美國
證券交易委員會
華盛頓特區20549
表格
根據1934年證券交易法第13或15(d)條款的季度報告。 |
截至2024年6月30日季度結束
或
根據1934年證券交易法第13或15(d)條款的過渡報告 |
過渡期從_________到_________
佣金文件號碼：
委員會檔案編號：
（依憑章程所載的完整登記名稱）
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(成立地或組織其他管轄區) |
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（聯邦稅號） |
(主要行政辦公室的地址)（郵政編碼）
(
(註冊人電話號碼，包括區號)
N/A
（前名稱、前地址和前財政年度，
如果與上一份報告相比有所更改)
根據本法第 12 (b) 條註冊的證券：
金科房地產公司
每種類別的名稱 |
交易 標的 |
每個交易所的名稱為 註冊在哪些交易所 |
Kimco Realty OP，LLC
每種類別的名稱 |
交易 標的 |
每個交易所的名稱為 註冊在哪些交易所 |
None |
N/A |
N/A |
請勾選表示：（1）申報人在過去12個月內（或申報人在此期間需要提交此類報告的較短時間內，已提交了證券交易所法案第13條或第15(d)條規定的所有報告；並 （2）該申報人在過去90天內一直受到申報要求的約束。
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金科房地產公司 |
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Kimco Realty OP，LLC |
請用勾選表示，登記申報人是否在過去12個月內（或者在要求提交此類檔案的更短期間內）依照《S-t法規第405條》（本章節第232.405條）的規定，已經遞交所有必須提交的互動數據檔案。
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金科房地產公司 |
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Kimco Realty OP，LLC |
請勾選指示登記者是否為大型快速提交人、快速提交人、非快速提交人、較小的報告公司或新興成長型公司。請參閱交易所法規120億2條，了解「大型快速提交人」、「快速提交人」、「較小的報告公司」和「新興成長型公司」的定義。
Kimco Realty公司：
☒ |
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加速歸檔人 |
☐ |
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非加速歸檔人 |
☐ |
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小型報告公司 |
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新興成長型企業 |
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Kimco Realty OP，有限責任公司：
大型加速歸檔人 |
☐ |
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加速歸檔人 |
☐ |
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☒ |
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小型報告公司 |
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新興成長型企業 |
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如果該企業為新興成長型企業，請在是否選擇不使用證交法第13(a)條所提供之符合任何新的或修訂財務會計標準的延長過渡期的方格中打勾。
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金科房地產公司 ☐ |
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金科房地產運營有限責任公司 ☐ |
勾選表示申報人是否為外殼公司（定義於交易所法規第1202條）。
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金科房地產公司是 ☐ 否 |
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Kimco Realty OP, LLC 是 ☐ 否 |
(僅適用於公司註冊人員)
請指示每一類受註冊者普通股的流通股數，截至最近可行日期為止。
截至2024年10月22日，Kimco Realty Corporation擁有
解說說明
本報告結合了金科地產公司（以下簡稱“公司”）和金科地產OP，有限責任公司（以下簡稱“金科OP”）截至2024年9月30日季度結束的10-Q表格的季度報告。在2023年1月1日之前，公司的業務是通過一個被稱爲金科地產公司的前身實體進行的（以下簡稱“前身”）。在2022年12月14日，前身的董事會批准了與原名爲新KRC股份有限公司（以下簡稱“子公司”）（前身的馬里蘭公司和前身的全資子公司）以及KRC Merger子公司（前身的全資子公司，以下簡稱“併購子公司”）達成《合併協議和計劃》（以下簡稱“UPREIt合併”），以將前身的業務整合爲一個遮陽傘合夥制房地產投資信託，或稱爲“UPREIT”。
根據UPREIt合併協議，在2023年1月1日，合併子公司併入原有公司，原有公司作爲存續實體和母公司的全資子公司繼續存在，每一股原有公司的普通股被轉換爲一股母公司的等值普通股（每一股繼續以其現有的逐筆明細符號交易，並擁有與重組前相同的權利、權力和限制）。
在重組之際，母公司更名爲Kimco Realty Corporation，並代替前身成爲紐約證券交易所上市的公共公司。截至2023年1月3日起，前身轉爲一家有限責任公司，設立於特拉華州，被稱爲Kimco Realty OP，LLC，我們在此稱爲“Kimco OP”。
根據重組，公司幾乎所有的資產由Kimco OP持有，公司幾乎所有的業務通過Kimco OP（直接或通過其子公司）進行，Kimco OP是公司的經營公司，公司是Kimco OP的管理成員。公司的高管和董事與重組之前的前身的高管和董事相同。
母公司是一家股權房地產投資信託（"REIT"），也是Kimco OP的管理成員。截至2024年9月30日，母公司持有99.84%的Kimco OP中未償付的有限責任公司權益（"OP Units"）。
股東權益和成員資本是母公司未經審計的簡明綜合財務報表與Kimco OP的主要差異領域。 Kimco OP的資本目前包括母公司擁有的OP單位和第三方擁有的非控制性OP單位。第三方擁有的OP單位在Kimco OP的財務報表中計入資本，而在母公司的財務報表中計入非控股權益。
母公司出於財務報告目的合併Kimco OP，除了在Kimco OP的投資外，母公司沒有重要資產。因此，儘管股東權益、成員資本和非控股權益如上所述有所不同，母公司和Kimco OP的資產和負債在其各自的財務報表上是相同的。
公司認爲將母公司和Kimco OP的季度報告合併到這份單一報告中，將會帶來以下好處：
爲了突出母公司與Kimco OP之間的差異，本季度報告中有部分內容單獨討論母公司和Kimco OP，包括單獨的基本報表（但合併的附註）、單獨的控制和程序部分，以及單獨的第31和第32號認證。在結合母公司和Kimco OP披露的部分中，除非上下文另有要求，本季度報告將母公司和/或Kimco OP的行爲或持股視爲公司的行爲或持股（直接或通過其子公司，包括Kimco OP）。
在本季度報告中，除非上下文另有要求：
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項目 1。 |
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金科地產公司及其子公司的簡明合併財務報表（未經審計） |
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Kimco Realty OP，LLC及其子公司的簡明綜合財務報表（未經審計） |
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Kimco Realty Corporation及其子公司，Kimco Realty OP，LLC及其子公司 |
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項目2。 |
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項目3。 |
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項目4。 |
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項目 1。 |
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項目1A。 |
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項目2。 |
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項目3。 |
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項目4。 |
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項目5。 |
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第6項。 |
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3
KIMCO房地產公司及其子公司
簡明綜合簡明資產負債表
（未經審核）
（以千為單位，除股份信息外）
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2024年9月30日 |
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2023年12月31日 |
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資產： |
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房地產業，減去累計折舊和攤銷$ |
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$ |
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$ |
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對房地產合資企業的投資和預付款 |
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其他投資 |
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現金、現金等價物和受限制的現金 |
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可市場證券 |
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應收帳款及票據，淨額 |
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營運租賃權利資產，淨額 |
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其他資產 |
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總資產（1） |
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$ |
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$ |
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負債： |
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應付票據，淨額 |
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$ |
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$ |
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應付款抵押貸款，淨額 |
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應付帳款及應計費用 |
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分紅派息應付款 |
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租賃負債 |
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其他負債 |
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負債總額（1） |
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可贖回的非控股權益 |
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股東權益： |
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優先股，面額$0.01，授權股數為5,000,000股，發行且流通股數為截至2024年6月30日和2023年12月31日之184,668,188股和181,364,180股。 |
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0.01 |
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資本剩餘 |
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累積的分紅派息超過淨利潤 |
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累積的其他全面損益/收益 |
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股東權益總額 |
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非控股權益 |
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總股東權益 |
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負債加股東權益總額 |
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隨附附注是這些簡明綜合財務報表的重要組成部分。
4
KIMCO房地產公司及其子公司
簡明綜合財務報表收入聲明
（未經審核）
（單位：千，每股資料除外）
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截至九月三十日的三個月 |
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截至九月三十日的九個月。 |
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2024 |
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2023 |
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2023 |
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收入 |
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租賃物業收入，淨 |
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管理及其他費用收入 |
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總營業收入 |
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營運費用 |
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租金 |
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房地產稅 |
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營運和維護 |
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一般及行政費用 |
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資產減損損失 |
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合併費用 |
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折舊及攤銷 |
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營業費用總額 |
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出售財產的收益 |
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營業收入 |
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其他收益/（費用） |
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特別分紅收入 |
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其他收入，淨額 |
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可交易證券的收益/(損失)，淨額 |
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利息支出 |
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稅前收入，淨額，聯營公司投資的淨收益， |
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(準備金)/稅收收益，淨額 |
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合營企業的收益份額，淨額 |
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其他投資的收益份額，淨額 |
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凈利潤 |
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歸屬於非控制權益的淨收入 |
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凈利潤歸屬公司 |
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優先分紅，淨額 |
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可供公司普通股東分配的淨利潤 |
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每股普通股： |
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可供公司普通股東的淨利潤： |
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-基本 |
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-稀釋 |
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加權平均股份： |
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-基本 |
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-稀釋 |
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隨附附注是這些簡明綜合財務報表的重要組成部分。
5
KIMCO REALTY CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(unaudited)
(in thousands)
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Three Months Ended September 30, |
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Nine Months Ended September 30, |
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2024 |
|
|
2023 |
|
|
2024 |
|
|
2023 |
|
||||
Net income |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
Other comprehensive (loss)/income: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Unrealized gains related to defined benefit plan |
|
|
|
|
|
( |
) |
|
|
|
|
|
( |
) |
||
Unrealized losses on cash flow hedges for interest |
|
|
( |
) |
|
|
|
|
|
( |
) |
|
|
|
||
Equity in unrealized (losses)/gains on cash flow hedges for interest |
|
|
( |
) |
|
|
|
|
|
( |
) |
|
|
|
||
Other comprehensive loss |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Comprehensive income |
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Comprehensive income attributable to noncontrolling interests |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Comprehensive income attributable to the Company |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
The accompanying notes are an integral part of these condensed consolidated financial statements.
6
KIMCO REALTY CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY
For the Three Months Ended September 30, 2024 and 2023
(unaudited)
(in thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Retained |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings/ |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(Cumulative |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Distributions |
|
|
Accumulated |
|
|
|
|
|
|
|
|
|
|
||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
in Excess |
|
|
Other |
|
|
Total |
|
|
|
|
|
|
|
||||||||||
|
|
Preferred Stock |
|
|
Common Stock |
|
|
Paid-in |
|
|
of Net |
|
|
Comprehensive |
|
|
Stockholders' |
|
|
Noncontrolling |
|
|
Total |
|
||||||||||||||||
|
|
Issued |
|
|
Amount |
|
|
Issued |
|
|
Amount |
|
|
Capital |
|
|
Income) |
|
|
(Loss)/Income |
|
|
Equity |
|
|
Interests |
|
|
Equity |
|
||||||||||
Balance at July 1, 2023 |
|
|
|
|
$ |
|
|
|
|
|
$ |
|
|
$ |
|
|
$ |
( |
) |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|||||||||
Contributions from noncontrolling interests |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
|
|
|
|
||
Net income |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
|
|
|
- |
|
|
|
|
|
|
|
|
|
|
||||
Other comprehensive income: |
|
|
|
|||||||||||||||||||||||||||||||||||||
Unrealized gains related to defined benefit plan |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
( |
) |
|
|
( |
) |
|
|
- |
|
|
|
( |
) |
Equity in unrealized gains on cash flow hedges for |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
|
|
|
|
|
|
- |
|
|
|
|
|||
Redeemable noncontrolling interests income |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
( |
) |
|
|
( |
) |
Dividends declared to preferred shares |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
( |
) |
|
|
- |
|
|
|
( |
) |
|
|
- |
|
|
|
( |
) |
Dividends declared to common shares |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
( |
) |
|
|
- |
|
|
|
( |
) |
|
|
- |
|
|
|
( |
) |
Distributions to noncontrolling interests |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
( |
) |
|
|
( |
) |
Surrender of restricted common stock |
|
|
- |
|
|
|
- |
|
|
|
( |
) |
|
|
- |
|
|
|
( |
) |
|
|
- |
|
|
|
- |
|
|
|
( |
) |
|
|
- |
|
|
|
( |
) |
Amortization of equity awards |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
|
|
|
- |
|
|
|
- |
|
|
|
|
|
|
- |
|
|
|
|
|||
Redemption/conversion of noncontrolling interests |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
( |
) |
|
|
- |
|
|
|
- |
|
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
Balance at September 30, 2023 |
|
|
|
|
$ |
|
|
|
|
|
$ |
|
|
$ |
|
|
$ |
( |
) |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Balance at July 1, 2024 |
|
|
|
|
$ |
|
|
|
|
|
$ |
|
|
$ |
|
|
$ |
( |
) |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|||||||||
Contributions from noncontrolling interests |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
|
|
|
|
||
Net income |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
|
|
|
- |
|
|
|
|
|
|
|
|
|
|
||||
Other comprehensive income: |
|
|
|
|||||||||||||||||||||||||||||||||||||
Unrealized losses on cash flow hedges for interest |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
( |
) |
|
|
( |
) |
|
|
- |
|
|
|
( |
) |
Equity in unrealized losses on cash flow hedges for interest |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
( |
) |
|
|
( |
) |
|
|
- |
|
|
|
( |
) |
Redeemable noncontrolling interests income |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
( |
) |
|
|
( |
) |
Dividends declared to preferred shares |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
( |
) |
|
|
- |
|
|
|
( |
) |
|
|
- |
|
|
|
( |
) |
Dividends declared to common shares |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
( |
) |
|
|
- |
|
|
|
( |
) |
|
|
- |
|
|
|
( |
) |
Repurchase of preferred stock |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
( |
) |
|
|
- |
|
|
|
- |
|
|
|
( |
) |
|
|
- |
|
|
|
( |
) |
Distributions to noncontrolling interests |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
( |
) |
|
|
( |
) |
Surrender of restricted common stock |
|
|
- |
|
|
|
- |
|
|
|
( |
) |
|
|
- |
|
|
|
( |
) |
|
|
- |
|
|
|
- |
|
|
|
( |
) |
|
|
- |
|
|
|
( |
) |
Amortization of equity awards |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
|
|
|
- |
|
|
|
- |
|
|
|
|
|
|
|
|
|
|
||||
Redemption/conversion of noncontrolling interests |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
( |
) |
|
|
- |
|
|
|
- |
|
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
Adjustment of redeemable noncontrolling interests to |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
( |
) |
|
|
- |
|
|
|
- |
|
|
|
( |
) |
|
|
- |
|
|
|
( |
) |
Balance at September 30, 2024 |
|
|
|
|
$ |
|
|
|
|
|
$ |
|
|
$ |
|
|
$ |
( |
) |
|
$ |
( |
) |
|
$ |
|
|
$ |
|
|
$ |
|
||||||||
The accompanying notes are an integral part of these condensed consolidated financial statements.
7
KIMCO REALTY CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY
For the Nine Months Ended September 30, 2024 and 2023
(unaudited)
(in thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Retained |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings/ |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(Cumulative |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Distributions |
|
|
Accumulated |
|
|
|
|
|
|
|
|
|
|
||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
in Excess |
|
|
Other |
|
|
Total |
|
|
|
|
|
|
|
||||||||||
|
|
Preferred Stock |
|
|
Common Stock |
|
|
Paid-in |
|
|
of Net |
|
|
Comprehensive |
|
|
Stockholders' |
|
|
Noncontrolling |
|
|
Total |
|
||||||||||||||||
|
|
Issued |
|
|
Amount |
|
|
Issued |
|
|
Amount |
|
|
Capital |
|
|
Income) |
|
|
(Loss)/Income |
|
|
Equity |
|
|
Interests |
|
|
Equity |
|
||||||||||
Balance at January 1, 2023 |
|
|
|
|
$ |
|
|
|
|
|
$ |
|
|
$ |
|
|
$ |
( |
) |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|||||||||
Contributions from noncontrolling interests |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
|
|
|
|
||
Net income |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
|
|
|
- |
|
|
|
|
|
|
|
|
|
|
||||
Other comprehensive income: |
|
|
|
|||||||||||||||||||||||||||||||||||||
Unrealized gains related to defined benefit plan |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
( |
) |
|
|
( |
) |
|
|
- |
|
|
|
( |
) |
Equity in unrealized gains on cash flow hedges for |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
|
|
|
|
|
|
- |
|
|
|
|
|||
Redeemable noncontrolling interests income |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
( |
) |
|
|
( |
) |
Dividends declared to preferred shares |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
( |
) |
|
|
- |
|
|
|
( |
) |
|
|
- |
|
|
|
( |
) |
Dividends declared to common shares |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
( |
) |
|
|
- |
|
|
|
( |
) |
|
|
- |
|
|
|
( |
) |
Repurchase of preferred stock |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
( |
) |
|
|
- |
|
|
|
- |
|
|
|
( |
) |
|
|
- |
|
|
|
( |
) |
Distributions to noncontrolling interests |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
( |
) |
|
|
( |
) |
Issuance of common stock |
|
|
- |
|
|
|
- |
|
|
|
|
|
|
|
|
|
( |
) |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
||
Surrender of restricted common stock |
|
|
- |
|
|
|
- |
|
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|
|
- |
|
|
|
- |
|
|
|
( |
) |
|
|
- |
|
|
|
( |
) |
Exercise of common stock options |
|
|
- |
|
|
|
- |
|
|
|
|
|
|
|
|
|
|
|
|
- |
|
|
|
- |
|
|
|
|
|
|
- |
|
|
|
|
|||||
Amortization of equity awards |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
|
|
|
- |
|
|
|
- |
|
|
|
|
|
|
- |
|
|
|
|
|||
Redemption/conversion of noncontrolling interests |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
( |
) |
|
|
- |
|
|
|
- |
|
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
Balance at September 30, 2023 |
|
|
|
|
$ |
|
|
|
|
|
$ |
|
|
$ |
|
|
$ |
( |
) |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Balance at January 1, 2024 |
|
|
|
|
$ |
|
|
|
|
|
$ |
|
|
$ |
|
|
$ |
( |
) |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|||||||||
Contributions from noncontrolling interests |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
|
|
|
|
||
Net income |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
|
|
|
- |
|
|
|
|
|
|
|
|
|
|
||||
Other comprehensive income: |
|
|
|
|||||||||||||||||||||||||||||||||||||
Unrealized losses on cash flow hedges for interest |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
( |
) |
|
|
( |
) |
|
|
- |
|
|
|
( |
) |
Equity in unrealized losses on cash flow hedges for interest |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
( |
) |
|
|
( |
) |
|
|
- |
|
|
|
( |
) |
Redeemable noncontrolling interests income |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
( |
) |
|
|
( |
) |
Dividends declared to preferred shares |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
( |
) |
|
|
- |
|
|
|
( |
) |
|
|
- |
|
|
|
( |
) |
Dividends declared to common shares |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
( |
) |
|
|
- |
|
|
|
( |
) |
|
|
- |
|
|
|
( |
) |
Repurchase of preferred stock |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
( |
) |
|
|
- |
|
|
|
- |
|
|
|
( |
) |
|
|
- |
|
|
|
( |
) |
Distributions to noncontrolling interests |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
( |
) |
|
|
( |
) |
Issuance of preferred stock for merger (1) |
|
|
|
|
|
|
|
|
- |
|
|
|
- |
|
|
|
|
|
|
- |
|
|
|
- |
|
|
|
|
|
|
- |
|
|
|
|
|||||
Issuance of common stock for merger (1) |
|
|
- |
|
|
|
- |
|
|
|
|
|
|
|
|
|
|
|
|
- |
|
|
|
- |
|
|
|
|
|
|
- |
|
|
|
|
|||||
Issuance of common stock |
|
|
- |
|
|
|
- |
|
|
|
|
|
|
|
|
|
( |
) |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
||
Noncontrolling interests assumed from the merger (1) |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
|
|
|
|
||
Surrender of restricted common stock |
|
|
- |
|
|
|
- |
|
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|
|
- |
|
|
|
- |
|
|
|
( |
) |
|
|
- |
|
|
|
( |
) |
Amortization of equity awards |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
|
|
|
- |
|
|
|
- |
|
|
|
|
|
|
|
|
|
|
||||
Redemption/conversion of noncontrolling interests |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
( |
) |
|
|
- |
|
|
|
- |
|
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
Adjustment of redeemable noncontrolling interests to |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
( |
) |
|
|
- |
|
|
|
- |
|
|
|
( |
) |
|
|
- |
|
|
|
( |
) |
Balance at September 30, 2024 |
|
|
|
|
$ |
|
|
|
|
|
$ |
|
|
$ |
|
|
$ |
( |
) |
|
$ |
( |
) |
|
$ |
|
|
$ |
|
|
$ |
|
||||||||
The accompanying notes are an integral part of these condensed consolidated financial statements.
8
KIMCO REALTY CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(unaudited)
(in thousands)
|
|
Nine Months Ended September 30, |
|
|||||
|
|
2024 |
|
|
2023 |
|
||
Cash flow from operating activities: |
|
|
|
|
|
|
||
Net income |
|
$ |
|
|
$ |
|
||
Adjustments to reconcile net income to net cash flow provided by operating activities: |
|
|
|
|
|
|
||
Depreciation and amortization |
|
|
|
|
|
|
||
Impairment charges |
|
|
|
|
|
|
||
Straight-line rental income adjustments, net |
|
|
( |
) |
|
|
( |
) |
Amortization of above-market and below-market leases, net |
|
|
( |
) |
|
|
( |
) |
Amortization of deferred financing costs and fair value debt adjustments, net |
|
|
( |
) |
|
|
( |
) |
Equity award expense |
|
|
|
|
|
|
||
Gain on sale of properties |
|
|
( |
) |
|
|
( |
) |
Loss/(gain) on marketable securities, net |
|
|
|
|
|
( |
) |
|
Change in fair value of embedded derivative liability |
|
|
( |
) |
|
|
|
|
Equity in income of joint ventures, net |
|
|
( |
) |
|
|
( |
) |
Equity in income of other investments, net |
|
|
( |
) |
|
|
( |
) |
Distributions from joint ventures and other investments |
|
|
|
|
|
|
||
Change in accounts and notes receivable, net |
|
|
|
|
|
|
||
Change in accounts payable and accrued expenses |
|
|
|
|
|
|
||
Change in other operating assets and liabilities, net |
|
|
( |
) |
|
|
( |
) |
Net cash flow provided by operating activities |
|
|
|
|
|
|
||
|
|
|
|
|
|
|
||
Cash flow from investing activities: |
|
|
|
|
|
|
||
Acquisition of operating real estate and other related net assets |
|
|
( |
) |
|
|
( |
) |
Improvements to operating real estate |
|
|
( |
) |
|
|
( |
) |
Acquisition of RPT Realty |
|
|
( |
) |
|
|
|
|
Investment in marketable securities |
|
|
( |
) |
|
|
( |
) |
Proceeds from sale of marketable securities |
|
|
|
|
|
|
||
Investment in cost method investment |
|
|
( |
) |
|
|
( |
) |
Investments in and advances to real estate joint ventures |
|
|
( |
) |
|
|
( |
) |
Reimbursements of investments in and advances to real estate joint ventures |
|
|
|
|
|
|
||
Investments in and advances to other investments |
|
|
( |
) |
|
|
( |
) |
Reimbursements of investments in and advances to other investments |
|
|
|
|
|
|
||
Investment in mortgage and other financing receivables |
|
|
( |
) |
|
|
( |
) |
Collection of mortgage and other financing receivables |
|
|
|
|
|
|
||
Proceeds from sale of properties |
|
|
|
|
|
|
||
Net cash flow used for investing activities |
|
|
( |
) |
|
|
( |
) |
|
|
|
|
|
|
|
||
Cash flow from financing activities: |
|
|
|
|
|
|
||
Principal payments on debt, excluding normal amortization of rental property debt |
|
|
( |
) |
|
|
( |
) |
Principal payments on rental property debt |
|
|
( |
) |
|
|
( |
) |
Proceeds from issuance of unsecured term loans |
|
|
|
|
|
|
||
Proceeds from issuance of unsecured notes |
|
|
|
|
|
|
||
Repayments of unsecured term loans |
|
|
( |
) |
|
|
|
|
Repayments of unsecured notes |
|
|
( |
) |
|
|
|
|
Financing origination costs |
|
|
( |
) |
|
|
( |
) |
Contributions from noncontrolling interests |
|
|
|
|
|
|
||
Redemption/distribution of noncontrolling interests |
|
|
( |
) |
|
|
( |
) |
Dividends paid |
|
|
( |
) |
|
|
( |
) |
Proceeds from issuance of stock |
|
|
|
|
|
|
||
Repurchase of preferred stock |
|
|
( |
) |
|
|
( |
) |
Shares repurchased for employee tax withholding on equity awards |
|
|
( |
) |
|
|
( |
) |
Change in tenants' security deposits |
|
|
|
|
|
|
||
Net cash flow used for financing activities |
|
|
( |
) |
|
|
( |
) |
|
|
|
|
|
|
|
||
Net change in cash, cash equivalents and restricted cash |
|
|
|
|
|
|
||
Cash, cash equivalents and restricted cash, beginning of the period |
|
|
|
|
|
|
||
Cash, cash equivalents and restricted cash, end of the period |
|
$ |
|
|
$ |
|
||
|
|
|
|
|
|
|
||
Interest paid (net of capitalized interest of $ |
|
$ |
|
|
$ |
|
||
|
|
|
|
|
|
|
||
Income taxes paid, net of refunds |
|
$ |
|
|
$ |
|
||
The accompanying notes are an integral part of these condensed consolidated financial statements.
9
KIMCO REALTY OP, LLC AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(unaudited)
(in thousands, except unit information)
|
|
September 30, 2024 |
|
|
December 31, 2023 |
|
||
Assets: |
|
|
|
|
|
|
||
Real estate, net of accumulated depreciation and amortization of $ |
|
$ |
|
|
$ |
|
||
Investments in and advances to real estate joint ventures |
|
|
|
|
|
|
||
Other investments |
|
|
|
|
|
|
||
Cash, cash equivalents and restricted cash |
|
|
|
|
|
|
||
Marketable securities |
|
|
|
|
|
|
||
Accounts and notes receivable, net |
|
|
|
|
|
|
||
Operating lease right-of-use assets, net |
|
|
|
|
|
|
||
Other assets |
|
|
|
|
|
|
||
Total assets (1) |
|
$ |
|
|
$ |
|
||
|
|
|
|
|
|
|
||
Liabilities: |
|
|
|
|
|
|
||
Notes payable, net |
|
$ |
|
|
$ |
|
||
Mortgages payable, net |
|
|
|
|
|
|
||
Accounts payable and accrued expenses |
|
|
|
|
|
|
||
Dividends payable |
|
|
|
|
|
|
||
Operating lease liabilities |
|
|
|
|
|
|
||
Other liabilities |
|
|
|
|
|
|
||
Total liabilities (1) |
|
|
|
|
|
|
||
Redeemable noncontrolling interests |
|
|
|
|
|
|
||
|
|
|
|
|
|
|
||
|
|
|
|
|
|
|||
|
|
|
|
|
|
|
||
Members' capital: |
|
|
|
|
|
|
||
Preferred units; |
|
|
|
|
|
|
||
General member; |
|
|
|
|
|
|
||
Limited members; |
|
|
|
|
|
|
||
Accumulated other comprehensive (loss)/income |
|
|
( |
) |
|
|
|
|
Total members' capital |
|
|
|
|
|
|
||
Noncontrolling interests |
|
|
|
|
|
|
||
Total capital |
|
|
|
|
|
|
||
Total liabilities and capital |
|
$ |
|
|
$ |
|
||
The accompanying notes are an integral part of these condensed consolidated financial statements.
10
KIMCO REALTY OP, LLC AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(unaudited)
(in thousands, except per unit data)
|
|
Three Months Ended September 30, |
|
|
Nine Months Ended September 30, |
|
||||||||||
|
|
2024 |
|
|
2023 |
|
|
2024 |
|
|
2023 |
|
||||
Revenues |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Revenues from rental properties, net |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
Management and other fee income |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Total revenues |
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Operating expenses |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Rent |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
Real estate taxes |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
Operating and maintenance |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
General and administrative |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
Impairment charges |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
Merger charges |
|
|
|
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|
Depreciation and amortization |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
Total operating expenses |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Gain on sale of properties |
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Operating income |
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Other income/(expense) |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Special dividend income |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Other income, net |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Gain/(loss) on marketable securities, net |
|
|
|
|
|
|
|
|
( |
) |
|
|
|
|||
Interest expense |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Income before income taxes, net, equity in income of joint ventures, |
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
(Provision)/benefit for income taxes, net |
|
|
( |
) |
|
|
|
|
|
( |
) |
|
|
( |
) |
|
Equity in income of joint ventures, net |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Equity in income of other investments, net |
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Net income |
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Net income attributable to noncontrolling interests |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Net income attributable to Kimco OP |
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Preferred distributions, net |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Net income available to Kimco OP's common unitholders |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Per common unit: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Net income available to Kimco OP's common unitholders: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
-Basic |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
-Diluted |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Weighted average units: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
-Basic |
|
|
|
|
|
|
|
|
|
|
|
|
||||
-Diluted |
|
|
|
|
|
|
|
|
|
|
|
|
||||
The accompanying notes are an integral part of these condensed consolidated financial statements.
11
KIMCO REALTY OP, LLC AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(unaudited)
(in thousands)
|
|
Three Months Ended September 30, |
|
|
Nine Months Ended September 30, |
|
||||||||||
|
|
2024 |
|
|
2023 |
|
|
2024 |
|
|
2023 |
|
||||
Net income |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
Other comprehensive (loss)/income: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Unrealized gains related to defined benefit plan |
|
|
|
|
|
( |
) |
|
|
|
|
|
( |
) |
||
Unrealized losses on cash flow hedges for interest |
|
|
( |
) |
|
|
|
|
|
( |
) |
|
|
|
||
Equity in unrealized (losses)/gains on cash flow hedges for interest |
|
|
( |
) |
|
|
|
|
|
( |
) |
|
|
|
||
Other comprehensive loss |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Comprehensive income |
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Comprehensive income attributable to noncontrolling interests |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Comprehensive income attributable to Kimco OP |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
The accompanying notes are an integral part of these condensed consolidated financial statements.
12
KIMCO REALTY OP, LLC AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN CAPITAL
For the Three Months Ended September 30, 2024 and 2023
(unaudited)
(in thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Accumulated |
|
|
|
|
|
|
|
|
|
|
||||||||||
|
|
General Member |
|
|
Limited Members |
|
|
Other |
|
|
Total |
|
|
|
|
|
|
|
||||||||||||||||||||||
|
|
Preferred Units |
|
|
Common Units |
|
|
Common Units |
|
|
Comprehensive |
|
|
Members' |
|
|
Noncontrolling |
|
|
Total |
|
|||||||||||||||||||
|
|
Issued |
|
|
Amount |
|
|
Issued |
|
|
Amount |
|
|
Issued |
|
|
Amount |
|
|
(Loss)/Income |
|
|
Capital |
|
|
Interests |
|
|
Capital |
|
||||||||||
Balance at July 1, 2023 |
|
|
|
|
$ |
|
|
|
|
|
$ |
|
|
|
- |
|
|
$ |
- |
|
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||||||
Contributions from noncontrolling interests |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
|
|
|
|
||
Net income |
|
|
- |
|
|
|
|
|
|
- |
|
|
|
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
|
|
|
|
|
|
|
|||||
Other comprehensive income: |
|
|
|
|||||||||||||||||||||||||||||||||||||
Unrealized gains related to defined benefit plan |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
( |
) |
|
|
( |
) |
|
|
- |
|
|
|
( |
) |
Equity in unrealized gains on cash flow hedges for |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
|
|
|
|
|
|
- |
|
|
|
|
|||
Redeemable noncontrolling interests income |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
( |
) |
|
|
( |
) |
Distributions declared to preferred unitholders |
|
|
- |
|
|
|
( |
) |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
( |
) |
|
|
- |
|
|
|
( |
) |
Distributions declared to common unitholders |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
( |
) |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
( |
) |
|
|
- |
|
|
|
( |
) |
Distributions to noncontrolling interests |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
( |
) |
|
|
( |
) |
Surrender of restricted common units |
|
|
- |
|
|
|
- |
|
|
|
( |
) |
|
|
( |
) |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
( |
) |
|
|
- |
|
|
|
( |
) |
Amortization of equity awards |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
|
|
|
- |
|
|
|
|
|||
Redemption/conversion of noncontrolling interests |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
( |
) |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
Balance at September 30, 2023 |
|
|
|
|
$ |
|
|
|
|
|
$ |
|
|
|
- |
|
|
$ |
- |
|
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Balance at July 1, 2024 |
|
|
|
|
$ |
|
|
|
|
|
$ |
|
|
|
|
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||||||||
Contributions from noncontrolling interests |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
|
|
|
|
||
Net income |
|
|
- |
|
|
|
|
|
|
- |
|
|
|
|
|
|
- |
|
|
|
|
|
|
- |
|
|
|
|
|
|
|
|
|
|
||||||
Other comprehensive income: |
|
|
|
|||||||||||||||||||||||||||||||||||||
Unrealized losses on cash flow hedges for interest |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
( |
) |
|
|
( |
) |
|
|
- |
|
|
|
( |
) |
Equity in unrealized losses on cash flow hedges for interest |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
( |
) |
|
|
( |
) |
|
|
- |
|
|
|
( |
) |
Redeemable noncontrolling interests income |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
( |
) |
|
|
( |
) |
Distributions declared to preferred unitholders |
|
|
- |
|
|
|
( |
) |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
( |
) |
|
|
- |
|
|
|
( |
) |
Distributions declared to common unitholders |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
( |
) |
|
|
- |
|
|
|
( |
) |
|
|
- |
|
|
|
( |
) |
|
|
- |
|
|
|
( |
) |
Repurchase of preferred units |
|
|
- |
|
|
|
( |
) |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
( |
) |
|
|
- |
|
|
|
( |
) |
Distributions to noncontrolling interests |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
( |
) |
|
|
( |
) |
Surrender of restricted common units |
|
|
- |
|
|
|
- |
|
|
|
( |
) |
|
|
( |
) |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
( |
) |
|
|
- |
|
|
|
( |
) |
Amortization of equity awards |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
|
|
|
- |
|
|
|
|
|
|
- |
|
|
|
|
|
|
- |
|
|
|
|
||||
Redemption/conversion of noncontrolling interests |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
( |
) |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
Adjustment of redeemable noncontrolling interests to estimated fair value |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
( |
) |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
( |
) |
|
|
- |
|
|
|
( |
) |
Balance at September 30, 2024 |
|
|
|
|
$ |
|
|
|
|
|
$ |
|
|
|
|
|
$ |
|
|
$ |
( |
) |
|
$ |
|
|
$ |
|
|
$ |
|
|||||||||
The accompanying notes are an integral part of these condensed consolidated financial statements.
13
KIMCO REALTY OP, LLC AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN CAPITAL
For the Nine Months Ended September 30, 2024 and 2023
(unaudited)
(in thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Accumulated |
|
|
|
|
|
|
|
|
|
|
||||||||||
|
|
General Member |
|
|
Limited Members |
|
|
Other |
|
|
Total |
|
|
|
|
|
|
|
||||||||||||||||||||||
|
|
Preferred Units |
|
|
Common Units |
|
|
Common Units |
|
|
Comprehensive |
|
|
Members' |
|
|
Noncontrolling |
|
|
Total |
|
|||||||||||||||||||
|
|
Issued |
|
|
Amount |
|
|
Issued |
|
|
Amount |
|
|
Issued |
|
|
Amount |
|
|
(Loss)/Income |
|
|
Capital |
|
|
Interests |
|
|
Capital |
|
||||||||||
Balance at January 1, 2023 |
|
|
|
|
$ |
|
|
|
|
|
$ |
|
|
|
- |
|
|
$ |
- |
|
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||||||
Contributions from noncontrolling interests |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
|
|
|
|
||
Net income |
|
|
- |
|
|
|
|
|
|
- |
|
|
|
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
|
|
|
|
|
|
|
|||||
Other comprehensive income: |
|
|
|
|||||||||||||||||||||||||||||||||||||
Unrealized gains related to defined benefit plan |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
( |
) |
|
|
( |
) |
|
|
- |
|
|
|
( |
) |
Equity in unrealized gains on cash flow hedges for |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
|
|
|
|
|
|
- |
|
|
|
|
|||
Redeemable noncontrolling interests income |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
( |
) |
|
|
( |
) |
Distributions declared to preferred unitholders |
|
|
- |
|
|
|
( |
) |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
( |
) |
|
|
- |
|
|
|
( |
) |
Distributions declared to common unitholders |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
( |
) |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
( |
) |
|
|
- |
|
|
|
( |
) |
Repurchase of preferred units |
|
|
- |
|
|
|
( |
) |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
( |
) |
|
|
- |
|
|
|
( |
) |
Distributions to noncontrolling interests |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
( |
) |
|
|
( |
) |
Issuance of common units |
|
|
- |
|
|
|
- |
|
|
|
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
Surrender of restricted common units |
|
|
- |
|
|
|
- |
|
|
|
( |
) |
|
|
( |
) |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
( |
) |
|
|
- |
|
|
|
( |
) |
Exercise of common stock options |
|
|
- |
|
|
|
- |
|
|
|
|
|
|
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
|
|
|
- |
|
|
|
|
||||
Amortization of equity awards |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
|
|
|
- |
|
|
|
|
|||
Redemption/conversion of noncontrolling interests |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
( |
) |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
Balance at September 30, 2023 |
|
|
|
|
$ |
|
|
|
|
|
$ |
|
|
|
- |
|
|
$ |
- |
|
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Balance at January 1, 2024 |
|
|
|
|
$ |
|
|
|
|
|
$ |
|
|
|
- |
|
|
$ |
- |
|
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||||||
Contributions from noncontrolling interests |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
|
|
|
|
||
Net income |
|
|
- |
|
|
|
|
|
|
- |
|
|
|
|
|
|
- |
|
|
|
|
|
|
- |
|
|
|
|
|
|
|
|
|
|
||||||
Other comprehensive income: |
|
|
|
|||||||||||||||||||||||||||||||||||||
Unrealized losses on cash flow hedges for interest |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
( |
) |
|
|
( |
) |
|
|
- |
|
|
|
( |
) |
Equity in unrealized losses on cash flow hedges for interest |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
( |
) |
|
|
( |
) |
|
|
- |
|
|
|
( |
) |
Redeemable noncontrolling interests income |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
( |
) |
|
|
( |
) |
Distributions declared to preferred unitholders |
|
|
- |
|
|
|
( |
) |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
( |
) |
|
|
- |
|
|
|
( |
) |
Distributions declared to common unitholders |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
( |
) |
|
|
- |
|
|
|
( |
) |
|
|
- |
|
|
|
( |
) |
|
|
- |
|
|
|
( |
) |
Repurchase of preferred units |
|
|
- |
|
|
|
( |
) |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
( |
) |
|
|
- |
|
|
|
( |
) |
Distributions to noncontrolling interests |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
( |
) |
|
|
( |
) |
Issuance of preferred units for merger (1) |
|
|
|
|
|
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
|
|
|
- |
|
|
|
|
||||
Issuance of common units for merger (1) |
|
|
- |
|
|
|
- |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
- |
|
|
|
|
|
|
- |
|
|
|
|
||||||
Issuance of common units |
|
|
- |
|
|
|
- |
|
|
|
|
|
|
- |
|
|
|
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
||
Redemption of common units |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
( |
) |
|
|
- |
|
|
|
( |
) |
|
|
- |
|
|
|
( |
) |
Surrender of restricted common units |
|
|
- |
|
|
|
- |
|
|
|
( |
) |
|
|
( |
) |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
( |
) |
|
|
- |
|
|
|
( |
) |
Amortization of equity awards |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
|
|
|
- |
|
|
|
|
|
|
- |
|
|
|
|
|
|
- |
|
|
|
|
||||
Redemption/conversion of noncontrolling interests |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
( |
) |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
Adjustment of redeemable noncontrolling interests to estimated fair |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
( |
) |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
( |
) |
|
|
- |
|
|
|
( |
) |
Balance at September 30, 2024 |
|
|
|
|
$ |
|
|
|
|
|
$ |
|
|
|
|
|
$ |
|
|
$ |
( |
) |
|
$ |
|
|
$ |
|
|
$ |
|
|||||||||
The accompanying notes are an integral part of these condensed consolidated financial statements.
14
KIMCO REALTY OP, LLC AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(unaudited)
(in thousands)
|
|
Nine Months Ended September 30, |
|
|||||
|
|
2024 |
|
|
2023 |
|
||
Cash flow from operating activities: |
|
|
|
|
|
|
||
Net income |
|
$ |
|
|
$ |
|
||
Adjustments to reconcile net income to net cash flow provided |
|
|
|
|
|
|
||
Depreciation and amortization |
|
|
|
|
|
|
||
Impairment charges |
|
|
|
|
|
|
||
Straight-line rental income adjustments, net |
|
|
( |
) |
|
|
( |
) |
Amortization of above-market and below-market leases, net |
|
|
( |
) |
|
|
( |
) |
Amortization of deferred financing costs and fair value debt adjustments, net |
|
|
( |
) |
|
|
( |
) |
Equity award expense |
|
|
|
|
|
|
||
Gain on sale of properties |
|
|
( |
) |
|
|
( |
) |
Loss/(gain) on marketable securities, net |
|
|
|
|
|
( |
) |
|
Change in fair value of embedded derivative liability |
|
|
( |
) |
|
|
|
|
Equity in income of joint ventures, net |
|
|
( |
) |
|
|
( |
) |
Equity in income of other investments, net |
|
|
( |
) |
|
|
( |
) |
Distributions from joint ventures and other investments |
|
|
|
|
|
|
||
Change in accounts and notes receivable, net |
|
|
|
|
|
|
||
Change in accounts payable and accrued expenses |
|
|
|
|
|
|
||
Change in other operating assets and liabilities, net |
|
|
( |
) |
|
|
( |
) |
Net cash flow provided by operating activities |
|
|
|
|
|
|
||
|
|
|
|
|
|
|
||
Cash flow from investing activities: |
|
|
|
|
|
|
||
Acquisition of operating real estate and other related net assets |
|
|
( |
) |
|
|
( |
) |
Improvements to operating real estate |
|
|
( |
) |
|
|
( |
) |
Acquisition of RPT Realty |
|
|
( |
) |
|
|
|
|
Investment in marketable securities |
|
|
( |
) |
|
|
( |
) |
Proceeds from sale of marketable securities |
|
|
|
|
|
|
||
Investment in cost method investments |
|
|
( |
) |
|
|
( |
) |
Investments in and advances to real estate joint ventures |
|
|
( |
) |
|
|
( |
) |
Reimbursements of investments in and advances to real estate joint ventures |
|
|
|
|
|
|
||
Investments in and advances to other investments |
|
|
( |
) |
|
|
( |
) |
Reimbursements of investments in and advances to other investments |
|
|
|
|
|
|
||
Investment in mortgage and other financing receivables |
|
|
( |
) |
|
|
( |
) |
Collection of mortgage and other financing receivables |
|
|
|
|
|
|
||
Proceeds from sale of properties |
|
|
|
|
|
|
||
Net cash flow used for investing activities |
|
|
( |
) |
|
|
( |
) |
|
|
|
|
|
|
|
||
Cash flow from financing activities: |
|
|
|
|
|
|
||
Principal payments on debt, excluding normal amortization of rental property debt |
|
|
( |
) |
|
|
( |
) |
Principal payments on rental property debt |
|
|
( |
) |
|
|
( |
) |
Proceeds from issuance of unsecured term loans |
|
|
|
|
|
|
||
Proceeds from issuance of unsecured notes |
|
|
|
|
|
|
||
Repayments of unsecured term loans |
|
|
( |
) |
|
|
|
|
Repayments of unsecured notes |
|
|
( |
) |
|
|
|
|
Financing origination costs |
|
|
( |
) |
|
|
( |
) |
Contributions from noncontrolling interests |
|
|
|
|
|
|
||
Redemption/distribution of noncontrolling interests |
|
|
( |
) |
|
|
( |
) |
Distributions paid to common and preferred unitholders |
|
|
( |
) |
|
|
( |
) |
Proceeds from issuance of units |
|
|
|
|
|
|
||
Repurchase of preferred units |
|
|
( |
) |
|
|
( |
) |
Units repurchased for employee tax withholding on equity awards |
|
|
( |
) |
|
|
( |
) |
Change in tenants' security deposits |
|
|
|
|
|
|
||
Net cash flow used for financing activities |
|
|
( |
) |
|
|
( |
) |
|
|
|
|
|
|
|
||
Net change in cash, cash equivalents and restricted cash |
|
|
|
|
|
|
||
Cash, cash equivalents and restricted cash, beginning of the period |
|
|
|
|
|
|
||
Cash, cash equivalents and restricted cash, end of the period |
|
$ |
|
|
$ |
|
||
|
|
|
|
|
|
|
||
Interest paid (net of capitalized interest of $ |
|
$ |
|
|
$ |
|
||
|
|
|
|
|
|
|
||
Income taxes paid, net of refunds |
|
$ |
|
|
$ |
|
||
The accompanying notes are an integral part of these condensed consolidated financial statements.
15
KIMCO REALTY CORPORATION AND SUBSIDIARIES AND KIMCO REALTY OP, LLC AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
1. Business and Organization
Kimco Realty Corporation and its subsidiaries (the “Parent Company”) operates as a Real Estate Investment Trust ("REIT"), of which substantially all of the Parent Company’s assets are held by, and substantially all of the Parent Company’s operations are conducted through, Kimco Realty OP, LLC (“Kimco OP”), either directly or through its subsidiaries, as the Parent Company’s operating company. The Parent Company is the managing member and exercises exclusive control over Kimco OP. As of September 30, 2024, the Parent Company owned
The Company is North America’s largest publicly traded owner and operator of open-air, grocery-anchored shopping centers and a growing portfolio of mixed-use assets. The Company’s portfolio is primarily concentrated in the first-ring suburbs of the top major metropolitan markets, including those in high-barrier-to-entry coastal markets and rapidly expanding Sun Belt cities, with a tenant mix focused on essential, necessity-based goods and services that drive multiple shopping trips per week. The Company, its affiliates and related real estate joint ventures are engaged principally in the ownership, management, development and operation of open-air shopping centers, including mixed-use assets, which are anchored primarily by grocery stores, off-price retailers, discounters or service-oriented tenants. Additionally, the Company provides complementary services that capitalize on the Company’s established retail real estate expertise. The Company’s mission is to create destinations for everyday living that inspire a sense of community and deliver value to our many stakeholders. The Company evaluates performance on a property specific or transactional basis and does not distinguish its principal business or group its operations on a geographical basis for purposes of measuring performance. Accordingly, the Company believes it has a single reportable segment for disclosure purposes in accordance with accounting principles generally accepted in the United States of America (“GAAP”).
The Company elected status as a REIT for federal income tax purposes commencing with its taxable year which began January 1, 1992 and operates in a manner that enables the Company to maintain its status as a REIT. To qualify as a REIT, the Company must meet several organizational and operational requirements, and is required to annually distribute at least 90% of its net taxable income, determined without regard to the dividends paid deduction and excluding any net capital gain. In addition, the Company will be subject to federal income tax at regular corporate rates to the extent that it distributes less than 100% of its net taxable income, including any net capital gains. In January 2023, the Company consummated the Reorganization into an UPREIT structure as described in the Explanatory Note at the beginning of this Quarterly Report on Form 10-Q. If, as the Company believes, it is organized and operates in such a manner so as to qualify and remain qualified as a REIT under the Code, the Company, generally, will not be subject to U.S. federal income tax, provided that distributions to its stockholders equal at least the amount of its REIT taxable income, as defined in the Code. The Company maintains certain subsidiaries that have made joint elections with the Company to be treated as taxable REIT subsidiaries (“TRSs”), that permit the Company to engage through such TRSs in certain business activities that the REIT may not conduct directly. A TRS is subject to federal and state income taxes on its income, and the Company includes, when applicable, a provision for taxes in its condensed consolidated financial statements.
RPT Merger
On August 28, 2023, the Company and RPT Realty (“RPT”) announced that they had entered into a definitive merger agreement (the “Merger Agreement”) pursuant to which the Company would acquire RPT through a series of mergers (collectively, the “RPT Merger”). On January 2, 2024, RPT merged with and into the Company, with the Company continuing as the surviving public company. The RPT Merger added
Under the terms of the Merger Agreement, each RPT common share was converted into
During the nine months ended September 30, 2024, the Company incurred expenses of $
16
KIMCO REALTY CORPORATION AND SUBSIDIARIES AND KIMCO REALTY OP, LLC AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)
2. Summary of Significant Accounting Policies
Basis of Presentation
This report combines the quarterly reports on Form 10-Q for the quarterly period ended September 30, 2024, of the Parent Company and Kimco OP into this single report. The accompanying Condensed Consolidated Financial Statements include the accounts of the Parent Company and Kimco OP and their consolidated subsidiaries. The Reorganization resulted in a merger of entities under common control in accordance with GAAP. The Company’s subsidiaries include subsidiaries which are wholly owned or which the Company has a controlling interest, including where the Company has been determined to be a primary beneficiary of a variable interest entity (“VIE”) in accordance with the consolidation guidance of the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”). The Parent Company serves as the general member of Kimco OP. The limited members of Kimco OP have limited rights over Kimco OP and do not have the power to direct the activities that most significantly impact Kimco OP’s economic performance. As such, Kimco OP is considered a VIE, and the Parent Company, which consolidates it, is the primary beneficiary. All inter-company balances and transactions have been eliminated in consolidation. The information presented in the accompanying Condensed Consolidated Financial Statements is unaudited and reflects all adjustments which are, in the opinion of management, necessary to reflect a fair statement of the results for the interim periods presented, and all such adjustments are of a normal recurring nature. Amounts as of December 31, 2023 included in the Condensed Consolidated Financial Statements have been derived from the audited Consolidated Financial Statements as of that date, but does not include all annual disclosures required by GAAP. These Condensed Consolidated Financial Statements should be read in conjunction with the Company’s Annual Report on Form 10-K for the year ended December 31, 2023, as certain disclosures in this Quarterly Report that would duplicate those included in such Annual Report on Form 10-K are not included in these Condensed Consolidated Financial Statements.
On January 2, 2024, the Parent Company, as managing member of Kimco OP, entered into an amended and restated limited liability company agreement of Kimco OP (the “Amended and Restated Limited Liability Company Agreement”), providing for, among other things, the creation of Class N Preferred Units of Kimco OP, having the preferences, rights and limitations set forth therein, and certain modifications to the provisions regarding LTIP Units (as defined in the Amended and Restated Limited Liability Company Agreement), including provisions governing distribution and tax allocation requirements and the procedures for converting LTIP Units.
Subsequent Events
The Company has evaluated subsequent events and transactions for potential recognition or disclosure in its Condensed Consolidated Financial Statements (See Footnote 4 of the Notes to Condensed Consolidated Financial Statements).
17
KIMCO REALTY CORPORATION AND SUBSIDIARIES AND KIMCO REALTY OP, LLC AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)
New Accounting Pronouncements
The following table represents Accounting Standards Updates (“ASUs”) to the FASB’s ASC that, as of September 30, 2024, are not yet effective for the Company and for which the Company has not elected early adoption, where permitted:
ASU |
Description |
Effective Date |
Effect on the financial statements or other significant matters |
ASU 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures |
The amendments in this ASU improve reportable segment disclosure requirements, primarily through enhanced disclosures about significant segment expenses. In addition, the amendments enhance interim disclosure requirements, clarify circumstances in which an entity can disclose multiple segment measures of profit or loss, provide new segment disclosure requirements for entities with a single reportable segment, and contain other disclosure requirements. |
Annual fiscal years beginning January 1, 2024, and interim periods for fiscal years beginning January 1, 2025; Early adoption permitted |
There are aspects of this ASU that apply to entities with one reportable segment. The Company will review the extent of new disclosures necessary prior to implementation. Other than additional disclosure, the adoption of this ASU is not expected to have a material impact on the Company’s financial position and/or results of operations.
|
ASU 2023-05, Business Combinations – Joint Venture Formations (Subtopic 805-60): Recognition and Initial Measurement |
The amendments in this ASU address the accounting for contributions made to a joint venture, upon formation, in a joint venture’s separate financial statements. To reduce diversity in practice and provide decision-useful information to a joint venture’s investors, these amendments require that a joint venture apply a new basis of accounting upon formation. By applying a new basis of accounting, a joint venture, upon formation, will recognize and initially measure its assets and liabilities at fair value (with exceptions to fair value measurement that are consistent with the business combinations guidance). Additionally, existing joint ventures have the option to apply the guidance retrospectively.
|
January 1, 2025; Early adoption permitted |
This ASU does not impact accounting for joint ventures by the venturers. As such, the Company does not expect the adoption of this ASU will have a material impact on the Company’s financial position and/or results of operations. |
ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures |
This ASU requires entities to provide additional information in the rate reconciliation and additional disclosures about income taxes paid. The guidance requires public business entities to disclose in their rate reconciliation table additional categories of information about federal, state and foreign income taxes and to provide more details about the reconciling items in some categories if the items meet a quantitative threshold. The guidance requires all entities annually to disclose income taxes paid (net of refunds received) disaggregated by federal (national), state and foreign taxes and to disaggregate the information by jurisdiction based on a quantitative threshold.
|
Annual fiscal years beginning January 1, 2025, and interim periods for fiscal years beginning January 1, 2026; Early adoption permitted |
The Company will review the extent of new disclosures necessary prior to implementation. Other than additional disclosure, the adoption of this ASU is not expected to have a material impact on the Company’s financial position and/or results of operations. |
18
KIMCO REALTY CORPORATION AND SUBSIDIARIES AND KIMCO REALTY OP, LLC AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)
ASU 2024-01, Compensation - Stock Compensation (Topic 718) |
The amendments in this ASU clarify how to determine whether profits interest and similar awards should be accounted for as a share-based payment arrangement (ASC 718) or as a cash bonus or profit-sharing arrangement (ASC 710, Compensation - General, or other guidance) and applies to all reporting entities that account for profits interest awards as compensation to employees or non-employees. In addition to the illustrative guidance, this ASU modifies the language in paragraph 718-10-15-3 to improve its clarity and operability without changing the guidance. The amendments should be applied either retrospectively to all prior periods presented in the financial statements, or prospectively to profits interests and similar awards granted or modified on or after the adoption date. |
January 1, 2025; Early adoption permitted |
The Company does not expect the adoption of this ASU to have a material impact on the Company’s financial position and/or results of operations. |
The following ASU to the FASB’s ASC has been adopted by the Company as of the date listed:
ASU |
Description |
Adoption Date |
Effect on the financial statements or other significant matters |
ASU 2022-03, Fair Value Measurement (Topic 820): Fair Value Measurement of Equity Securities Subject to Contractual Sale Restrictions |
This ASU clarifies the guidance in Topic 820, Fair Value Measurement, when measuring the fair value of an equity security subject to contractual restrictions that prohibit the sale of an equity security and provides new disclosure requirements for equity securities subject to contractual sale restrictions that are measured at fair value in accordance with Topic 820.
|
|
The
|
Regulatory Update
On March 6, 2024, the Securities and Exchange Commission (“SEC”) adopted final rules that will require registrants to disclose climate-related information in registration statements and annual reports, including material climate-related risks and impacts, descriptions of board oversight and risk management activities, and any material climate-related targets or goals. The landmark rules also will require accelerated and large accelerated filers to disclose material Scope 1 and Scope 2 greenhouse gas emissions. These disclosures will be subject to independent third-party assurance. Registrants will also have to disclose, among other things, certain effects of severe weather events and other natural conditions and amounts related to carbon offsets and renewable energy credits or certificates in their audited financial statements. On March 15, 2024, a federal appellate court imposed a temporary stay pending judicial review of these new rules. The SEC voluntarily stayed its recently adopted climate disclosure rules pending the completion of judicial review. The Company plans to comply with the disclosure requirements of the final rules when they become effective, and are currently evaluating the impact these final rules will have on the Company’s SEC filings and related disclosures.
3. RPT Merger
Overview
On January 2, 2024, the Company completed the Merger with RPT, under which RPT merged with and into the Company, with the Company continuing as the surviving public company. The RPT Merger added
19
KIMCO REALTY CORPORATION AND SUBSIDIARIES AND KIMCO REALTY OP, LLC AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)
Under the terms of the Merger Agreement, each RPT common share was converted into
The number of RPT shares/units outstanding as of January 2, 2024, converted to shares of the Company’s shares/units were determined as follows (amounts presented in thousands, except per share data):
|
|
Common Shares (1) |
|
|
OP Units |
|
|
Cumulative |
|
|||
RPT shares/units outstanding as of January 2, 2024 |
|
|
|
|
|
|
|
|
|
|||
Exchange ratio |
|
|
|
|
|
|
|
|
|
|||
Kimco shares/units issued |
|
|
|
|
|
|
|
|
|
|||
|
|
|
|
|
|
|
|
|
|
|||
Value of Kimco stock per share/unit |
|
$ |
|
|
$ |
|
|
$ |
|
|||
Equity consideration given from Kimco shares/units issued |
|
$ |
|
|
$ |
|
|
$ |
|
|||
The following table presents the total value of consideration paid by Kimco at the close of the RPT Merger (in thousands):
|
|
Calculated Value of |
|
|
Cash Consideration* |
|
|
Total Value of Consideration |
|
|||
As of January 2, 2024 |
|
$ |
|
|
$ |
|
|
$ |
|
|||
*
20
KIMCO REALTY CORPORATION AND SUBSIDIARIES AND KIMCO REALTY OP, LLC AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)
Provisional Purchase Price Allocation
In accordance with ASC 805-10, Business Combinations, the Company accounted for the RPT Merger as a business combination using the acquisition method of accounting. Based on the total value of the consideration, the total fair value of the assets acquired and liabilities assumed in the RPT Merger was $
|
|
Provisional Allocation as of |
|
|
Adjustments |
|
|
Provisional Allocation as of |
|
|||
Land |
|
$ |
|
|
$ |
( |
) |
|
$ |
|
||
Building and improvements |
|
|
|
|
|
|
|
|
|
|||
In-place leases |
|
|
|
|
|
( |
) |
|
|
|
||
Above-market leases |
|
|
|
|
|
( |
) |
|
|
|
||
Real estate assets |
|
|
|
|
|
|
|
|
|
|||
Investments in and advances to real estate joint ventures |
|
|
|
|
|
- |
|
|
|
|
||
Investments in and advances to other investments |
|
|
|
|
|
- |
|
|
|
|
||
Operating lease right-of-use assets, net |
|
|
|
|
|
- |
|
|
|
|
||
Accounts receivable and other assets |
|
|
|
|
|
- |
|
|
|
|
||
Total assets acquired |
|
|
|
|
|
|
|
|
|
|||
|
|
|
|
|
|
|
|
|
|
|||
Notes payable |
|
|
( |
) |
|
|
- |
|
|
|
( |
) |
Accounts payable and other liabilities |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
Operating lease liabilities |
|
|
( |
) |
|
|
- |
|
|
|
( |
) |
Below-market leases |
|
|
( |
) |
|
|
|
|
|
( |
) |
|
Total liabilities assumed |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|
|
|
|
|
|
|
|
|
|
|||
Total purchase price |
|
$ |
|
|
$ |
- |
|
|
$ |
|
||
The provisional fair market value of the acquired properties is based upon a valuation prepared by the Company with assistance of a third-party valuation specialist. The Company is in the process of reviewing the assumptions and inputs used by the third-party valuation specialist to ensure reasonableness and that the procedures are performed in accordance with management’s policy. Therefore, the final acquisition accounting adjustments, including the purchase price and its allocation, are not yet complete as of this filing. Once the purchase price and allocation are complete, an adjustment to the provisional purchase price or allocation may occur. Additionally, any excess purchase price, which could differ materially, may result in the recognition of goodwill, the amount of which may be significant.
The following table details the provisional weighted average useful lives, in years, of the purchase price provisionally allocated to real estate and related intangible assets and liabilities acquired arising from the RPT Merger:
|
|
Weighted Average |
|
|
Land |
|
n/a |
|
|
Building |
|
|
|
|
Building improvements |
|
|
|
|
Tenant improvements |
|
|
|
|
In-place leases |
|
|
|
|
Above-market leases |
|
|
|
|
Below-market leases |
|
|
|
|
Operating right-of-use assets |
|
|
|
|
Since the date of the Merger through September 30, 2024, the revenue and earnings from RPT included in the Company’s Condensed Consolidated Statements of Income are $
21
KIMCO REALTY CORPORATION AND SUBSIDIARIES AND KIMCO REALTY OP, LLC AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)
Pro forma Information
The pro forma financial information set forth below is based upon the Company’s historical Condensed Consolidated Statements of Income for the three and nine months ended September 30, 2024 and 2023, adjusted to give effect to these properties acquired as of January 1, 2023. The pro forma financial information is presented for informational purposes only and may not be indicative of what actual results of income would have been, nor does it purport to represent the results of income for future periods. Amounts are presented in millions, except per share figures.
|
|
Three Months Ended September 30, |
|
|
Nine Months Ended September 30, |
|
||||||||||
|
|
2024 |
|
|
2023 |
|
|
2024 |
|
|
2023 |
|
||||
Revenues from rental properties, net |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
Net income (1) |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
Net income available to the Company’s common shareholders (1) |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
4. Real Estate
Acquisitions
During the nine months ended September 30, 2024, there were no operating property acquisitions other than those acquired in connection with the RPT Merger.
|
|
|
|
|
|
|
|
|
Purchase Price |
|
|
|
|
|||||||||||
Property Name |
|
Location |
|
Month Acquired |
|
Cash |
|
|
Debt |
|
|
Other |
|
|
Total |
|
|
GLA |
|
|||||
Portfolio (2 properties) (1) |
|
Various |
|
Jan-23 |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|
|
|
|||||
Crossroads Plaza Parcel |
|
Cary, NC |
|
Jan-23 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Northridge Shopping Center Parcel |
|
Arvada, CO |
|
Jan-23 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Stafford Marketplace Parcel (2) |
|
Stafford, VA |
|
Feb-23 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Tustin Heights (1) |
|
Tustin, CA |
|
Mar-23 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Marlton Plaza Parcel |
|
Cherry Hill, NJ |
|
Jul-23 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Stonebridge at Potomac Town Center |
|
Woodbridge, VA |
|
Aug-23 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
|
|
|
|
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|
|
|
|||||
22
KIMCO REALTY CORPORATION AND SUBSIDIARIES AND KIMCO REALTY OP, LLC AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)
The purchase price for these acquisitions was allocated to real estate and related intangible assets and liabilities acquired, as applicable, in accordance with our accounting policies for asset acquisitions.
|
|
Allocation as of |
|
|
Weighted Average Useful Life (in Years) |
|
||
Land |
|
$ |
|
|
n/a |
|
||
Building |
|
|
|
|
|
|
||
Building improvements |
|
|
|
|
|
|
||
Tenant improvements |
|
|
|
|
|
|
||
In-place leases |
|
|
|
|
|
|
||
Above-market leases |
|
|
|
|
|
|
||
Below-market leases |
|
|
( |
) |
|
|
|
|
Other assets |
|
|
|
|
n/a |
|
||
Other liabilities |
|
|
( |
) |
|
n/a |
|
|
Net assets acquired |
|
$ |
|
|
|
|
||
In October 2024, the Company acquired Waterford Lakes Town Center, which was comprised of
Dispositions
The table below summarizes the Company’s disposition activity relating to consolidated operating properties and parcels for the nine months ended September 30, 2024 and 2023 (dollars in millions):
|
|
Nine Months Ended September 30, |
|
|||||
|
|
2024 |
|
|
2023 |
|
||
Aggregate sales price/gross fair value (1) (2) (3) |
|
$ |
|
|
$ |
|
||
Gain on sale of properties (4) |
|
$ |
|
|
$ |
|
||
Number of properties sold |
|
|
|
|
|
|
||
Number of parcels sold/deconsolidated (2) |
|
|
|
|
|
|
||
Impairments
During the nine months ended September 30, 2024, the Company recognized aggregate impairment charges related to adjustments to property carrying values of $
23
KIMCO REALTY CORPORATION AND SUBSIDIARIES AND KIMCO REALTY OP, LLC AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)
5. Investments in and Advances to Real Estate Joint Ventures
The Company has investments in and advances to various real estate joint ventures. These joint ventures are engaged primarily in the operation of shopping centers which are either owned or held under long-term operating leases. The Company and the joint venture partners have joint approval rights for major decisions, including those regarding property operations. As such, the Company holds noncontrolling interests in these joint ventures and accounts for them under the equity method of accounting. The Company manages certain of these joint venture investments and, where applicable, earns acquisition fees, leasing commissions, property management fees, asset management fees and construction management fees.
|
|
Noncontrolling |
|
The Company’s Investment |
|
|||||
Joint Venture |
|
As of September 30, 2024 |
|
September 30, 2024 |
|
|
December 31, 2023 |
|
||
Prudential Investment Program |
|
|
$ |
|
|
$ |
|
|||
Kimco Income Opportunity Portfolio (“KIR”) |
|
|
|
|
|
|
|
|||
R2G Venture LLC (“R2G”) (1) |
|
|
|
|
|
|
|
|||
Canada Pension Plan Investment Board (“CPP”) |
|
|
|
|
|
|
|
|||
Other Institutional Joint Ventures |
|
Various |
|
|
|
|
|
|
||
Other Joint Venture Programs (2) |
|
Various |
|
|
|
|
|
|
||
Total* |
|
|
|
$ |
|
|
$ |
|
||
*
The table below presents the Company’s share of net income for the above investments, which is included in Equity in income of joint ventures, net on the Company’s Condensed Consolidated Statements of Income for the three and nine months ended September 30, 2024 and 2023 (in millions):
|
|
Three Months Ended September 30, |
|
|
Nine Months Ended September 30, |
|
||||||||||
Joint Venture |
|
2024 |
|
|
2023 |
|
|
2024 |
|
|
2023 |
|
||||
Prudential Investment Program |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
KIR |
|
|
|
|
|
|
|
|
|
|
|
|
||||
R2G |
|
|
|
|
|
|
|
|
|
|
||||||
CPP |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Other Institutional Joint Ventures |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Other Joint Venture Programs |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Total |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
During the nine months ended September 30, 2024, certain of the Company’s real estate joint ventures disposed of an operating property and other property interest, in separate transactions, for an aggregate sales price of $
During the nine months ended September 30, 2023, the Company acquired the remaining
24
KIMCO REALTY CORPORATION AND SUBSIDIARIES AND KIMCO REALTY OP, LLC AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)
The table below presents debt balances within the Company’s unconsolidated joint venture investments for which the Company held noncontrolling ownership interests at September 30, 2024 and December 31, 2023 (dollars in millions):
|
|
As of September 30, 2024 |
|
|
As of December 31, 2023 |
|
||||||||||||||||||
Joint Venture |
|
Mortgages and |
|
|
Weighted Average |
|
|
Weighted Average |
|
|
Mortgages and |
|
|
Weighted Average |
|
|
Weighted Average |
|
||||||
Prudential Investment Program |
|
$ |
|
|
|
% |
|
|
|
|
$ |
|
|
|
% |
|
|
|
||||||
KIR |
|
|
|
|
|
% |
|
|
|
|
|
|
|
|
% |
|
|
|
||||||
R2G (1) |
|
|
|
|
|
% |
|
|
|
|
|
|
|
|
|
|
|
- |
|
|||||
CPP |
|
|
|
|
|
% |
|
|
|
|
|
|
|
|
% |
|
|
|
||||||
Other Institutional Joint Ventures |
|
|
|
|
|
% |
|
|
|
|
|
|
|
|
% |
|
|
|
||||||
Other Joint Venture Programs (2) |
|
|
|
|
|
% |
|
|
|
|
|
|
|
|
% |
|
|
|
||||||
Total |
|
$ |
|
|
|
|
|
|
|
|
$ |
|
|
|
|
|
|
|
||||||
*
6. Other Investments
The Company has provided capital to owners and developers of real estate properties through its Preferred Equity program, which is included in Other investments on the Company’s Condensed Consolidated Balance Sheets. In connection with the RPT Merger, the Company acquired a preferred equity investment of $
During the nine months ended September 30, 2024, the Company converted its $
During the nine months ended September 30, 2023, the Company contributed a land parcel and related entitlements, located in Ardmore, PA, into a preferred equity investment with a gross value of $
7. Marketable Securities
The amortized cost and unrealized gains, net of marketable securities as of September 30, 2024 and December 31, 2023, were as follows (in thousands):
|
|
As of September 30, 2024 |
|
|
As of December 31, 2023 |
|
||
Marketable securities: |
|
|
|
|
|
|
||
Amortized cost |
|
$ |
|
|
$ |
|
||
Unrealized gain |
|
|
|
|
|
|
||
Total fair value |
|
$ |
|
|
$ |
|
||
25
KIMCO REALTY CORPORATION AND SUBSIDIARIES AND KIMCO REALTY OP, LLC AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)
The Company’s net gains/(losses) on marketable securities and dividend income for the three and nine months ended September 30, 2024 and 2023, were as follows (in thousands):
|
|
Three Months Ended September 30, |
|
|
Nine Months Ended September 30, |
|
||||||||||
|
|
2024 |
|
|
2023 |
|
|
2024 |
|
|
2023 |
|
||||
Gain/(loss) on marketable securities, net |
|
$ |
|
|
$ |
|
|
$ |
( |
) |
|
$ |
|
|||
Dividend income (included in Other income, net |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
The portion of unrealized gains/(losses) on marketable securities for the period that relates to marketable securities still held at the reporting date (in thousands):
|
|
Three Months Ended September 30, |
|
|
Nine Months Ended September 30, |
|
||||||||||
|
|
2024 |
|
|
2023 |
|
|
2024 |
|
|
2023 |
|
||||
Gain/(loss) on marketable securities, net |
|
$ |
|
|
$ |
|
|
$ |
( |
) |
|
$ |
|
|||
Less: Net (gain)/loss recognized related to marketable |
|
|
( |
) |
|
|
( |
) |
|
|
|
|
|
|
||
Unrealized gain related to marketable |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
During the nine months ended September 30, 2024, the Company sold its remaining
During the nine months ended September 30, 2023, the Company received a $
Also, during the nine months ended September 30, 2023, the Company sold
8. Accounts and Notes Receivable
The components of accounts and notes receivable, net of potentially uncollectible amounts as of September 30, 2024 and December 31, 2023, were as follows (in thousands):
|
|
As of September 30, 2024 |
|
|
As of December 31, 2023 |
|
||
Billed tenant receivables |
|
$ |
|
|
$ |
|
||
Unbilled common area maintenance, insurance and tax reimbursements |
|
|
|
|
|
|
||
Other receivables |
|
|
|
|
|
|
||
Straight-line rent receivables |
|
|
|
|
|
|
||
Total accounts and notes receivable, net |
|
$ |
|
|
$ |
|
||
9. Leases
Lessor Leases
The Company’s primary source of revenues is derived from lease agreements, which includes rental income and expense reimbursement. The Company’s lease income is comprised of minimum base rent, expense reimbursements, percentage rent, lease termination fee income, ancillary income, amortization of above-market and below-market rent adjustments and straight-line rent adjustments.
26
KIMCO REALTY CORPORATION AND SUBSIDIARIES AND KIMCO REALTY OP, LLC AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)
The disaggregation of the Company’s lease income, which is included in Revenues from rental properties, net on the Company’s Condensed Consolidated Statements of Income, as either fixed or variable lease income based on the criteria specified in ASC 842, for the three and nine months ended September 30, 2024 and 2023, was as follows (in thousands):
|
|
Three Months Ended September 30, |
|
|
Nine Months Ended September 30, |
|
||||||||||
|
|
2024 |
|
|
2023 |
|
|
2024 |
|
|
2023 |
|
||||
Lease income: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Fixed lease income (1) |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
Variable lease income (2) |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Above-market and below-market leases amortization, net |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Adjustments for potentially uncollectible lease income or |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
Total lease income |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
Lessee Leases
The Company currently leases real estate space under non-cancelable operating lease agreements for ground leases and administrative office leases. The Company’s operating leases have remaining lease terms ranging from less than
In connection with the RPT Merger, the Company obtained a $
The Company has three properties under finance leasing arrangements that consist of variable lease payments with a bargain purchase option. As of September 30, 2024, the finance right-of-use assets of $
The weighted-average remaining non-cancelable lease term and weighted-average discount rates for the Company’s operating and finance leases as of September 30, 2024 were as follows:
|
|
Operating Leases |
|
|
Finance Leases |
|
||
Weighted-average remaining lease term (in years) |
|
|
|
|
|
|
||
Weighted-average discount rate |
|
|
% |
|
|
% |
||
The components of the Company’s lease expense, which are included in interest expense, rent expense and general and administrative expense on the Company’s Condensed Consolidated Statements of Income for the three and nine months ended September 30, 2024 and 2023, were as follows (in thousands):
|
|
Three Months Ended September 30, |
|
|
Nine Months Ended September 30, |
|
||||||||||
|
|
2024 |
|
|
2023 |
|
|
2024 |
|
|
2023 |
|
||||
Lease cost: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Finance lease cost |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
Operating lease cost |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Variable lease cost |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Total lease cost |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
27
KIMCO REALTY CORPORATION AND SUBSIDIARIES AND KIMCO REALTY OP, LLC AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)
10. Other Assets
Mortgages and Other Financing Receivables
During the nine months ended September 30, 2024, the Company provided, as a lender, the following mortgage and other financing receivables (dollars in millions):
Date Issued |
|
Face Amount |
|
|
Interest Rate |
|
Maturity Date |
|
Feb-24 (1) |
|
$ |
|
|
|
Feb-29 |
||
Mar-24 |
|
$ |
|
|
|
Mar-29 |
||
Mar-24 (1) |
|
$ |
|
|
|
Mar-29-Mar-34 |
||
Apr-24 |
|
$ |
|
|
|
Oct-34 |
||
Apr-24 |
|
$ |
|
|
|
Apr-27 |
||
Jun-24 |
|
$ |
|
|
|
Jul-29 |
||
Jun-24 (2) |
|
$ |
|
|
|
Jun-25 |
||
Jun-24 (2) |
|
$ |
|
|
|
Jun-34 |
||
Aug-24 |
|
$ |
|
|
|
Aug-28 |
||
Apr-24-Sept-24 |
|
$ |
|
|
|
Nov-26 |
||
During the nine months ended September 30, 2024, the Company incurred charges of $
During the nine months ended September 30, 2024, the Company collected the following mortgage and other financing receivables (dollars in millions):
Date Collected |
|
Face Amount |
|
|
Interest Rate |
|
Maturity Date |
|
Mar-24 |
|
$ |
|
|
|
Mar-29-Mar-34 |
||
Jun-24 |
|
$ |
|
|
|
Dec-24 |
||
Sept-24 |
|
$ |
|
|
|
Oct-24 |
||
11. Notes and Mortgages Payable
Notes Payable
On September 9, 2024, Fitch Ratings assigned the Company a rating of A- for its senior unsecured debt, assigned a BBB credit rating for its preferred stock, and assigned its ‘Stable’ rating outlook. As a result, the Company achieved certain interest rate reductions and facility fee reductions for its Credit Facility and unsecured term loans.
The Company has a $
28
KIMCO REALTY CORPORATION AND SUBSIDIARIES AND KIMCO REALTY OP, LLC AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)
In connection with the RPT Merger, the Company assumed the following notes payable (dollars in millions):
Type |
|
Amount Assumed |
|
|
Interest Rate |
|
Maturity Date |
|
Unsecured notes (1) |
|
$ |
|
|
|
|||
Unsecured term loan (2) |
|
$ |
|
|
|
|||
Unsecured term loan (2) |
|
$ |
|
|
|
|||
Unsecured term loan (2) |
|
$ |
|
|
|
|||
Unsecured term loan (2) |
|
$ |
|
|
|
|||
During September 2024, the Company issued $
On January 2, 2024, the Company entered into a new $
During the nine months ended September 30, 2024, the Company fully repaid the following notes payables (dollars in millions):
Type |
|
Date Paid |
|
Amount Repaid |
|
|
Interest Rate |
|
Maturity Date |
|
Unsecured note |
|
|
$ |
|
|
|
||||
Unsecured note |
|
|
$ |
|
|
|
||||
Mortgages Payable
During the nine months ended September 30, 2024, the Company repaid $
12. Derivatives
Derivative Instruments & Hedging Activities
The Company is exposed to certain risks arising from both its business operations and economic conditions. The Company manages economic risks, including interest rate, liquidity, and credit risks primarily by managing the amount, sources, and duration of its debt funding and the use of derivative financial instruments. Specifically, the Company may use derivatives to manage exposures that arise
29
KIMCO REALTY CORPORATION AND SUBSIDIARIES AND KIMCO REALTY OP, LLC AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)
from changes in interest rates and limits the risk by following established risk management policies and procedures, including the use of derivatives.
During the nine months ended September 30, 2024, the Company entered into
The interest rate swaps are measured at fair value using the market standard methodology of netting the discounted future fixed cash receipts (or payments) and the discounted expected variable cash payments (or receipts). The variable cash payments (or receipts) are based on an expectation of future interest rates (forward curves) derived from observable market interest rate curves. The Company classifies the interest rate swaps as Level 2 and are measured on a recurring basis.
The following table summarizes the terms and fair value of the Company’s derivative financial instruments as of September 30, 2024 (amounts in thousands):
Instrument |
|
Number of Swap Agreements |
|
Associated Debt Instrument |
|
Effective Date |
|
Maturity Date |
|
Notional |
|
|
Fair Value (2) |
|
||
Interest rate swap |
|
|
$ |
|
|
|
$ |
( |
) |
|
$ |
( |
) |
|||
Interest rate swaps |
|
|
$ |
|
|
|
|
( |
) |
|
|
( |
) |
|||
Interest rate swaps |
|
|
$ |
|
|
|
|
( |
) |
|
|
( |
) |
|||
Interest rate swaps |
|
|
$ |
|
|
|
|
( |
) |
|
|
( |
) |
|||
Interest rate swaps |
|
|
$ |
|
|
|
|
( |
) |
|
|
( |
) |
|||
Interest rate swaps |
|
|
$ |
|
|
|
|
( |
) |
|
|
( |
) |
|||
Interest rate swap |
|
|
$ |
|
|
|
|
( |
) |
|
|
( |
) |
|||
|
|
|
|
|
|
|
|
|
|
$ |
( |
) |
|
$ |
( |
) |
The table below details the location in the financial statements of the gain/(loss) recognized on interest rate swaps designated as cash flow hedges for the three and nine months ended September 30, 2024 (amounts in thousands):
|
|
Three Months Ended September 30, 2024 |
|
|
Nine Months Ended September 30, 2024 |
|
||
Amount of loss recognized in AOCI on interest rate swaps, net |
|
$ |
( |
) |
|
$ |
( |
) |
Amount reclassified from AOCI into income as Interest expense |
|
$ |
|
|
$ |
|
||
Total amount of Interest expense presented in the Condensed Consolidated |
|
$ |
( |
) |
|
$ |
( |
) |
The Company has interests in certain unconsolidated joint ventures, which have interest rate swaps. As of September 30, 2024 and December 31, 2023, the Company’s share of the change in fair value of the cash flow hedges for interest payments was $
13. Noncontrolling Interests
Noncontrolling interests represent the portion of equity that the Company does not own in those entities it consolidates as a result of having a controlling interest or having determined that the Company was the primary beneficiary of a VIE in accordance with the provisions of the FASB’s Consolidation guidance. The Company accounts and reports for noncontrolling interests in accordance with
30
KIMCO REALTY CORPORATION AND SUBSIDIARIES AND KIMCO REALTY OP, LLC AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)
the Consolidation guidance and the Distinguishing Liabilities from Equity guidance issued by the FASB. The Company identifies its noncontrolling interests separately within the equity section on the Company’s Condensed Consolidated Balance Sheets. The amounts of consolidated net income attributable to the Company and to the noncontrolling interests are presented separately on the Company’s Condensed Consolidated Statements of Income.
In connection with the RPT Merger, the Parent Company issued
During the nine months ended September 30, 2024, the Company acquired the remaining outside partners’ interests in a consolidated property for a purchase price of $
The Company owns
Type |
|
Par Value |
|
|
Number of Units |
|
|
Return Per Annum |
||
Preferred Outside Partner Units |
|
$ |
|
|
|
|
|
|||
Common Outside Partner Units |
|
$ |
|
|
|
|
|
Equal to the Company’s common stock dividend |
||
Included within noncontrolling interests are units that were determined to be contingently redeemable that are classified as Redeemable noncontrolling interests and presented in the mezzanine section between Total liabilities and Stockholders’ equity on the Company’s Condensed Consolidated Balance Sheets.
The following table presents the change in the redemption value of the Redeemable noncontrolling interests for the nine months ended September 30, 2024 and 2023 (in thousands):
|
|
Nine Months Ended September 30, |
|
|||||
|
|
2024 |
|
|
2023 |
|
||
Balance at January 1, |
|
$ |
|
|
$ |
|
||
Net income |
|
|
|
|
|
|
||
Distributions |
|
|
( |
) |
|
|
( |
) |
Redemption/conversion of noncontrolling interests |
|
|
( |
) |
|
|
|
|
Adjustment to estimated redemption value |
|
|
|
|
|
|
||
Balance at September 30, |
|
$ |
|
|
$ |
|
||
31
KIMCO REALTY CORPORATION AND SUBSIDIARIES AND KIMCO REALTY OP, LLC AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)
14. Variable Interest Entities
Consolidated Operating Properties
Included within the Company’s operating properties at September 30, 2024 and December 31, 2023, are
The majority of the operations of these VIEs are funded with cash flows generated from the properties. The Company has not provided financial support to any of these VIEs that it was not previously contractually required to provide, which consists primarily of funding any capital expenditures, including tenant improvements, which are deemed necessary to continue to operate the entity and any operating cash shortfalls that the entity may experience.
All liabilities of these consolidated VIEs are non-recourse to the Company (“VIE Liabilities”). The assets of the unencumbered VIEs are not restricted for use to settle only the obligations of these VIEs. The remaining VIE assets are encumbered by third-party non-recourse mortgage debt. The assets associated with these encumbered VIEs (“Restricted Assets”) are collateral under the respective mortgages and are therefore restricted and can only be used to settle the corresponding liabilities of the VIE.
|
|
As of September 30, 2024 |
|
|
As of December 31, 2023 |
|
||
Number of unencumbered VIEs |
|
|
|
|
|
|
||
Number of encumbered VIEs |
|
|
|
|
|
|
||
Total number of consolidated VIEs |
|
|
|
|
|
|
||
|
|
|
|
|
|
|
||
Restricted Assets: |
|
|
|
|
|
|
||
Real estate, net |
|
$ |
|
|
$ |
|
||
Cash, cash equivalents and restricted cash |
|
|
|
|
|
|
||
Accounts and notes receivable, net |
|
|
|
|
|
|
||
Other assets |
|
|
|
|
|
|
||
Total Restricted Assets |
|
$ |
|
|
$ |
|
||
|
|
|
|
|
|
|
||
VIE Liabilities: |
|
|
|
|
|
|
||
Mortgages payable, net |
|
$ |
|
|
$ |
|
||
Accounts payable and accrued expenses |
|
|
|
|
|
|
||
Operating lease liabilities |
|
|
|
|
|
|
||
Other liabilities |
|
|
|
|
|
|
||
Total VIE Liabilities |
|
$ |
|
|
$ |
|
||
Unconsolidated Redevelopment Investment
Included in the Company’s preferred equity investments at September 30, 2024, is an unconsolidated development project which is a VIE for which the Company is not the primary beneficiary. This preferred equity investment was primarily established to develop real estate property for long-term investment and was deemed a VIE primarily based on the fact that the equity investment at risk was not sufficient to permit the entity to finance its activities without additional financial support. The initial equity contributed to this entity was not sufficient to fully finance the real estate construction as development costs are funded by the partners over the construction period. The Company determined that it was not the primary beneficiary of this VIE based on the fact that the Company has shared control of this entity along with the entity’s partners and therefore does not have a controlling financial interest.
32
KIMCO REALTY CORPORATION AND SUBSIDIARIES AND KIMCO REALTY OP, LLC AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)
As of September 30, 2024, the Company’s investment in this VIE was $
15. Fair Value Measurements
All financial instruments of the Company are reflected in the accompanying Condensed Consolidated Balance Sheets at amounts which, in management’s estimation, based upon an interpretation of available market information and valuation methodologies, reasonably approximate their fair values, except those listed below, for which fair values are disclosed. The valuation method used to estimate fair value for fixed-rate and variable-rate debt, and mortgage and other finance receivables, is based on discounted cash flow analyses, with assumptions that include credit spreads, market yield curves, trading activity, loan amounts and debt maturities. The fair values for marketable securities are based on published values, securities dealers’ estimated market values or comparable market sales. The fair value for embedded derivative liability is based on using the “with-and-without” method. Such fair value estimates are not necessarily indicative of the amounts that would be realized upon disposition. Interest rate swaps are measured at fair value using the market standard methodology of netting the discounted future fixed cash receipts (or payments) and the discounted expected variable cash payments (or receipts). The variable cash payments (or receipts) are based on an expectation of future interest rates (forward curves) derived from observable market interest rate curves.
As a basis for considering market participant assumptions in fair value measurements, the FASB’s Fair Value Measurements and Disclosures guidance establishes a fair value hierarchy that distinguishes between market participant assumptions based on market data obtained from sources independent of the reporting entity (observable inputs that are classified within Levels 1 and 2 of the hierarchy) and the reporting entity’s own assumptions about market participant assumptions (unobservable inputs classified within Level 3 of the hierarchy).
The following are financial instruments for which the Company’s estimated fair value differs from the carrying amount (in thousands):
|
|
|
|
September 30, 2024 |
|
|
December 31, 2023 |
|
||||||||||
|
|
Fair Value Hierarchy |
|
Carrying |
|
|
Estimated |
|
|
Carrying |
|
|
Estimated |
|
||||
Assets: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Mortgage and other financing receivables (1) |
|
Level 3 |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
Liabilities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Notes payable, net (2) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Senior unsecured notes |
|
Level 2 |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
Term loans |
|
Level 3 |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
Mortgages payable, net (3) |
|
Level 3 |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
The Company has certain financial instruments that must be measured under the FASB’s Fair Value Measurements and Disclosures guidance, including available for sale securities, interest rate swaps and embedded derivative liabilities. The Company currently does not have non-financial assets and non-financial liabilities that are required to be measured at fair value on a recurring basis.
In instances where the determination of the fair value measurement is based on inputs from different levels of the fair value hierarchy, the level of the fair value hierarchy within which the entire fair value measurement falls is based on the lowest level input that is significant to the fair value measurement in its entirety. The Company’s assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment and considers factors specific to the asset or liability.
33
KIMCO REALTY CORPORATION AND SUBSIDIARIES AND KIMCO REALTY OP, LLC AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)
The tables below present the Company’s financial assets and liabilities measured at fair value on a recurring basis at September 30, 2024 and December 31, 2023, aggregated by the level of the fair value hierarchy within which those measurements fall (in thousands):
|
|
Balance at |
|
|
Level 1 |
|
|
Level 2 |
|
|
Level 3 |
|
||||
Assets: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Marketable equity securities |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
Liabilities: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Interest rate swaps derivative liabilities |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
Embedded derivative liability |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
|
|
Balance at |
|
|
Level 1 |
|
|
Level 2 |
|
|
Level 3 |
|
||||
Assets: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Marketable equity securities |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
Liabilities: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Embedded derivative liability |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
The significant unobservable input (Level 3 inputs) used in measuring the Company’s embedded derivative liability, which is categorized with Level 3 of the fair value hierarchy, is the discount rate of
The table below presents the change in fair value of the embedded derivative liability measured using Level 3 inputs for the nine months ended September 30, 2024 and 2023 (in thousands):
|
|
Nine Months Ended September 30, |
|
|||||
|
|
2024 |
|
|
2023 |
|
||
Balance as of January 1, |
|
$ |
|
|
$ |
|
||
Settlements |
|
|
( |
) |
|
|
|
|
Change in fair value (included in Other income, net) |
|
|
( |
) |
|
|
|
|
Balance as of September 30, |
|
$ |
|
|
$ |
|
||
Assets measured at fair value on a non-recurring basis at December 31, 2023 were as follows (in thousands):
|
|
Balance at |
|
|
Level 1 |
|
|
Level 2 |
|
|
Level 3 |
|
||||
Real estate |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
During the nine months ended September 30, 2024 and 2023, the Company recognized impairment charges related to adjustments to property carrying values of $
16. Incentive Plans
The Company has an Equity Participation Plan (as amended and/or restated, the “Equity Plan”), which provides for a maximum of
The Company accounts for equity awards in accordance with FASB’s compensation – Stock Compensation guidance, which requires that all share-based payments to employees, including grants of employee stock options, restricted stock, performance shares and LTIP Units, be recognized in the Condensed Consolidated Statements of Income over the service period based on their fair values. Fair value of performance awards is determined using the Monte Carlo method, which is intended to estimate the fair value of the awards at the grant date. Fair value of restricted shares is calculated based on the price on the date of grant.
34
KIMCO REALTY CORPORATION AND SUBSIDIARIES AND KIMCO REALTY OP, LLC AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)
The Company recognized expenses associated with its equity awards of $
Restricted Stock
Information with respect to restricted stock under the Plan for the nine months ended September 30, 2024 and 2023 is as follows:
|
|
Nine Months Ended September 30, |
|
|||||
|
|
2024 |
|
|
2023 |
|
||
Restricted stock outstanding as of January 1, |
|
|
|
|
|
|
||
Granted (1) |
|
|
|
|
|
|
||
Vested |
|
|
( |
) |
|
|
( |
) |
Forfeited |
|
|
( |
) |
|
|
( |
) |
Restricted stock outstanding as of September 30, |
|
|
|
|
|
|
||
Performance Shares
Information with respect to performance share awards under the Plan for the nine months ended September 30, 2024 and 2023 is as follows:
|
|
Nine Months Ended September 30, |
|
|||||
|
|
2024 |
|
|
2023 |
|
||
Performance share awards outstanding as of January 1, |
|
|
|
|
|
|
||
Granted (1) |
|
|
|
|
|
|
||
Vested (2) |
|
|
( |
) |
|
|
( |
) |
Performance share awards outstanding as of September 30, |
|
|
|
|
|
|
||
The significant assumptions underlying the determination of fair values using Monte Carlo simulations for these performance awards granted during 2024 and 2023 were as follows:
|
|
2024 |
|
|
2023 |
|
||
Stock price |
|
|
|
|
|
|
||
Dividend yield (1) |
|
|
|
|
|
|
||
Risk-free interest rate |
|
|
% |
|
|
% |
||
Volatility (2) |
|
|
% |
|
|
% |
||
Term of the award (years) |
|
|
|
|
|
|
||
Time-Based LTIP Units
During the nine months ended September 30, 2024, the Company granted to certain employees and directors
35
KIMCO REALTY CORPORATION AND SUBSIDIARIES AND KIMCO REALTY OP, LLC AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)
ratably over
The aggregate grant-date fair value of the Time-Based LTIP Units for the nine months ended September 30, 2024 was $
Performance-Based LTIP Units
During the nine months ended September 30, 2024, the Company granted to certain employees
Performance-Based LTIP Units are performance-based equity compensation pursuant to which participants have the opportunity to earn LTIP Units based on the total shareholder return of the Company’s common shares relative to its peers, as defined, or based on other performance criteria as determined by the Board of Directors, over the defined performance period. Any Performance-Based LTIP Units that are earned vest at the end of the
The aggregate grant-date fair value of the Performance-Based LTIP Units for the nine months ended September 30, 2024 was $
|
|
2024 |
|
|
Stock price |
|
|
|
|
Dividend yield (1) |
|
|
|
|
Risk-free interest rate |
|
|
% |
|
Volatility (2) |
|
|
% |
|
Term of the award (years) |
|
|
|
|
17. Stockholders’ Equity
Preferred Stock
The Company’s outstanding Preferred Stock is detailed below (in thousands, except share data and par values):
As of September 30, 2024 |
||||||||||||||||||||||||||
Class of Preferred Stock |
|
Shares |
|
|
Shares |
|
|
Liquidation |
|
|
Dividend |
|
|
Annual |
|
|
Par Value |
|
|
Optional |
||||||
Class L |
|
|
|
|
|
|
|
$ |
|
|
|
% |
|
$ |
|
|
$ |
|
|
|||||||
Class M |
|
|
|
|
|
|
|
|
|
|
|
% |
|
$ |
|
|
$ |
|
|
|||||||
Class N (1) |
|
|
|
|
|
|
|
|
|
|
|
% |
|
$ |
|
|
$ |
|
|
N/A |
||||||
|
|
|
|
|
|
|
|
$ |
|
|
|
|
|
|
|
|
|
|
|
|
||||||
36
KIMCO REALTY CORPORATION AND SUBSIDIARIES AND KIMCO REALTY OP, LLC AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)
As of December 31, 2023 |
||||||||||||||||||||||||||
Class of Preferred Stock |
|
Shares |
|
|
Shares |
|
|
Liquidation |
|
|
Dividend |
|
|
Annual |
|
|
Par Value |
|
|
Optional |
||||||
Class L |
|
|
|
|
|
|
|
$ |
|
|
|
% |
|
$ |
|
|
$ |
|
|
|||||||
Class M |
|
|
|
|
|
|
|
|
|
|
|
% |
|
$ |
|
|
$ |
|
|
|||||||
|
|
|
|
|
|
|
|
$ |
|
|
|
|
|
|
|
|
|
|
|
|
||||||
During January 2024, the Company’s Board of Directors authorized the repurchase of up to
Class of Preferred Stock |
|
Depositary Shares Repurchased |
|
|
Purchase Price (in thousands) |
|
||
Class N |
|
|
|
|
$ |
|
||
The Class L, M and N Preferred Stock rank pari passu as to voting rights, priority for receiving dividends and liquidation preference as set forth below.
As to any matter on which the Class L, M or N Preferred Stock may vote, including any actions by written consent, each share of the Class L, M or N Preferred Stock shall be entitled to 1,000 votes, each of which 1,000 votes may be directed separately by the holder thereof. With respect to each share of Class L, M or N Preferred Stock, the holder thereof may designate up to 1,000 proxies, with each such proxy having the right to vote a whole number of votes (totaling 1,000 votes per share of Class L, M or N Preferred Stock). As a result, each Class L, M or N Depositary Share is entitled to one vote.
Common Stock
The Company has a common share repurchase program, which is scheduled to expire February 28, 2026. Under this program, the Company may repurchase shares of its common stock, par value $
During September 2023, the Company established an at-the-market continuous offering program (the “ATM Program”) pursuant to which the Company may offer and sell from time-to-time shares of its common stock, par value $
In connection with the RPT Merger, each RPT common share was converted into
Dividends Declared
The following table provides a summary of the dividends declared per share:
|
|
Three Months Ended September 30, |
|
|
Nine Months Ended September 30, |
|
||||||||||
|
|
2024 |
|
|
2023 |
|
|
2024 |
|
|
2023 |
|
||||
Common Shares |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
Class L Depositary Shares |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
Class M Depositary Shares |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
Class N Depositary Shares |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
37
KIMCO REALTY CORPORATION AND SUBSIDIARIES AND KIMCO REALTY OP, LLC AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)
18. Supplemental Schedule of Non-Cash Investing / Financing Activities
The following schedule summarizes the non-cash investing and financing activities of the Company for the nine months ended September 30, 2024 and 2023 (in thousands):
|
|
Nine Months Ended September 30, |
|
|||||
|
|
2024 |
|
|
2023 |
|
||
Proceeds held in escrow through the sale of real estate interests |
|
$ |
|
|
$ |
|
||
Acquisition of real estate interests from a lease modification |
|
$ |
|
|
$ |
|
||
Disposition of real estate interests through the issuance of mortgage and other financing |
|
$ |
|
|
$ |
|
||
Decrease in other investments through the issuance of mortgage and other financing receivables |
|
$ |
|
|
$ |
|
||
Deconsolidation of real estate interests through contribution to other investments |
|
$ |
|
|
$ |
|
||
Surrender of common stock/units |
|
$ |
|
|
$ |
|
||
Declaration of dividends paid in succeeding period |
|
$ |
|
|
$ |
|
||
Capital expenditures accrual |
|
$ |
|
|
$ |
|
||
Lease liabilities arising from obtaining operating right-of-use assets |
|
$ |
|
|
$ |
|
||
Decrease in redeemable noncontrolling interests’ carrying amount, net |
|
$ |
|
|
$ |
|
||
RPT Merger: |
|
|
|
|
|
|
||
Real estate assets, net |
|
$ |
|
|
$ |
|
||
Investment in real estate joint ventures |
|
$ |
|
|
$ |
|
||
Investment in other investments |
|
$ |
|
|
$ |
|
||
Other assets and liabilities, net |
|
$ |
( |
) |
|
$ |
- |
|
Notes payable |
|
$ |
( |
) |
|
$ |
|
|
Lease liabilities arising from obtaining operating right-of-use assets |
|
$ |
( |
) |
|
$ |
|
|
Non-controlling interest |
|
$ |
( |
) |
|
$ |
|
|
Preferred stock issued in exchange for RPT preferred shares |
|
$ |
( |
) |
|
$ |
|
|
Common stock issued in exchange for RPT common shares |
|
$ |
( |
) |
|
$ |
|
|
Consolidation of Joint Ventures: |
|
|
|
|
|
|
||
Increase in real estate and other assets, net |
|
$ |
|
|
$ |
|
||
Increase in mortgage payables |
|
$ |
|
|
$ |
|
||
The following table provides a reconciliation of cash, cash equivalents and restricted cash recorded on the Company’s Condensed Consolidated Balance Sheets to the Company’s Condensed Consolidated Statements of Cash Flows (in thousands):
|
|
As of September 30, 2024 |
|
|
As of December 31, 2023 |
|
||
Cash and cash equivalents |
|
$ |
|
|
$ |
|
||
Restricted cash |
|
|
|
|
|
|
||
Total cash, cash equivalents and restricted cash |
|
$ |
|
|
$ |
|
||
19. Commitments and Contingencies
Letters of Credit
The Company has issued letters of credit in connection with the completion and repayment guarantees, primarily on certain of the Company’s redevelopment projects and guaranty of payment related to the Company’s insurance program. At September 30, 2024, these letters of credit aggregated $
Funding Commitments
The Company has investments with funding commitments of $
Other
The Parent Company guarantees the unsecured debt instruments of Kimco OP. These guarantees by the Parent Company are full, irrevocable, unconditional and absolute joint and several guarantees to the holders of each series of such unsecured debt instruments.
In connection with the construction of its development and redevelopment projects and related infrastructure, certain public agencies require posting of performance and surety bonds to guarantee that the Company’s obligations are satisfied. These bonds expire upon the
38
KIMCO REALTY CORPORATION AND SUBSIDIARIES AND KIMCO REALTY OP, LLC AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)
completion of the improvements and infrastructure. As of September 30, 2024, there were $
The Company provides a guaranty for the payment of any debt service shortfalls on the Sheridan Redevelopment Agency issued Series A bonds, which are tax increment revenue bonds issued in connection with a development project in Sheridan, Colorado. These tax increment revenue bonds have a balance of $
In connection with the RPT Merger, the Company provides a guaranty for the payment of any debt service shortfalls on the City of Jacksonville Series 2005A bonds, which are tax increment revenue bonds issued in connection with a redevelopment project in Jacksonville, FL. Repayment of the bonds is to be made in accordance with a level-payment amortization schedule over 20 years, and repayments are made out of tax revenues generated by the redevelopment. The remaining debt service payments due over the life of the bonds, including principal and interest, are $
The Company is subject to various other legal proceedings and claims that arise in the ordinary course of business. Management believes that the final outcome of such matters will not have a material adverse effect on the financial position, results of operations or liquidity of the Company taken as a whole as of September 30, 2024.
20. Accumulated Other Comprehensive (Loss)/Income (“AOCI”)
The following tables present the change in the components of AOCI for the three and nine months ended September 30, 2024 and 2023:
|
|
Three Months Ended September 30, 2024 |
|
|
Nine Months Ended September 30, 2024 |
|
||||||||||||||||||
|
|
Cash Flow Hedges for |
|
|
Cash Flow Hedges for Interest Payments of Unconsolidated Investee |
|
|
Total |
|
|
Cash Flow Hedges for |
|
|
Cash Flow Hedges for Interest Payments of Unconsolidated Investee |
|
|
Total |
|
||||||
Balance at beginning of period |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||||
Other comprehensive (loss)/income before reclassifications |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|
|
|
|
|
( |
) |
|
Amounts reclassed from AOCI |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
Net current-period other comprehensive loss |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
Balance at end of period |
|
$ |
( |
) |
|
$ |
|
|
$ |
( |
) |
|
$ |
( |
) |
|
$ |
|
|
$ |
( |
) |
||
|
|
Three Months Ended September 30, 2023 |
|
|
Nine Months Ended September 30, 2023 |
|
||||||||||||||||||
|
|
Defined |
|
|
Cash Flow Hedges for Interest Payments of Unconsolidated Investee |
|
|
Total |
|
|
Defined |
|
|
Cash Flow Hedges for Interest Payments of Unconsolidated Investee |
|
|
Total |
|
||||||
Balance at beginning of period |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||||
Other comprehensive income before reclassifications |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Amounts reclassified from AOCI |
|
|
( |
) |
|
|
|
|
|
( |
) |
|
|
( |
) |
|
|
|
|
|
( |
) |
||
Net current-period other comprehensive (loss)/income |
|
|
( |
) |
|
|
|
|
|
( |
) |
|
|
( |
) |
|
|
|
|
|
( |
) |
||
Balance at end of period |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||||
On the Company’s Condensed Consolidated Statements of Income, unrealized gains and losses reclassified from AOCI related to (i) cash flow hedges for interest payments, which are included in Interest expense, (ii) cash flow hedges for interest payments of
39
KIMCO REALTY CORPORATION AND SUBSIDIARIES AND KIMCO REALTY OP, LLC AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)
unconsolidated investee, which are included in Equity in income of joint ventures, net, and (iii) settlement of defined benefit plan which is included in Other income, net.
During the three months ended September 30, 2023, the Weingarten Realty Investors’ noncontributory qualified cash balance retirement plan (the “Benefit Plan”) obligations of $
40
KIMCO REALTY CORPORATION AND SUBSIDIARIES AND KIMCO REALTY OP, LLC AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)
21. Earnings Per Share/Units
The following table sets forth the reconciliation of the Company’s earnings and the weighted-average number of shares used in the calculation of basic and diluted earnings per share (amounts presented in thousands, except per share data):
|
|
Three Months Ended September 30, |
|
|
Nine Months Ended September 30, |
|
||||||||||
|
|
2024 |
|
|
2023 |
|
|
2024 |
|
|
2023 |
|
||||
Computation of Basic and Diluted Earnings Per Share: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Net income available to the Company's common |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
Change in redeemable noncontrolling interests' carrying amount |
|
|
( |
) |
|
|
|
|
|
( |
) |
|
|
|
||
Earnings attributable to participating securities |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
Net income available to the Company’s common |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Distributions on convertible units |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Net income available to the Company’s common |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Weighted average common shares outstanding – basic |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Effect of dilutive securities (1): |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Equity awards |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Assumed conversion of convertible units |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Weighted average common shares outstanding – diluted |
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Net income available to the Company's common |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Basic earnings per share |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
Diluted earnings per share |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
The following table sets forth the reconciliation of Kimco OP’s earnings and the weighted-average number of units used in the calculation of basic and diluted earnings per unit (amounts presented in thousands except per unit data):
|
|
Three Months Ended September 30, |
|
|
Nine Months Ended September 30, |
|
||||||||||
|
|
2024 |
|
|
2023 |
|
|
2024 |
|
|
2023 |
|
||||
Computation of Basic and Diluted Earnings Per Unit: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Net income available to Kimco OP’s common unitholders |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
Change in redeemable noncontrolling interests' carrying amount |
|
|
( |
) |
|
|
|
|
|
( |
) |
|
|
|
||
Earnings attributable to participating securities |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
Net income available to Kimco OP’s common unitholders |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Distributions on convertible units |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Net income available to Kimco OP’s common unitholders |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Weighted average common units outstanding – basic |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Effect of dilutive securities (1): |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Unit awards |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Assumed conversion of convertible units |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Weighted average common units outstanding – diluted |
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Net income available to Kimco OP’s common unitholders: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Basic earnings per unit |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
Diluted earnings per unit |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
41
KIMCO REALTY CORPORATION AND SUBSIDIARIES AND KIMCO REALTY OP, LLC AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)
Unvested restricted share awards contain non-forfeitable rights to distributions or distribution equivalents. The impact of the unvested restricted share awards on earnings per share has been calculated using the two-class method whereby earnings are allocated to the unvested restricted share awards based on dividends declared and the unvested restricted shares’ participation rights in undistributed earnings.
42
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations
Forward-Looking Statements
This Quarterly Report on Form 10-Q, together with other statements and information publicly disseminated by the Company, contains certain forward-looking statements within the meaning of 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”). The Company intends such forward-looking statements to be covered by the safe harbor provisions for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995 and includes this statement for purposes of complying with the safe harbor provisions. Forward-looking statements, which are based on certain assumptions and describe the Company’s future plans, strategies and expectations, are generally identifiable by use of the words “believe,” “expect,” “intend,” “commit,” “anticipate,” “estimate,” “project,” “will,” “target,” “plan,” “forecast” or similar expressions. You should not rely on forward-looking statements since they involve known and unknown risks, uncertainties and other factors which, in some cases, are beyond the Company’s control and could materially affect actual results, performances or achievements. Factors which may cause actual results to differ materially from current expectations include, but are not limited to, (i) general adverse economic and local real estate conditions, (ii) the impact of competition, including the availability of acquisition or development opportunities and the costs associated with purchasing and maintaining assets; (iii) the inability of major tenants to continue paying their rent obligations due to bankruptcy, insolvency or a general downturn in their business, (iv) the reduction in the Company’s income in the event of multiple lease terminations by tenants or a failure of multiple tenants to occupy their premises in a shopping center, (v) the potential impact of e-commerce and other changes in consumer buying practices, and changing trends in the retail industry and perceptions by retailers or shoppers, including safety and convenience, (vi) the availability of suitable acquisition, disposition, development and redevelopment opportunities, and the costs associated with purchasing and maintaining assets and risks related to acquisitions not performing in accordance with our expectations, (vii) the Company’s ability to raise capital by selling its assets, (viii) disruptions and increases in operating costs due to inflation and supply chain disruptions, (ix) risks associated with the development of mixed-use commercial properties, including risks associated with the development, and ownership of non-retail real estate, (x) changes in governmental laws and regulations, including, but not limited to, changes in data privacy, environmental (including climate change), safety and health laws, and management’s ability to estimate the impact of such changes, (xi) the Company’s failure to realize the expected benefits of the merger with RPT Realty (the “RPT Merger”), (xii) the risk of litigation, including shareholder litigation, in connection with the RPT Merger, including any resulting expense, (xiii) risks related to future opportunities and plans for the combined company, including the uncertainty of expected future financial performance and results of the combined company, (xiv) the possibility that, if the Company does not achieve the perceived benefits of the RPT Merger as rapidly or to the extent anticipated by financial analysts or investors, the market price of the Company’s common stock could decline, (xv) valuation and risks related to the Company’s joint venture and preferred equity investments and other investments, (xvi) collectability of mortgage and other financing receivables, (xvii) impairment charges, (xviii) criminal cybersecurity attacks, disruption, data loss or other security incidents and breaches, (xix) risks related to artificial intelligence, (xx) impact of natural disasters and weather and climate-related events, (xxi) pandemics or other health crises, (xxii) our ability to attract, retain and motivate key personnel, (xxiii) financing risks, such as the inability to obtain equity, debt or other sources of financing or refinancing on favorable terms to the Company, (xxiv) the level and volatility of interest rates and management’s ability to estimate the impact thereof, (xxv) changes in the dividend policy for the Company’s common and preferred stock and the Company’s ability to pay dividends at current levels, (xxvi) unanticipated changes in the Company’s intention or ability to prepay certain debt prior to maturity and/or hold certain securities until maturity, (xxvii) the Company’s ability to continue to maintain its status as a REIT for U.S. federal income tax purposes and potential risks and uncertainties in connection with its UPREIT structure, and (xxviii) other risks and uncertainties identified under Item 1A, “Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2023. Accordingly, there is no assurance that the Company’s expectations will be realized. The Company disclaims any intention or obligation to update the forward-looking statements, whether as a result of new information, future events or otherwise. You are advised to refer to any further disclosures the Company makes in other filings with the Securities and Exchange Commission (“SEC”).
The following discussion should be read in conjunction with the accompanying Condensed Consolidated Financial Statements and Notes thereto. These unaudited financial statements include all adjustments which are, in the opinion of management, necessary to reflect a fair statement of the results for the interim periods presented, and all such adjustments are of a normal recurring nature.
Executive Overview
Kimco Realty Corporation is a REIT, of which substantially all of the Company’s assets are held by, and substantially all of the Company’s operations are conducted through, Kimco OP, either directly or through its subsidiaries, as the Company’s operating company. The Company is the managing member and exercises exclusive control over Kimco OP. As of September 30, 2024, the Parent Company owned 99.84% of the outstanding limited liability company interests (the “OP Units”) in Kimco OP.
43
The Company is North America’s largest publicly traded owner and operator of open-air, grocery-anchored shopping centers and a growing portfolio of mixed-use assets. The terms “Kimco,” the “Company,” “we,” “our” and “us” each refers to Kimco Realty Corporation and its subsidiaries, unless the context indicates otherwise. The Company’s mission is to create destinations for everyday living that inspire a sense of community and deliver value to our many stakeholders.
The Company is a self-administered real estate investment trust (“REIT”) and has owned and operated open-air shopping centers for over 60 years. The Company has not engaged, nor does it expect to retain, any REIT advisors in connection with the operation of its properties. As of September 30, 2024, the Company had interests in 567 U.S. shopping center properties, aggregating 100.5 million square feet of gross leasable area (“GLA”), located in 30 states. In addition, the Company had 67 other property interests, primarily including net leased properties, preferred equity investments, and other investments, totaling 5.5 million square feet of GLA. The Company’s ownership interests in real estate consist of its consolidated portfolio and portfolios where the Company owns an economic interest, such as properties in the Company’s investment real estate management programs, where the Company partners with institutional investors and also retains management.
The Company’s primary business objective is to be the premier owner and operator of open-air, grocery-anchored shopping centers, and a growing portfolio of mixed-use assets, in the U.S. The Company believes it can achieve this objective by:
On September 9, 2024, Fitch Ratings assigned the Company a rating of A- for its senior unsecured debt, assigned a BBB credit rating for its preferred stock, and assigned its ‘Stable’ rating outlook. As a result, the Company achieved certain interest rate reductions and facility fee reduction for its unsecured revolving credit facility (the “Credit Facility”) and unsecured term loans.
RPT Merger
On January 2, 2024, RPT Realty merged with and into the Company, with the Company continuing as the surviving public company, pursuant to the definitive merger agreement (the “Merger Agreement”) between the Company and RPT, which was entered into on August 28, 2023. As a result of the RPT Merger, three Company acquired 56 open-air shopping centers, including 43 wholly owned and 13 joint venture assets, comprising 13.3 million square feet of gross leasable area, to the Company’s existing portfolio. The Company also obtained RPT’s 6% stake in a 49-property net lease joint venture.
Under the terms of the Merger Agreement, each RPT common share was converted into 0.6049 of a newly issued share of the Company’s common stock, together with cash in lieu of fractional shares, and each 7.25% Series D Cumulative Convertible Perpetual Preferred Share of RPT was converted into the right to receive one depositary share representing one one-thousandth of a share of the Company’s 7.25% Class N Cumulative Convertible Perpetual Preferred Stock, par value $1.00 per share (the “Class N Preferred Stock”). In connection with the RPT Merger, the Company issued 53.0 million shares of common stock, 1,849 shares of Class N Preferred Stock, and 953,400 OP Units. See Footnote 3 of the Notes to Condensed Consolidated Financial Statements for further details on the RPT Merger.
Economic Conditions
The economy continues to face challenges which could impact the Company and its tenants, including elevated inflation rates. In response to the elevated rate of inflation, the Federal Reserve steadily increased interest rates in 2022 and 2023. During September 2024, the Federal Reserve reduced the target range for federal funds rate by 0.50% to 4.75%-5.00%, which cut its overnight borrowing rate by 0.50%, as it believed certain indicators suggested that economic activity has continued to expand and inflation has made downward progress. This reduction is intended to support growth and stabilize the labor market. Fluctuations of certain economic data and indicators could impact future interest rate considerations by the Federal Reserve. Despite this reduction, interest rate levels could adversely impact the business and financial results of the Company and its tenants. In addition, slower economic growth and the potential for a recession could have an adverse effect on the Company and its tenants. This could negatively affect the overall demand for retail space, including the demand for leasable space in the Company’s properties.
Any of these events could materially adversely impact the Company’s business, financial condition, results of operations or stock price. The Company continues to monitor economic, financial, and social conditions and will assess its asset portfolio for any impairment indicators. If the Company determines that any of its assets are impaired, the Company would be required to take impairment charges, and such amounts could be material.
44
Effects of Inflation
Many of the Company’s long-term leases contain provisions designed to help mitigate the adverse impact of inflation. Such provisions include clauses enabling the Company to receive payment of additional rent calculated as a percentage of tenants’ gross sales above pre-determined thresholds, which generally increase as prices rise, and/or as a result of escalation clauses, which generally increase rental rates during the terms of the leases. Such escalation clauses often include increases based upon changes in the consumer price index or similar inflation indices. In addition, many of the Company’s leases are for terms of less than 10 years, which permits the Company to seek to increase rents to market rates upon renewal. To assist in partially mitigating the Company’s exposure to increases in costs and operating expenses, including common area maintenance costs, real estate taxes and insurance, resulting from inflation, the Company’s leases include provisions that either (i) require the tenant to pay an allocable share of these operating expenses or (ii) contain fixed contractual amounts, which include escalation clauses, to reimburse these operating expenses.
Results of Operations
Comparison of the three and nine months ended September 30, 2024 and 2023
Results from operations for the three and nine months ended September 30, 2024 reflect the results of the Company’s Merger with RPT on January 2, 2024.
The following table presents the comparative results from the Company’s Condensed Consolidated Statements of Income for the three and nine months ended September 30, 2024, as compared to the corresponding periods in 2023 (in thousands, except per share data):
|
|
Three Months Ended September 30, |
|
|
Nine Months Ended September 30, |
|
||||||||||||||||||
|
|
2024 |
|
|
2023 |
|
|
Change |
|
|
2024 |
|
|
2023 |
|
|
Change |
|
||||||
Revenues |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Revenues from rental properties, net |
|
$ |
502,875 |
|
|
$ |
441,816 |
|
|
$ |
61,059 |
|
|
$ |
1,498,001 |
|
|
$ |
1,319,162 |
|
|
$ |
178,839 |
|
Management and other fee income |
|
|
4,757 |
|
|
|
4,249 |
|
|
|
508 |
|
|
|
13,616 |
|
|
|
12,635 |
|
|
|
981 |
|
Operating expenses |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Rent (1) |
|
|
(4,239 |
) |
|
|
(3,939 |
) |
|
|
(300 |
) |
|
|
(12,744 |
) |
|
|
(12,097 |
) |
|
|
(647 |
) |
Real estate taxes |
|
|
(64,996 |
) |
|
|
(57,875 |
) |
|
|
(7,121 |
) |
|
|
(194,538 |
) |
|
|
(173,002 |
) |
|
|
(21,536 |
) |
Operating and maintenance (2) |
|
|
(88,744 |
) |
|
|
(76,604 |
) |
|
|
(12,140 |
) |
|
|
(262,267 |
) |
|
|
(226,919 |
) |
|
|
(35,348 |
) |
General and administrative (3) |
|
|
(33,850 |
) |
|
|
(33,697 |
) |
|
|
(153 |
) |
|
|
(103,238 |
) |
|
|
(101,180 |
) |
|
|
(2,058 |
) |
Impairment charges |
|
|
(375 |
) |
|
|
(2,237 |
) |
|
|
1,862 |
|
|
|
(4,277 |
) |
|
|
(14,043 |
) |
|
|
9,766 |
|
Merger charges |
|
|
- |
|
|
|
(3,750 |
) |
|
|
3,750 |
|
|
|
(25,246 |
) |
|
|
(3,750 |
) |
|
|
(21,496 |
) |
Depreciation and amortization |
|
|
(144,688 |
) |
|
|
(127,437 |
) |
|
|
(17,251 |
) |
|
|
(447,555 |
) |
|
|
(382,983 |
) |
|
|
(64,572 |
) |
Gain on sale of properties |
|
|
551 |
|
|
|
- |
|
|
|
551 |
|
|
|
944 |
|
|
|
52,376 |
|
|
|
(51,432 |
) |
Other income/(expense) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Special dividend income |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
194,116 |
|
|
|
(194,116 |
) |
Other income, net |
|
|
22,203 |
|
|
|
8,377 |
|
|
|
13,826 |
|
|
|
39,953 |
|
|
|
19,080 |
|
|
|
20,873 |
|
Gain/(loss) on marketable securities, net |
|
|
79 |
|
|
|
13,225 |
|
|
|
(13,146 |
) |
|
|
(27,613 |
) |
|
|
17,642 |
|
|
|
(45,255 |
) |
Interest expense |
|
|
(76,216 |
) |
|
|
(60,424 |
) |
|
|
(15,792 |
) |
|
|
(224,122 |
) |
|
|
(182,404 |
) |
|
|
(41,718 |
) |
(Provision)/benefit for income taxes, net |
|
|
(128 |
) |
|
|
729 |
|
|
|
(857 |
) |
|
|
(72,355 |
) |
|
|
(61,127 |
) |
|
|
(11,228 |
) |
Equity in income of joint ventures, net |
|
|
20,981 |
|
|
|
16,257 |
|
|
|
4,724 |
|
|
|
63,413 |
|
|
|
57,589 |
|
|
|
5,824 |
|
Equity in income of other investments, net |
|
|
216 |
|
|
|
2,100 |
|
|
|
(1,884 |
) |
|
|
9,468 |
|
|
|
8,741 |
|
|
|
727 |
|
Net income attributable to noncontrolling interests |
|
|
(2,443 |
) |
|
|
(2,551 |
) |
|
|
108 |
|
|
|
(6,693 |
) |
|
|
(9,208 |
) |
|
|
2,515 |
|
Preferred dividends, net |
|
|
(7,961 |
) |
|
|
(6,285 |
) |
|
|
(1,676 |
) |
|
|
(23,864 |
) |
|
|
(18,736 |
) |
|
|
(5,128 |
) |
Net income available to the Company's common |
|
$ |
128,022 |
|
|
$ |
111,954 |
|
|
$ |
16,068 |
|
|
$ |
220,883 |
|
|
$ |
495,892 |
|
|
$ |
(275,009 |
) |
Net income available to the Company's common |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Diluted per common share |
|
$ |
0.19 |
|
|
$ |
0.18 |
|
|
$ |
0.01 |
|
|
$ |
0.32 |
|
|
$ |
0.80 |
|
|
$ |
(0.48 |
) |
Net income available to the Company’s common shareholders was $128.0 million for the three months ended September 30, 2024, as compared to $112.0 million for the comparable period in 2023. On a diluted per common share basis, net income available to the Company’s common shareholders for the three months ended September 30, 2024 was $0.19, as compared to $0.18 for the comparable period in 2023.
45
Net income available to the Company’s common shareholders was $220.9 million for the nine months ended September 30, 2024, as compared to $495.9 million for the comparable period in 2023. On a diluted per common share basis, net income available to the Company’s common shareholders for the nine months ended September 30, 2024 was $0.32, as compared to $0.80 for the comparable period in 2023.
The following describes the changes of certain line items included on the Company’s Condensed Consolidated Statements of Income that the Company believes changed significantly and affected Net income available to the Company’s common shareholders during the three and nine months ended September 30, 2024, as compared to the corresponding periods in 2023.
Revenues from rental properties, net –
The increase in Revenues from rental properties, net of $61.1 million for the three months ended September 30, 2024, as compared to the corresponding period in 2023, is primarily from (i) a net increase in revenues from tenants of $44.0 million due to properties acquired through the RPT Merger, (ii) a net increase in revenues from tenants of $16.7 million, primarily due to an increase in leasing activity and net growth in the current portfolio, and (iii) an increase in revenues of $3.0 million due to properties acquired during 2023, partially offset by (iv) a decrease in net straight-line rental income of $2.2 million and (v) a decrease in revenues of $0.4 million due to dispositions during 2024 and 2023.
The increase in Revenues from rental properties, net of $178.8 million for the nine months ended September 30, 2024, as compared to the corresponding period in 2023, is primarily from (i) a net increase in revenues from tenants of $133.3 million due to properties acquired through the RPT Merger, (ii) a net increase in revenues from tenants of $42.6 million, primarily due to an increase in leasing activity and net growth in the current portfolio, and (iii) an increase in revenues of $13.4 million due to properties acquired during 2023, partially offset by (iv) a decrease in revenues of $6.1 million due to dispositions during 2024 and 2023 and (v) a decrease in net straight-line rental income of $4.4 million.
Real estate taxes –
The increase in Real estate taxes of $7.1 million and $21.5 million for the three and nine months ended September 30, 2024, respectively, as compared to the corresponding periods in 2023, is primarily due to properties acquired during 2024 and 2023, primarily related to the RPT Merger, partially offset by dispositions during 2024 and 2023.
Operating and maintenance –
The increase in Operating and maintenance expense of $12.1 million for the three months ended September 30, 2024, as compared to the corresponding period in 2023, is primarily due to (i) an increase of $8.4 million resulting from properties acquired related to the RPT Merger and (ii) an increase in repairs and maintenance expense of $3.5 million.
The increase in Operating and maintenance expense of $35.3 million for the nine months ended September 30, 2024, as compared to the corresponding period in 2023, is primarily due to (i) an increase of $25.0 million resulting from properties acquired related to the RPT Merger and (ii) an increase in repairs and maintenance expense of $9.5 million.
Impairment charges –
During the nine months ended September 30, 2024 and 2023, the Company recognized impairment charges related to adjustments to property carrying values of $4.3 million and $14.0 million, respectively, for which the Company’s estimated fair values were primarily based upon signed contracts or letters of intent from third party offers. These adjustments to property carrying values were recognized in connection with the Company’s efforts to market certain properties and management’s assessment as to the likelihood and timing of such potential transactions. Certain of the calculations to determine fair values utilized unobservable inputs and, as such, were classified as Level 3 of the FASB’s fair value hierarchy.
Merger charges –
During the nine months ended September 30, 2024 and 2023, the Company incurred costs of $25.2 million and $3.8 million, respectively, associated with the RPT Merger, primarily comprised of severance, professional and legal fees.
Depreciation and amortization –
The increase in Depreciation and amortization of $17.3 million for the three months ended September 30, 2024, as compared to the corresponding period in 2023, is primarily due to (i) an increase of $32.4 million resulting from properties acquired during 2024 and 2023, primarily related to the RPT Merger, and (ii) an increase of $2.2 million due to depreciation commencing on certain redevelopment projects that were placed into service during 2024 and 2023, partially offset by (iii) a net decrease of $17.3 million, primarily from fully depreciated assets, write-offs due to demolition and tenant vacates and dispositions during 2024 and 2023.
46
The increase in Depreciation and amortization of $64.6 million for the nine months ended September 30, 2024, as compared to the corresponding period in 2023, is primarily due to (i) an increase of $89.1 million resulting from properties acquired during 2024 and 2023, primarily related to the RPT Merger, and (ii) an increase of $14.0 million due to depreciation commencing on certain redevelopment projects that were placed into service during 2024 and 2023, partially offset by (iii) a net decrease of $38.5 million, primarily from fully depreciated assets, write-offs due to demolition and tenant vacates and dispositions during 2024 and 2023.
Gain on sale of properties –
During the nine months ended September 30, 2024, the Company disposed of 11 operating properties and seven land parcels, in separate transactions, for an aggregate sales price of $254.1 million, which resulted in aggregate gains of $0.9 million. During the nine months ended September 30, 2023, the Company disposed of four operating properties and 11 land parcels, in separate transactions, for an aggregate sales price of $175.0 million, which resulted in aggregate gains of $52.4 million.
Special dividend income –
During the nine months ended September 30, 2023, the Company received $194.1 million representing its share of the Albertsons Companies Inc. (“ACI”) special dividend payment.
Other income, net –
The increase in Other income, net of $13.8 million for the three months ended September 30, 2024, as compared to the corresponding period in 2023, is primarily due to (i) a net increase in mortgage and other financing income of $8.8 million, and (ii) an increase of $4.8 million due to mark-to-market fluctuations of an embedded derivative liability.
The increase in Other income, net of $20.9 million for the nine months ended September 30, 2024, as compared to the corresponding period in 2023, is primarily due to (i) a net increase in mortgage and other financing income of $10.6 million, (ii) an increase of $8.7 million due to mark-to-market fluctuations of an embedded derivative liability, (iii) an increase in interest income of $5.3 million due to higher levels of cash on hand, (iv) a decrease in environmental remediation expense of $4.7 million, (v) an increase in income of $3.8 million from settlement of contracts, and (vi) an increase of $1.2 million from insurance proceeds, partially offset by (vii) a decrease of $8.7 million relating to net settlement gains recognized upon liquidation of the Company’s defined benefit plan during 2023 and (viii) a decrease in dividend income of $5.2 million, primarily due to the sale of the remaining shares of ACI common stock held by the Company.
Gain/(loss) on marketable securities, net –
The change in Gain/(loss) on marketable securities, net of $13.1 million and $45.3 million for the three and nine months ended September 30, 2024, respectively, as compared to the corresponding periods in 2023 is due to mark-to-market fluctuations and the sale of the remaining shares of ACI common stock held by the Company during 2024 and 2023.
Interest expense –
The increase in Interest expense of $15.8 million and $41.7 million for the three and nine months ended September 30, 2024, respectively, as compared to the corresponding periods in 2023, is primarily due to (i) the issuance of unsecured notes during 2023 and 2024 and (ii) increased levels of borrowings and assumptions of unsecured notes and term loans in connection with the RPT Merger, partially offset by (iii) the paydown of unsecured notes during 2024 and 2023.
(Provision)/benefit for income taxes, net –
The change in (Provision)/benefit for income taxes, net of $11.2 million for the nine months ended September 30, 2024, as compared to the corresponding period in 2023, is primarily due to the Company’s sale of shares of ACI common stock during 2024 and 2023, which generated taxable long-term capital gains. The Company anticipates retaining the proceeds from the sale during 2024 and, as a result, recorded federal and state income taxes on these gains.
Equity in income of joint ventures, net –
The increase in Equity in income of joint ventures, net of $4.7 million for the three months ended September 30, 2024, as compared to the corresponding period in 2023, is primarily due to (i) higher equity in income of $6.4 million, primarily due to newly acquired joint ventures in connection with the RPT Merger, partially offset by (ii) lower gains of $1.1 million recognized on sale of properties within various joint venture investments during 2024, as compared to 2023, and (iii) an increase in interest expense of $0.6 million.
The increase in Equity in income of joint ventures, net of $5.8 million for the nine months ended September 30, 2024, as compared to the corresponding period in 2023, is primarily due to (i) higher equity in income of $16.5 million, primarily due to newly acquired joint
47
ventures in connection with the RPT Merger, partially offset by (ii) lower gains of $7.5 million recognized on sale of properties within various joint venture investments during 2024, as compared to 2023 and (iii) an increase in interest expense of $3.2 million.
Preferred dividends –
The increase in Preferred dividends of $5.1 million for the nine months ended September 30, 2024, as compared to the corresponding period in 2023, is primarily due to the issuance of the Class N Preferred Stock in connection with the RPT Merger.
Tenant Concentration
The Company seeks to reduce its operating and leasing risks through diversification achieved by the geographic distribution of its properties and a large tenant base. As of September 30, 2024, the Company had interests in 567 U.S. shopping center properties, aggregating 100.5 million square feet of gross leasable area (“GLA”), located in 30 states. At September 30, 2024, the Company’s five largest tenants were TJX Companies, The Home Depot, Ross Stores, Amazon/Whole Foods and Burlington Stores, Inc., which represented 3.8%, 1.8%, 1.8%, 1.8% and 1.7%, respectively, of the Company’s annualized base rental revenues, including the proportionate share of base rental revenues from properties in which the Company has less than a 100% economic interest.
Liquidity and Capital Resources
The Company’s capital resources include accessing the public debt and equity capital markets, unsecured term loans, mortgages and construction loan financing, and immediate access to the Credit Facility with bank commitments of $2.0 billion, which can be increased to $2.75 billion through an accordion feature.
The Company anticipates that net cash flow provided by operating activities, borrowings under its Credit Facility and the issuance of equity, public debt, as well as other debt and equity alternatives, will provide the necessary capital required by the Company. The Company will continue to evaluate its capital requirements for both its short-term and long-term liquidity needs, which could be affected by various risks and uncertainties, including, but not limited to, the effects of inflation, interest rates, and other risks detailed in Part I, Item 1A. Risk Factors of our Annual Report on Form 10-K for the year ended December 31, 2023 as supplemented by the risks and uncertainties identified under Item 1A, “Risk Factors” in this Quarterly Report on Form 10-Q.
The Company’s cash flow activities are summarized as follows (in thousands):
|
|
Nine Months Ended September 30, |
|
|||||
|
|
2024 |
|
|
2023 |
|
||
Cash, cash equivalents and restricted cash, beginning of the period |
|
$ |
783,757 |
|
|
$ |
149,829 |
|
Net cash flow provided by operating activities |
|
|
766,080 |
|
|
|
881,409 |
|
Net cash flow used for investing activities |
|
|
(91,855 |
) |
|
|
(75,961 |
) |
Net cash flow used for financing activities |
|
|
(667,938 |
) |
|
|
(531,015 |
) |
Net change in cash, cash equivalents and restricted cash |
|
|
6,287 |
|
|
|
274,433 |
|
Cash, cash equivalents and restricted cash, end of the period |
|
$ |
790,044 |
|
|
$ |
424,262 |
|
Operating Activities
Net cash flow provided by operating activities for the nine months ended September 30, 2024 was $766.1 million, as compared to $881.4 million for the comparable period in 2023. The decrease of $115.3 million is primarily attributable to:
Investing Activities
Net cash flow used for investing activities was $91.9 million for the nine months ended September 30, 2024, as compared to $76.0 million for the comparable period in 2023.
Investing activities during the nine months ended September 30, 2024 primarily consisted of:
Cash inflows:
48
Cash outflows:
Investing activities during the nine months ended September 30, 2023 primarily consisted of:
Cash inflows:
Cash outflows:
Acquisition of Operating Real Estate –
During the nine months ended September 30, 2024, the Company expended $149.1 million in conjunction with the RPT Merger. During the nine months ended September 30, 2024 and 2023, the Company expended $10.0 million and $269.5 million, respectively, for the acquisition of operating real estate properties. The Company anticipates spending up to approximately $150.0 million to $200.0 million towards the acquisition of, or the purchase of additional interests in, operating properties for the remainder of 2024. The Company intends to fund these potential acquisitions with net cash flow provided by operating activities, cash on hand, proceeds from property dispositions, and/or availability under its Credit Facility.
Improvements to Operating Real Estate –
During the nine months ended September 30, 2024 and 2023, the Company expended $213.4 million and $179.1 million, respectively, for improvements to operating real estate. These amounts consist of the following (in thousands):
|
|
Nine Months Ended September 30, |
|
|||||
|
|
2024 |
|
|
2023 |
|
||
Redevelopment and renovations |
|
$ |
94,520 |
|
|
$ |
98,902 |
|
Tenant improvements and tenant allowances |
|
|
118,921 |
|
|
|
80,243 |
|
Total improvements |
|
$ |
213,441 |
|
|
$ |
179,145 |
|
The Company has an ongoing program to redevelop and re-tenant its properties to maintain or enhance its competitive position in the marketplace. The Company is actively pursuing redevelopment opportunities within its operating portfolio, which it believes will increase the overall value by bringing in new tenants and improving the assets’ value. The Company anticipates its capital commitment toward these redevelopment projects and re-tenanting efforts for the remainder of 2024 will be approximately $50.0 million to $100.0 million. The funding of these capital requirements will be provided by net cash flow provided by operating activities, cash on hand, proceeds from property dispositions, and/or availability under the Company’s Credit Facility.
49
Financing Activities
Net cash flow used for financing activities was $667.9 million for the nine months ended September 30, 2024, as compared to $531.0 million for the comparable period in 2023.
Financing activities during the nine months ended September 30, 2024 primarily consisted of:
Cash inflows:
Cash outflows:
Financing activities during the nine months ended September 30, 2023 primarily consisted of:
Cash inflows:
Cash outflows:
The Company continually evaluates its debt maturities and based on management’s current assessment, believes it has viable financing and refinancing alternatives that will not materially adversely impact its expected financial results. As of September 30, 2024, the Company had consolidated floating rate debt totaling $17.0 million. The Company continues to pursue borrowing opportunities with large commercial U.S. and global banks, select life insurance companies and certain regional and local banks.
There are no debt maturities for the remainder of 2024. The Company intends to maintain strong debt service coverage and fixed charge coverage ratios as part of its commitment to maintain or improve its unsecured debt ratings. The Company may, from time to time, seek to obtain funds through additional common and preferred equity offerings, unsecured debt financings and/or mortgage/construction loan financings and other capital alternatives.
The Company utilizes the public debt and equity markets as its principal source of capital for its expansion needs through offerings of its public unsecured debt and equity. Proceeds from public capital market activities have been used for the purposes of, among other things, repaying indebtedness, acquiring interests in open-air, grocery anchored shopping centers and mixed-use assets, expanding and improving properties in the portfolio and other investments.
During January 2023, the Company filed a shelf registration statement on Form S-3, which is effective for a term of three years, for future unlimited offerings, from time to time, of debt securities, preferred stock, depositary shares, common stock and common stock warrants. The Company, pursuant to this shelf registration statement may, from time to time, offer for sale its senior unsecured debt securities for any general corporate purposes, including (i) funding specific liquidity requirements in its business, including property acquisitions, development and redevelopment costs and (ii) managing the Company’s debt maturities.
During January 2023, the Company filed a registration statement on Form S-8 for its 2020 Equity Participation Plan (the “2020 Plan”), which was previously approved by the Company’s stockholders and is a successor to the Restated Kimco Realty Corporation 2010 Equity Participation Plan that expired in March 2020. The 2020 Plan provides for a maximum of 10,000,000 shares of the Company’s common stock to be reserved for the issuance of stock options, stock appreciation rights, restricted stock, restricted stock units,
50
performance awards, dividend equivalents, stock payments, deferred stock awards and long-term incentive plan units. At September 30, 2024, the Company had 3.0 million shares of common stock available for issuance under the 2020 Plan.
Preferred Stock –
Under the terms of the Merger Agreement, each 7.25% Series D Cumulative Convertible Perpetual Preferred Share of RPT was converted into the right to receive one depositary share representing one one-thousandth of a share of Class N Preferred Stock of the Company having the rights, preferences and privileges substantially as set forth in the Merger Agreement, in each case, without interest, and subject to any withholding required under applicable law, upon the terms and subject to the conditions set forth in the Merger Agreement.
The Company’s Board of Director’s authorized the repurchase of up to 891,000 depositary shares of Class L preferred stock, 1,047,000 depositary shares of Class M preferred stock, and 185,000 depositary shares of Class N preferred stock, representing an aggregate of up to 2,123 shares of the Company’s preferred stock, par value $1.00 per share, through February 28, 2026. During the nine months ended September 30, 2024, the Company repurchased the following preferred stock:
Class of Preferred Stock |
|
Depositary Shares Repurchased |
|
|
Purchase Price (in thousands) |
|
||
Class N |
|
|
80 |
|
|
$ |
5 |
|
On August 22, 2024, the Company filed a preliminary prospectus supplement for a tender offer to purchase for cash any and all of its outstanding Class N Preferred Stock. The information in this preliminary prospectus supplement is not complete and may be changed. This preliminary prospectus supplement and the accompanying prospectus are not an offer to sell these securities, nor are they soliciting offers to buy these securities, in any jurisdiction where the offer or sale is not permitted.
Common Stock –
During September 2023, the Company established an at-the-market continuous offering program (the “ATM Program”) pursuant to which the Company may offer and sell from time-to-time shares of its common stock, par value $0.01 per share, with an aggregate gross sales price of up to $500.0 million through a consortium of banks acting as sales agents. Sales of the shares of common stock may be made, as needed, from time to time in “at the market” offerings as defined in Rule 415 of the Securities Act of 1933, as amended, including by means of ordinary brokers’ transactions on the New York Stock Exchange or otherwise (i) at market prices prevailing at the time of sale, (ii) at prices related to prevailing market prices or (iii) as otherwise agreed to with the applicable sales agent. In addition, the Company may from time to time enter into separate forward sale agreements with one or more banks. The Company did not issue any shares under the ATM Program during the nine months ended September 30, 2024. As of September 30, 2024, the Company had $500.0 million available under this ATM Program.
The Company has a common share repurchase program, which is scheduled to expire on February 28, 2026. Under this program, the Company may repurchase shares of its common stock, par value $0.01 per share, with an aggregate gross purchase price of up to $300.0 million. The Company did not repurchase any shares under the common share repurchase program during the nine months ended September 30, 2024. As of September 30, 2024, the Company had $224.9 million available under this common share repurchase program.
In connection with the RPT Merger, each RPT common share issued and outstanding immediately prior to the effective time of the RPT Merger was converted into 0.6049 shares of newly issued shares of Kimco common stock, resulting in 53.0 million common shares issued to effect the RPT Merger.
Senior Unsecured Notes –
The Company’s indenture governing its senior unsecured notes contains the following covenants, all of which the Company is compliant with:
Covenant |
|
Must Be |
|
As of September 30, 2024 |
Consolidated Indebtedness to Total Assets |
|
< 60% |
|
38% |
Consolidated Secured Indebtedness to Total Assets |
|
< 40% |
|
1% |
Consolidated Income Available for Debt Service to Maximum Annual Service Charge |
|
> 1.50x |
|
4.4x |
Unencumbered Total Asset Value to Consolidated Unsecured Indebtedness |
|
> 1.50x |
|
2.4x |
For a full description of the various indenture covenants, refer to the Indenture dated September 1, 1993; the First Supplemental Indenture dated August 4, 1994; the Second Supplemental Indenture dated April 7, 1995; the Third Supplemental Indenture dated June 2, 2006; the Fourth Supplemental Indenture dated April 26, 2007; the Fifth Supplemental Indenture dated as of September 24, 2009; the Sixth Supplemental Indenture dated as of May 23, 2013; Seventh Supplemental Indenture dated as of April 24, 2014; and the Eighth
51
Supplemental Indenture dated as of January 3, 2023, each as filed with the SEC. In connection with the merger with Weingarten, the Company assumed senior unsecured notes which have covenants that are similar to the Company’s existing debt covenants for its senior unsecured notes. Please refer to the form Indenture included in Weingarten’s Registration Statement on Form S-3, filed with the Securities and Exchange Commission on February 10, 1995, the First Supplemental Indenture, dated as of August 2, 2006 filed with Weingarten’s Current Report on Form 8-K dated August 2, 2006, and the Second Supplemental Indenture, dated as of October 9, 2012 filed with Weingarten’s Current Report on Form 8-K dated October 9, 2012. See the Exhibits Index to our Annual Report on Form 10-K for the year ended December 31, 2023 for specific filing information.
In connection with the Reorganization, Kimco OP became the issuer of the senior notes and the Parent Company has provided a full and unconditional guarantee of Kimco OP’s obligations under each series of senior notes previously issued and outstanding.
During September 2024, the Company issued $500.0 million in senior unsecured notes, which are scheduled to mature in March 2035 and accrue interest at a rate of 4.85% per annum. These senior unsecured notes are guaranteed by the Company. The Company intends to use the net proceeds from this offering for general corporate purposes.
During the nine months ended September 30, 2024, the Company fully repaid the following notes payables (dollars in millions):
Type |
|
Date Paid |
|
Amount Repaid |
|
|
Interest Rate |
|
Maturity Date |
|
Unsecured note |
|
Jan-24 |
|
$ |
246.2 |
|
|
4.45% |
|
Jan-24 |
Unsecured notes (1) |
|
Jan-24 |
|
$ |
511.5 |
|
|
3.64%-4.74% |
|
Jun-25-Nov-31 |
Unsecured note |
|
Mar-24 |
|
$ |
400.0 |
|
|
2.70% |
|
Mar-24 |
Credit Facility –
On September 9, 2024, Fitch Ratings assigned the Company a rating of A- for its senior unsecured debt, assigned a BBB credit rating for its preferred stock, and assigned its ‘Stable’ rating outlook. As a result, the Company achieved certain interest rate reductions and facility fee reduction for its Credit Facility and unsecured term loans.
The Company has a $2.0 billion Credit Facility with a group of banks. The Credit Facility is scheduled to expire in March 2027 with two additional six-month options to extend the maturity date, at the Company’s discretion, to March 2028. The Credit Facility is guaranteed by the Parent Company. The Credit Facility can be increased to $2.75 billion through an accordion feature. The Credit Facility is a green credit facility tied to sustainability metric targets, as described in the agreement. The Credit Facility accrues interest at a rate of Adjusted Term SOFR, as defined in the terms of the Credit Facility, plus 77.5 basis points and fluctuates in accordance with the Company’s credit ratings. The interest rate can be further adjusted upward or downward based on the sustainability metric targets and the Company’s credit rating outlook, as defined in the agreement. As of September 30, 2024, the interest rate on the Credit Facility is Adjusted Term SOFR plus 68.5 basis points (5.53% as of September 30, 2024) after reductions for sustainability metrics achieved and an upgraded credit rating profile. Pursuant to the terms of the Credit Facility, the Company is subject to certain covenants. As of September 30, 2024, the Credit Facility had no outstanding balance and no appropriations for letters of credit.
Pursuant to the terms of the Credit Facility, the Company, among other things, is subject to maintenance of various covenants. The Company is currently in compliance with these covenants. The financial covenants for the Credit Facility are as follows:
Covenant |
|
Must Be |
|
As of September 30, 2024 |
Total Indebtedness to Gross Asset Value (“GAV”) |
|
< 60% |
|
35% |
Total Priority Indebtedness to GAV |
|
< 35% |
|
1% |
Unencumbered Asset Net Operating Income to Total Unsecured Interest Expense |
|
> 1.75x |
|
4.5x |
Fixed Charge Total Adjusted EBITDA to Total Debt Service |
|
> 1.50x |
|
4x |
Term Loans –
The Company entered into a Seventh Amended and Restated Credit Agreement, through which the term loans assumed in connection with the RPT Merger were terminated (fully repaid) and new term loans were issued to replace the assumed loans. The new term loans retained the amounts and maturities of the assumed term loans, however, the rates (Adjusted Term SOFR plus 0.905% and fluctuate based on credit rating profile and achieving sustainability metric targets, as described in the agreement) and covenants were revised to match those within the Company's Credit Facility. The following unsecured term loans were assumed, terminated and issued (dollars in millions):
52
Type |
|
Date Paid |
|
Amount Repaid |
|
|
Interest Rate (1) |
|
Maturity Date |
|
Unsecured term loan |
|
Jan-24 |
|
$ |
50.0 |
|
|
4.15% |
|
Nov-26 |
Unsecured term loan |
|
Jan-24 |
|
$ |
100.0 |
|
|
4.11% |
|
Feb-27 |
Unsecured term loan |
|
Jan-24 |
|
$ |
50.0 |
|
|
3.43% |
|
Aug-27 |
Unsecured term loan |
|
Jan-24 |
|
$ |
110.0 |
|
|
3.71% |
|
Feb-28 |
On January 2, 2024, Kimco OP entered into a new $200.0 million unsecured term loan credit facility (the “Term Loan Credit Facility”) pursuant to a credit agreement, among Kimco OP, TD Bank, N.A., as administrative agent, and the other parties thereto. The Term Loan Credit Facility accrues interest at a spread (currently 0.800% after reductions for sustainability metrics achieved and an upgraded credit rating profile) to the Adjusted Term SOFR Rate (as defined in the credit agreement), that fluctuates in accordance with changes in Kimco’s senior debt ratings. In addition, during the three months ended September 30 2024, the Company amended the Term Loan Credit Facility, in separate transactions, to increase the aggregate principal amount from $200.0 million to $550.0 million. The additional $350.0 million is subject to the same terms as the existing Term Loan Credit Facility. As of September 30, 2024, the Company had six swap rate agreements with various lenders swapping the overall interest rate on the $550.0 million Term Loan Credit Facility to an all-in fixed rate of 4.6122%.
Mortgages Payable –
During the nine months ended September 30, 2024, the Company repaid $11.8 million of mortgage debt that encumbered three operating properties.
In addition to the public equity and debt markets as capital sources, the Company may, from time to time, obtain mortgage financing on selected properties to partially fund the capital needs of its real estate re-development and re-tenanting projects. As of September 30, 2024, the Company had over 525 unencumbered property interests in its portfolio.
Other –
During the nine months ended September 30, 2024, the Company sold its remaining 14.2 million shares of ACI common stock held by the Company, generating net proceeds of $299.1 million. For tax purposes, the Company recognized a long-term capital gain of $288.7 million. The Company anticipates retaining the proceeds from this stock sale for general corporate purposes and, as a result, recorded federal and state income taxes of $72.9 million on the taxable gain.
The Parent Company guarantees the unsecured debt instruments of Kimco OP. These guarantees by the Parent Company are full, irrevocable, unconditional and absolute joint and several guarantees to the holders of each series of such unsecured debt instruments.
The Company has issued letters of credit in connection with completion and repayment guarantees, primarily on certain of the Company’s redevelopment projects and guaranty of payment related to the Company’s insurance program. At September 30, 2024, these letters of credit aggregated $39.8 million.
The Company has investments with funding commitments of $27.5 million, of which $19.3 million has been funded as of September 30, 2024.
In connection with the construction of its development and redevelopment projects and related infrastructure, certain public agencies require posting of performance and surety bonds to guarantee that the Company’s obligations are satisfied. These bonds expire upon the completion of the improvements and infrastructure. As of September 30, 2024, there were $16.2 million in performance and surety bonds outstanding.
The Company provides a guaranty for the payment of any debt service shortfalls on the Sheridan Redevelopment Agency issued Series A bonds, which are tax increment revenue bonds issued in connection with a development project in Sheridan, Colorado. These tax increment revenue bonds have a balance of $41.0 million outstanding at September 30, 2024. The bonds are to be repaid with incremental sales and property taxes and a public improvement fee ("PIF") to be assessed on current and future retail sales and, to the extent necessary, any amounts we may have to provide under a guaranty. The revenue generated from incremental sales, property taxes and PIF have satisfied the debt service requirements to date. The incremental taxes and PIF are to remain intact until the earlier of the payment of the bond liability in full or 2040.
In connection with the RPT Merger, the Company provides a guaranty for the payment of any debt service shortfalls on the City of Jacksonville Series 2005A bonds, which are tax increment revenue bonds issued in connection with a redevelopment project in Jacksonville, FL. Repayment of the bonds is to be made in accordance with a level-payment amortization schedule over 20 years, and repayments are made out of tax revenues generated by the redevelopment. The remaining debt service payments due over the life of the
53
bonds, including principal and interest, are $4.5 million as of September 30, 2024. There have been no payments made by the Company under this guaranty agreement to date and the Company does not expect to make any payments over the life of the agreement.
Dividends –
In connection with its intention to continue to qualify as a REIT for U.S. federal income tax purposes, the Company expects to continue paying regular dividends to its stockholders. These dividends will be paid from operating cash flows. The Company’s Board of Directors will continue to evaluate the Company’s dividend policy on a quarterly basis as it monitors sources of capital and evaluates the impact of the economy and capital markets availability on operating fundamentals. Since cash used to pay dividends reduces amounts available for capital investment, the Company generally intends to maintain a dividend payout ratio that reserves such amounts as it considers necessary for the expansion and renovation of shopping centers in its portfolio, debt reduction, the acquisition of interests in new properties and other investments as suitable opportunities arise and such other factors as the Board of Directors considers appropriate. Cash dividends paid for common and preferred stock for the nine months ended September 30, 2024 and 2023 were $507.8 million and $446.6 million, respectively.
Although the Company receives substantially all of its rental payments on a monthly basis, it generally intends to continue paying dividends quarterly. Amounts accumulated in advance of each quarterly distribution will be invested by the Company in short-term money market or other suitable instruments with institutions that have high credit ratings. The Company’s objective is to establish a dividend level that maintains compliance with the Company’s REIT taxable income distribution requirements. On July 30, 2024, the Company’s Board of Directors declared a quarterly dividend with respect to the Company’s classes of preferred shares (Classes L, M and N), which were paid on October 15, 2024, to shareholders of record on October 1, 2024. In addition, the Company’s Board of Directors declared a quarterly cash dividend of $0.24 per common share which was paid on September 19, 2024 to shareholders of record on September 5, 2024.
On October 29, 2024, the Company’s Board of Directors declared quarterly dividends with respect to the Company’s classes of preferred shares (Classes L, M and N), which are scheduled to be paid on January 15, 2025, to shareholders of record on January 2, 2025. Additionally, the Company’s Board of Directors declared a quarterly cash dividend of $0.25 per common share, representing a 4.2% increase from the prior quarterly dividend of $0.24, payable on December 19, 2024 to shareholders of record on December 5, 2024.
Hurricane Impact –
The Company incurred no significant damage to its properties in September and October 2024 as a result of hurricanes Helene and Milton, which primarily hit Florida, South Carolina and Georgia.
Funds From Operations
Funds From Operations (“FFO”) is a supplemental non-GAAP financial measure utilized to evaluate the operating performance of real estate companies. NAREIT defines FFO as net income/(loss) available to the Company’s common shareholders computed in accordance with generally accepted accounting principles in the United States (“GAAP”), excluding (i) depreciation and amortization related to real estate, (ii) gains or losses from sales of certain real estate assets, (iii) gains and losses from change in control, (iv) impairment write-downs of certain real estate assets and investments in entities when the impairment is directly attributable to decreases in the value of depreciable real estate held by the entity and (v) after adjustments for unconsolidated partnerships and joint ventures calculated to reflect FFO on the same basis. The Company also made an election, in accordance with the NAREIT Funds From Operations White Paper-2018 Restatement, to exclude from its calculation of FFO (i) gains and losses on the sale of assets and impairments of assets incidental to its main business and (ii) mark-to-market changes in the value of its equity securities. As such, the Company does not include gains/impairments on land parcels, mark-to-market gains/losses from marketable securities, allowance for credit losses on mortgage receivables, gains/impairments on other investments or other amounts considered incidental to its main business in NAREIT defined FFO.
The Company presents FFO available to the Company’s common shareholders as it considers it an important supplemental measure of our operating performance and believes it is frequently used by securities analysts, investors and other interested parties in the evaluation of REITs, many of which present FFO available to the Company’s common shareholders when reporting results. Comparison of our presentation of FFO available to the Company’s common shareholders to similarly titled measures for other REITs may not necessarily be meaningful due to possible differences in the application of the NAREIT definition used by such REITs.
FFO is a supplemental non-GAAP financial measure of real estate companies’ operating performances, which does not represent cash generated from operating activities in accordance with GAAP, and therefore, should not be considered an alternative for net income or cash flows from operations as a measure of liquidity.
54
The Company’s reconciliation of Net income available to the Company’s common shareholders to FFO available to the Company’s common shareholders is reflected in the table below (in thousands, except per share data).
|
|
Three Months Ended September 30, |
|
|
Nine Months Ended September 30, |
|
||||||||||
|
|
2024 |
|
|
2023 |
|
|
2024 |
|
|
2023 |
|
||||
Net income available to the Company’s common shareholders |
|
$ |
128,022 |
|
|
$ |
111,954 |
|
|
$ |
220,883 |
|
|
$ |
495,892 |
|
Gain on sale of properties |
|
|
(551 |
) |
|
|
- |
|
|
|
(944 |
) |
|
|
(52,376 |
) |
Gain on sale of joint venture properties |
|
|
(7 |
) |
|
|
(1,130 |
) |
|
|
(1,501 |
) |
|
|
(9,020 |
) |
Depreciation and amortization - real estate related |
|
|
143,482 |
|
|
|
126,291 |
|
|
|
443,836 |
|
|
|
379,294 |
|
Depreciation and amortization - real estate joint ventures |
|
|
21,218 |
|
|
|
16,244 |
|
|
|
64,161 |
|
|
|
48,390 |
|
Impairment charges (including real estate joint ventures) |
|
|
375 |
|
|
|
2,237 |
|
|
|
8,778 |
|
|
|
14,040 |
|
Profit participation from other investments, net |
|
|
377 |
|
|
|
479 |
|
|
|
(5,299 |
) |
|
|
(2,282 |
) |
Special dividend income |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
(194,116 |
) |
(Gain)/loss on marketable securities/derivative, net |
|
|
(4,849 |
) |
|
|
(6,225 |
) |
|
|
25,922 |
|
|
|
(10,642 |
) |
Provision/(benefit) for income taxes, net (2) |
|
|
59 |
|
|
|
(669 |
) |
|
|
71,706 |
|
|
|
61,463 |
|
Noncontrolling interests (1) |
|
|
(738 |
) |
|
|
(575 |
) |
|
|
(2,367 |
) |
|
|
(68 |
) |
FFO available to the Company’s common shareholders (3) |
|
$ |
287,388 |
|
|
$ |
248,606 |
|
|
$ |
825,175 |
|
|
$ |
730,575 |
|
Weighted average shares outstanding for FFO calculations: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Basic |
|
|
671,231 |
|
|
|
617,090 |
|
|
|
670,851 |
|
|
|
616,888 |
|
Units |
|
|
3,293 |
|
|
|
2,562 |
|
|
|
3,245 |
|
|
|
2,555 |
|
Convertible preferred shares |
|
|
4,265 |
|
|
|
- |
|
|
|
4,265 |
|
|
|
- |
|
Dilutive effect of equity awards |
|
|
289 |
|
|
|
124 |
|
|
|
193 |
|
|
|
129 |
|
Diluted (2) |
|
|
679,078 |
|
|
|
619,776 |
|
|
|
678,554 |
|
|
|
619,572 |
|
FFO per common share – basic |
|
$ |
0.43 |
|
|
$ |
0.40 |
|
|
$ |
1.23 |
|
|
$ |
1.18 |
|
FFO per common share – diluted (2) |
|
$ |
0.43 |
|
|
$ |
0.40 |
|
|
$ |
1.23 |
|
|
$ |
1.18 |
|
Same Property Net Operating Income (“Same property NOI”)
Same property NOI is a supplemental non-GAAP financial measure of real estate companies’ operating performance and should not be considered an alternative to net income in accordance with GAAP or cash flows from operations as a measure of liquidity. The Company considers Same property NOI as an important operating performance measure because it is frequently used by securities analysts and investors to measure only the net operating income of properties that have been owned by the Company for the entire current and prior year reporting periods. It excludes properties under redevelopment, development and pending stabilization; properties are deemed stabilized at the earlier of (i) reaching 90% leased or (ii) one year following a project’s inclusion in operating real estate. Same property NOI assists in eliminating disparities in net income due to the development, acquisition or disposition of properties during the particular period presented, and thus provides a more consistent performance measure for the comparison of the Company's properties.
For the three and nine months ended September 30, 2024 and 2023, the Company included Same property NOI from the RPT properties acquired through the RPT Merger, as the Company owned these properties for the full three and nine months ended September 30, 2024 and 2023. The amount of the adjustment relating to RPT same property NOI for the nine months ended September 30, 2024 and three and nine months ended September 30, 2023, included in the table below, represents the Same property NOI from RPT properties prior to the RPT Merger, which is not included in the Company's Net income available to the Company’s common shareholders.
Same property NOI is calculated using revenues from rental properties (excluding straight-line rent adjustments, lease termination fees, TIFs and amortization of above/below market rents) less charges for credit losses, operating and maintenance expense, real estate taxes and rent expense plus the Company’s proportionate share of Same property NOI from unconsolidated real estate joint ventures, calculated on the same basis. The Company’s method of calculating Same property NOI available to the Company’s common shareholders may differ from methods used by other REITs and, accordingly, may not be comparable to such other REITs.
55
The following is a reconciliation of Net income available to the Company’s common shareholders to Same property NOI (in thousands):
|
|
Three Months Ended September 30, |
|
|
Nine Months Ended September 30, |
|
||||||||||
|
|
2024 |
|
|
2023 |
|
|
2024 |
|
|
2023 |
|
||||
Net income available to the Company’s |
|
$ |
128,022 |
|
|
$ |
111,954 |
|
|
$ |
220,883 |
|
|
$ |
495,892 |
|
Adjustments: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Management and other fee income |
|
|
(4,757 |
) |
|
|
(4,249 |
) |
|
|
(13,616 |
) |
|
|
(12,635 |
) |
General and administrative |
|
|
33,850 |
|
|
|
33,697 |
|
|
|
103,238 |
|
|
|
101,180 |
|
Impairment charges |
|
|
375 |
|
|
|
2,237 |
|
|
|
4,277 |
|
|
|
14,043 |
|
Merger charges |
|
|
- |
|
|
|
3,750 |
|
|
|
25,246 |
|
|
|
3,750 |
|
Depreciation and amortization |
|
|
144,688 |
|
|
|
127,437 |
|
|
|
447,555 |
|
|
|
382,983 |
|
Gain on sale of properties |
|
|
(551 |
) |
|
|
- |
|
|
|
(944 |
) |
|
|
(52,376 |
) |
Special dividend income |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
(194,116 |
) |
Interest expense and other income, net |
|
|
54,013 |
|
|
|
52,047 |
|
|
|
184,169 |
|
|
|
163,324 |
|
(Gain)/loss on marketable securities, net |
|
|
(79 |
) |
|
|
(13,225 |
) |
|
|
27,613 |
|
|
|
(17,642 |
) |
Provision/(benefit) for income taxes, net |
|
|
128 |
|
|
|
(729 |
) |
|
|
72,355 |
|
|
|
61,127 |
|
Equity in income of other investments, net |
|
|
(216 |
) |
|
|
(2,100 |
) |
|
|
(9,468 |
) |
|
|
(8,741 |
) |
Net income attributable to noncontrolling interests |
|
|
2,443 |
|
|
|
2,551 |
|
|
|
6,693 |
|
|
|
9,208 |
|
Preferred dividends, net |
|
|
7,961 |
|
|
|
6,285 |
|
|
|
23,864 |
|
|
|
18,736 |
|
RPT same property NOI (1) |
|
|
- |
|
|
|
42,893 |
|
|
|
610 |
|
|
|
121,761 |
|
Non same property net operating income |
|
|
(10,664 |
) |
|
|
(14,368 |
) |
|
|
(36,620 |
) |
|
|
(43,209 |
) |
Non-operational expense from joint ventures, net |
|
|
28,231 |
|
|
|
23,106 |
|
|
|
85,629 |
|
|
|
61,911 |
|
Same property NOI |
|
$ |
383,444 |
|
|
$ |
371,286 |
|
|
$ |
1,141,484 |
|
|
$ |
1,105,196 |
|
Same property NOI increased by $12.2 million, or 3.3%, for the three months ended September 30, 2024, as compared to the corresponding period in 2023. This increase is primarily the result of (i) a net increase of $11.7 million, primarily related to an increase in rental revenue driven by strong leasing activity and (ii) a decrease in non-recoverable operating expenses of $0.5 million.
Same property NOI increased by $36.3 million, or 3.3%, for the nine months ended September 30, 2024, as compared to the corresponding period in 2023. This increase is primarily the result of (i) a net increase of $31.5 million, primarily related to an increase in rental revenue driven by strong leasing activity and (ii) a decrease in non-recoverable operating expenses of $4.8 million.
Leasing Activity
During the nine months ended September 30, 2024, the Company executed 1,205 leases totaling 8.0 million square feet in the Company’s consolidated operating portfolio, comprised of 326 new leases and 879 renewals and options. The leasing costs associated with these new leases are estimated to aggregate $67.0 million, or $39.21 per square foot. These costs include $51.3 million of tenant improvements and $15.7 million of external leasing commissions. The average rent per square foot for (i) new leases was $22.97 and (ii) renewals and options was $19.44.
56
Tenant Lease Expirations
At September 30, 2024, the Company has a total of 9,279 leases in its consolidated operating portfolio. The following table sets forth the aggregate lease expirations for each of the next ten years, assuming no renewal options are exercised. For purposes of the table, the Total Annual Base Rent Expiring represents annualized rental revenue, excluding the impact of straight-line rent, for each lease that expires during the respective year. Amounts in thousands, except for number of leases data:
Year Ending December 31, |
|
Number of Leases |
|
|
Square Feet |
|
|
Total Annual Base Rent Expiring |
|
|
% of Gross |
|
||||
(1) |
|
|
102 |
|
|
|
425 |
|
|
$ |
9,031 |
|
|
|
0.6 |
% |
2024 |
|
|
137 |
|
|
|
501 |
|
|
$ |
11,936 |
|
|
|
0.8 |
% |
2025 |
|
|
1,037 |
|
|
|
6,357 |
|
|
$ |
123,373 |
|
|
|
8.5 |
% |
2026 |
|
|
1,305 |
|
|
|
11,206 |
|
|
$ |
190,194 |
|
|
|
13.1 |
% |
2027 |
|
|
1,359 |
|
|
|
10,631 |
|
|
$ |
199,158 |
|
|
|
13.7 |
% |
2028 |
|
|
1,352 |
|
|
|
11,320 |
|
|
$ |
219,211 |
|
|
|
15.1 |
% |
2029 |
|
|
1,249 |
|
|
|
10,257 |
|
|
$ |
192,729 |
|
|
|
13.3 |
% |
2030 |
|
|
651 |
|
|
|
5,445 |
|
|
$ |
111,800 |
|
|
|
7.7 |
% |
2031 |
|
|
417 |
|
|
|
2,828 |
|
|
$ |
61,624 |
|
|
|
4.2 |
% |
2032 |
|
|
425 |
|
|
|
3,246 |
|
|
$ |
61,970 |
|
|
|
4.3 |
% |
2033 |
|
|
446 |
|
|
|
3,532 |
|
|
$ |
67,349 |
|
|
|
4.6 |
% |
2034 |
|
|
417 |
|
|
|
3,148 |
|
|
$ |
70,676 |
|
|
|
4.9 |
% |
Item 3. Quantitative and Qualitative Disclosures About Market Risk.
The Company’s primary market risk exposure is interest rate risk. The Company periodically evaluates its exposure to short-term interest rates and will, from time-to-time, enter into interest rate protection agreements which mitigate, but do not eliminate, the effect of changes in interest rates on its floating-rate debt. As of September 30, 2024, the Company had 26 interest rate swaps with notional amounts aggregating to $860.0 million. The interest rate swap agreements are designated as cash flow hedges and are held by the Company to reduce the impact of changes in interest rates on variable rate debt. The hedged debt is reflected as fixed rate unsecured debt in the table below. The Company has not entered, and does not plan to enter, into any derivative financial instruments for trading or speculative purposes.
The following table presents the carrying value of the Company’s aggregate fixed rate and variable rate debt obligations outstanding, including fair market value adjustments and unamortized deferred financing costs, as of September 30, 2024, with corresponding weighted-average interest rates sorted by maturity date. In addition, the following table presents the fair value of the Company’s debt obligations outstanding, excluding unamortized deferred financing costs. The table does not include extension options where available (amounts in millions).
|
|
2024 |
|
|
2025 |
|
|
2026 |
|
|
2027 |
|
|
2028 |
|
|
Thereafter |
|
|
Total |
|
|
Fair Value |
|
||||||||
Secured Debt |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Fixed Rate |
|
$ |
- |
|
|
$ |
49.7 |
|
|
$ |
- |
|
|
$ |
33.3 |
|
|
$ |
133.9 |
|
|
$ |
101.4 |
|
|
$ |
318.3 |
|
|
$ |
304.3 |
|
Average Interest Rate |
|
|
- |
|
|
|
3.50 |
% |
|
|
- |
|
|
|
4.01 |
% |
|
|
4.49 |
% |
|
|
3.82 |
% |
|
|
4.07 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Variable Rate |
|
$ |
- |
|
|
$ |
17.0 |
|
|
$ |
- |
|
|
$ |
- |
|
|
$ |
- |
|
|
$ |
- |
|
|
$ |
17.0 |
|
|
$ |
17.0 |
|
Average Interest Rate |
|
|
- |
|
|
|
6.50 |
% |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
6.50 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Unsecured Debt |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Fixed Rate |
|
$ |
- |
|
|
$ |
744.1 |
|
|
$ |
1,377.6 |
|
|
$ |
585.4 |
|
|
$ |
517.6 |
|
|
$ |
4,742.2 |
|
|
$ |
7,966.9 |
|
|
$ |
7,590.1 |
|
Average Interest Rate |
|
|
- |
|
|
|
3.48 |
% |
|
|
3.74 |
% |
|
|
4.21 |
% |
|
|
2.55 |
% |
|
|
4.28 |
% |
|
|
3.86 |
% |
|
|
|
|
Based on the Company’s variable-rate debt balances, interest expense would have increased by $0.1 million for the nine months ended September 30, 2024 if short-term interest rates were 1.0% higher.
Item 4. Controls and Procedures.
Controls and Procedures (Kimco Realty Corporation)
The Parent Company’s management, with the participation of the Parent Company’s Chief Executive Officer and Chief Financial Officer, has evaluated the effectiveness of the Parent Company’s disclosure controls and procedures (as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”)) as of the end of the period covered by this report. Based on such evaluation, the Parent Company’s Chief Executive Officer and Chief Financial Officer have concluded that, as of the end of such period, the Parent Company’s disclosure controls and procedures are effective.
57
On January 2, 2024, the Company completed the RPT Merger and, accordingly, the Company’s management is in the process of integrating RPT’s operations into its internal control over financial reporting, as necessary, to accommodate modifications to its business processes related to the RPT Merger transaction. None of these integration activities had a material impact on our system of internal control over financial reporting.
There have not been any changes in the Parent Company’s internal control over financial reporting during the fiscal quarter to which this report relates that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.
Controls and Procedures (Kimco Realty OP, LLC)
Kimco OP’s management, with the participation of the Kimco OP’s Chief Executive Officer and Chief Financial Officer, has evaluated the effectiveness of Kimco OP’s disclosure controls and procedures (as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) as of the end of the period covered by this report. Based on such evaluation, Kimco OP’s Chief Executive Officer and Chief Financial Officer have concluded that, as of the end of such period, Kimco OP’s disclosure controls and procedures are effective.
On January 2, 2024, the Company completed the RPT Merger and accordingly Kimco OP’s management is in the process of integrating RPT’s operations into its internal control over financial reporting, as necessary, to accommodate modifications to its business processes related to the RPT Merger transaction. None of these integration activities had a material impact on our system of internal control over financial reporting.
There have not been any changes in Kimco OP’s internal control over financial reporting during the fiscal quarter to which this report relates that have materially affected, or are reasonably likely to materially affect, Kimco OP’s internal control over financial reporting.
58
PART II
OTHER INFORMATION
Item 1. Legal Proceedings.
The Company is not presently involved in any litigation nor, to its knowledge, is any litigation threatened against the Company or its subsidiaries that, in management's opinion, would result in any material adverse effect on the Company's ownership, management or operation of its properties taken as a whole, or which is not covered by the Company's insurance.
Item 1A. Risk Factors.
As of the date of this report, there are no material changes to our risk factors as previously disclosed in Part I, Item 1A of our Annual Report on Form 10-K for the year ended December 31, 2023.
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.
Issuer Purchases of Equity Securities
The Company’s Board of Directors authorized the repurchase of up to 891,000 depositary shares of Class L preferred stock, 1,047,000 depositary shares of Class M preferred stock, and 185,000 depositary shares of Class N Preferred Stock par value $1.00 per share through February 28, 2026. During the three months ended September 30, 2024, the Company repurchased the following Class N depositary shares:
Period |
|
Total Number of |
|
|
Average Price |
|
|
Total Number of |
|
|
Approximate Dollar Value of Shares that May Yet Be Purchased Under the Plans or Programs |
|||
July 1, 2024 – July 31, 2024 |
|
|
- |
|
|
$ |
- |
|
|
|
- |
|
|
n/a |
August 1, 2024 – August 31, 2024 |
|
|
80 |
|
|
|
57.90 |
|
|
|
- |
|
|
n/a |
September 1, 2024 – September 30, 2024 |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
n/a |
Total |
|
|
80 |
|
|
$ |
57.90 |
|
|
|
- |
|
|
|
The Company has a common share repurchase program, which is scheduled to expire on February 28, 2026. Under this program, the Company may repurchase shares of its common stock, par value $0.01 per share, with an aggregate gross purchase price of up to $300.0 million. The Company did not repurchase any shares under the common share repurchase program during the nine months ended September 30, 2024. As of September 30, 2024, the Company had $224.9 million available under this common share repurchase program.
During the nine months ended September 30, 2024, the Company repurchased 767,753 shares of the Company’s common stock for an aggregate purchase price of $15.3 million (weighted average price of $19.88 per share) in connection with common shares surrendered or deemed surrendered to the Company to satisfy statutory minimum tax withholding obligations in connection with equity-based compensation plans.
The following table presents information regarding the shares of common stock repurchased by the Company during the three months ended September 30, 2024:
Period |
|
Total Number of |
|
|
Average Price Paid |
|
|
Total Number of |
|
|
Approximate Dollar Value of Shares that May Yet Be Purchased Under the Plans or Programs |
|
||||
July 1, 2024 – July 31, 2024 |
|
|
770 |
|
|
$ |
22.03 |
|
|
|
- |
|
|
$ |
224.9 |
|
August 1, 2024 – August 31, 2024 |
|
|
26,577 |
|
|
|
21.73 |
|
|
|
- |
|
|
$ |
224.9 |
|
September 1, 2024 – September 30, 2024 |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
$ |
224.9 |
|
Total |
|
|
27,347 |
|
|
$ |
21.74 |
|
|
|
- |
|
|
|
|
|
Item 3. Defaults Upon Senior Securities.
None.
59
Item 4. Mine Safety Disclosures.
Not applicable.
Item 5. Other Information.
Rule 10b5-1 Plan Elections.
During the three months ended September 30, 2024, no director or officer (as defined in § 240.16a–1(f) of this chapter) of the Company
Item 6. Exhibits.
Exhibits –
4.1 Agreement to File Instruments
Kimco Realty Corporation (the “Registrant”) hereby agrees to file with the Securities and Exchange Commission, upon request of the Commission, all instruments defining the rights of holders of long-term debt of the Registrant and its consolidated subsidiaries, and for any of its unconsolidated subsidiaries for which financial statements are required to be filed, and for which the total amount of securities authorized thereunder does not exceed 10 percent of the total assets of the Registrant and its subsidiaries on a consolidated basis.
10.1 |
|
10.2 |
|
31.1 |
|
31.2 |
|
31.3 |
|
31.4 |
|
32.1* |
|
32.2* |
|
32.3* |
|
32.4* |
|
101.INS |
Inline XBRL Instance Document - the Instance Document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document. |
101.SCH |
Inline XBRL Taxonomy Extension Schema With Embedded Linkbase Documents |
104 |
Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101) |
|
|
* Furnished herewith.
60
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
|
|
|
KIMCO REALTY CORPORATION |
|
|
|
|
|
|
|
|
October 31, 2024 |
|
|
/s/ Conor C. Flynn |
(Date) |
|
|
Conor C. Flynn |
|
|
|
Chief Executive Officer |
|
|
|
|
|
|
|
|
October 31, 2024 |
|
|
/s/ Glenn G. Cohen |
(Date) |
|
|
Glenn G. Cohen |
|
|
|
Chief Financial Officer |
61
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
|
|
|
KIMCO REALTY OP, LLC BY: KIMCO REALTY CORPORATION, managing member |
|
|
|
|
|
|
|
|
October 31, 2024 |
|
|
/s/ Conor C. Flynn |
(Date) |
|
|
Conor C. Flynn |
|
|
|
Chief Executive Officer |
|
|
|
|
|
|
|
|
October 31, 2024 |
|
|
/s/ Glenn G. Cohen |
(Date) |
|
|
Glenn G. Cohen |
|
|
|
Chief Financial Officer |
62