenants back to an accrual basis of
accounting, only included in guidance as tenants are
converted. |
(5) Weighted average cap rates exclude non-income producing assets;
2021 cap rate was 4.3% including $48 million of non-income
producing assets; 2022 cap rate range includes the sale
of Costa Verde ($125M at a ~1.5% cap rate, not
stabilized). |
Conference Call Information
To discuss Regency’s fourth quarter results and
provide further business updates, management will host a conference
call on Friday, February 11, 2022, at 10:00 a.m. ET. Dial-in and
webcast information is listed below.
Fourth Quarter
2021 Earnings Conference Call |
Date: |
Friday, February 11, 2022 |
Time: |
10:00 a.m. ET |
Dial#: |
877-407-0789 or
201-689-8562 |
Webcast: |
investors.regencycenters.com |
Replay
Webcast Archive: Investor Relations page under
Events & Webcasts
|
|
|
|
|
|
Reconciliation
of Net Income Attributable to Common Stockholders to Nareit FFO and
Core Operating Earnings - Actual (in thousands) |
|
|
|
|
|
|
|
|
|
|
|
|
For
the Periods Ended December 31, 2021 and 2020 |
Three Months
Ended |
|
Year to
Date |
|
2021 |
2020 |
|
2021 |
2020 |
|
|
|
|
|
|
Reconciliation of Net Income to Nareit FFO: |
|
|
|
|
|
|
|
|
|
|
|
Net Income Attributable to Common Stockholders |
$ |
67,859 |
|
38,487 |
|
|
$ |
361,411 |
|
44,889 |
|
Adjustments to reconcile to Nareit Funds From Operations (1): |
|
|
|
|
|
Depreciation and amortization (excluding FF&E) |
|
82,765 |
|
94,289 |
|
|
|
330,364 |
|
375,865 |
|
Goodwill impairment |
|
- |
|
- |
|
|
|
- |
|
132,128 |
|
Gain on sale of real estate |
|
(61,915 |
) |
(21,228 |
) |
|
|
(100,499 |
) |
(69,879 |
) |
Provision for impairment of real estate |
|
85,229 |
|
17,764 |
|
|
|
95,815 |
|
18,778 |
|
Exchangeable operating partnership units |
|
300 |
|
174 |
|
|
|
1,615 |
|
203 |
|
|
|
|
|
|
|
Nareit Funds From Operations |
$ |
174,238 |
|
129,486 |
|
|
$ |
688,706 |
|
501,984 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of Nareit FFO to Core Operating
Earnings: |
|
|
|
|
|
|
|
|
|
|
|
Nareit Funds From Operations |
$ |
174,238 |
|
129,486 |
|
|
$ |
688,706 |
|
501,984 |
|
Adjustments to reconcile to Core Operating Earnings (1): |
|
|
|
|
|
Not Comparable Items |
|
|
|
|
|
Early extinguishment of debt |
|
- |
|
2,685 |
|
|
|
- |
|
22,043 |
|
Promote income |
|
- |
|
- |
|
|
|
(13,589 |
) |
- |
|
Certain Non-Cash Items |
|
|
|
|
|
Straight line rent |
|
(3,240 |
) |
(3,778 |
) |
|
|
(13,534 |
) |
(15,605 |
) |
Uncollectible straight line rent |
|
(6,124 |
) |
7,681 |
|
|
|
(5,965 |
) |
39,255 |
|
Above/below market rent amortization, net |
|
(5,791 |
) |
(10,860 |
) |
|
|
(23,889 |
) |
(41,293 |
) |
Debt premium/discount amortization |
|
(105 |
) |
(117 |
) |
|
|
(565 |
) |
(1,233 |
) |
|
|
|
|
|
|
Core Operating Earnings |
$ |
158,978 |
|
125,097 |
|
|
$ |
631,164 |
|
505,151 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted Average Shares For Diluted Earnings per Share |
|
171,866 |
|
169,980 |
|
|
|
170,694 |
|
169,460 |
|
|
|
|
|
|
|
Weighted Average Shares For Diluted FFO and Core Operating Earnings
per Share |
|
172,626 |
|
170,745 |
|
|
|
171,456 |
|
170,225 |
|
|
|
|
|
|
|
(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 Stockholders to pro-rata Same Property
NOI.
|
|
|
|
|
|
Reconciliation
of Net Income Attributable to Common Stockholders to Pro-Rata Same
Property NOI - Actual (in thousands) |
|
|
|
|
|
|
|
|
|
|
|
|
For
the Periods Ended December 31, 2021 and 2020 |
Three Months
Ended |
|
Year to
Date |
|
2021 |
2020 |
|
2021 |
2020 |
|
|
|
|
|
|
Net income attributable to common stockholders |
$ |
67,859 |
|
38,487 |
|
|
$ |
361,411 |
|
44,889 |
|
Less: |
|
|
|
|
|
Management, transaction, and other fees |
|
(6,918 |
) |
(7,417 |
) |
|
|
(40,337 |
) |
(26,501 |
) |
Other(1) |
|
(15,676 |
) |
(8,544 |
) |
|
|
(46,860 |
) |
(25,912 |
) |
Plus: |
|
|
|
|
|
Depreciation and amortization |
|
76,396 |
|
86,739 |
|
|
|
303,331 |
|
345,900 |
|
General and administrative |
|
19,955 |
|
20,512 |
|
|
|
78,218 |
|
75,001 |
|
Other operating expense |
|
3,064 |
|
7,617 |
|
|
|
5,751 |
|
12,642 |
|
Other expense |
|
65,594 |
|
35,474 |
|
|
|
132,977 |
|
256,407 |
|
Equity in income of investments in real estate excluded from NOI
(2) |
|
3,852 |
|
12,838 |
|
|
|
53,119 |
|
59,726 |
|
Net income attributable to noncontrolling interests |
|
1,124 |
|
729 |
|
|
|
4,877 |
|
2,428 |
|
NOI |
|
215,250 |
|
186,435 |
|
|
|
852,487 |
|
744,580 |
|
|
|
|
|
|
|
Less non-same property NOI (3) |
|
(3,108 |
) |
(2,124 |
) |
|
|
(3,314 |
) |
(11,472 |
) |
|
|
|
|
|
|
Same Property NOI |
$ |
212,142 |
|
184,311 |
|
|
$ |
849,173 |
|
733,108 |
|
|
|
|
|
|
|
Same Property NOI without Termination Fees |
$ |
210,104 |
|
182,051 |
|
|
$ |
842,727 |
|
725,358 |
|
|
|
|
|
|
|
Same Property NOI without Termination Fees or
Redevelopments |
$ |
187,315 |
|
162,660 |
|
|
$ |
752,604 |
|
648,348 |
|
|
|
|
|
|
|
|
|
|
|
|
|
(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-K with the SEC and,
therefore, remain subject to adjustment.
The Company has published forward-looking
statements and additional financial information in its fourth
quarter 2021 supplemental package that may help investors estimate
earnings. A copy of the Company’s fourth quarter 2021 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-K for the year-ended December 31, 2021. Regency
may, but assumes no obligation to, update information in the
supplemental package from time to time.
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.
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 Stockholders 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 2021
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,” “should,” “expect,” “estimate,” “believe,”
“intend,” “forecast,” “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 SEC filings. 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 except as required by
law. These risks and events include, without limitation:
Risk Factors
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 and cash flows. Changing economic and
retail market conditions in geographic areas where our properties
are concentrated may reduce our revenues and cash flow. In
addition, labor challenges and supply delays and shortages due to a
variety of macroeconomic factors, including inflationary pressures,
could affect the retail industry. Our success depends on the
continued presence and success of our “anchor” tenants. A
significant percentage of our revenues are derived from smaller
“shop space” tenants and our net income may be adversely impacted
if our smaller shop tenants are not successful. 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 the Disabilities Act and fire,
safety and other regulations may have a 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 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. The
interest rates on our Unsecured Credit facilities as well as on our
variable rate mortgages and interest rate swaps might change based
on changes to the method in which LIBOR or its replacement rate is
determined.
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 historical
rates.
Risk Factors Relating 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 stockholders
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. 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
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