[LETTER TO SHAREHOLDERS](index=3&type=section&id=SECTION%20ONE) JBG SMITH's Q2 2025 letter details a strategic pivot to office investments and share repurchases, funded by multifamily asset sales, aiming for long-term NAV per share growth [Shareholder Letter](index=3&type=section&id=LETTER%20TO%20SHAREHOLDERS) JBG SMITH commits to long-term NAV per share growth, strategically repositioning its portfolio from multifamily to office investments due to evolving DC real estate market conditions - Persistent macroeconomic and political uncertainties, with adverse impacts from federal spending cuts and headcount reductions, are shaping the DC real estate market[3](index=3&type=chunk) - The company is executing a deliberate pivot to reallocate capital from multifamily assets towards office investments, including opportunistic acquisitions and share repurchases[3](index=3&type=chunk) - This shift reflects the conviction that office now offers a more compelling risk-adjusted return profile due to **historically low office values**, while multifamily assets still command attractive pricing[3](index=3&type=chunk) [Capital Allocation](index=4&type=section&id=Capital%20Allocation) The company's capital allocation strategy focuses on maximizing long-term NAV per share growth by rotating across asset classes, monetizing multifamily assets to fund share repurchases and opportunistic office investments - Core objective is maximizing **long-term NAV per share growth** through disciplined capital allocation and asset rotation[9](index=9&type=chunk) - Monetizing liquid multifamily assets (e.g., WestEnd25, West Half interest, Capitol Point North, The Batley) at or above NAV provides efficient capital for share repurchases and opportunistic investments[10](index=10&type=chunk) - Repurchased **23.6 million shares for $376.9 million** year-to-date at an average price of **$15.98 per share**, totaling **$1.5 billion (80.4 million shares)** since 2020[11](index=11&type=chunk) - Acquired Tysons Dulles Plaza, a **491,500-square-foot office campus**, for **$42.3 million**, representing over a **20.0% in-place NOI capitalization rate**, with redevelopment potential[12](index=12&type=chunk) [Financial and Operating Metrics](index=5&type=section&id=Financial%20and%20Operating%20Metrics) For Q2 2025, JBG SMITH reported Core FFO of $12.7 million ($0.19 per diluted share) and a 3.0% decrease in portfolio Same Store NOI, operating at elevated leverage of 11.8x Net Debt to Annualized Adjusted EBITDA - Core FFO attributable to common shares for Q2 2025 was **$12.7 million**, or **$0.19 per diluted share**[14](index=14&type=chunk) - Annualized NOI totaled **$251.0 million** (excluding sold, recapitalized, and acquired assets), up **0.1%** quarter over quarter[14](index=14&type=chunk) - Portfolio Same Store NOI decreased **3.0%** for the three months ended June 30, 2025[14](index=14&type=chunk) - Net Debt to Annualized Adjusted EBITDA was **11.8x** as of June 30, 2025, indicating elevated leverage levels[15](index=15&type=chunk) - **84.4% of debt was fixed or hedged** as of the end of Q2 2025, with no other debt maturities until December 2026[16](index=16&type=chunk) [Operating Portfolio](index=5&type=section&id=Operating%20Portfolio) The operating portfolio showed mixed performance in Q2 2025, with slight declines in multifamily leased/occupied rates but positive rent growth, while office saw decreased rates and negative mark-to-market, offset by National Landing leasing activity - In-Service multifamily portfolio ended Q2 2025 at **94.8% leased** (down **0.9% QoQ**) and **92.9% occupied** (down **1.4% QoQ**)[17](index=17&type=chunk) - Same Store multifamily portfolio increased effective rents by **1.0%** for new leases and **8.9%** upon renewal, with a **49.0% renewal rate**[17](index=17&type=chunk) - Office portfolio ended Q2 2025 at **76.5% leased** (down **1.8% QoQ**) and **74.8% occupied** (down **1.6% QoQ**)[22](index=22&type=chunk) - Executed **208,000 square feet of office leases** with a weighted average lease term of **5.8 years**; second-generation leases had a **negative 6.1% rental rate mark-to-market**[6](index=6&type=chunk)[22](index=22&type=chunk) [Multifamily Trends](index=5&type=section&id=Multifamily%20Trends) The In-Service multifamily portfolio experienced slight declines in leased and occupied rates but maintained positive rent growth, with new assets like The Zoe showing strong initial demand - In-Service multifamily portfolio ended Q2 2025 at **94.8% leased** (down **0.9% QoQ**) and **92.9% occupied** (down **1.4% QoQ**)[17](index=17&type=chunk) Q2 2025 Change | Metric | Q2 2025 Change | | :--------------------- | :------------- | | New Leases Effective Rents | +1.0% | | Renewal Leases Effective Rents | +8.9% | | Renewal Rate | 49.0% | - The Zoe is **40.0% leased**, and The Grace and Reva are **83.5% leased** as of this week[6](index=6&type=chunk)[18](index=18&type=chunk) - A **30.0% increase** in Amazon employees living in the National Landing multifamily portfolio since January 2nd[18](index=18&type=chunk) [DC Metro Multifamily Trends](index=5&type=section&id=DC%20Metro%20Multifamily%20Trends) The DC metro multifamily market showed resilience in H1 2025 with 1.5% year-over-year rent growth, healthy occupancy, and constrained new supply, indicating robust future growth - Year-over-year rent growth in the DC metro multifamily market was **1.5%**, significantly above the US average of **-0.7%**[19](index=19&type=chunk) - Median absolute rents remain high with healthy occupancy levels just below **93.9%**[19](index=19&type=chunk) - New supply pipeline remains constrained with only **1.4% of total inventory** under construction, creating a robust environment for growth[21](index=21&type=chunk) [Office Trends](index=6&type=section&id=Office%20Trends) The office portfolio saw declines in leased/occupied rates and negative mark-to-market on second-generation leases, but National Landing leasing activity increased, driven by defense and technology tenants - Office portfolio ended Q2 2025 at **76.5% leased** (down **1.8% QoQ**) and **74.8% occupied** (down **1.6% QoQ**)[22](index=22&type=chunk) - Executed **208,000 square feet of leases** with a weighted average lease term of **5.8 years**; second-generation leases had a **negative 6.1% rental rate mark-to-market**[6](index=6&type=chunk)[22](index=22&type=chunk) - Leasing in National Landing is primarily driven by SCIF/secure facility users, technology-related tenants, and defense-related tenants, comprising approximately **93% of Q2 leasing activity**[23](index=23&type=chunk) - Over **1.0 million square feet of obsolete office space** has been taken out of service in National Landing for redevelopment or conversion[24](index=24&type=chunk) [Northern Virginia Office Trends](index=6&type=section&id=Northern%20Virginia%20Office%20Trends) Northern Virginia, especially National Landing, is expected to benefit from a $1.0 trillion defense budget, driving demand despite a sluggish first half, with long-term vacancy abatement anticipated from residential conversions - Historic **$1.0 trillion defense budget** expected to disproportionately benefit Northern Virginia, driving demand to National Landing[25](index=25&type=chunk) - Sluggish first half with net absorption essentially flat year-to-date, reflecting tenant caution[26](index=26&type=chunk) - A backlog of **4.3 million square feet** of active but not-yet-signed requirements and **12.4 million square feet** of office space slated for residential conversion suggest future vacancy abatement[26](index=26&type=chunk) - Market health is expected to return over a period of years, not quarters, given the **23.0% direct vacancy rate**[26](index=26&type=chunk) [Strategic Outlook](index=7&type=section&id=Strategic%20Outlook) JBG SMITH remains focused on long-term value creation through National Landing's transformation and portfolio enhancement, leveraging generational low office valuations and discounted shares for high-conviction investments - Strategy remains clear: focus on **long-term value creation**, not short-term noise[27](index=27&type=chunk) - Committed to enhancing the stability and enduring strength of both office and multifamily portfolios, with National Landing transformation as a testament to execution[27](index=27&type=chunk) - Office valuations at **generational lows** and shares trading at a **meaningful discount to NAV** present a rare window to deploy capital into high-conviction opportunities for substantial NAV per share growth[27](index=27&type=chunk) [Q2 2025 EARNINGS RELEASE](index=8&type=section&id=SECTION%20TWO) JBG SMITH reported a net loss of $19.2 million for Q2 2025, with Core FFO of $12.7 million ($0.19 per diluted share), continuing strategic capital allocation through asset dispositions, share repurchases, and an office acquisition, amidst mixed operating performance [Q2 2025 Earnings Release Highlights](index=9&type=section&id=Q2%202025%20EARNINGS%20RELEASE%20HIGHLIGHTS) JBG SMITH reported a net loss of $19.2 million and Core FFO of $12.7 million for Q2 2025, with Annualized NOI at $268.4 million and Same Store NOI decreasing by 3.0%, alongside significant asset sales, an office acquisition, and share repurchases Q2 2025 Financial Performance (in thousands) | Metric | Three Months Ended June 30, 2025 | Six Months Ended June 30, 2025 | | :------------------------------------ | :------------------------------- | :------------------------------ | | Net loss attributable to common shareholders | $(19,241) | $(65,000) | | Net loss per diluted share | $(0.29) | $(0.87) | | FFO | $10,000 | $3,700 | | FFO per diluted share | $0.15 | $0.05 | | Core FFO | $12,700 | $19,900 | | Core FFO per diluted share | $0.19 | $0.27 | Annualized Net Operating Income (Annualized NOI) (in millions) | Period | Annualized NOI (at share) | | :------------------------------------ | :------------------------ | | Three Months Ended June 30, 2025 | $268.4 million | | Three Months Ended March 31, 2025 | $270.1 million | | Annualized NOI (excluding sold/recapitalized/acquired assets) | $251.0 million (Q2 2025) vs $250.8 million (Q1 2025) | - Same Store NOI (SSNOI) decreased **3.0%** quarter-over-quarter to **$59.5 million** for Q2 2025, primarily due to lower occupancy and higher operating expenses in multifamily, and lower occupancy/recovery revenue in commercial[42](index=42&type=chunk) [Operating Portfolio (Earnings Release)](index=10&type=section&id=Operating%20Portfolio%20(Earnings%20Release)) The operating portfolio experienced declines in occupancy across both multifamily and commercial segments in Q2 2025, with Same Store NOI decreasing by 3.0%, despite positive rent increases for multifamily and significant office leasing activity - Same Store NOI (SSNOI) at JBG SMITH's share decreased **3.0%** quarter-over-quarter to **$59.5 million** for Q2 2025[42](index=42&type=chunk) Multifamily Occupancy Rates | Metric | June 30, 2025 | March 31, 2025 | | :-------------------------- | :------------ | :------------- | | Operating Multifamily Leased | 89.0% | 93.0% | | Operating Multifamily Occupied | 85.8% | 91.3% | | In-Service Multifamily Leased | 94.8% | 95.7% | | In-Service Multifamily Occupied | 92.9% | 94.3% | - In the Same Store multifamily portfolio, effective rents increased by **1.0%** for new leases and **8.9%** upon renewal, with a **49.0% renewal rate**[42](index=42&type=chunk) - The operating commercial portfolio was **76.5% leased** and **74.8% occupied** as of June 30, 2025 (down from **78.3%** and **76.4%** respectively in Q1 2025)[42](index=42&type=chunk) - Executed approximately **208,000 square feet of office leases** (**87,000 sq ft new leases**) in Q2 2025, with second-generation leases showing a **6.1% cash rental rate decrease** and a **4.8% GAAP rental rate decrease**[42](index=42&type=chunk) [Development Portfolio](index=10&type=section&id=Development%20Portfolio) As of June 30, 2025, JBG SMITH has one multifamily asset, Valen (355 units), under construction and a substantial development pipeline of 19 assets with 8.7 million square feet of estimated potential density - One multifamily asset, Valen (formerly 2000 South Bell Street), consisting of **355 units**, was under construction as of June 30, 2025[38](index=38&type=chunk) - The development pipeline includes **19 assets** with **8.7 million square feet** of estimated potential development density[39](index=39&type=chunk) [Third-Party Asset Management and Real Estate Services Business (Earnings Release)](index=10&type=section&id=Third-Party%20Asset%20Management%20and%20Real%20Estate%20Services%20Business%20(Earnings%20Release)) For Q2 2025, revenue from third-party real estate services, including reimbursements, totaled $14.8 million, with the core business generating $6.9 million primarily from property/asset management and leasing fees - Revenue from third-party real estate services, including reimbursements, was **$14.8 million** for Q2 2025[40](index=40&type=chunk) - Excluding reimbursements and service revenue from real estate ventures, revenue from the third-party asset management and real estate services business was **$6.9 million**[40](index=40&type=chunk) - This **$6.9 million** was primarily driven by **$4.0 million of property and asset management fees**, **$1.1 million of leasing fees**, and **$1.0 million of other service revenue**[40](index=40&type=chunk) [Balance Sheet (Earnings Release)](index=11&type=section&id=Balance%20Sheet%20(Earnings%20Release)) As of June 30, 2025, JBG SMITH's total enterprise value was approximately $3.8 billion, with Net Debt to Annualized Adjusted EBITDA at 11.8x, supported by $61.4 million in cash and $524.0 million in undrawn credit capacity, alongside significant asset dispositions and share repurchases - Total enterprise value was approximately **$3.8 billion** as of June 30, 2025[46](index=46&type=chunk) - Net Debt to annualized Adjusted EBITDA was **11.8x** as of June 30, 2025[46](index=46&type=chunk) - As of June 30, 2025, the company had **$61.4 million of cash and cash equivalents** and **$524.0 million of undrawn capacity** under its revolving credit facility[46](index=46&type=chunk) - Acquired Tysons Dulles Plaza for **$42.3 million** in May 2025[46](index=46&type=chunk) - Sold a **40.0% interest in West Half for $100.0 million**, Capitol Point – North for **$11.0 million**, and WestEnd25 for **$186.0 million** in Q2 2025. Subsequent to quarter end, sold The Batley for **$155.0 million**[46](index=46&type=chunk) - Repurchased and retired **11.2 million common shares for $184.9 million** during Q2 2025[46](index=46&type=chunk) [Dividends](index=11&type=section&id=Dividends) On July 24, 2025, JBG SMITH's Board of Trustees declared a quarterly dividend of $0.175 per common share, payable on August 21, 2025, to shareholders of record as of August 7, 2025 - Quarterly dividend of **$0.175 per common share** declared on July 24, 2025[44](index=44&type=chunk) - Payable on August 21, 2025, to shareholders of record as of August 7, 2025[44](index=44&type=chunk) [About JBG SMITH](index=11&type=section&id=About%20JBG%20SMITH) JBG SMITH is a leading owner, operator, and developer of mixed-use properties in the Washington, DC market, with approximately 75.0% of its holdings in the National Landing submarket, anchored by Amazon and Virginia Tech - JBG SMITH owns, operates, and develops mixed-use properties concentrated in amenity-rich, Metro-served submarkets in and around Washington, DC, most notably National Landing[45](index=45&type=chunk) - Approximately **75.0% of JBG SMITH's holdings** are in the National Landing submarket, anchored by Amazon's headquarters, Virginia Tech's **$1 billion Innovation Campus**, proximity to the Pentagon, and placemaking initiatives[45](index=45&type=chunk) - Dynamic portfolio currently comprises **12.0 million square feet** at share of multifamily, office, and retail assets, **98% of which are Metro-served**[45](index=45&type=chunk)[47](index=47&type=chunk) - Maintains a development pipeline encompassing **8.7 million square feet** of mixed-use, primarily multifamily, development opportunities[47](index=47&type=chunk) - Committed to the operation and development of green, smart, and healthy buildings and plans to maintain carbon neutral operations annually[47](index=47&type=chunk) [Forward-Looking Statements](index=12&type=section&id=Forward-Looking%20Statements) This section cautions that forward-looking statements are not guarantees of performance, with future results potentially differing materially due to numerous assumptions, risks, and uncertainties, including economic conditions and federal spending - Forward-looking statements are not guarantees of performance and represent intentions, plans, expectations, and beliefs subject to numerous assumptions, risks, and uncertainties[48](index=48&type=chunk) - Factors that could materially affect outcomes include adverse economic conditions in the Washington, DC metropolitan area (e.g., federal government spending/headcount reductions), development timing/costs, supply chain disruptions, financing commitments, and competitive factors[49](index=49&type=chunk) - The company claims the protection of the safe harbor for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995[49](index=49&type=chunk) [Pro Rata Information](index=12&type=section&id=Pro%20Rata%20Information) The company presents certain financial information 'at JBG SMITH Share' as a non-GAAP measure to reflect economic interests in real estate ventures, providing valuable insight but not substituting GAAP consolidated financial statements due to control limitations and co-venturer risks - Financial information is presented 'at JBG SMITH Share,' referring to the company's ownership percentage of consolidated and unconsolidated assets in real estate ventures[50](index=50&type=chunk) - This 'at JBG SMITH Share' information is a non-GAAP presentation, believed to provide valuable information regarding economic interests in partially owned entities[51](index=51&type=chunk) - Limitations include lack of control over unconsolidated ventures, no legal claim to co-venturers' shares, and exposure to economic risks or equity capital calls[52](index=52&type=chunk)[53](index=53&type=chunk) - Occupancy, non-GAAP financial measures, leverage metrics, and operating assets/metrics exclude certain subordinated interests where investment is zero and no near-term cash flow is anticipated[54](index=54&type=chunk) [Non-GAAP Financial Measures](index=13&type=section&id=Non-GAAP%20Financial%20Measures) This section defines various non-GAAP financial measures, including EBITDA, FFO, FAD, Net Debt, and NOI, used by management to assess operating performance, financial condition, and dividend funding ability, serving as supplemental information to GAAP - EBITDA, EBITDAre, and Adjusted EBITDA are non-GAAP measures used to evaluate operating performance by removing capital structure impact and non-cash expenses, with EBITDAre computed per Nareit definition[55](index=55&type=chunk)[56](index=56&type=chunk)[57](index=57&type=chunk) - FFO, Core FFO, and FAD are non-GAAP measures useful for comparing levered operating performance and assessing dividend funding ability, with FFO computed per Nareit definition[59](index=59&type=chunk)[60](index=60&type=chunk)[61](index=61&type=chunk)[63](index=63&type=chunk) - Net Debt represents total consolidated and unconsolidated indebtedness less cash and cash equivalents at JBG SMITH's share, used to manage financial flexibility and leverage[64](index=64&type=chunk) - NOI, Same Store NOI, and Annualized NOI are non-GAAP measures used to assess asset performance, reflecting property-related revenue less operating expenses, excluding non-cash items[65](index=65&type=chunk)[66](index=66&type=chunk) - These non-GAAP measures are supplemental and should not be considered in isolation or as substitutes for GAAP net income (loss) or cash flow[58](index=58&type=chunk)[63](index=63&type=chunk)[65](index=65&type=chunk) [Definitions](index=16&type=section&id=Definitions) This section defines key terms like 'Development Pipeline,' 'Estimated Potential Development Density,' 'First-generation' and 'Second-generation' leases, 'In-Service,' 'Same Store,' and 'Under-Construction' to ensure consistent understanding of the financial report - Development Pipeline refers to assets with potential for construction, subject to entitlements, design, and market conditions[67](index=67&type=chunk) - Estimated Potential Development Density reflects management's estimate of developable gross square feet based on current business plans[68](index=68&type=chunk) - First-generation is a lease on space vacant for at least nine months or newly delivered space; Second-generation is a lease on space vacant for less than nine months[69](index=69&type=chunk)[73](index=73&type=chunk) - In-Service refers to multifamily or commercial operating assets that are at or above **90% leased** or have been operating and collecting rent for more than 12 months[71](index=71&type=chunk) - Same Store refers to assets that were In-Service for the entirety of both periods being compared, excluding significant redevelopment or renovation[72](index=72&type=chunk) - Transaction and Other Costs include costs related to completed, potential, and pursued transactions, demolition costs, and severance[75](index=75&type=chunk) - Under-Construction refers to assets that were under construction during the three months ended June 30, 2025[76](index=76&type=chunk) [Condensed Consolidated Balance Sheets](index=18&type=section&id=CONDENSED%20CONSOLIDATED%20BALANCE%20SHEETS) JBG SMITH's consolidated balance sheet as of June 30, 2025, shows total assets of $4.55 billion, a decrease from $5.02 billion at December 31, 2024, primarily due to reductions in real estate, cash, liabilities, and total equity Condensed Consolidated Balance Sheets (in thousands) | Metric | June 30, 2025 | December 31, 2024 | | :------------------------------------ | :------------ | :---------------- | | Total Assets | $4,549,295 | $5,020,540 | | Real estate, net | $3,775,688 | $4,111,459 | | Cash and cash equivalents | $61,432 | $145,804 | | Total Liabilities | $2,683,299 | $2,787,850 | | Mortgage loans, net | $1,540,670 | $1,767,173 | | Revolving credit facility | $226,000 | $85,000 | | Total Equity | $1,322,793 | $1,809,058 | [Condensed Consolidated Statements of Operations](index=19&type=section&id=CONDENSED%20CONSOLIDATED%20STATEMENTS%20OF%20OPERATIONS) For Q2 2025, JBG SMITH reported a net loss of $19.2 million, an improvement from Q2 2024, despite decreased total revenue, as a significant gain on real estate sales partially offset increased impairment losses and interest expense Condensed Consolidated Statements of Operations (in thousands) | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | | :------------------------------------ | :------------------------------- | :------------------------------- | | Total revenue | $126,479 | $135,320 | | Property rental | $106,509 | $112,536 | | Third-party real estate services, including reimbursements | $14,805 | $17,397 | | Total expenses | $128,214 | $138,434 | | Interest expense | $(35,571) | $(31,973) | | Gain on the sale of real estate, net | $41,832 | $89 | | Impairment loss | $(31,813) | $(1,025) | | Net loss attributable to common shareholders | $(19,241) | $(24,373) | | Loss per common share - diluted | $(0.29) | $(0.27) | [EBITDA, EBITDAre AND ADJUSTED EBITDA RECONCILIATIONS (NON-GAAP)](index=20&type=section&id=EBITDA%2C%20EBITDAre%20AND%20ADJUSTED%20EBITDA%20RECONCILIATIONS%20(NON-GAAP)) For Q2 2025, JBG SMITH reported EBITDA of $61.4 million, EBITDAre of $49.9 million, and Adjusted EBITDA of $52.7 million, with Net Debt to Annualized Adjusted EBITDA at 11.8x as of June 30, 2025 EBITDA, EBITDAre and Adjusted EBITDA (in thousands) | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | | :-------------------- | :------------------------------- | :------------------------------- | | EBITDA | $61,432 | $52,292 | | EBITDAre | $49,913 | $52,203 | | Adjusted EBITDA | $52,710 | $52,980 | - Net Debt to Annualized Adjusted EBITDA was **11.8x** as of June 30, 2025, compared to **11.9x** in Q2 2024[84](index=84&type=chunk) - Net Debt (at JBG SMITH Share) was **$2,480,609 thousand** as of June 30, 2025, compared to **$2,522,604 thousand** in Q2 2024[84](index=84&type=chunk) [FFO, CORE FFO AND FAD RECONCILIATIONS (NON-GAAP)](index=21&type=section&id=FFO%2C%20CORE%20FFO%20AND%20FAD%20RECONCILIATIONS%20(NON-GAAP)) For Q2 2025, FFO attributable to common shareholders was $9.95 million ($0.15 per diluted share), Core FFO was $12.71 million ($0.19 per diluted share), and FAD available to OP Units was $18.21 million, with an 84.2% FAD Payout Ratio FFO, Core FFO and FAD (in thousands, except per share) | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | | :-------------------------------------- | :------------------------------- | :------------------------------- | | FFO Attributable to Common Shareholders | $9,953 | $14,335 | | FFO per common share - diluted | $0.15 | $0.16 | | Core FFO Attributable to Common Shareholders | $12,714 | $16,058 | | Core FFO per common share - diluted | $0.19 | $0.18 | | FAD available to OP Units | $18,208 | $19,728 | | FAD Payout Ratio | 84.2% | 96.4% | - Weighted average shares - diluted (FFO and Core FFO) were **68,451 thousand** for Q2 2025, down from **91,154 thousand** in Q2 2024, reflecting share repurchases[89](index=89&type=chunk) [NOI RECONCILIATIONS (NON-GAAP)](index=23&type=section&id=NOI%20RECONCILIATIONS%20(NON-GAAP)) For Q2 2025, JBG SMITH's total NOI was $65.6 million, with Operating Portfolio NOI at $67.1 million and Same Store NOI at $59.5 million, representing a 3.0% decrease in Same Store NOI compared to Q2 2024 NOI Metrics (in thousands) | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | | :-------------------- | :------------------------------- | :------------------------------- | | NOI | $65,633 | $69,253 | | Operating Portfolio NOI | $67,102 | $71,594 | | Same Store NOI | $59,527 | $61,340 | | Change in Same Store NOI | (3.0)% | N/A | - Key adjustments from net loss to NOI include adding back depreciation and amortization, general and administrative expenses, interest expense, and impairment loss, while subtracting third-party real estate services revenue and gain on sale of real estate[96](index=96&type=chunk) [Q2 2025 SUPPLEMENTAL INFORMATION](index=25&type=section&id=SECTION%20THREE) This section provides detailed supplemental information for Q2 2025, covering company overview, comprehensive financial data, leasing activity, property portfolio specifics, and debt structure, offering a granular view of JBG SMITH's operations and financial health [Overview](index=25&type=section&id=Overview) The overview provides foundational information about JBG SMITH, including disclosures, company profile, financial snapshot, and a high-level portfolio summary, emphasizing its focus on mixed-use properties in the Washington, DC market, particularly National Landing - JBG SMITH owns, operates, and develops mixed-use properties in amenity-rich, Metro-served submarkets in and around Washington, DC, with approximately **75.0% of its holdings in National Landing**[105](index=105&type=chunk) - National Landing is anchored by Amazon's headquarters, Virginia Tech's **$1 billion Innovation Campus**, proximity to the Pentagon, and placemaking initiatives[105](index=105&type=chunk) Company Snapshot as of June 30, 2025 | Metric | Value | | :------------------------------------ | :---------- | | Indicated annual dividend per share | $0.70 | | Dividend yield | 4.0 % | | Common share price | $17.30 | | Total market capitalization | $1.32 billion | | Total consolidated and unconsolidated indebtedness (at JBG SMITH Share) | $2.55 billion | | Net Debt | $2.48 billion | | Total Enterprise Value | $3.80 billion | | Net Debt / Total Enterprise Value | 65.3 % | Operating Portfolio Overview (at JBG SMITH Share) | Asset Type | Units / Square Feet | % Leased | % Occupied (1) | Annualized NOI (2) (in thousands) | | :-------------------- | :------------------ | :--------- | :---------- | :------------- | | Multifamily | 6,596 Units | 89.0% | 85.8% | $123,876 | | Commercial | 6,962,917 SF | 76.5% | 74.8% | $139,984 | | Ground Leases | — | — | — | $4,548 | | **Operating - Total** | **6,596 Units/ 6,962,917 SF** | **81.8%** | **79.5%** | **$268,408** | - Development portfolio includes one multifamily asset under construction (**355 units**) and **19 assets** in the development pipeline (**8.7 million SF** estimated potential density)[121](index=121&type=chunk) [Disclosures](index=26&type=section&id=Disclosures) This sub-section reiterates the forward-looking statements disclaimer and clarifies the basis of presentation for unaudited non-GAAP 'Pro Rata Information' (at JBG SMITH Share), highlighting its supplemental nature and associated limitations - Forward-looking statements are not guarantees of performance and are subject to numerous assumptions, risks, and uncertainties, with future results potentially differing materially[102](index=102&type=chunk)[103](index=103&type=chunk) - The Investor Package contains unaudited information and non-GAAP measures; 'at JBG SMITH Share' is a non-GAAP presentation reflecting economic interests in real estate ventures[106](index=106&type=chunk)[107](index=107&type=chunk) - The non-GAAP 'at JBG SMITH Share' information should not be considered in isolation or as a substitute for consolidated GAAP financial statements due to limitations in control and potential economic risks with co-venturers[109](index=109&type=chunk) - Occupancy, non-GAAP financial measures, leverage metrics, and operating assets/metrics exclude certain subordinated interests in commercial buildings where investment is zero and no near-term cash flow is anticipated[110](index=110&type=chunk) [Company Profile](index=29&type=section&id=Company%20Profile) JBG SMITH is a Maryland REIT focused on mixed-use properties in the Washington, DC metro area, particularly National Landing, with its executive leadership and a financial snapshot as of June 30, 2025, detailing market capitalization, debt, and enterprise value - Executive Officers include W. Matthew Kelly (CEO), M. Moina Banerjee (CFO), George L. Xanders (CIO), Steven A. Museles (CLO), and Evan Regan-Levine (CSO)[115](index=115&type=chunk) Company Snapshot as of June 30, 2025 | Metric | Value | | :------------------------------------ | :---------- | | Exchange/ticker | NYSE: JBGS | | Indicated annual dividend per share | $0.70 | | Dividend yield | 4.0 % | | Common share price | $17.30 | | Common shares and common limited partnership units ("OP Units") outstanding | 76.02 million | | Total consolidated and unconsolidated indebtedness at JBG SMITH Share | $2.55 billion | | Net Debt | $2.48 billion | | Total Enterprise Value | $3.80 billion | | Net Debt / Total Enterprise Value | 65.3 % | [Financial Highlights](index=30&type=section&id=Financial%20Highlights) For Q2 2025, JBG SMITH reported a net loss of $19.2 million and Core FFO of $15.7 million (attributable to OP Units), with a FAD payout ratio of 84.2% and Net Debt to annualized Adjusted EBITDA at 11.8x, with a total debt weighted average interest rate of 5.26% Summary Financial Results (dollars in thousands, except per share data) | Financial Highlights | Three Months Ended June 30, 2025 | Six Months Ended June 30, 2025 | | :------------------------------------ | :------------------------------- | :------------------------------ | | Total revenue | $126,479 | $247,165 | | Net loss attributable to common shareholders | $(19,241) | $(64,961) | | Per diluted common share | $(0.29) | $(0.87) | | Operating portfolio NOI | $67,102 | $134,614 | | FFO (1) | $12,324 | $4,829 | | Core FFO (1) | $15,743 | $24,403 | | FAD (1) | $18,208 | $28,603 | | FAD payout ratio | 84.2 % | 115.2 % | | EBITDA (1) | $61,432 | $92,103 | | EBITDAre (1) | $49,913 | $80,047 | | Adjusted EBITDA (1) | $52,710 | $98,066 | Debt Summary (at JBG SMITH Share, June 30, 2025) | Debt Summary | Value | | :------------------------------------ | :---------- | | Total consolidated indebtedness | $2,479,101 | | Total consolidated and unconsolidated indebtedness | $2,546,215 | | Weighted average interest rates (Total debt) | 5.26 % | | Cash and cash equivalents | $65,606 | | Net Debt / total enterprise value | 65.3 % | | Net Debt to annualized Adjusted EBITDA | 11.8 x | [Portfolio Overview](index=31&type=section&id=Portfolio%20Overview) As of June 30, 2025, JBG SMITH's operating portfolio (at JBG SMITH Share) consists of 6,596 multifamily units and 6.96 million commercial square feet, with overall leased and occupied rates of 81.8% and 79.5% respectively, and a development pipeline of 19 assets with 8.7 million square feet of potential density Operating Portfolio (at JBG SMITH Share, June 30, 2025) | Asset Type | Number of Assets | Units / Square Feet | % Leased | % Occupied (1) | Annualized Rent (in thousands) | Annualized NOI (2) (in thousands) | | :-------------------- | :--------------- | :------------------ | :--------- | :---------- | :-------------- | :------------- | | Multifamily In-Service | 12 | 5,368 Units | 94.8% | 92.9% | $145,639 | $110,944 | | Multifamily Recently Delivered | 3 | 1,228 Units | 63.7% | 57.5% | $26,786 | $12,932 | | Commercial | 21 | 6,962,917 SF | 76.5% | 74.8% | $223,661 | $139,984 | | Ground Leases | 2 | — | — | — | — | $4,548 | | **Operating - Total** | **38** | **6,596 Units/ 6,962,917 SF** | **81.8%** | **79.5%** | **$396,086** | **$268,408** | Development Portfolio (at JBG SMITH Share, June 30, 2025) | Category | Number of Assets | Units / Square Feet | | :-------------------- | :--------------- | :------------------ | | Under-Construction | 1 | 355 Units | | Development Pipeline | 19 | 8,672,800 SF | [Financial Information](index=32&type=section&id=Financial%20Information) This section provides detailed financial statements and non-GAAP reconciliations for JBG SMITH, including condensed consolidated balance sheets, statements of operations, and specific breakdowns for unconsolidated real estate ventures, offering a granular view of the company's financial performance and position [Condensed Consolidated Balance Sheets](index=32&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) JBG SMITH's consolidated balance sheet as of June 30, 2025, shows total assets of $4.55 billion, a decrease from $5.02 billion at December 31, 2024, primarily due to reductions in real estate, cash, liabilities, and total equity Condensed Consolidated Balance Sheets (in thousands) | Metric | June 30, 2025 | December 31, 2024 | | :------------------------------------ | :------------ | :---------------- | | Total Assets | $4,549,295 | $5,020,540 | | Real estate, net | $3,775,688 | $4,111,459 | | Cash and cash equivalents | $61,432 | $145,804 | | Total Liabilities | $2,683,299 | $2,787,850 | | Mortgage loans, net | $1,540,670 | $1,767,173 | | Revolving credit facility | $226,000 | $85,000 | | Total Equity | $1,322,793 | $1,809,058 | [Condensed Consolidated Statements of Operations](index=33&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) For Q2 2025, JBG SMITH reported a net loss of $19.2 million, an improvement from Q2 2024, despite decreased total revenue, as a significant gain on real estate sales partially offset increased impairment losses and interest expense Condensed Consolidated Statements of Operations (in thousands) | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | | :------------------------------------ | :------------------------------- | :------------------------------- | | Total revenue | $126,479 | $135,320 | | Property rental | $106,509 | $112,536 | | Third-party real estate services, including reimbursements | $14,805 | $17,397 | | Total expenses | $128,214 | $138,434 | | Interest expense | $(35,571) | $(31,973) | | Gain on the sale of real estate, net | $41,832 | $89 | | Impairment loss | $(31,813) | $(1,025) | | Net loss attributable to common shareholders | $(19,241) | $(24,373) | | Loss per common share - diluted | $(0.29) | $(0.27) | [Unconsolidated Real Estate Ventures - Balance Sheet and Operating Information](index=34&type=section&id=Unconsolidated%20Real%20Estate%20Ventures%20-%20Balance%20Sheet%20and%20Operating%20Information) As of June 30, 2025, JBG SMITH's share of unconsolidated real estate ventures had total assets of $160.5 million and total liabilities of $77.7 million, generating $2.4 million in total revenue and $0.85 million in net income for Q2 2025 Balance Sheet Information (at JBG SMITH Share, in thousands) | Metric | June 30, 2025 | | :-------------------- | :------------ | | Total real estate, at cost | $161,542 | | Real estate, net | $144,020 | | Total assets | $160,481 | | Borrowings, net | $67,114 | | Total liabilities | $77,693 | Operating Information (at JBG SMITH Share, in thousands) | Metric | Three Months Ended June 30, 2025 | | :-------------------- | :------------------------------- | | Total revenue | $2,427 | | Total expenses | $2,055 | | Net income | $851 | | Income from unconsolidated real estate ventures, net | $1,091 | [Other Tangible Assets and Liabilities](index=35&type=section&id=Other%20Tangible%20Assets%20and%20Liabilities) As of June 30, 2025, JBG SMITH's share of other tangible assets, net, totaled $142.6 million, primarily from restricted cash and receivables, while other tangible liabilities, net, amounted to $162.4 million, mainly from accounts payable and other liabilities Other Tangible Assets, Net (at JBG SMITH Share, in thousands) | Asset | June 30, 2025 | | :------------------- | :------------ | | Restricted cash | $30,955 | | Tenant and other receivables, net | $21,587 | | Other assets, net | $90,097 | | **Total Other Tangible Assets, Net** | **$142,639** | Other Tangible Liabilities, Net (at JBG SMITH Share, in thousands) | Liability | June 30, 2025 | | :--------------------- | :------------ | | Accounts payable and accrued liabilities | $81,691 | | Other liabilities, net | $80,680 | | **Total Other Tangible Liabilities, Net** | **$162,371** | [EBITDA, EBITDAre and Adjusted EBITDA Reconciliations (Non-GAAP)](index=36&type=section&id=EBITDA%2C%20EBITDAre%20and%20Adjusted%20EBITDA%20Reconciliations%20(Non-GAAP)) For Q2 2025, JBG SMITH reported EBITDA of $61.4 million, EBITDAre of $49.9 million, and Adjusted EBITDA of $52.7 million, with Net Debt to Annualized Adjusted EBITDA at 11.8x, reflecting adjustments from net loss for depreciation, interest, and other non-recurring items EBITDA, EBITDAre and Adjusted EBITDA (dollars in thousands) | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | | :-------------------- | :------------------------------- | :------------------------------- | | EBITDA | $61,432 | $52,292 | | EBITDAre | $49,913 | $52,203 | | Adjusted EBITDA | $52,710 | $52,980 | - Net Debt to Annualized Adjusted EBITDA was **11.8x** as of June 30, 2025 (vs. **11.9x** in Q2 2024)[133](index=133&type=chunk) - Net Debt (at JBG SMITH Share) was **$2,480,609 thousand** as of June 30, 2025 (vs. **$2,522,604 thousand** in Q2 2024)[133](index=133&type=chunk) [FFO, Core FFO and FAD Reconciliations (Non-GAAP)](index=37&type=section&id=FFO%2C%20Core%20FFO%20and%20FAD%20Reconciliations%20(Non-GAAP)) For Q2 2025, FFO attributable to OP Units was $12.3 million, Core FFO was $15.7 million, and FAD available to OP Units was $18.2 million, resulting in an 84.2% FAD Payout Ratio, reflecting a decrease in FFO/Core FFO but an improved FAD payout ratio compared to Q2 2024 FFO, Core FFO and FAD (in thousands, except per share data) | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | | :-------------------------------------- | :------------------------------- | :------------------------------- | | FFO Attributable to OP Units | $12,324 | $16,927 | | FFO Attributable to Common Shareholders | $9,953 | $14,335 | | Core FFO Attributable to OP Units | $15,743 | $18,962 | | Core FFO Attributable to Common Shareholders | $12,714 | $16,058 | | FAD available to OP Units | $18,208 | $19,728 | | FAD Payout Ratio | 84.2 % | 96.4 % | - Weighted average shares - diluted (FFO and Core FFO) were **68,451 thousand** for Q2 2025, down from **91,154 thousand** in Q2 2024[136](index=136&type=chunk) [Third-Party Asset Management and Real Estate Services Business (Non-GAAP)](index=39&type=section&id=Third-Party%20Asset%20Management%20and%20Real%20Estate%20Services%20Business%20(Non-GAAP)) For Q2 2025, JBG SMITH's third-party asset management and real estate services business generated $6.85 million in total service revenue (at JBG SMITH Share), primarily from property management, asset management, and leasing fees, resulting in $1.45 million in total services revenue less allocated expenses Third-Party Asset Mgmt and Real Estate Services Business (in thousands, at JBG SMITH Share) | Service Revenue Type | Three Months Ended June 30, 2025 | | :-------------------------- | :------------------------------- | | Property management fees | $3,279 | | Asset management fees | $706 | | Development fees | $464 | | Leasing fees | $1,099 | | Construction management fees | $267 | | Other service revenue | $1,035 | | **Total Revenue (1)** | **$6,850** | - Total Services Revenue Less Allocated General and Administrative Expenses was **$1,453 thousand** for Q2 2025[144](index=144&type=chunk) - Excludes **$7.9 million of reimbursement revenue** and **$0.1 million of service revenue** from economic interest in real estate ventures[144](index=144&type=chunk) [Pro Rata Adjusted General and Administrative Expenses (Non-GAAP)](index=40&type=section&id=Pro%20Rata%20Adjusted%20General%20and%20Administrative%20Expenses%20(Non-GAAP)) For Q2 2025, JBG SMITH's total general and administrative expenses were $30.28 million, which, after adjustments for reimbursed expenses and unconsolidated real estate ventures, resulted in Pro Rata Adjusted General and Administrative Expenses of $22.43 million Pro Rata Adjusted G&A (in thousands) | General and Administrative Expenses | Per Statement of Operations | Adjustments (A) | Adjustments (B) | Pro Rata Adjusted | | :-------------------------- | :------------------------ | :-------------- | :-------------- | :---------------- | | Corporate and other | $16,720 | $0 | $314 | $17,034 | | Third-party real estate services | $13,562 | $(7,851) | $(314) | $5,397 | | **Total** | **$30,282** | **$(7,851)** | **$0** | **$22,431** | - Adjustment A removes **$7.9 million of general and administrative expenses** reimbursed by third-party owners[145](index=145&type=chunk) - Adjustment B reflects an allocation of JBG SMITH's share of general and administrative expenses of unconsolidated real estate ventures[146](index=146&type=chunk) [Same Store NOI (Non-GAAP)](index=41&type=section&id=Same%20Store%20NOI%20(Non-GAAP)) For Q2 2025, JBG SMITH's total Same Store NOI decreased by 3.0% year-over-year to $59.5 million, with multifamily NOI decreasing by 1.5% due to higher expenses and commercial NOI decreasing by 4.6% due to lower revenue, while ground leases increased by 19.9% Same Store NOI (at JBG SMITH Share, in thousands) | Category | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | % Change | | :-------------------- | :------------------------------- | :------------------------------- | :------- | | Multifamily | $24,796 | $25,180 | (1.5)% | | Commercial | $33,594 | $35,212 | (4.6)% | | Ground Leases | $1,137 | $948 | 19.9% | | **Total Same Store NOI** | **$59,527** | **$61,340** | **(3.0)%** | - Multifamily revenue increased **1.4% YoY**, but expenses increased **5.7%**, leading to a **1.5% NOI decrease**[147](index=147&type=chunk) - Commercial revenue decreased **4.6% YoY**, and expenses decreased **4.5%**, resulting in a **4.6% NOI decrease**[147](index=147&type=chunk) [Summary NOI (Non-GAAP)](index=42&type=section&id=Summary%20NOI%20(Non-GAAP)) For Q2 2025, JBG SMITH's Operating Portfolio NOI (at JBG SMITH Share) was $67.1 million, with an annualized NOI of $268.4 million, an overall occupancy of 79.5%, and significant annualized free rent of $23.7 million Operating Portfolio NOI and Annualized NOI (at JBG SMITH Share, in thousands) | Category | Operating Portfolio NOI | Annualized NOI | | :-------------------- | :---------------------- | :------------- | | Multifamily | $30,969 | $123,876 | | Commercial | $34,996 | $139,984 | | Ground Leases | $1,137 | $4,548 | | **Total Operating Portfolio NOI** | **$67,102** | **$268,408** | - Overall **% occupied** (at JBG SMITH Share) was **79.5%**[149](index=149&type=chunk) - Annualized Free Rent (at JBG SMITH Share) was **$23,692 thousand**[149](index=149&type=chunk) - Annualized base rent of signed leases, not commenced (at JBG SMITH Share) was **$6,284 thousand**[149](index=149&type=chunk) [Summary NOI – Multifamily (Non-GAAP)](index=43&type=section&id=Summary%20NOI%20%E2%80%93%20Multifamily%20(Non-GAAP)) For Q2 2025, JBG SMITH's multifamily operating portfolio (at JBG SMITH Share) generated $31.0 million in NOI, with an annualized NOI of $123.9 million, 85.8% occupied, and $3.06 million in annualized free rent Multifamily Operating Portfolio NOI and Annualized NOI (at JBG SMITH Share, in thousands) | Region | Operating Portfolio NOI | Annualized NOI | | :-------------------- | :---------------------- | :------------- | | National Landing | $16,785 | $67,140 | | DC | $14,184 | $56,736 | | **Total Multifamily** | **$30,969** | **$123,876** | - Multifamily portfolio **% occupied** (at JBG SMITH Share) was **85.8%**[155](index=155&type=chunk) - Annualized Free Rent (at JBG SMITH Share) was **$3,056 thousand**[155](index=155&type=chunk) - Annualized base rent of signed leases, not commenced (at JBG SMITH Share) was **$420 thousand**[155](index=155&type=chunk) [Summary NOI – Commercial (Non-GAAP)](index=44&type=section&id=Summary%20NOI%20%E2%80%93%20Commercial%20(Non-GAAP)) For Q2 2025, JBG SMITH's commercial operating portfolio (at JBG SMITH Share) generated $35.0 million in NOI, with an annualized NOI of $139.98 million, 74.8% occupied, and $18.97 million in annualized free rent Commercial Operating Portfolio NOI and Annualized NOI (at JBG SMITH Share, in thousands) | Region | Operating Portfolio NOI | Annualized NOI | | :-------------------- | :---------------------- | :------------- | | National Landing | $30,387 | $121,548 | | Other | $4,609 | $18,436 | | **Total Commercial** | **$34,996** | **$139,984** | - Commercial portfolio **% occupied** (at JBG SMITH Share) was **74.8%**[160](index=160&type=chunk) - Annualized Free Rent (at JBG SMITH Share) was **$18,968 thousand**[160](index=160&type=chunk) - Annualized base rent of signed leases, not commenced (at JBG SMITH Share) was **$5,864 thousand**[160](index=160&type=chunk) [Leasing Activity](index=45&type=section&id=Leasing%20Activity) This section details JBG SMITH's multifamily and office leasing performance, including new and renewal lease rates, lease terms, mark-to-market changes, future lease expirations, and tenant/industry concentration, highlighting exposure to government, government contractors, and business services [Signed But Not Yet Commenced Leases](index=45&type=section&id=Signed%20But%20Not%20Yet%20Commenced%20Leases) As of June 30, 2025, JBG SMITH had $6.28 million in annualized estimated rent from signed but not yet commenced leases (at JBG SMITH Share), primarily from commercial operating leases, with expected commencement throughout 2025 and 2026 - Total annualized estimated rent from signed but not yet commenced leases (at JBG SMITH Share) was **$6,284 thousand**[164](index=164&type=chunk) Annualized Estimated Rent by Asset Type (at JBG SMITH Share, in thousands) | Asset Type | Annualized Estimated Rent | | :-------------------- | :------------------------ | | Multifamily Operating | $420 | | Commercial Operating | $5,864 | - Expected rent commencement is staggered, with significant portions in **Q4 2025 ($785k)**, **Q1 2026 ($1,455k)**, and **Q2 2026 ($1,466k)**[164](index=164&type=chunk) [Leasing Activity - Multifamily](index=46&type=section&id=Leasing%20Activity%20-%20Multifamily) For Q2 2025, JBG SMITH's multifamily portfolio (Same Store, at JBG SMITH Share) achieved effective new lease rates of 1.0% and effective renewal lease rates of 8.9%, with a blended rate of 5.0% and a renewal rate of 49.0%, consistent with Q2 2024 Multifamily Leasing Activity (Same Store, at JBG SMITH Share) | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | | :-------------------------- | :------------------------------- | :------------------------------- | | Effective new lease rates | 1.0% | 1.0% | | Effective renewal lease rates | 8.9% | 9.0% | | Effective blended lease rates | 5.0% | 5.1% | | Renewal rate | 49.0% | 51.6% | [Leasing Activity - Office](index=47&type=section&id=Leasing%20Activity%20-%20Office) For Q2 2025, JBG SMITH executed 208,000 square feet of office leases (at JBG SMITH Share), with a weighted average lease term of 5.8 years, and second-generation leases experiencing a (6.1)% cash rental rate decrease and a (4.8)% GAAP rental rate decrease Q2 2025 Office Leasing Activity (at JBG SMITH Share) | Metric | New Leasing | Renewal Leasing | Total Leasing | | :------------------------------------ | :---------- | :-------------- | :------------ | | Square feet leased (in thousands) | 87 | 121 | 208 | | Initial rent ($/SF) | $46.75 | $50.75 | $49.07 | | Weighted average lease term (years) | 7.5 | 4.5 | 5.8 | | Weighted average Free Rent period (months) | 4.2 | 4.9 | 4.6 | | Tenant improvements and leasing commissions per square foot per annum ($) | $12.01 | $2.76 | $7.80 | Mark-to-Market on Second-Generation Space (Q2 2025) | Basis | % change | | :---------- | :------- | | Cash basis | (6.1)% | | GAAP basis | (4.8)% | [Lease Expirations](index=48&type=section&id=Lease%20Expirations) As of June 30, 2025, JBG SMITH's office and retail operating portfolio has 5.23 million square feet of leases expiring, with a total annualized rent of $234.5 million and a weighted average remaining lease term of 5.5 years, with significant expirations projected for 2027 and 2031 Total Lease Expirations (at JBG SMITH Share, June 30, 2025) | Metric | Value | | :-------------------- | :---------------- | | Number of Leases | 393 | | Square Feet | 5,231,489 | | Annualized Rent (in thousands) | $234,549 | | Weighted Average Remaining Lease Term | 5.5 years | Lease Expiration Schedule (by year, % of Total Square Feet) | Year | % of Total Square Feet | | :--- | :--------------------- | | 2025 | 6.2 % | | 2026 | 6.7 % | | 2027 | 13.2 % | | 2028 | 7.9 % | | 2029 | 5.2 % | | 2030 | 10.9 % | | 2031 | 11.8 % | | 2032 | 12.5 % | | 2033 | 6.8 % | | Thereafter | 18.3 % | [Tenant Concentration](index=49&type=section&id=Tenant%20Concentration) As of June 30, 2025, JBG SMITH's operating office and retail portfolio (at JBG SMITH Share) shows significant tenant concentration, with the U.S. Government (GSA) as the largest tenant (23.5% of annualized rent) and Amazon as the second largest (7.1%), with the top 20 tenants contributing 56.7% of total annualized rent Top 2 Tenants by % of Total Annualized Rent (at JBG SMITH Share) | Tenant | % of Total Annualized Rent | | :-------------------------- | :------------------------- | | U.S. Government (GSA) | 23.5 % | | Amazon | 7.1 % | - Total annualized rent from the top 20 tenants is **$132,972 thousand**, representing **56.7% of the total annualized rent**[175](index=175&type=chunk) - Total Annualized Rent (at JBG SMITH Share) was **$234,549 thousand**[175](index=175&type=chunk) [Industry Diversity](index=50&type=section&id=Industry%20Diversity) As of June 30, 2025, JBG SMITH's operating office and retail portfolio (at JBG SMITH Share) demonstrates a diverse industry mix, with strong concentrations in Government Contractors (27.4% of annualized rent), Government (23.7%), and Business Services (14.9%), reflecting its Washington, DC market focus Top 3 Industries by % of Total Annualized Rent (at JBG SMITH Share) | Industry | % of Total Annualized Rent | | :-------------------- | :------------------------- | | Government Contractors | 27.4 % | | Government | 23.7 % | | Business Services | 14.9 % | - Total Annualized Rent (at JBG SMITH Share) was **$234,549 thousand**[177](index=177&type=chunk) [Property Data](index=51&type=section&id=Property%20Data) This section provides detailed tables for JBG SMITH's property portfolio, categorizing assets as multifamily, commercial, under-construction, and development pipeline, including metrics such as ownership, square footage/units, leased/occupied percentages, and annualized rent/NOI, offering a comprehensive view of the company's real estate holdings and development projects [Property Tables: Multifamily](index=51&type=section&id=Property%20Tables%3A%20Multifamily) JBG SMITH's multifamily portfolio (at 100% share) comprises 15 operating assets with 6,596 units, including 12 In-Service assets (94.7% leased, 92.8% occupied) and three recently delivered assets (63.7% leased, 57.5% occupied), with one asset, Valen, under construction Operating Multifamily Assets (at 100% Share, June 30, 2025) | Category | Number of Units | % Leased | % Occupied | Annualized Rent (in thousands) | | :-------------------- | :-------------- | :--------- | :---------- | :----------------------------- | | In-Service | 5,368 | 94.7% | 92.8% | $152,020 | | Recently Delivered | 1,228 | 63.7% | 57.5% | $26,786 | | **Total Operating** | **6,596** | **89.1%** | **85.9%** | **$178,806** | - Valen (formerly 2000 South Bell Street) is under construction with **355 units**[179](index=179&type=chunk)[183](index=183&type=chunk) - Portfolio reconciliation from Q1 2025 to Q2 2025 shows one asset (The Zoe) placed into service and one asset (The Batley) disposed, along with a recapitalization of West Half[181](index=181&type=chunk)[183](index=183&type=chunk) [Property Tables: Commercial](index=53&type=section&id=Property%20Tables%3A%20Commercial) JBG SMITH's commercial portfolio (at 100% share) consists of 21 operating assets totaling 6.96 million square feet, 77.4% leased and 75.7% occupied, generating $245.8 million in annualized rent, with the Tysons Dulles Plaza office campus acquired in Q2 2025 Operating Commercial Assets (at 100% Share, June 30, 2025) | Metric | Value | | :-------------------- | :---------------- | | Total Square Feet | 6,962,917 | | % Leased | 77.4% | | % Occupied | 75.7% | | Annualized Rent (in thousands) | $245,816 | | Office Annualized Rent Per Square Foot | $46.62 | | Retail Annualized Rent Per Square Foot | $44.57 | - Tysons Dulles Plaza, a **491,494-square-foot office campus**, was acquired on May 2, 2025[184](index=184&type=chunk)[185](index=185&type=chunk) - Portfolio reconciliation from Q1 2025 to Q2 2025 shows the acquisition of Tysons Dulles Plaza and minor re-measurements[185](index=185&type=chunk) [Property Tables: Under-Construction](index=55&type=section&id=Property%20Tables%3A%20Under-Construction) JBG SMITH has one multifamily asset, Valen, under construction in National Landing, comprising 355 units and 303,932 square feet, with an estimated completion in Q3 2025, stabilization in Q4 2026, and a projected NOI yield of 6.0% on total investment Under-Construction Asset (at 100% Share, June 30, 2025) | Asset | Submarket | Units | Square Feet | Estimated Completion Date | Estimated Stabilization Date | | :---- | :-------- | :---- | :---------- | :------------------------ | :------------------------- | | Valen | National Landing | 355 | 303,932 | Q3 2025 | Q4 2026 | Financial Projections (at JBG SMITH Share, in thousands) | Metric | Value | | :-------------------------- | :------------ | | Estimated Total Investment | $179,881 | | Estimated Incremental Investment | $13,027 | | Estimated Stabilized NOI (dollars in millions) | $10.7 | | Projected NOI Yield (Estimated Total Investment) | 6.0 % | | Projected NOI Yield (Estimated Incremental Investment) | 82.2 % | [Property Tables: Development Pipeline](index=56&type=section&id=Property%20Tables%3A%20Development%20Pipeline) JBG SMITH's development pipeline (at 100% share) consists of 19 assets with an estimated potential development density of 10.7 million square feet (8.3 million SF multifamily, 2.2 million SF office, 0.27 million SF retail), with 56% fully entitled Development Pipeline (at 100% Share, June 30, 2025) | Asset Type | Estimated Potential Development Density (SF) | Number of Units | | :-------------------- | :--------------------------------------- | :-------------- | | Multifamily | 8,264,600 | 7,685 | | Office | 2,184,300 | — | | Retail | 265,800 | — | | **Total** | **10,714,700** | **7,685** | Development Pipeline (at JBG SMITH Share, June 30, 2025) | Asset Type | Estimated Potential Development Density (SF) | Number of Units | | :-------------------- | :--------------------------------------- | :-------------- | | Multifamily | 7,649,800 | 7,155 | | Office | 806,000 | — | | Retail | 217,000 | — | | **Total** | **8,672,800** | **7,155** | - Approximately **56% (4,859,600 SF)** of the development pipeline (at JBG SMITH Share) is fully entitled, with the remaining **44% (3,813,200 SF)** in entitlement process[192](index=192&type=chunk) - Historical Cost at JBG SMITH Share for the development pipeline was **$391,118 thousand**[192](index=192&type=chunk) [Disposition and Recapitalization Activity](index=58&type=section&id=Disposition%20and%20Recapitalization%20Activity) JBG SMITH completed significant disposition and recapitalization activities in Q1, Q2, and Q3 2025 YTD, totaling $546.0 million in gross sales price (at JBG SMITH Share), including multifamily assets and a development parcel, and recapitalized a 40.0% interest in West Half for $100.0 million Disposition Activity (at JBG SMITH Share, in thousands) | Period | Asset | Asset Type | Gross Sales Price | | :-------------------- | :-------------------- | :-------------------- | :---------------- | | Q1 2025 | 8001 Woodmont | Multifamily | $194,000 | | Q2 2025 | Capitol Point - North | Development Pipeline | $11,000 | | Q2 2025 | WestEnd25 | Multifamily | $186,000 | | Q3 2025 To Date | The Batley | Multifamily | $155,000 | | **Total Gross Sales Price** | | | **$546,000** | - Recapitalized a **40.0% interest in West Half**, a **465-unit multifamily asset**, for **$100.0 million** on May 28, 2025[195](index=195&type=chunk) [Debt](index=59&type=section&id=Debt) This section provides a detailed overview of JBG SMITH's debt structure, including maturity schedules, interest rates, and credit facility information, with total consolidated and unconsolidated principal balance of $2.57 billion as of June 30, 2025, and 84.4% of its debt fixed or hedged [Debt Summary](index=59&type=section&id=Debt%20Summary) As of June 30, 2025, JBG SMITH's total consolidated and unconsolidated principal balance was $2.57 billion, with only 1.3% maturing in 2025, a total weighted average interest rate of 5.26%, and $524.0 million in undrawn revolving credit facility capacity - Total Consolidated and Unconsolidated Principal Balance (at JBG SMITH Share) was **$2,569,419 thousand**[197](index=197&type=chunk) - Only **$33,000 thousand (1.3%)** of total debt is maturing in 2025[197](index=197&type=chunk) Debt Type Distribution (at JBG SMITH Share) | Type | % of total debt maturing | | :---------- | :----------------------- | | Floating rate | 32.7 % | | Fixed rate | 67.3 % | Weighted Average Interest Rates (at JBG SMITH Share) | Type | Rate | | :---------- | :----- | | Variable rate | 5.65 % | | Fixed rate | 5.08 % | | Total debt | 5.26 % | - Revolving credit facility has a **$750 million commitment**, **$226 million outstanding principal balance**, and **$524 million undrawn capacity**[199](index=199&type=chunk) [Debt by Instrument](index=60&type=section&id=Debt%20by%20Instrument) This section details JBG SMITH's consolidated and unconsolidated debt by instrument as of June 30, 2025, including term loans and mortgage loans, with 84.4% of the debt fixed or hedged and a weighted average interest rate of 5.26% - Total Consolidated Principal Balance was **$2,501,419 thousand**[204](index=204&type=chunk) - Total Unconsolidated Principal Balance was **$235,000 thousand**[205](index=205&type=chunk) Key Consolidated Debt Instruments (June 30, 2025, in thousands) | Instrument | Principal Balance | Current Annual Interest Rate | Initial Maturity Date | | :------------------------------------ | :---------------- | :--------------------------- | :-------------------- | | Tranche A‑1 Term Loan | $200,000 | 5.44 % | 01/14/26 | | Tranche A‑2 Term Loan | $400,000 | 4.30 % | 01/13/28 | | Revolving Credit Facility | $226,000 | 6.04 % | 06/29/27 | | The Grace and Reva | $273,620 | 5.19 % | 12/01/29 | Key Unconsolidated Debt Instruments (June 30, 2025, in thousands) | Instrument | Principal Balance | Current Annual Interest Rate | Initial Maturity Date | | :-------------------- | :---------------- | :--------------------------- | :-------------------- | | 1101 17th Street | $60,000 | 5.63 % | 07/14/25 | | 4747 Bethesda Avenue | $175,000 | 5.67 % | 02/20/27 | - Including interest rate caps, **84.4% of the company's debt is fixed or hedged**[200](index=200&type=chunk) [Definitions](index=62&type=section&id=Definitions) This section provides comprehensive definitions for various financial and operational terms used throughout the Supplemental Information, including 'Annualized Rent,' 'Development Pipeline,' 'EBITDA,' 'FFO,' 'FAD,' 'Net Debt,' 'NOI,' 'Same Store,' and 'Under-Construction,' clarifying non-GAAP methodologies and forward-looking estimate limitations - Annualized Rent is the in-place monthly base rent (plus tenant reimbursements for commercial) multiplied by 12, excluding signed but not commenced leases and percentage rent[209](index=209&type=chunk) - EBITDA, EBITDAre, and Adjusted EBITDA are non-GAAP measures for operating performance, adjusted from net income, with EBITDAre following Nareit definition[212](index=212&type=chunk)[213](index=213&type=chunk) - FFO, Core FFO, and FAD are non-GAAP measures for levered operating performance and dividend funding ability, adjusted from net income, with FFO following Nareit definition[220](index=220&type=chunk)[221](index=221&type=chunk)[222](index=222&type=chunk) - Net Debt represents total consolidated and unconsolidated indebtedness less cash and cash equivalents at JBG SMITH Share[229](index=229&type=chunk) - NOI, Same Store NOI, Annualized NOI, Estimated Stabilized NOI, and Projected NOI Yield are non-GAAP measures for asset performance, reflecting property-related revenue less operating expenses[230](index=230&type=chunk)[231](index=231&type=chunk)[232](index=232&type=chunk) - JBG SMITH Share refers to the company's ownership percentage of consolidated and unconsolidated assets, excluding certain subordinated interests[226](index=226&type=chunk) - Reconciliations for non-GAAP estimates on a future basis (e.g., Estimated Stabilized NOI) are not provided due to the inherent difficulty of forecasting and the potential for misleading precision[234](index=234&type=chunk) [Appendix – Interest Expense, Transaction and Other Costs, and NOI Reconciliations (Non-GAAP)](index=66&type=section&id=Appendix%20%E2%80%93%20Interest%20Expense%2C%20Transaction%20and%20Other%20Costs%2C%20and%20NOI%20Reconciliations%20(Non-GAAP)) This appendix provides detailed reconciliations for interest expense, transaction and other costs, and net operating income (NOI) for Q2 2025 and YTD, breaking down interest expense, itemizing transaction costs, and offering a comprehensive reconciliation from net loss to NOI, including adjustments for unconsolidated real estate ventures and non-cash items Interest Expense (at JBG SMITH Share, in thousands) | Component | Three Months Ended June 30, 2025 | | :------------------------------------ | :------------------------------- | | Interest expense before capitalized interest | $35,161 | | Amortization of deferred financing costs | $3,872 | | Capitalized interest | $(2,390) | | **Total** | **$36,620** | Transaction and Other Costs (in thousands) | Component | Three Months Ended June 30, 2025 | |

Core Insights - Office REITs experienced significant losses during the recent REIT earnings season, as reported by Hoya Capital, a leading source for sector-level REIT analysis [1] - Following a strong performance in Q4, office leasing volumes for Q1 2025 were disappointing, indicating a potential downturn in the sector [1] Summary by Category Industry Performance - Office REITs were identified as one of the main losers in the REIT earnings season, highlighting challenges within the sector [1] Leasing Activity - The office leasing volumes for Q1 2025 fell short of expectations after a robust Q4, suggesting a decline in demand for office space [1]

Portfolio Overview - As of March 31, 2025, the operating portfolio consisted of 37 assets, including 15 multifamily assets totaling 6,459 units and 20 commercial assets totaling 6.5 million square feet[142]. - The company delivered The Grace and Reva with 808 multifamily units and approximately 38,000 square feet of retail space in 2024[143]. - The company expects to deliver Valen, a 355-unit multifamily tower, later in 2025[143]. Financial Performance - The net loss attributable to common shareholders for Q1 2025 was $45.7 million, or $0.56 per diluted common share, compared to a net loss of $32.3 million, or $0.36 per diluted common share in Q1 2024[150]. - Same store net operating income (NOI) decreased by 5.5% to $63.1 million for Q1 2025 compared to $66.8 million in Q1 2024[150]. - Property rental revenue decreased by approximately $21.1 million, or 17.2%, to $101.5 million in Q1 2025 from $122.6 million in Q1 2024, primarily due to a $25.0 million decrease in revenue from commercial assets[158]. - Third-party real estate services revenue decreased by approximately $3.0 million, or 16.5%, to $14.9 million in Q1 2025 from $17.9 million in Q1 2024[159]. - Same store NOI decreased by $3.7 million, or 5.5%, to $63.1 million for Q1 2025 from $66.8 million for Q1 2024, attributed to lower occupancy and higher utilities expense[173]. - Net loss attributable to common shareholders increased to $45.72 million in Q1 2025 from $32.28 million in Q1 2024, representing a 41.7% increase[175]. - Multifamily property revenue increased by $2.8 million, or 5.3%, to $55.2 million in Q1 2025 from $52.4 million in Q1 2024[181]. - Commercial property revenue decreased by $13.9 million, or 20.7%, to $53.5 million in Q1 2025 from $67.4 million in Q1 2024[182]. Occupancy Rates - The in-service multifamily portfolio was 94.3% occupied as of March 31, 2025, a decrease of 50 basis points from December 31, 2024[147]. - The office portfolio occupancy was 76.4% as of March 31, 2025, a decrease of 10 basis points from December 31, 2024[148]. Expenses and Costs - Depreciation and amortization expense decreased by approximately $9.3 million, or 16.3%, to $47.6 million in Q1 2025 from $56.9 million in Q1 2024[160]. - Interest expense increased by approximately $5.0 million, or 16.7%, to $35.2 million in Q1 2025 from $30.2 million in Q1 2024[165]. - Total property expenses for multifamily and commercial segments increased to $21.71 million and $20.62 million respectively in Q1 2025[180]. - Impairment loss was $8.5 million in Q1 2025, down from $17.2 million in Q1 2024, related to a development parcel[166]. Shareholder Actions - The company has a share repurchase plan with a capacity of $684.1 million as of March 31, 2025[146]. - The company repurchased and retired 12.2 million common shares for $187.5 million, at a weighted average purchase price of $15.43 per share[156]. - The Board of Trustees increased the common share repurchase authorization to $2.0 billion, with 12.2 million shares repurchased for $187.5 million at an average price of $15.43 during Q1 2025[198]. - The company paid dividends totaling $14.8 million and distributions to redeemable noncontrolling interests of $2.8 million[156]. Cash Flow and Debt - Net cash provided by operating activities was $12.9 million for Q1 2025, down from $37.0 million in Q1 2024[203]. - Cash and cash equivalents decreased by $62.9 million to $120.3 million as of March 31, 2025, primarily due to $237.1 million used in financing activities[204]. - Net cash provided by investing activities was $161.3 million, mainly from $188.8 million in real estate sales[206]. - Outstanding debt was $2.5 billion as of March 31, 2025, down from $2.6 billion at the end of 2024[204]. - The company’s mortgage loans totaled $1.64 billion as of March 31, 2025, down from $1.78 billion at the end of 2024[186]. - The company anticipates that cash flows from continuing operations will be adequate to fund business operations and debt service[185]. - As of March 31, 2025, the company had material cash requirements totaling $338.0 million due in 2025 and 2026 for debt service obligations[200]. Interest Rate Management - The effective interest rate for the revolving credit facility was 5.90% as of March 31, 2025[195]. - The company had variable rate mortgage loans totaling $535,457 thousand with a weighted average effective interest rate of 5.55% as of March 31, 2025[225]. - Interest rate swap and cap agreements had an aggregate notional value of $1.4 billion as of March 31, 2025, down from $2.0 billion as of December 31, 2024[230]. - The fair value of interest rate swaps and caps designated as effective hedges was $14.5 million in assets and $4.3 million in liabilities as of March 31, 2025[230]. - The company follows established risk management policies to hedge interest rate risk using derivative financial instruments[228]. - The company assesses the effectiveness of its hedges both at inception and on an ongoing basis, impacting expenses and net income[229].

Financial Performance - JBG SMITH reported a net loss of $45.7 million for Q1 2025, compared to a net loss of $32.3 million in Q1 2024, representing an increase in loss of 41.9% year-over-year [45]. - Funds From Operations (FFO) for Q1 2025 was $(6.2) million, down from $10.7 million in Q1 2024, indicating a significant decline in operational profitability [45]. - Core FFO for Q1 2025 was $7.2 million, down from $26.9 million in Q1 2024, reflecting a decrease of 73.3% year-over-year [45]. - Total revenue for Q1 2025 was $120,686, a decrease of 17.0% from $145,184 in Q1 2024 [93]. - EBITDA for Q1 2025 was $30,671, down 33.2% from $45,909 in Q1 2024 [96]. - Adjusted EBITDA decreased to $45,356 in Q1 2025, a decline of 28.5% from $63,686 in Q1 2024 [99]. - The FAD Payout Ratio for Q1 2025 was 169.4%, significantly higher than 53.7% in Q1 2024 [103]. - Net loss attributable to common shareholders was $45,720 in Q1 2025, compared to a net loss of $32,276 in Q1 2024, representing a 41.7% increase in losses [100]. Portfolio Performance - The multifamily portfolio ended the quarter at 95.7% leased and 94.3% occupied, with Same Store multifamily portfolio effective rents increasing by 1.5% for new leases and 5.6% upon renewal [11][23]. - The office portfolio ended the quarter at 78.3% leased and 76.4% occupied, with a negative 5.5% Same Store NOI growth for the three months ended March 31, 2025 [20][28]. - The operating multifamily portfolio was 93.0% leased and 91.3% occupied as of March 31, 2025, showing slight improvements from 92.9% and 91.0% respectively in Q4 2024 [55]. - Same Store NOI decreased by 5.5% quarter-over-quarter to $63.1 million for Q1 2025, primarily due to lower occupancy and higher utilities expenses [55]. - The total annualized rent across all leases as of March 31, 2025, is $223,874 million, with a weighted average rent per square foot of $45.37 [185]. - The total annualized estimated rent for multifamily operating assets is projected to reach $1,068 million by June 30, 2026, with a steady increase from $768 million as of March 31, 2025 [174]. Debt and Liquidity - A total of 12.2 million shares were repurchased at an average price of $15.43 per share, totaling $187.5 million in 2025, with a cumulative repurchase of 69.0 million shares since 2020 [16]. - The company refinanced RiverHouse Apartments with a $258.9 million loan at a favorable 5.03% rate, enhancing balance sheet flexibility [13]. - The floating rate exposure remains low, with 88.3% of debt fixed or hedged, and only $33.0 million of debt maturing this year, representing 1.3% of total debt [22]. - The company reported a decrease in total equity from $1,809,058 thousand to $1,570,992 thousand, a decline of approximately 13.2% [90]. - The company has a revolving credit facility that increased from $85,000 thousand to $162,000 thousand, indicating a strategic move to enhance liquidity [90]. Market Trends and Outlook - The DC metro area saw year-over-year rent growth of 3.2%, with vacancy rates at 5.5%, indicating resilience despite economic disruptions [25][26]. - The company anticipates continued decreases in earnings and increases in Net Debt to Annualized Adjusted EBITDA through mid-2025, but expects stabilization from newly constructed multifamily assets [21]. - Future growth is anticipated to be influenced by economic factors, including job growth and public transportation expansion in the Washington, DC metropolitan area [114]. - The company is positioned to capitalize on land sales, ground leases, and joint ventures to enhance its portfolio [114]. Development and Construction - JBG SMITH has a development pipeline of 19 assets, representing 8.9 million square feet of estimated potential development density [51]. - The company has 775 units under construction, totaling 580,966 square feet, which will contribute to future revenue growth [191]. - The company has a multifamily project under construction at 2000/2001 South Bell Street, with an estimated total investment of $343.435 million and projected NOI yield of 6.2% [199]. - The completed construction of The Zoe, a 420-unit tower, contributes to the multifamily segment's growth [200]. Asset Management - The company is actively involved in third-party asset management and real estate services, providing fee-based services [117]. - Approximately 75.0% of JBG SMITH's holdings are located in the National Landing submarket, which is driven by key demand factors including Amazon's headquarters and Virginia Tech's $1 billion Innovation Campus [117]. - The company emphasizes the importance of non-GAAP measures like EBITDA and Adjusted EBITDA for evaluating operating performance, although specific figures were not provided in the extracted content [69][70].

Group 1 - The article discusses the author's journey into investing, starting in high school in 2011, focusing on REITs, preferred stocks, and high-yield bonds, indicating a long-standing interest in markets and the economy [1] - The author has recently adopted a strategy that combines long stock positions with covered calls and cash secured puts, emphasizing a fundamental long-term investment approach [1] - The author primarily covers REITs and financials on Seeking Alpha, with occasional articles on ETFs and other stocks influenced by macro trade ideas [1]

Debt and Financial Instruments - As of December 31, 2024, the total debt balance was $1.78 billion, with a weighted average interest rate of 5.58% for variable rate debt and 4.79% for fixed rate debt [378]. - The estimated fair value of consolidated debt was $2.6 billion as of December 31, 2024, compared to $2.5 billion in 2023 [381]. - The company had interest rate swap and cap agreements with an aggregate notional value of $2.0 billion designated as effective hedges as of December 31, 2024 [384]. - The company reported a variable rate mortgage loan balance of $587.25 million with an effective interest rate of 5.58% as of December 31, 2024 [378]. - The fair value of non-designated derivatives, specifically interest rate cap agreements, was $2.3 million in assets and $2.3 million in liabilities as of December 31, 2024 [385]. - The company’s revolving credit facility had an outstanding balance of $85 million with an effective interest rate of 5.98% as of December 31, 2024 [378]. - The Tranche A-1 Term Loan had a balance of $200 million with a fixed interest rate of 5.34% as of December 31, 2024 [378]. - The company’s interest rate swaps fixed SOFR at a weighted average interest rate of 4.00% for the Tranche A-1 Term Loan as of December 31, 2024 [386]. - The company’s variable rate mortgage loans included interest rate cap agreements with a weighted average interest rate cap strike of 3.36% [378]. - The company’s pro rata share of debt of unconsolidated real estate ventures was $68 million, with a variable rate of 5.68% [378]. Revenue and Income - Total revenue for 2024 was $547.3 million, a decrease of 9.4% from $604.2 million in 2023 [406]. - Property rental revenue decreased to $457.0 million in 2024, down 5.2% from $483.2 million in 2023 [406]. - Net loss attributable to common shareholders for 2024 was $143.5 million, compared to a net loss of $80.0 million in 2023 [406]. - Net income for 2024 was $(177,753) thousand, a decline from $(91,709) thousand in 2023, compared to a profit of $98,986 thousand in 2022 [407]. - Comprehensive loss attributable to JBG Smith Properties was $(148,476) thousand in 2024, compared to $(105,580) thousand in 2023, and a profit of $146,965 thousand in 2022 [407]. - Total revenue from U.S. federal government leases increased to $64.958 million in 2024, accounting for 11.9% of total revenue, up from 10.7% in 2023 [422][423]. Assets and Liabilities - Total assets decreased to $5.02 billion in 2024 from $5.52 billion in 2023, a decline of 9.1% [403]. - Total liabilities decreased slightly to $2.79 billion in 2024 from $2.83 billion in 2023 [404]. - The company’s total shareholders' equity decreased to $1.81 billion in 2024 from $2.22 billion in 2023, a decline of 18.6% [404]. - Cash and cash equivalents decreased to $145.8 million in 2024 from $164.8 million in 2023 [403]. - The balance of common shares as of December 31, 2024, was 84,500 thousand, a decrease from 94,309 thousand in 2023 [410]. - The total assets of unconsolidated real estate ventures decreased to $488.6 million from $867.6 million in 2023, a decline of approximately 43.6% [513]. - The total equity of unconsolidated real estate ventures decreased to $232.4 million in 2024 from $593.8 million in 2023, a decline of approximately 60.8% [513]. Impairment and Losses - The company reported an impairment loss of $55.4 million in 2024, compared to $90.2 million in 2023 [406]. - The company recorded impairment losses of $6.7 million related to development parcels in its unconsolidated real estate ventures for the year ended December 31, 2024 [499]. - The company recognized an impairment loss of $3.3 million related to The Foundry, included in "Loss from unconsolidated real estate ventures, net" for the year ended December 31, 2023 [507]. Cash Flow and Financing Activities - Net cash provided by operating activities decreased to $129.393 million in 2024 from $183.372 million in 2023, reflecting a decline of approximately 29.4% [412]. - The company reported a net cash used in financing activities of $290.797 million in 2024, compared to $158.825 million in 2023, indicating a significant increase in cash outflows [412]. - The company had a net cash provided by investing activities of $144.155 million in 2024, contrasting with a net cash used of $98.179 million in 2023 [412]. - The company repurchased common shares worth $(170,770) thousand in 2024, compared to $(335,313) thousand in 2023 [410]. Shareholder Information - Dividends declared on common shares were $0.875 per share in 2024, compared to $0.675 per share in 2023 [410]. - The weighted average number of common shares outstanding decreased to 88.3 million in 2024 from 105.1 million in 2023 [406]. Real Estate and Development - Development costs and real estate additions amounted to $218.029 million in 2024, a decrease from $333.744 million in 2023 [412]. - The total investments in unconsolidated real estate ventures decreased to $93.7 million in 2024 from $264.3 million in 2023, a decline of 64.6% [498]. - The company recognized revenue of $16.3 million for leasing and property management services provided to unconsolidated real estate ventures in 2024 [503]. - The company acquired a 50% ownership interest in 8001 Woodmont for $115.0 million, including the assumption of a $51.9 million mortgage loan [489]. Accounting and Reporting - The company has adopted ASU 2023-07 for segment reporting, enhancing disclosures of significant segment expenses without impacting consolidated financial statements [482]. - The SEC's new climate-related disclosure rules, effective for annual reports starting December 31, 2025, will require disclosures on climate-related risks and governance [484]. - The fair value hierarchy prioritizes Level 1 inputs (quoted prices in active markets) over Level 3 inputs (unobservable inputs), ensuring a robust valuation process [466]. - Derivative financial instruments are recognized at fair value, with cash flows classified as operating cash flows unless they contain a financing element [457]. Miscellaneous - The company formed an unconsolidated real estate venture with Fortress in April 2022, contributing $66.1 million for a 33.5% interest [509]. - The company acquired the ground lessee's interest in 1900 Crystal Drive for $26.6 million in June 2024 [517].

[SECTION ONE: Letter to Shareholders](index=4&type=section&id=LETTER%20TO%20SHAREHOLDERS%20SECTION%20ONE) This section presents the management's letter to shareholders, covering macroeconomic trends, operational highlights, capital allocation, financial performance, and debt position [Management Letter](index=4&type=section&id=Management%20Letter) The management letter highlights an improved real estate capital market sentiment following the first rate cut in four years. The company reported strong multifamily performance, successful capital recycling, and significant share repurchases, while also outlining its capital allocation strategy and current financial position [Macroeconomic & Real Estate Market Sentiment](index=4&type=section&id=Macroeconomic%20%26%20Real%20Estate%20Market%20Sentiment) This section discusses the improved real estate capital market sentiment and strengthening apartment and office market fundamentals - The **first Federal Reserve rate cut in four years** has improved real estate capital market sentiment among lenders and equity investors[4](index=4&type=chunk) - Apartment fundamentals have strengthened due to limited supply, and the office market has cleared its bottom with improved leasing fundamentals[4](index=4&type=chunk) - The five-day in-office workweek is making a comeback, with major employers like Amazon mandating it, at a time when office supply is diminishing due to conversions and teardowns[4](index=4&type=chunk) [Q3 2024 Key Operational Highlights](index=4&type=section&id=Q3%202024%20Key%20Operational%20Highlights) This section outlines the company's key operational achievements for Q3 2024, including successful asset sales, strong multifamily performance, and sustainability awards - Closed on the sale of Fort Totten Square for **$86.8 million**, contributing to **$263.6 million** in year-to-date capital recycling transactions at an average **4.8% capitalization rate**[5](index=5&type=chunk) - Multifamily In-Service portfolio occupancy increased by **140 basis points** to **95.7%** and was **97.0% leased**[6](index=6&type=chunk) - Same Store multifamily portfolio effective rents increased by **4.5%** for new leases and **6.1%** upon renewal, with a **60.0% renewal rate** and **3.5% Same Store NOI growth**[6](index=6&type=chunk) - The Grace and Reva, two new towers in National Landing, were **63.2% leased** as of October 27th, exceeding the leasing performance of all five prior multifamily deliveries since 2017[7](index=7&type=chunk) - Received Nareit's Impact at Scale Award and maintained a **5-star GRESB ranking**, recognized as Global Listed Sector Leader and Americas Regional Sector Leader for Diversified (Office and Residential) REITs[8](index=8&type=chunk) [Capital Allocation Strategy](index=5&type=section&id=Capital%20Allocation%20Strategy) This section details the company's approach to capital allocation, focusing on development opportunities, non-core asset dispositions, and share repurchases - Expects development opportunities to become more economically viable in a positive macroeconomic landscape, with **9.3 million square feet** of Development Pipeline expected to be entitled by the **end of 2025**[9](index=9&type=chunk) - Continues to dispose of non-core assets, marketing over **$200 million** in combined value for sale, following **$263.6 million** in capital recycling year-to-date[11](index=11&type=chunk) - New investments, including developments, acquisitions, and share buybacks, will primarily be financed through asset recycling[12](index=12&type=chunk) - Repurchased **10.8 million shares** for **$168.3 million** year-to-date at an average price of **$15.61**, totaling **$1.1 billion** since 2020 (**56.6 million shares**, **~38% of outstanding shares**)[12](index=12&type=chunk) [Financial and Operating Metrics Overview](index=5&type=section&id=Financial%20and%20Operating%20Metrics%20Overview) This section provides a summary of the company's key financial and operating metrics for Q3 2024, including FFO, NOI, and portfolio occupancy rates Q3 2024 Key Financial and Operating Metrics | Metric | Value | | :---------------------------------- | :------------------- | | Core FFO attributable to common shares | $19.3 million | | Core FFO per diluted share | $0.23 | | Annualized NOI (excluding sold/out-of-service assets) | In line with last quarter | | Multifamily portfolio leased | 92.7% | | Multifamily portfolio occupied | 90.6% | | In-Service multifamily portfolio leased | 97.0% | | In-Service multifamily portfolio occupied | 95.7% | | Office portfolio leased | 80.7% | | Office portfolio occupied | 79.1% | | Same Store NOI growth (QoQ) | 0.5% | [Debt and Liquidity Position](index=5&type=section&id=Debt%20and%20Liquidity%20Position) This section outlines the company's debt and liquidity profile, including leverage ratios, debt maturity, and anticipated earnings pressures - Net Debt to Annualized Adjusted EBITDA was **10.6x** as of **September 30, 2024**[14](index=14&type=chunk) - Floating rate exposure remains low, with **91.4%** of debt fixed or hedged, and a weighted average debt maturity of **3.1 years**[15](index=15&type=chunk) - Repaid an **$83.3 million** mortgage loan and executed a **one-year extension** of the **Tranche A-1 Term Loan**[15](index=15&type=chunk) - Anticipates continued **downward pressure** on earnings and office Same Store NOI through 2025, and **upward pressure** on **Net Debt to Annualized Adjusted EBITDA** due to tenant vacates and construction spend[14](index=14&type=chunk) - Expected pressures will be lessened by income from new deliveries (The Grace, Reva, Valen, The Zoe), multifamily rent growth, and office demand in National Landing[14](index=14&type=chunk) [Operating Portfolio Performance](index=6&type=section&id=Operating%20Portfolio%20Performance) The operating portfolio showed strong multifamily performance with increased occupancy and rent growth, driven by new developments and limited market-wide supply. The office portfolio experienced a slight decrease in occupancy but saw improved leasing sentiment and activity, particularly in defense and technology sectors, with strategic repurposing of older assets [Multifamily Portfolio Trends](index=6&type=section&id=Multifamily%20Portfolio%20Trends) This section details the positive trends in the multifamily portfolio, including increased occupancy, rent growth, and strong leasing performance of new developments Multifamily Portfolio Performance (QoQ) | Metric | Q3 2024 | Change QoQ | | :---------------------------------- | :------ | :--------- | | In-Service Portfolio Leased | 97.0% | +0.1% | | In-Service Portfolio Occupied | 95.7% | +1.4% | | Same Store New Lease Effective Rents | +4.5% | N/A | | Same Store Renewal Lease Effective Rents | +6.1% | N/A | | Same Store Renewal Rate | 60.0% | N/A | | Same Store NOI Growth | +3.5% | N/A | - The Grace and Reva (808 units) were **60.7% leased** by quarter-end and **63.2% leased** by October 27th, exceeding the leasing pace of all five prior multifamily deliveries since 2017[17](index=17&type=chunk) - Market-wide (DC Metro) new multifamily starts are stalled (**3,103 units under construction**), pushing occupancy to **94.1%** and rents to grow at **3.5%**[18](index=18&type=chunk) - The DC metro region's **3.5% rent growth** compares favorably to **0.6%** in other Gateway markets, with a favorable supply picture[19](index=19&type=chunk) [Office Portfolio Trends](index=7&type=section&id=Office%20Portfolio%20Trends) This section analyzes the office portfolio trends, noting a slight occupancy decrease, improved tenant sentiment, strategic asset repurposing, and a shift towards five-day in-office work Office Portfolio Performance (QoQ) | Metric | Q3 2024 | Change QoQ | | :---------------------------------- | :------ | :--------- | | Portfolio Leased | 80.7% | -1.5% | | Portfolio Occupied | 79.1% | -1.5% | | Square Feet Leased (Q3) | 150,000 SF | N/A | | Weighted Average Lease Term | 6.3 years | N/A | | Second-Generation Lease Rental Rate Mark-to-Market (Cash) | +1.2% | N/A | - Tenant surveys indicate higher engagement and a **25% YoY increase** in intent to renew, with National Landing renewals averaging under **$5 per square foot per annum** in leasing costs[21](index=21&type=chunk) - Leasing in National Landing is primarily driven by government contractors, secure facility needs, and technology-related tenants, accounting for approximately **80%** of leasing activity this year[21](index=21&type=chunk) - Approximately **600,000 square feet** were taken out of service this year, with an additional **143,000 square feet** planned, to repurpose older buildings for redevelopment or conversion[22](index=22&type=chunk) - Anticipates approximately **475,000 square feet** (**$21.5 million annualized rent**) of tenant vacates in National Landing by **H1 2025**, resulting in a pro forma occupancy of **~69%** (excluding highly levered assets)[23](index=23&type=chunk) - Market-wide, there's a significant attitudinal shift towards five-day in-office work, with **79% of U.S. CEOs** expecting this by **2027** (up from **34%** earlier this year)[24](index=24&type=chunk) - Northern Virginia office market shows an uptick in leasing activity, with **60-80%** of transactions being renewals, and **55%** of quarterly leasing in defense, engineering, and technology sectors[26](index=26&type=chunk) - Limited new supply (**210,000 SF under construction**) and potential repurposing of over **10 million square feet** of obsolete office buildings could significantly reduce the **23.5% vacancy rate**[26](index=26&type=chunk) [Conclusion and Outlook](index=8&type=section&id=Conclusion%20and%20Outlook) The company is encouraged by recent Federal Reserve actions, the apparent bottoming of the office market, and the return to five-day in-office work. Having largely completed its portfolio transformation to majority multifamily, JBG SMITH is well-positioned to capitalize on the next phase of the real estate cycle, with an active office leasing pipeline and shrinking office inventory - Encouraged by recent **Federal Reserve action** on interest rates, the **apparent bottom in the office market**, and the return of the **five-day in-office workweek**[27](index=27&type=chunk) - The company has largely completed its portfolio transformation, now being almost **majority multifamily**, and has successfully repositioned the **National Landing submarket**[27](index=27&type=chunk) - The office leasing pipeline is **more active than at any time since 2020**, and the office denominator continues to shrink[27](index=27&type=chunk) [Personnel Update](index=8&type=section&id=Personnel%20Update) Kai Reynolds, Chief Development Officer, will be retiring at the end of the year, with gratitude expressed for his contributions - **Chief Development Officer, Kai Reynolds**, will be **retiring at the end of this year**[28](index=28&type=chunk) [SECTION TWO: Q3 2024 Earnings Release](index=11&type=section&id=Q3%202024%20EARNINGS%20RELEASE%20SECTION%20TWO) This section provides a summary of JBG SMITH's third-quarter 2024 financial results, including net loss, FFO, NOI, operating portfolio performance, and balance sheet highlights [Third Quarter 2024 Results Summary](index=11&type=section&id=Third%20Quarter%202024%20Results%20Summary) JBG SMITH reported a net loss for Q3 2024, with FFO and Core FFO also decreasing compared to the prior year. Annualized NOI saw a slight decrease, primarily due to tenant vacates, while Same Store NOI increased marginally, driven by multifamily performance [Financial Performance (Net Loss, FFO, Core FFO)](index=11&type=section&id=Financial%20Performance%20(Net%20Loss%2C%20FFO%2C%20Core%20FFO)) This section details the company's net loss, FFO, and Core FFO for Q3 2024, comparing performance against the prior year Q3 2024 vs. Q3 2023 Financial Performance | Metric | Q3 2024 (in millions) | Q3 2023 (in millions) | Change | | :---------------------------------- | :-------------------- | :-------------------- | :----- | | Net loss attributable to common shareholders | $(27.0) | $(58.0) | +$31.0 | | Net loss per diluted share | $(0.32) | $(0.58) | +$0.26 | | FFO attributable to common shareholders | $19.5 | $40.1 | $(20.6) | | FFO per diluted share | $0.23 | $0.40 | $(0.17) | | Core FFO attributable to common shareholders | $19.3 | $41.0 | $(21.7) | | Core FFO per diluted share | $0.23 | $0.40 | $(0.17) | - The net loss for Q3 2024 improved compared to Q3 2023, which included a significant impairment loss of **$59.3 million** related to real estate assets[30](index=30&type=chunk) [Annualized & Same Store NOI](index=11&type=section&id=Annualized%20%26%20Same%20Store%20NOI) This section presents the Annualized and Same Store Net Operating Income (NOI) for Q3 2024, highlighting drivers of change Annualized NOI (at JBG SMITH Share) | Metric | Q3 2024 (in millions) | Q2 2024 (in millions) | Change | | :---------------------------------- | :-------------------- | :-------------------- | :----- | | Annualized NOI | $282.4 | $286.4 | $(4.0) | | Annualized NOI (excluding sold/out-of-service assets) | $278.1 | $278.4 | $(0.3) | - The decrease in Annualized NOI (excluding sold/out-of-service assets) was primarily due to tenant vacates and higher concessions at certain multifamily assets, partially offset by lower real estate tax expense[30](index=30&type=chunk)[31](index=31&type=chunk) Same Store NOI (SSNOI) (at JBG SMITH Share) | Metric | Q3 2024 (in millions) | Change QoQ | | :---------------------------------- | :-------------------- | :--------- | | SSNOI | $68.6 | +0.5% | | SSNOI increase drivers | Higher rents and occupancy, lower concessions in multifamily; lower real estate taxes in commercial. | | SSNOI decrease drivers | Higher operating expenses in multifamily; lower occupancy and recovery revenue in commercial. | [Operating Portfolio Highlights](index=12&type=section&id=Operating%20Portfolio%20Highlights) The operating multifamily portfolio saw a slight decrease in overall occupancy but the In-Service segment remained strong. The commercial portfolio experienced a modest decline in both leased and occupied rates, while office leasing activity included a mix of new and renewal leases with positive rental rate increases Operating Portfolio Occupancy & Leasing (QoQ) | Metric | As of Sep 30, 2024 | As of Jun 30, 2024 | Change | | :---------------------------------- | :----------------- | :----------------- | :----- | | Operating Multifamily Leased | 92.7% | 96.9% | -4.2% | | Operating Multifamily Occupied | 90.6% | 94.3% | -3.7% | | In-Service Multifamily Leased | 97.0% | 96.9% | +0.1% | | In-Service Multifamily Occupied | 95.7% | 94.3% | +1.4% | | Same Store Multifamily New Lease Effective Rents | +4.5% | N/A | N/A | | Same Store Multifamily Renewal Lease Effective Rents | +6.1% | N/A | N/A | | Same Store Multifamily Renewal Rate | 60.0% | N/A | N/A | | Operating Commercial Leased | 80.7% | 82.3% | -1.6% | | Operating Commercial Occupied | 79.1% | 80.6% | -1.5% | - Executed approximately **150,000 square feet** of office leases in Q3 2024 (**46,000 SF new leases**) and **496,000 square feet year-to-date** (**241,000 SF new leases**)[32](index=32&type=chunk) - Second-generation office leases generated a **1.2% rental rate increase** on a cash basis for Q3 and a **1.5% increase year-to-date**[32](index=32&type=chunk) [Development Portfolio Overview](index=12&type=section&id=Development%20Portfolio%20Overview) The company has one multifamily asset with 775 units under construction. The Grace and Reva were recently placed into the operating portfolio. The development pipeline consists of 18 assets with 9.3 million square feet of estimated potential development density - **One multifamily asset** consisting of **775 units** is currently under construction[33](index=33&type=chunk) - **The Grace and Reva** (formerly 1900 Crystal Drive) were placed into the operating multifamily portfolio in Q2 2024[33](index=33&type=chunk) - The development pipeline includes **18 assets** with an estimated potential development density of **9.3 million square feet**[33](index=33&type=chunk) [Third-Party Asset Management and Real Estate Services Business](index=12&type=section&id=Third-Party%20Asset%20Management%20and%20Real%20Estate%20Services%20Business) Revenue from third-party real estate services, including reimbursements, was $17.1 million for Q3 2024. Excluding reimbursements and service revenue from real estate ventures, the business generated $8.3 million, primarily from property and asset management fees Q3 2024 Third-Party Real Estate Services Revenue | Revenue Type | Amount (in millions) | | :---------------------------------- | :------------------- | | Total revenue (including reimbursements) | $17.1 | | Revenue (excluding reimbursements and venture service revenue) | $8.3 | | Property and asset management fees | $5.0 | | Other service revenue | $1.6 | | Leasing fees | $1.0 | [Balance Sheet & Capital Activities](index=13&type=section&id=Balance%20Sheet%20%26%20Capital%20Activities) As of September 30, 2024, JBG SMITH's total enterprise value was approximately $4.3 billion, with Net Debt to annualized Adjusted EBITDA at 10.6x. The company engaged in asset dispositions, debt repayment, and share repurchases during the quarter Balance Sheet Metrics (as of Sep 30, 2024) | Metric | Value | | :---------------------------------- | :------------------- | | Total enterprise value | ~$4.3 billion | | Common shares and units outstanding | 98.4 million | | Common shares and units value | $1.7 billion | | Debt (net) at JBG SMITH share | $2.7 billion | | Cash and cash equivalents at JBG SMITH share | $141.7 million | | Net Debt to annualized Adjusted EBITDA | 10.6x | | Net Debt / total enterprise value | 59.6% | | Cash and cash equivalents | $137.0 million | | Availability under revolving credit facility | $644.3 million | - Sold Fort Totten Square for **$86.8 million** in **September 2024**[37](index=37&type=chunk) - Repaid an **$83.3 million** mortgage loan and extended the **$200.0 million Tranche A-1 Term Loan** by **one year to January 2026**[37](index=37&type=chunk) - Repurchased and retired **3.1 million common shares** for **$50.2 million** at a weighted average price of **$16.23 per share**[37](index=37&type=chunk) [Dividends](index=13&type=section&id=Dividends) The Board of Trustees declared a quarterly dividend of $0.175 per common share, payable in November 2024 - A quarterly dividend of **$0.175 per common share** was declared on **October 24, 2024**, payable on **November 22, 2024**[38](index=38&type=chunk) [About JBG SMITH](index=13&type=section&id=About%20JBG%20SMITH) JBG SMITH is a leading owner, operator, investor, and developer of mixed-use properties in the Washington, DC market, with a significant concentration in National Landing. The company focuses on placemaking, green building, and maintaining carbon-neutral operations - JBG SMITH owns, operates, invests in, and develops mixed-use properties in high-growth, high-barrier-to-entry submarkets in and around **Washington, DC**, primarily **National Landing**[39](index=39&type=chunk) - Approximately **75.0%** of JBG SMITH's holdings are in **National Landing**, anchored by **Amazon's new headquarters**, **Virginia Tech's Innovation Campus**, proximity to the Pentagon, and placemaking initiatives[39](index=39&type=chunk) - The portfolio comprises **13.1 million square feet** of multifamily, office, and retail assets (at share), **98%** of which are Metro-served, and a development pipeline of **9.3 million square feet**, primarily multifamily[39](index=39&type=chunk) - Committed to green, smart, and healthy buildings, with plans to maintain **carbon-neutral operations** annually[39](index=39&type=chunk) [Forward-Looking Statements](index=13&type=section&id=Forward-Looking%20Statements) This section provides a cautionary statement regarding forward-looking statements, highlighting that future results may differ materially due to numerous assumptions, risks, and uncertainties, and advises against undue reliance on these statements - Statements in the release may constitute '**forward-looking statements**' subject to **numerous assumptions, risks, and uncertainties**, and future results may **differ materially**[40](index=40&type=chunk) - Factors influencing outcomes include **adverse economic conditions**, timing and costs of development, financing commitments, and competitive factors[40](index=40&type=chunk) - Investors are cautioned not to place **undue reliance** on forward-looking statements, and the company does not undertake to publicly release revisions[40](index=40&type=chunk) [Pro Rata Information](index=14&type=section&id=Pro%20Rata%20Information) The company presents financial information 'at JBG SMITH Share' to reflect its economic interests in consolidated and unconsolidated real estate ventures, emphasizing that this non-GAAP presentation provides valuable insights into its portfolio's composition and performance, despite not representing GAAP-compliant control or legal claims to co-venturers' shares - Financial information is presented '**at JBG SMITH Share**' (pro rata share) to reflect ownership percentage in consolidated and unconsolidated real estate ventures[41](index=41&type=chunk) - This **non-GAAP presentation** provides **valuable information** on the **portfolio's composition, performance, and capitalization**, as a significant portion of assets are held through real estate ventures[41](index=41&type=chunk)[42](index=42&type=chunk) - The company does **not control unconsolidated ventures** and does **not have legal claim** to co-venturers' shares; this information should **not be considered a substitute for GAAP financial statements**[42](index=42&type=chunk) - Certain **subordinated interests** in commercial buildings and associated non-recourse mortgage loans are excluded from occupancy and non-GAAP metrics due to **zero investment** and **no anticipated near-term cash flow distributions**[42](index=42&type=chunk) [Non-GAAP Financial Measures Explanation](index=15&type=section&id=Non-GAAP%20Financial%20Measures%20Explanation) This section explains the calculation and utility of various non-GAAP financial measures, including EBITDA, EBITDAre, Adjusted EBITDA, FFO, Core FFO, FAD, Net Debt, and NOI. These measures are used by management to assess operating performance, financial flexibility, and dividend funding ability, providing supplemental insights beyond GAAP, but are not substitutes for GAAP measures - **EBITDA, EBITDAre, and Adjusted EBITDA** are non-GAAP measures used to evaluate **operating performance** by removing the impact of capital structure and certain non-cash expenses[43](index=43&type=chunk)[44](index=44&type=chunk) - **FFO, Core FFO, and FAD** are non-GAAP measures useful for comparing **levered operating performance** and assessing the ability to **fund dividends**, by excluding real estate depreciation and other non-comparable items[44](index=44&type=chunk)[45](index=45&type=chunk) - **Net Debt** is a non-GAAP measure representing **total consolidated and unconsolidated indebtedness less cash and cash equivalents**, used to manage financial flexibility and leverage[45](index=45&type=chunk) - **NOI and Annualized NOI** are non-GAAP measures used to assess **asset performance** by reflecting property-related revenue less operating expenses, excluding non-cash items and financing costs[45](index=45&type=chunk) - These non-GAAP measures are **supplemental** and should be considered in conjunction with GAAP financial statements, as they have limitations and may **not be comparable** to measures used by other companies[44](index=44&type=chunk)[45](index=45&type=chunk) [Definitions (Earnings Release)](index=18&type=section&id=Definitions%20(Earnings%20Release)) This section provides key definitions for terms used in the earnings release, including Development Pipeline, Estimated Potential Development Density, First-generation, Formation Transaction, Free Rent, GAAP, In-Service, Non-Same Store, and Same Store - Key terms defined include '**Development Pipeline**' (assets with potential for construction), '**Estimated Potential Development Density**' (management's estimate of developable square feet), and '**In-Service**' (multifamily/commercial assets at or above 90% leased or operating for >12 months)[47](index=47&type=chunk) - Definitions also cover '**First-generation**' (newly vacant or delivered space leases), '**Formation Transaction**' (spin-off and acquisition events), '**Free Rent**' (abated rent), '**GAAP**' (accounting principles), '**Non-Same Store**' (excluded from Same Store pool), and '**Same Store**' (assets in-service for both comparison periods, excluding significant redevelopment)[47](index=47&type=chunk) [Condensed Consolidated Financial Statements (Summary)](index=19&type=section&id=Condensed%20Consolidated%20Financial%20Statements%20(Summary)) This section provides a summary of the company's condensed consolidated financial statements, including balance sheets, statements of operations, and reconciliations for non-GAAP measures like EBITDA, FFO, and NOI. For detailed financial tables and comprehensive reconciliations, refer to the 'Detailed Financial Information' section in the Supplemental Information [Condensed Consolidated Balance Sheets (Summary)](index=19&type=section&id=Condensed%20Consolidated%20Balance%20Sheets%20(Summary)) This section summarizes the company's condensed consolidated balance sheets, presenting key assets, liabilities, and equity as of September 30, 2024, and December 31, 2023 Condensed Consolidated Balance Sheets (in thousands) | Asset/Liability | Sep 30, 2024 | Dec 31, 2023 | | :---------------------------------- | :----------- | :----------- | | **ASSETS:** | | | | Real estate, net | $4,429,977 | $4,536,759 | | Cash and cash equivalents | $136,983 | $164,773 | | Investments in unconsolidated real estate ventures | $100,682 | $264,281 | | Total Assets | $5,182,477 | $5,518,515 | | **LIABILITIES & EQUITY:** | | | | Mortgage loans, net | $1,816,156 | $1,783,014 | | Revolving credit facility | $90,000 | $62,000 | | Term loans, net | $717,578 | $717,172 | | Total liabilities | $2,841,880 | $2,825,929 | | Total equity | $1,895,652 | $2,251,849 | | Total Liabilities, Redeemable Noncontrolling Interests and Equity | $5,182,477 | $5,518,515 | [Condensed Consolidated Statements of Operations (Summary)](index=20&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations%20(Summary)) This section provides a summary of the company's condensed consolidated statements of operations, detailing revenues, expenses, and net loss for Q3 2024 and Q3 2023 Condensed Consolidated Statements of Operations (in thousands, Q3 2024 vs. Q3 2023) | Item | Q3 2024 | Q3 2023 | | :---------------------------------- | :------ | :------ | | Total revenue | $136,026 | $151,562 | | Total expenses | $129,756 | $136,793 | | Total other income (expense) | $(36,748) | $(80,793) | | Net loss | $(31,309) | $(66,101) | | Net loss attributable to common shareholders | $(26,980) | $(58,007) | | Loss per common share - diluted | $(0.32) | $(0.58) | [EBITDA, EBITDAre and Adjusted EBITDA Reconciliations (Summary)](index=22&type=section&id=EBITDA%2C%20EBITDAre%20and%20Adjusted%20EBITDA%20Reconciliations%20(Summary)) This section summarizes the reconciliations for EBITDA, EBITDAre, and Adjusted EBITDA, along with the Net Debt to Annualized Adjusted EBITDA ratio for Q3 2024 and Q3 2023 EBITDA, EBITDAre and Adjusted EBITDA (in thousands, Q3 2024 vs. Q3 2023) | Metric | Q3 2024 | Q3 2023 | | :---------------------------------- | :------ | :------ | | Net loss | $(31,309) | $(66,101) | | EBITDA | $56,676 | $16,641 | | EBITDAre | $62,028 | $77,720 | | Adjusted EBITDA | $60,010 | $76,313 | | Net Debt to Annualized Adjusted EBITDA | 10.6x | 8.1x | [FFO, Core FFO and FAD Reconciliations (Summary)](index=23&type=section&id=FFO%2C%20Core%20FFO%20and%20FAD%20Reconciliations%20(Summary)) This section summarizes the reconciliations for FFO, Core FFO, and FAD, including per share amounts and the FAD payout ratio for Q3 2024 and Q3 2023 FFO, Core FFO and FAD (in thousands, Q3 2024 vs. Q3 2023) | Metric | Q3 2024 | Q3 2023 | | :---------------------------------- | :------ | :------ | | FFO Attributable to Common Shareholders | $19,499 | $40,098 | | Core FFO Attributable to Common Shareholders | $19,292 | $41,040 | | FFO per common share - diluted | $0.23 | $0.40 | | Core FFO per common share - diluted | $0.23 | $0.40 | | FAD available to OP Units (A) | $18,450 | $43,909 | | Distributions to common shareholders and unitholders (B) | $17,891 | $26,801 | | FAD Payout Ratio (B÷A) | 97.0% | 61.0% | [NOI Reconciliations (Summary)](index=25&type=section&id=NOI%20Reconciliations%20(Summary)) This section summarizes the reconciliations for Net Operating Income (NOI), including consolidated, unconsolidated, and Same Store NOI for Q3 2024 and Q3 2023 NOI Reconciliations (in thousands, Q3 2024 vs. Q3 2023) | Metric | Q3 2024 | Q3 2023 | | :---------------------------------- | :------ | :------ | | Consolidated NOI | $65,068 | $72,915 | | NOI attributable to unconsolidated real estate ventures at our share | $1,292 | $5,374 | | NOI | $68,336 | $78,866 | | Operating Portfolio NOI | $70,597 | $79,861 | | Same Store NOI | $68,585 | $68,254 | | Change in Same Store NOI | 0.5% | N/A | [SECTION THREE: Q3 2024 Supplemental Information](index=28&type=section&id=Q3%202024%20SUPPLEMENTAL%20INFORMATION%20SECTION%20THREE) This section provides detailed supplemental information for Q3 2024, including overview disclosures, company profile, financial highlights, portfolio data, leasing activity, debt details, and comprehensive non-GAAP reconciliations [Overview Disclosures](index=29&type=section&id=Overview%20Disclosures) This section provides essential disclosures, including detailed forward-looking statements, the company's organizational structure and basis of presentation, an explanation of pro rata financial reporting, and a list of all non-GAAP measures used in the investor package, along with a reference to comprehensive definitions [Forward-Looking Statements](index=29&type=section&id=Forward-Looking%20Statements) This section provides detailed cautionary statements regarding forward-looking information, outlining potential impacts of market disruptions, NOI growth, and development timelines - Detailed cautionary statements regarding forward-looking information, including potential impacts of **market disruptions**, **NOI growth**, leverage profile, **Amazon's headquarters**, **office market trends**, and **development timelines**[62](index=62&type=chunk) - Highlights numerous factors beyond control that could affect outcomes, such as **economic conditions**, **development costs**, and **financing**[62](index=62&type=chunk) [Organization and Basis of Presentation](index=30&type=section&id=Organization%20and%20Basis%20of%20Presentation) This section describes JBG SMITH's organizational structure as a Maryland REIT, its focus on mixed-use properties, and the unaudited nature of the Investor Package information - JBG SMITH is a **Maryland real estate investment trust** focused on **mixed-use properties** in the **Washington, DC market**, particularly **National Landing**[63](index=63&type=chunk) - The company also operates a **third-party asset management and real estate services business** for **JBG Legacy Funds** and other parties[63](index=63&type=chunk) - Information in the Investor Package is **unaudited** unless otherwise indicated and does not purport to disclose all GAAP-required items[63](index=63&type=chunk) [Pro Rata Information](index=30&type=section&id=Pro%20Rata%20Information) This section explains the 'at JBG SMITH Share' financial presentation, a non-GAAP measure reflecting economic interests in real estate ventures, and its utility for investors - Financial information '**at JBG SMITH Share**' is a **non-GAAP presentation** reflecting the company's **economic interest** in consolidated and unconsolidated real estate ventures[63](index=63&type=chunk) - This presentation provides **valuable information** on **portfolio composition, performance, and capitalization**, but is **not a substitute for GAAP financial statements**[63](index=63&type=chunk) - Certain **subordinated interests** and associated **non-recourse mortgage loans** in unconsolidated ventures are excluded from occupancy and non-GAAP measures due to **zero investment** and **no anticipated cash flow**[63](index=63&type=chunk) [Definitions (Supplemental Information)](index=31&type=section&id=Definitions%20(Supplemental%20Information)) This section directs readers to pages 39-43 for a comprehensive list of definitions pertinent to the Investor Package - Refers to **pages 39-43** for a **comprehensive list of definitions** of terms used in the Investor Package[64](index=64&type=chunk) [Non-GAAP Measures](index=31&type=section&id=Non-GAAP%20Measures) This section lists all non-GAAP financial measures used in the Investor Package, emphasizing their role as supplemental information for assessing financial condition and operations - Lists all non-GAAP financial measures included in the Investor Package, such as **EBITDA, FFO, FAD, NOI**, and their various **adjusted forms**[65](index=65&type=chunk) - These measures are explained as **useful supplemental information** for investors regarding financial condition and results of operations, with reconciliations provided[65](index=65&type=chunk) [Company Profile](index=32&type=section&id=Company%20Profile) As of September 30, 2024, JBG SMITH's company snapshot shows a total enterprise value of $4.26 billion, with Net Debt at $2.54 billion, representing 59.6% of total enterprise value. The indicated annual dividend per share is $0.70, yielding 4.0% Company Snapshot as of September 30, 2024 | Metric | Value | | :---------------------------------- | :------------------- | | Exchange/ticker | NYSE: JBGS | | Indicated annual dividend per share | $0.70 | | Dividend yield | 4.0% | | Common share price | $17.48 | | Common shares and OP Units outstanding (in millions) | 98.37 | | Total market capitalization (in billions) | $1.72 | | Total consolidated and unconsolidated indebtedness at JBG SMITH Share (in billions) | $2.68 | | Less: cash and cash equivalents at JBG SMITH Share (in billions) | $(0.14) | | Net Debt (in billions) | $2.54 | | Total Enterprise Value (in billions) | $4.26 | | Net Debt / Total Enterprise Value | 59.6% | [Financial Highlights](index=33&type=section&id=Financial%20Highlights) The financial highlights for Q3 2024 show total revenue of $136.0 million and a net loss attributable to common shareholders of $(27.0) million. Key non-GAAP metrics include Operating Portfolio NOI of $70.6 million, Core FFO of $23.0 million, and an FAD payout ratio of 97.0%. The Net Debt to annualized Adjusted EBITDA stood at 10.6x Summary Financial Results (Q3 2024) | Metric | Three Months Ended Sep 30, 2024 | | :---------------------------------- | :------------------------------ | | Total revenue | $136,026 | | Net loss attributable to common shareholders | $(26,980) | | Per diluted common share | $(0.32) | | Operating portfolio NOI | $70,597 | | FFO (attributable to OP Units) | $23,224 | | Core FFO (attributable to OP Units) | $22,977 | | FAD (attributable to OP Units) | $18,450 | | FAD payout ratio | 97.0% | | EBITDA (attributable to OP Units) | $56,676 | | EBITDAre (attributable to OP Units) | $62,028 | | Adjusted EBITDA (attributable to OP Units) | $60,010 | | Net Debt / total enterprise value | 59.6% | | Net Debt to annualized Adjusted EBITDA | 10.6x | Debt Summary (at JBG SMITH Share, as of Sep 30, 2024) | Metric | Value | | :---------------------------------- | :------------------- | | Total consolidated indebtedness | $2,615,724 | | Total consolidated and unconsolidated indebtedness | $2,682,417 | | Weighted average interest rates (Variable) | 6.07% | | Weighted average interest rates (Fixed) | 4.63% | | Weighted average interest rates (Total) | 5.08% | | Cash and cash equivalents | $141,669 | [Portfolio Overview](index=34&type=section&id=Portfolio%20Overview) As of September 30, 2024, JBG SMITH's operating portfolio comprises 41 assets, with 6,781 multifamily units and 7.2 million commercial square feet. The total operating portfolio was 86.0% leased and 84.2% occupied, generating $282.4 million in annualized NOI. The development pipeline includes 18 assets with 9.3 million square feet of potential density Operating Portfolio Summary (at JBG SMITH Share, as of Sep 30, 2024) | Asset Type | Number of Assets | Units / Square Feet | % Leased | % Occupied | Annualized Rent (in thousands) | Annualized NOI (in thousands) | | :---------------------------------- | :--------------- | :------------------ | :------- | :--------- | :----------------------------- | :---------------------------- | | Multifamily (In-Service) | 14 | 5,973 Units | 97.0% | 95.7% | $180,530 | $125,288 | | Multifamily (Recently Delivered) | 2 | 808 Units | 60.7% | 55.1% | $17,499 | $3,740 | | Multifamily (Total) | 16 | 6,781 Units | 92.7% | 90.6% | $198,029 | $129,028 | | Commercial (Total) | 23 | 6,895,964 SF | 80.7% | 79.1% | $249,466 | $150,124 | | Ground Leases | 2 | — | — | — | — | $3,236 | | Operating (Total) | 41 | 6,781 Units / 6,895,964 SF | 86.0% | 84.2% | $447,495 | $282,388 | - The company has **one multifamily asset with 775 units** under construction and a development pipeline of **18 assets with 9.3 million square feet** of estimated potential development density[70](index=70&type=chunk) [Detailed Financial Information](index=35&type=section&id=Detailed%20Financial%20Information) This section provides detailed financial statements and reconciliations, including consolidated balance sheets, statements of operations, and specific non-GAAP metrics for unconsolidated ventures, tangible assets/liabilities, EBITDA, FFO, FAD, third-party services, G&A expenses, and various NOI summaries, offering a comprehensive view of the company's financial position and performance [Condensed Consolidated Balance Sheets](index=35&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) This section presents the detailed condensed consolidated balance sheets, outlining the company's assets, liabilities, and equity as of September 30, 2024, and December 31, 2023 Condensed Consolidated Balance Sheets (in thousands) | Asset/Liability | Sep 30, 2024 | Dec 31, 2023 | | :---------------------------------- | :----------- | :----------- | | **ASSETS:** | | | | Real estate, net | $4,429,977 | $4,536,759 | | Cash and cash equivalents | $136,983 | $164,773 | | Investments in unconsolidated real estate ventures | $100,682 | $264,281 | | Total Assets | $5,182,477 | $5,518,515 | | **LIABILITIES & EQUITY:** | | | | Mortgage loans, net | $1,816,156 | $1,783,014 | | Revolving credit facility | $90,000 | $62,000 | | Term loans, net | $717,578 | $717,172 | | Total liabilities | $2,841,880 | $2,825,929 | | Total equity | $1,895,652 | $2,251,849 | | Total Liabilities, Redeemable Noncontrolling Interests and Equity | $5,182,477 | $5,518,515 | [Condensed Consolidated Statements of Operations](index=36&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) This section provides the detailed condensed consolidated statements of operations, showing revenues, expenses, and net loss for Q3 2024 and Q3 2023 Condensed Consolidated Statements of Operations (in thousands, Q3 2024 vs. Q3 2023) | Item | Q3 2024 | Q3 2023 | | :---------------------------------- | :------ | :------ | | Total revenue | $136,026 | $151,562 | | Total expenses | $129,756 | $136,793 | | Total other income (expense) | $(36,748) | $(80,793) | | Net loss | $(31,309) | $(66,101) | | Net loss attributable to common shareholders | $(26,980) | $(58,007) | | Loss per common share - diluted | $(0.32) | $(0.58) | [Unconsolidated Real Estate Ventures - Balance Sheet and Operating Information](index=37&type=section&id=Unconsolidated%20Real%20Estate%20Ventures%20-%20Balance%20Sheet%20and%20Operating%20Information) This section details the balance sheet and operating information for unconsolidated real estate ventures, reflecting JBG SMITH's share of assets, liabilities, revenues, and expenses Unconsolidated Real Estate Ventures (in thousands, at JBG SMITH Share) | Item | Sep 30, 2024 | | :---------------------------------- | :----------- | | **BALANCE SHEET INFORMATION:** | | | Total real estate, at cost | $167,752 | | Real estate, net | $151,774 | | Total assets | $168,902 | | Borrowings, net | $66,693 | | Total liabilities | $78,551 | | **OPERATING INFORMATION (Q3 2024):** | | | Total revenue | $2,286 | | Total expenses | $2,377 | | Interest expense | $(1,041) | | Net loss | $(1,108) | | Income (loss) from unconsolidated real estate ventures, net | $(745) | [Other Tangible Assets and Liabilities](index=38&type=section&id=Other%20Tangible%20Assets%20and%20Liabilities) This section outlines other tangible assets and liabilities at JBG SMITH's share, including restricted cash, receivables, payables, and other liabilities as of September 30, 2024 Other Tangible Assets and Liabilities (in thousands, at JBG SMITH Share, as of Sep 30, 2024) | Item | Amount | | :---------------------------------- | :----- | | **Other Tangible Assets, Net:** | | | Restricted cash | $34,117 | | Tenant and other receivables, net | $31,339 | | Other assets, net | $108,147 | | Total Other Tangible Assets, Net | $173,603 | | **Other Tangible Liabilities, Net:** | | | Accounts payable and accrued liabilities | $100,643 | | Other liabilities, net | $82,686 | [EBITDA, EBITDAre and Adjusted EBITDA Reconciliations (Non-GAAP)](index=39&type=section&id=EBITDA%2C%20EBITDAre%20and%20Adjusted%20EBITDA%20Reconciliations%20(Non-GAAP)) This section provides detailed non-GAAP reconciliations for EBITDA, EBITDAre, and Adjusted EBITDA, along with the Net Debt to Annualized Adjusted EBITDA ratio for Q3 2024 and Q3 2023 EBITDA, EBITDAre and Adjusted EBITDA (in thousands, Q3 2024 vs. Q3 2023) | Metric | Q3 2024 | Q3 2023 | | :---------------------------------- | :------ | :------ | | Net loss | $(31,309) | $(66,101) | | EBITDA | $56,676 | $16,641 | | EBITDAre | $62,028 | $77,720 | | Adjusted EBITDA | $60,010 | $76,313 | | Net Debt to Annualized Adjusted EBITDA | 10.6x | 8.1x | | Total consolidated and unconsolidated indebtedness | $2,682,417 | $2,603,346 | [FFO, Core FFO and FAD Reconciliations (Non-GAAP)](index=40&type=section&id=FFO%2C%20Core%20FFO%20and%20FAD%20Reconciliations%20(Non-GAAP)) This section presents detailed non-GAAP reconciliations for FFO, Core FFO, and FAD, including per share amounts and the FAD payout ratio for Q3 2024 and Q3 2023 FFO, Core FFO and FAD (in thousands, Q3 2024 vs. Q3 2023) | Metric | Q3 2024 | Q3 2023 | | :---------------------------------- | :------ | :------ | | FFO Attributable to Common Shareholders | $19,499 | $40,098 | | Core FFO Attributable to Common Shareholders | $19,292 | $41,040 | | FFO per common share - diluted | $0.23 | $0.40 | | Core FFO per common share - diluted | $0.23 | $0.40 | | FAD available to OP Units (A) | $18,450 | $43,909 | | Distributions to common shareholders and unitholders (B) | $17,891 | $26,801 | | FAD Payout Ratio (B÷A) | 97.0% | 61.0% | [Third-Party Asset Management and Real Estate Services Business (Non-GAAP)](index=42&type=section&id=Third-Party%20Asset%20Management%20and%20Real%20Estate%20Services%20Business%20(Non-GAAP)) This section details the non-GAAP financial performance of the third-party asset management and real estate services business, including revenue breakdown and adjusted general and administrative expenses for Q3 2024 Third-Party Asset Management and Real Estate Services Business (in thousands, Q3 2024) | Service Revenue Type | Amount | | :---------------------------------- | :----- | | Property management fees | $3,903 | | Asset management fees | $1,139 | | Development fees | $323 | | Leasing fees | $998 | | Construction management fees | $342 | | Other service revenue | $1,551 | | Total Revenue | $8,256 | | Pro rata adjusted general and administrative expense: third-party real estate services | $(7,166) | | Total Services Revenue Less Allocated General and Administrative Expenses | $1,090 | [Pro Rata Adjusted General and Administrative Expenses (Non-GAAP)](index=43&type=section&id=Pro%20Rata%20Adjusted%20General%20and%20Administrative%20Expenses%20(Non-GAAP)) This section provides a non-GAAP reconciliation of pro rata adjusted general and administrative expenses, detailing corporate and third-party service allocations for Q3 2024 Pro Rata Adjusted General and Administrative Expenses (in thousands, Q3 2024) | Item | Statement of Operations | Adjustments (A) | Adjustments (B) | Pro Rata Adjusted | | :---------------------------------- | :---------------------- | :-------------- | :-------------- | :---------------- | | Corporate and other | $11,881 | — | $334 | $12,215 | | Third-party real estate services | $16,088 | $(8,588) | $(334) | $7,166 | | Total | $27,969 | $(8,588) | — | $19,381 | [Same Store NOI (Non-GAAP)](index=44&type=section&id=Same%20Store%20NOI%20(Non-GAAP)) This section presents the non-GAAP Same Store NOI for multifamily, commercial, and ground leases, detailing revenue, expenses, and percentage change for Q3 2024 versus Q3 2023 Same Store NOI (in thousands, at JBG SMITH share, Q3 2024 vs. Q3 2023) | Metric | Q3 2024 | Q3 2023 | % Change | | :---------------------------------- | :------ | :------ | :------- | | **Multifamily:** | | | | | Revenue | $50,668 | $49,016 | 3.4% | | Expenses | $(20,430) | $(19,790) | 3.2% | | Same Store NOI | $30,238 | $29,226 | 3.5% | | **Commercial:** | | | | | Revenue | $60,311 | $63,266 | (4.7%) | | Expenses | $(22,773) | $(24,831) | (8.3%) | | Same Store NOI | $37,538 | $38,435 | (2.3%) | | **Ground Leases:** | | | | | Same Store NOI | $809 | $593 | 36.4% | | **Total Same Store NOI** | $68,585 | $68,254 | 0.5% | | Non-Same Store NOI | $2,012 | $11,607 | (82.7%) | | Total Operating Portfolio NOI | $70,597 | $79,861 | (11.6%) | [Summary NOI (Non-GAAP)](index=45&type=section&id=Summary%20NOI%20(Non-GAAP)) This section provides a non-GAAP summary of Net Operating Income (NOI) across consolidated, unconsolidated, multifamily, commercial, and ground lease segments for Q3 2024 Summary NOI (in thousands, Q3 2024) | Item | Consolidated | Unconsolidated | Multifamily | Commercial | Ground Leases | Total at JBG SMITH Share | | :---------------------------------- | :----------- | :------------- | :---------- | :--------- | :------------ | :----------------------- | | Number of operating assets | 39 | 2 | 16 | 23 | 2 | 41 | | Total revenue | $115,191 | $2,420 | $56,479 | $60,311 | $821 | $117,611 | | Total expenses | $(46,094) | $(920) | $(24,222) | $(22,780) | $(12) | $(47,014) | | Operating Portfolio NOI | $69,097 | $1,500 | $32,257 | $37,531 | $809 | $70,597 | | Annualized NOI | $276,388 | $6,000 | $129,028 | $150,124 | $3,236 | $282,388 | | Annualized Free Rent (at JBG SMITH Share) | $37,196 | $128 | $8,156 | $27,500 | $1,668 | $37,324 | | % occupied (at JBG SMITH Share) | 84.2% | 86.0% | 90.6% | 79.1% | — | 84.2% | [Summary NOI - Multifamily (Non-GAAP)](index=46&type=section&id=Summary%20NOI%20-%20Multifamily%20(Non-GAAP)) This section details the non-GAAP Summary NOI for the multifamily portfolio, broken down by submarket (National Landing, DC, MD) for Q3 2024 Summary NOI – Multifamily (in thousands, Q3 2024, at JBG SMITH Share) | Item | Total | National Landing | DC | MD | | :---------------------------------- | :---- | :--------------- | :-- | :-- | | Number of operating assets | 16 | 6 | 9 | 1 | | Total revenue | $56,479 | $25,484 | $27,332 | $3,663 | | Total expenses | $(24,222) | $(11,339) | $(12,120) | $(763) | | Operating Portfolio NOI | $32,257 | $14,145 | $15,212 | $2,900 | | Annualized NOI | $129,028 | $56,580 | $60,848 | $11,600 | | % occupied | 90.6% | 86.7% | 95.1% | 94.1% | [Summary NOI - Commercial (Non-GAAP)](index=47&type=section&id=Summary%20NOI%20-%20Commercial%20(Non-GAAP)) This section provides the non-GAAP Summary NOI for the commercial portfolio, categorized by consolidated, unconsolidated, National Landing, and other segments for Q3 2024 Summary NOI – Commercial (in thousands, Q3 2024, at JBG SMITH Share) | Item | Consolidated | Unconsolidated | National Landing | Other | Total | | :---------------------------------- | :----------- | :------------- | :--------------- | :---- | :---- | | Number of operating assets | 21 | 2 | 18 | 5 | 23 | | Total revenue | $57,891 | $2,420 | $51,547 | $8,764 | $60,311 | | Total expenses | $(21,860) | $(920) | $(19,331) | $(3,449) | $(22,780) | | Operating Portfolio NOI | $36,031 | $1,500 | $32,216 | $5,315 | $37,531 | | Annualized NOI | $144,124 | $6,000 | $128,864 | $21,260 | $150,124 | | % occupied | 78.9% | 86.0% | 78.3% | 83.4% | 79.1% | [Leasing Activity Details](index=48&type=section&id=Leasing%20Activity%20Details) This section provides detailed insights into leasing activities, including signed but not yet commenced leases for multifamily and commercial properties, effective lease rates and renewal rates for multifamily, and comprehensive office leasing statistics. It also covers lease expiration schedules and the concentration and diversity of tenants across the portfolio [Signed But Not Yet Commenced Leases](index=48&type=section&id=Signed%20But%20Not%20Yet%20Commenced%20Leases) This section details the annualized total estimated rent for signed but not yet commenced leases across multifamily and commercial properties as of September 30, 2024 Signed But Not Yet Commenced Leases (in thousands, at JBG SMITH Share, as of Sep 30, 2024) | Asset Type | Annualized Total Estimated Rent | | :---------------------------------- | :------------------------------ | | Multifamily (Operating) | $1,588 | | Commercial (Operating, Consolidated) | $2,440 | | Commercial (Operating, Unconsolidated) | $80 | | Total | $4,108 | [Leasing Activity - Multifamily](index=49&type=section&id=Leasing%20Activity%20-%20Multifamily) This section presents multifamily leasing activity, including effective new and renewal lease rates, blended rates, and renewal rates for Q3 2024 versus Q3 2023 Multifamily Leasing Activity (Q3 2024 vs. Q3 2023) | Metric | Q3 2024 | Q3 2023 | | :---------------------------------- | :------ | :------ | | Effective new lease rates | 4.5% | 3.2% | | Effective renewal lease rates | 6.1% | 5.0% | | Effective blended lease rates | 5.4% | 4.1% | | Renewal rate | 60.0% | 56.3% | [Leasing Activity - Office](index=49&type=section&id=Leasing%20Activity%20-%20Office) This section details office leasing activity, including square footage leased, breakdown by new and renewal leases, weighted average lease terms, and rental rate changes for Q3 2024 and YTD 2024 Office Leasing Activity (Q3 2024 vs. YTD 2024) | Metric | Q3 2024 | YTD 2024 | | :---------------------------------- | :------ | :------- | | Square feet leased (at JBG SMITH Share) | 150,000 | 496,000 | | First-generation space: New | 5,000 | 51,000 | | Second-generation space: New | 41,000 | 190,000 | | Second-generation space: Renewal | 104,000 | 255,000 | | Weighted average lease term | 6.3 years | 6.0 years | | Weighted average Free Rent period | 4.0 months | 4.6 months | | Second-generation space cash basis % change | 1.2% | 1.5% | | Second-generation space GAAP basis % change | 8.4% | 9.6% | [Lease Expirations](index=51&type=section&id=Lease%20Expirations) This section provides a schedule of lease expirations, detailing the number of leases, square footage, and annualized rent by year, along with the weighted average remaining lease term Lease Expirations (as of Sep 30, 2024, at JBG SMITH Share) | Year of Lease Expiration | Number of Leases | Square Feet | % of Total Square Feet | Annualized Rent (in thousands) | % of Total Annualized Rent | | :---------------------------------- | :--------------- | :---------- | :--------------------- | :----------------------------- | :------------------------- | | Month-to-Month | 35 | 184,317 | 3.2% | $6,239 | 2.4% | | 2024 | 31 | 413,200 | 7.2% | $18,707 | 7.1% | | 2025 | 62 | 502,192 | 8.7% | $23,500 | 9.0% | | 2026 | 43 | 225,446 | 3.9% | $11,146 | 4.2% | | 2027 | 39 | 594,998 | 10.3% | $28,756 | 11.0% | | 2028 | 32 | 389,858 | 6.8% | $17,991 | 6.9% | | 2029 | 31 | 249,274 | 4.3% | $11,774 | 4.5% | | 2030 | 23 | 621,682 | 10.8% | $30,619 | 11.7% | | 2031 | 26 | 560,031 | 9.7% | $21,546 | 8.2% | | 2032 | 18 | 630,083 | 10.9% | $25,499 | 9.7% | | Thereafter | 75 | 1,400,343 | 24.2% | $66,520 | 25.3% | | Total / Weighted Average | 415 | 5,771,424 | 100.0% | $262,297 | 100.0% | - The weighted average remaining lease term for the entire portfolio (office and retail) is **5.6 years**[94](index=94&type=chunk) [Tenant Concentration](index=52&type=section&id=Tenant%20Concentration) This section identifies the top five tenant concentrations, detailing their number of leases, square footage, and contribution to total annualized rent as of September 30, 2024 Top 5 Tenant Concentration (as of Sep 30, 2024, at JBG SMITH Share) | Rank | Tenant | Number of Leases | Square Feet | % of Total Square Feet | Annualized Rent (in thousands) | % of Total Annualized Rent | | :--- | :---------------------------------- | :--------------- | :---------- | :--------------------- | :----------------------------- | :------------------------- | | 1 | U.S. Government (GSA) | 35 | 1,697,058 | 29.4% | $67,577 | 25.8% | | 2 | Amazon | 3 | 357,339 | 6.2% | $16,317 | 6.2% | | 3 | Lockheed Martin Corporation | 2 | 207,095 | 3.6% | $10,275 | 3.9% | | 4 | Public Broadcasting Service | 1 | 120,328 | 2.1% | $4,962 | 1.9% | | 5 | Accenture LLP | 2 | 102,756 | 1.8% | $4,942 | 1.9% | [Industry Diversity](index=53&type=section&id=Industry%20Diversity) This section outlines the top five industry diversity segments, detailing their number of leases, square footage, and contribution to total annualized rent as of September 30, 2024 Top 5 Industry Diversity (as of Sep 30, 2024, at JBG SMITH Share) | Rank | Industry | Number of Leases | Square Feet | % of Total Square Feet | Annualized Rent (in thousands) | % of Total Annualized Rent | | :--- | :---------------------------------- | :--------------- | :---------- | :--------------------- | :----------------------------- | :------------------------- | | 1 | Government | 39 | 1,706,415 | 29.6% | $68,051 | 25.9% | | 2 | Government Contractors | 89 | 1,364,599 | 23.6% | $65,510 | 25.0% | | 3 | Business Services | 26 | 693,959 | 12.0% | $33,107 | 12.6% | | 4 | Member Organizations | 35 | 489,105 | 8.5% | $24,533 | 9.4% | | 5 | Health Services | 26 | 244,267 | 4.2% | $10,991 | 4.2% | [Property Data Tables](index=54&type=section&id=Property%20Data%20Tables) This section provides detailed property tables for multifamily, commercial, under-construction, and development pipeline assets. It includes information on ownership, square footage, units, leasing and occupancy rates, annualized rent, and development schedules, offering a granular view of the company's real estate portfolio [Property Table - Multifamily](index=54&type=section&id=Property%20Table%20-%20Multifamily) This section presents detailed data for multifamily assets, including in-service, recently delivered, and under-construction properties, with units, leasing/occupancy rates, and annualized rent by submarket Multifamily Assets (at JBG SMITH Share, as of Sep 30, 2024) | Submarket | Number of Units | Multifamily % Leased | Multifamily % Occupied | Annualized Rent (in thousands) | | :---------------------------------- | :-------------- | :------------------- | :--------------------- | :----------------------------- | | **In-Service assets:** | | | | | | National Landing | 2,856 | 97.5% | 96.4% | $75,837 | | DC | 2,795 | 96.8% | 95.1% | $90,971 | | MD | 322 | 95.0% | 94.1% | $13,722 | | Total In-Service | 5,973 | 97.0% | 95.7% | $180,530 | | **Recently Delivered assets:** | | | | | | Total Recently Delivered | 808 | 60.7% | 55.1% | $17,499 | | **Operating - Total/Weighted Average** | 6,781 | 92.7% | 90.6% | $198,029 | | **Under-Construction assets:** | | | | | | Total Under-Construction | 775 | N/A | N/A | N/A | [Property Table - Commercial](index=56&type=section&id=Property%20Table%20-%20Commercial) This section provides detailed data for commercial assets, including office and retail properties, with leasing/occupancy rates and annualized rent by submarket Commercial Assets (at JBG SMITH Share, as of Sep 30, 2024) | Submarket | Office % Leased | Office % Occupied | Retail % Occupied | Annualized Rent (in thousands) | | :---------------------------------- | :-------------- | :---------------- | :---------------- | :----------------------------- | | National Landing | 80.2% | 78.3% | 95.3% | $203,225 | | Other | 83.6% | 83.4% | 85.7% | $46,241 | | Total at JBG SMITH Share | 80.7% | 79.1% | 94.8% | $249,466 | - Reconciliation of operating assets shows **23 commercial assets** totaling **7,230,808 SF** at **100% share** and **6,895,964 SF** at **JBG SMITH Share** as of **Q3 2024**[104](index=104&type=chunk) - Certain commercial assets contain **space held for development** or **not available for lease**, which is excluded from square footage, leased, and occupancy metrics[105](index=105&type=chunk)[106](index=106&type=chunk) [Property Table - Under-Construction](index=58&type=section&id=Property%20Table%20-%20Under-Construction) This section details the under-construction property, 2000/2001 South Bell Street, including its estimated construction schedule, units, square footage, and stabilized NOI Under-Construction Property (at JBG SMITH Share, as of Sep 30, 2024) | Asset | Submarket | Square Feet | Number of Units | Estimated Construction Start Date | Estimated Completion Date | Estimated Stabilization Date | Estimated Stabilized NOI (in millions) | | :---------------------------------- | :---------- | :---------- | :-------------- | :------------------------------ | :------------------------ | :--------------------------- | :------------------------------------- | | 2000/2001 South Bell Street | National Landing | 580,966 | 775 | Q1 2022 | Q1 2025 - Q3 2025 | Q4 2026 | $21.1 | - JBG SMITH is the **development manager** and **master lessee** for **2000/2001 South Bell Street**, which is consolidated as a **variable interest entity (VIE)**[108](index=108&type=chunk) [Property Table - Development Pipeline](index=59&type=section&id=Property%20Table%20-%20Development%20Pipeline) This section outlines the development pipeline, listing 18 assets with estimated potential development density and units, along with earliest potential construction start dates Development Pipeline (at JBG SMITH Share, as of Sep 30, 2024) | Location | Estimated Potential Development Density (SF) | Estimated Number of Units | | :---------------------------------- | :----------------------------------------- | :------------------------ | | National Landing | 7,224,100 | 5,565 | | DC | 2,107,000 | 1,935 | | Total | 9,331,100 | 7,500 | | Fully Entitled | 4,734,200 | 4,145 | - The pipeline includes **18 assets**, with earliest potential construction start dates ranging from **2024 to 2026**, subject to entitlements, design, and market conditions[109](index=109&type=chunk)[110](index=110&type=chunk) - Office developments are pre-lease dependent, and some assets are controlled through options to acquire leasehold interests[110](index=110&type=chunk) [Disposition Activity](index=61&type=section&id=Disposition%20Activity) JBG SMITH completed $263.6 million in disposition activity year-to-date 2024. This includes the sale of North End Retail for $14.3 million and Central Place Tower for $162.5 million in Q1, and Fort Totten Square for $86.8 million in Q3 Disposition Activity (in thousands, at JBG SMITH Share, YTD 2024) | Asset | Asset Type | Location | Date Disposed | Total Square Feet / Units | Gross Sales Price | | :---------------------------------- | :--------- | :--------- | :------------ | :------------------------ | :---------------- | | North End Retail | Multifamily | Washington, DC | Jan 22, 2024 | 27,355 SF | $14,250 | | Central Place Tower | Commercial | Arlington, VA | Feb 13, 2024 | 275,797 SF | $162,500 | | Fort Totten Square | Multifamily | Washington, DC | Sep 17, 2024 | 345 Units / 130,664 Retail SF | $86,800 | | Total | | | | | $263,550 | [Debt Details](index=62&type=section&id=Debt%20Details) As of September 30, 2024, JBG SMITH's total consolidated and unconsolidated principal balance was $2.71 billion. The debt portfolio is 68.6% fixed rate and 31.4% floating rate, with a weighted average interest rate of 5.08%. The company has $644.3 million in undrawn capacity under its revolving credit facility [Debt Summary](index=62&type=section&id=Debt%20Summary) This section summarizes the company's debt profile by type and maturity, including principal balances, interest rates, and fixed/floating rate percentages as of September 30, 2024 Debt Summary (in thousands, at JBG SMITH Share, as of Sep 30, 2024) | Debt Type | 2024 | 2025 | 2026 | 2027 | 2028 | Thereafter | Total | | :---------------------------------- | :--- | :--- | :--- | :--- | :--- | :--------- | :---------- | | Unsecured Debt | — | — | $200,000 | $90,000 | $520,000 | — | $810,000 | | Secured Debt | $120,933 | $340,710 | $321,976 | $358,301 | $85,000 | $670,003 | $1,896,923 | | Total Principal Balance | $120,933 | $340,710 | $521,976 | $448,301 | $605,000 | $670,003 | $2,706,923 | | % of total debt maturing | 4.5% | 12.6% | 19.3% | 16.6% | 22.4% | 24.6% | 100.0% | | % floating rate | — | — | 52.6% | 60.8% | 14.0% | 32.5% | 31.4% | | % fixed rate | 100.0% | 100.0% | 47.4% | 39.2% | 86.0% | 67.5% | 68.6% | | Total Weighted Average Interest Rates | 3.97% | 3.61% | 6.05% | 5.71% | 4.77% | 5.15% | 5.08% | Revolving Credit Facility and Term Loans (in thousands) | Facility | Credit Limit | Outstanding Principal Balance | Undrawn Capacity | All-In Interest Rate | | :---------------------------------- | :----------- | :---------------------------- | :--------------- | :------------------- | | Revolving Credit Facility | $750,000 | $90,000 | $644,333 | 6.46% | | Tranche A-1 Term Loan | $200,000 | $200,000 | — | 5.34% | | Tranche A-2 Term Loan | $400,000 | $400,000 | — | 4.20% | | 2023 Term Loan | $120,000 | $120,000 | — | 5.41% | | Total / Weighted Average | $1,470,000 | $810,000 | $644,333 | 4.91% | [Debt by Instrument](index=63&type=section&id=Debt%20by%20Instrument) This section provides a detailed breakdown of consolidated and unconsolidated debt by individual instrument, including principal balance, interest rates, and maturity dates as of September 30, 2024 Consolidated Debt by Instrument (in thousands, as of Sep 30, 2024) | Asset | Principal Balance | Stated Interest Rate | Interest Rate Hedge | Current Annual Interest Rate | Initial Maturity Date | Extended Maturity Date | | :---------------------------------- | :---------------- | :------------------- | :------------------ | :--------------------------- | :-------------------- | :--------------------- | | 2101 L Street | $120,933 | 3.97% | Fixed | 3.97% | 11/15/24 | 11/15/24 | | RiverHouse Apartments | $307,710 | S + 1.39% | Swap | 3.55% | 04/01/25 | 04/01/25 | | The Grace and Reva | $216,976 | S + 2.61% | Cap | 7.11% | 04/25/26 | 04/25/26 | | 1215 S. Clark Street | $105,000 | S + 1.35% | Swap | 5.17% | 12/22/26 | 12/22/26 | | Tranche A-1 Term Loan | $200,000 | S + 1.34% | Swap | 5.34% | 01/14/26 | 01/14/27 | | 8001 Woodmont | $100,414 | 4.82% | Fixed | 4.82% | 01/15/27 | 01/15/27 | | 2000/2001 South Bell Street | $147,388 | S + 2.25% | Cap | 6.77% | 01/22/27 | 01/22/27 | | 1235 S. Clark Street | $75,499 | 3.94% | Fixed | 3.94% | 11/01/27 | 11/01/27 | | Tranche A-2 Term Loan | $400,000 | S + 1.39% | Swap | 4.20% | 01/13/28 | 01/13/28 | | Revolving Credit Facility | $90,000 | S + 1.50% | — | 6.46% | 06/29/27 | 06/29/28 | | 2023 Term Loan | $120,000 | S + 1.40% | Swap | 5.41% | 06/29/28 | 06/29/28 | | 1225 S. Clark Street | $85,000 | S + 1.70% | — | 6.55% | 07/27/28 | 07/27/28 | | WestEnd25 | $97,500 | S + 1.45% | Swap | 4.16% | 08/05/29 | 08/05/29 | | Multifamily Credit Facility | $187,557 | 5.13% | Fixed | 5.13% | 02/01/30 | 02/01/30 | | 1221 Van Street | $87,253 | S + 2.62% | Swap | 6.59% | 08/01/30 | 08/01/30 | | 220 20th Street | $80,240 | S + 2.62% | Swap | 6.60% | 08/01/30 | 08/01/30

Core Viewpoint - JBG SMITH Properties has underperformed the Vanguard Real Estate Index Fund ETF in 2024, with a loss of nearly 6% compared to a 2% return in the benchmark ETF, but is expected to outperform due to a focus on multifamily properties and potential benefits from Fed rate cuts [2] Company Overview - JBG SMITH Properties is an office REIT with significant multifamily exposure, primarily in the DC metro area, where the commercial portfolio contributes 55% of adjusted net operating income (NOI) and the multifamily portfolio contributes 45% [3] - The commercial portfolio has a heavy reliance on government tenants, accounting for 25.6% of annualized rent, and government contractors at 25.5% [3] - A major multifamily development project is set to be completed by Q3 2025, with $667 million already invested and an expected 5.8% NOI yield [3] Operational Overview - The company reported a Core FFO of $0.18/share in Q2 2024, a 50% year-over-year decline, attributed to lower occupancy in the commercial portfolio (80.6%, down 3.4% Y/Y) and increased interest expenses [4] - Occupancy in the multifamily portfolio improved to 94.3%, up 0.6% Y/Y, while annualized NOI for the stable portfolio was $284 million, down 3% Y/Y [4] Capital Structure - As of Q2 2024, JBG SMITH had a net debt of $2.52 billion, representing 61% of the company's $4.13 billion enterprise value, which is high given the NOI performance but positions the company to benefit from anticipated Fed rate cuts [5] - The weighted average interest rate was 4.88%, with 29% of the debt at a floating rate and 71% fixed [5] Market-implied Cap Rate - The market-implied cap rate is calculated at 7.94% based on an annualized NOI of $284 million and an incremental contribution of $44 million from the development portfolio, which will lower to 7.75% after accounting for additional investments [6] Valuation - Adjusting for the incremental earnings from the development project, the run-rate core FFO could reach approximately $0.28/share, leading to an annualized core FFO of $1.12/share, which would be reasonable if the commercial portfolio stabilizes [7] - Post-completion of the multifamily project, the commercial portfolio's share of NOI is expected to decrease to 49%, while multifamily will account for 51% [7] Conclusion - Despite poor operating results in Q2 2024, JBG SMITH is positioned to benefit from upcoming Fed rate cuts, with a significant portion of its enterprise value funded by debt, and the multifamily portfolio's importance is set to increase as new projects are finalized [10]

PART I – FINANCIAL INFORMATION [Item 1. Financial Statements](index=4&type=section&id=Item%201.%20Financial%20Statements) Presents unaudited condensed consolidated financial statements and detailed notes for periods ended June 30, 2024, and December 31, 2023 [Condensed Consolidated Balance Sheets](index=4&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) Condensed Consolidated Balance Sheets (In thousands) | ASSETS / LIABILITIES, REDEEMABLE NONCONTROLLING EQUITY INTERESTS AND SHAREHOLDERS' EQUITY | June 30, 2024 | December 31, 2023 | | :--------------------------------------------------------------------------------------- | :------------ | :---------------- | | **ASSETS** | | | | Real estate, net | $4,526,415 | $4,536,759 | | Cash and cash equivalents | $163,536 | $164,773 | | Restricted cash | $42,366 | $35,668 | | Investments in unconsolidated real estate ventures | $101,043 | $264,281 | | Total assets | $5,325,116 | $5,518,515 | | **LIABILITIES** | | | | Mortgage loans, net | $1,876,459 | $1,783,014 | | Revolving credit facility | $40,000 | $62,000 | | Term loans, net | $717,610 | $717,172 | | Total liabilities | $2,853,861 | $2,825,929 | | Redeemable noncontrolling interests | $436,673 | $440,737 | | Total shareholders' equity of JBG SMITH Properties | $2,019,646 | $2,222,876 | | Total equity | $2,034,582 | $2,251,849 | | TOTAL LIABILITIES, REDEEMABLE NONCONTROLLING INTERESTS AND EQUITY | $5,325,116 | $5,518,515 | [Condensed Consolidated Statements of Operations](index=6&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) Condensed Consolidated Statements of Operations (In thousands, except per share data) | REVENUE / EXPENSES / OTHER INCOME (EXPENSE) | Three Months Ended June 30, 2024 | Three Months Ended June 30, 2023 | Six Months Ended June 30, 2024 | Six Months Ended June 30, 2023 | | :------------------------------------------ | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | **REVENUE** | | | | | | Property rental | $112,536 | $120,592 | $235,172 | $244,625 | | Third-party real estate services | $17,397 | $22,862 | $35,265 | $45,646 | | Total revenue | $135,320 | $152,095 | $280,504 | $305,057 | | **EXPENSES** | | | | | | Depreciation and amortization | $51,306 | $49,218 | $108,161 | $102,649 | | Property operating | $36,254 | $35,912 | $71,533 | $71,524 | | Real estate taxes | $14,399 | $14,424 | $28,194 | $29,648 | | Total expenses | $138,434 | $140,244 | $283,177 | $287,280 | | **OTHER INCOME (EXPENSE)** | | | | | | Net income (loss) attributable to common shareholders | $(24,373) | $(10,545) | $(56,649) | $10,626 | | Earnings (loss) per common share - Basic and Diluted | $(0.27) | $(0.10) | $(0.63) | $0.09 | [Condensed Consolidated Statements of Comprehensive Income (Loss)](index=7&type=section&id=Condensed%20Consolidated%20Statements%20of%20Comprehensive%20Income%20%28Loss%29) Condensed Consolidated Statements of Comprehensive Income (Loss) (In thousands) | Item | Three Months Ended June 30, 2024 | Three Months Ended June 30, 2023 | Six Months Ended June 30, 2024 | Six Months Ended June 30, 2023 | | :------------------------------------------------------------------------------------------------------------------------------------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | NET INCOME (LOSS) | $(33,414) | $(12,254) | $(75,604) | $12,056 | | Change in fair value of derivative financial instruments | $8,020 | $21,789 | $32,860 | $12,820 | | Reclassification of net income on derivative financial instruments from accumulated other comprehensive income into interest expense | $(10,471) | $(7,534) | $(20,892) | $(15,350) | | Total other comprehensive income (loss) | $(2,451) | $14,255 | $11,968 | $(2,530) | | COMPREHENSIVE INCOME (LOSS) | $(35,865) | $2,001 | $(63,636) | $9,526 | | COMPREHENSIVE INCOME (LOSS) ATTRIBUTABLE TO JBG SMITH PROPERTIES | $(26,895) | $910 | $(47,861) | $8,473 | [Condensed Consolidated Statements of Equity](index=8&type=section&id=Condensed%20Consolidated%20Statements%20of%20Equity) Condensed Consolidated Statements of Equity (In thousands) | Item | June 30, 2024 | December 31, 2023 | | :------------------------------------------------------------------------------------------------------------------------------------------------------------- | :------------ | :---------------- | | Common Shares (Shares) | 87,306 | 94,309 | | Common Shares (Amount) | $874 | $944 | | Additional Paid-In Capital | $2,855,724 | $2,978,852 | | Accumulated Deficit | $(865,782) | $(776,962) | | Accumulated Other Comprehensive Income | $28,830 | $20,042 | | Noncontrolling Interests | $14,936 | $28,973 | | Total Equity | $2,034,582 | $2,251,849 | | Net loss attributable to common shareholders and noncontrolling interests (Six Months Ended June 30, 2024) | $(67,616) | | | Common shares repurchased (Six Months Ended June 30, 2024) | $(118,158) | | | Dividends declared on common shares ($0.35 per common share) (Six Months Ended June 30, 2024) | $(32,171) | | | Acquisition of noncontrolling interests (Six Months Ended June 30, 2024) | $(26,586) | | | Total other comprehensive income (Six Months Ended June 30, 2024) | $11,968 | | [Condensed Consolidated Statements of Cash Flows](index=10&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Condensed Consolidated Statements of Cash Flows (In thousands) | Cash Flow Activity | Six Months Ended June 30, 2024 | Six Months Ended June 30, 2023 | | :-------------------------------------------------------------------------------------------------------------------------------------------- | :----------------------------- | :----------------------------- | | Net cash provided by operating activities | $60,813 | $89,431 | | Net cash provided by (used in) investing activities | $61,992 | $(135,500) | | Net cash used in financing activities | $(117,344) | $(25,160) | | Net increase (decrease) in cash and cash equivalents, and restricted cash | $5,461 | $(71,229) | | Cash and cash equivalents, and restricted cash, end of period | $205,902 | $202,844 | | Cash paid for interest (net of capitalized interest of $4,211 and $7,221 in 2024 and 2023) | $52,747 | $44,379 | | Accrued capital expenditures included in accounts payable and accrued expenses | $64,521 | $75,565 | | Common shares repurchased | $116,358 | $155,845 | | Dividends paid to common shareholders | $32,171 | $49,455 | [Notes to Condensed Consolidated Financial Statements](index=12&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) [1. Organization and Basis of Presentation](index=12&type=section&id=1.%20Organization%20and%20Basis%20of%20Presentation) - JBG SMITH Properties is a Maryland REIT focused on mixed-use properties in high-growth Washington, D.C. submarkets, primarily National Landing (**75% of holdings**)[170](index=170&type=chunk) - The company operates through JBG SMITH Properties LP, its operating partnership, in which JBG SMITH holds an **86.4% ownership interest** as of June 30, 2024[171](index=171&type=chunk) - As of June 30, 2024, the operating portfolio included **40 assets** (15 multifamily, 23 commercial, 2 land assets) and a development pipeline of **two under-construction multifamily assets** (**1,583 units**) and **18 assets** (**11.4 million sq ft**) in the development pipeline[172](index=172&type=chunk) [2. Summary of Significant Accounting Policies](index=14&type=section&id=2.%20Summary%20of%20Significant%20Accounting%20Policies) - The financial statements are prepared in accordance with GAAP for interim financial information and Form 10-Q instructions, with no material changes to significant accounting policies disclosed in the Annual Report[174](index=174&type=chunk)[180](index=180&type=chunk) - The company has elected to be taxed as a REIT, distributing at least **90% of its taxable income** as dividends to shareholders, and intends to maintain this status, also subject to federal, state, and local taxes on income from taxable REIT subsidiaries[179](index=179&type=chunk) - New accounting guidance includes ASU 2023-09 (Income Taxes) and ASU 2023-07 (Segment Reporting), effective for fiscal years beginning after December 15, 2024, and December 15, 2023, respectively, while the SEC's climate-related disclosure rules (March 2024) are currently stayed pending judicial review[198](index=198&type=chunk)[199](index=199&type=chunk)[200](index=200&type=chunk) [3. Dispositions](index=16&type=section&id=3.%20Dispositions) Disposition Activity (Six Months Ended June 30, 2024) | Date Disposed | Assets | Segment | Sales Price (In thousands) | Proceeds from Sale (In thousands) | Gain on Sale of Real Estate (In thousands) | | :-------------- | :-------------- | :---------- | :------------------------- | :-------------------------------- | :----------------------------------------- | | January 22, 2024 | North End Retail | Multifamily | $14,250 | $12,410 | $(1,200) | | Other | | | | | $1,486 | | **Total** | | | | | **$286** | - The company is under contract to sell a multifamily asset in Washington D.C. for **$86.8 million**, anticipated to close in 2024[187](index=187&type=chunk) [4. Investments in Unconsolidated Real Estate Ventures](index=17&type=section&id=4.%20Investments%20in%20Unconsolidated%20Real%20Estate%20Ventures) Investments in Unconsolidated Real Estate Ventures (In thousands) | Real Estate Venture | Effective Ownership Interest (June 30, 2024) | June 30, 2024 | December 31, 2023 | | :------------------ | :------------------------------------------- | :------------ | :---------------- | | PGIM | 50.0% | $724 | $163,375 | | J.P. Morgan | 50.0% | $73,892 | $72,742 | | 4747 Bethesda Venture | 20.0% | $11,672 | $13,118 | | Brandywine Realty Trust | 30.0% | $13,701 | $13,681 | | CBREI Venture | 10.0% | $174 | $180 | | Landmark Partners | 18.0% | $575 | $605 | | Other | | $305 | $580 | | **Total** | | **$101,043** | **$264,281** | - In February 2024, the PGIM venture sold its interest in Central Place Tower for **$325.0 million**, resulting in a proportionate share of aggregate gain of **$480,000** for JBG SMITH[205](index=205&type=chunk)[207](index=207&type=chunk) - The company provides leasing, property management, and other real estate services to its unconsolidated ventures, recognizing revenue of **$4.1 million** and **$8.7 million** for the three and six months ended June 30, 2024, respectively[206](index=206&type=chunk) [5. Variable Interest Entities](index=18&type=section&id=5.%20Variable%20Interest%20Entities) - JBG SMITH LP is the most significant consolidated VIE, with JBG SMITH holding an **86.4% limited partnership interest** and acting as the general partner, exercising full control[234](index=234&type=chunk) - In June 2024, JBG SMITH acquired the ground lessee's interest in 1900 Crystal Drive for **$26.6 million**, resulting in 1900 Crystal Drive no longer being a VIE[235](index=235&type=chunk) - As of June 30, 2024, excluding JBG SMITH LP, the company consolidated one VIE (2000/2001 South Bell Street) with total assets of **$256.1 million** and liabilities of **$157.9 million**[236](index=236&type=chunk) [6. Other Assets, Net](index=21&type=section&id=6.%20Other%20Assets%2C%20Net) Summary of Other Assets, Net (In thousands) | Item | June 30, 2024 | December 31, 2023 | | :-------------------------------------- | :------------ | :---------------- | | Prepaid expenses | $10,188 | $13,215 | | Derivative financial instruments, at fair value | $42,116 | $42,341 | | Deferred financing costs, net | $8,740 | $10,199 | | Operating lease right-of-use assets | $45,238 | $60,329 | | Investments in funds | $24,119 | $21,785 | | Other investments | $3,487 | $3,487 | | Other | $12,546 | $12,125 | | **Total other assets, net** | **$146,434** | **$163,481** | - Unrealized gains related to investments in real estate-focused technology companies were **$797,000** and **$1.3 million** for the three and six months ended June 30, 2024, respectively[238](index=238&type=chunk) [7. Debt](index=21&type=section&id=7.%20Debt) Summary of Mortgage Loans (In thousands) | Item | Weighted Average Effective Interest Rate (June 30, 2024) | June 30, 2024 | December 31, 2023 | | :------------------------------------------ | :------------------------------------------------------- | :------------ | :---------------- | | Variable rate | 6.23% | $701,283 | $608,582 | | Fixed rate | 4.78% | $1,188,709 | $1,189,643 | | Mortgage loans | | $1,889,992 | $1,798,225 | | Unamortized deferred financing costs and premium / discount, net | | $(13,533) | $(15,211) | | **Mortgage loans, net** | | **$1,876,459**| **$1,783,014** | Summary of Revolving Credit Facility and Term Loans (In thousands) | Item | Effective Interest Rate (June 30, 2024) | June 30, 2024 | December 31, 2023 | | :------------------------------------------ | :-------------------------------------- | :------------ | :---------------- | | Revolving credit facility | 6.78% | $40,000 | $62,000 | | Tranche A-1 Term Loan | 2.70% | $200,000 | $200,000 | | Tranche A-2 Term Loan | 3.58% | $400,000 | $400,000 | | 2023 Term Loan | 5.31% | $120,000 | $120,000 | | Term loans | | $720,000 | $720,000 | | Unamortized deferred financing costs, net | | $(2,390) | $(2,828) | | **Term loans, net** | | **$717,610** | **$717,172** | - As of June 30, 2024, the net carrying value of real estate collateralizing mortgage loans totaled **$2.2 billion** and the company had interest rate swap and cap agreements on certain mortgage loans with an aggregate notional value of **$1.6 billion**[240](index=240&type=chunk)[241](index=241&type=chunk) [8. Other Liabilities, Net](index=23&type=section&id=8.%20Other%20Liabilities%2C%20Net) Summary of Other Liabilities, Net (In thousands) | Item | June 30, 2024 | December 31, 2023 | | :------------------------------------------ | :------------ | :---------------- | | Lease intangible liabilities, net | $3,268 | $3,496 | | Lease incentive liabilities | $7,710 | $7,546 | | Liabilities related to operating lease right-of-use assets | $46,172 | $64,501 | | Prepaid rent | $12,864 | $11,881 | | Security deposits | $12,474 | $12,133 | | Environmental liabilities | $17,468 | $17,568 | | Deferred tax liability, net | $2,445 | $3,326 | | Derivative financial instruments, at fair value | $5,458 | $14,444 | | Other | $4,123 | $3,974 | | **Total other liabilities, net** | **$111,982** | **$138,869** | [9. Redeemable Noncontrolling Interests](index=25&type=section&id=9.%20Redeemable%20Noncontrolling%20Interests) - As of June 30, 2024, outstanding OP Units and redeemable LTIP Units totaled **13.8 million**, representing a **13.6% ownership interest** in JBG SMITH LP[249](index=249&type=chunk) - During the six months ended June 30, 2024, unitholders redeemed **625,166 OP Units**, which were exchanged for an equivalent number of common shares[249](index=249&type=chunk) [10. Property Rental Revenue](index=26&type=section&id=10.%20Property%20Rental%20Revenue) Summary of Property Rental Revenue (In thousands) | Revenue Type | Three Months Ended June 30, 2024 | Three Months Ended June 30, 2023 | Six Months Ended June 30, 2024 | Six Months Ended June 30, 2023 | | :-------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Fixed | $103,602 | $108,124 | $216,579 | $221,195 | | Variable | $8,934 | $12,468 | $18,593 | $23,430 | | **Total Property Rental Revenue** | **$112,536** | **$120,592** | **$235,172** | **$244,625** | [11. Share-Based Payments](index=26&type=section&id=11.%20Share-Based%20Payments) - In January 2024, the company granted **974,140 Time-Based LTIP Units** with a weighted average grant-date fair value of **$15.93 per unit**, primarily vesting over four years[256](index=256&type=chunk) - Also in January 2024, **1.9 million performance-based AO LTIP Units** were granted with a grant-date fair value of **$3.79 per unit**, subject to a TSR modifier and a three-year performance period[258](index=258&type=chunk) Summary of Share-Based Compensation Expense (In thousands) | Item | Three Months Ended June 30, 2024 | Three Months Ended June 30, 2023 | Six Months Ended June 30, 2024 | Six Months Ended June 30, 2023 | | :------------------------------------------------------------------------ | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Time-Based LTIP Units | $5,885 | $5,324 | $11,357 | $10,856 | | AO LTIP Units and Performance-Based LTIP Units | $3,476 | $3,282 | $6,954 | $6,942 | | LTIP Units | $1,552 | $1,000 | $1,552 | $1,000 | | Other equity awards | $1,168 | $1,262 | $2,212 | $2,798 | | Share-based compensation expense - other | $12,081 | $10,868 | $22,075 | $21,596 | | Share-based compensation related to Formation Transaction and special equity awards | $0 | $0 | $0 | $351 | | Total share-based compensation expense | $12,081 | $10,868 | $22,075 | $21,947 | | Less: amount capitalized | $(590) | $(782) | $(1,046) | $(1,433) | | **Share-based compensation expense** | **$11,491** | **$10,086** | **$21,029** | **$20,514** | [12. Transaction and Other Costs](index=30&type=section&id=12.%20Transaction%20and%20Other%20Costs) Summary of Transaction and Other Costs (In thousands) | Item | Three Months Ended June 30, 2024 | Three Months Ended June 30, 2023 | Six Months Ended June 30, 2024 | Six Months Ended June 30, 2023 | | :------------------------------------------ | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Completed, potential and pursued transaction expenses | $34 | $227 | $1,541 | $274 | | Severance and other costs | $505 | $1,799 | $512 | $3,247 | | Demolition costs | $285 | $1,466 | $285 | $2,443 | | **Transaction and other costs** | **$824** | **$3,492** | **$2,338** | **$5,964** | [13. Interest Expense](index=30&type=section&id=13.%20Interest%20Expense) Summary of Interest Expense (In thousands) | Item | Three Months Ended June 30, 2024 | Three Months Ended June 30, 2023 | Six Months Ended June 30, 2024 | Six Months Ended June 30, 2023 | | :------------------------------------------ | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Interest expense before capitalized interest | $31,234 | $27,805 | $62,074 | $55,713 | | Amortization of deferred financing costs | $4,179 | $1,351 | $8,082 | $2,630 | | Net loss on non-designated derivatives: | | | | | | Net unrealized loss | $27 | $2,944 | $69 | $5,641 | | Net realized loss | $0 | $97 | $0 | $230 | | Capitalized interest | $(3,467) | $(6,362) | $(8,092) | $(11,537) | | **Interest expense** | **$31,973** | **$25,835** | **$62,133** | **$52,677** | [14. Shareholders' Equity and Earnings (Loss) Per Common Share](index=30&type=section&id=14.%20Shareholders%27%20Equity%20and%20Earnings%20%28Loss%29%20Per%20Common%20Share) - The Board of Trustees authorized the repurchase of up to **$1.5 billion** of common shares, with **$1.1 billion** repurchased and retired since the program began in March 2020[269](index=269&type=chunk) Common Shares Repurchased (In millions, except per share data) | Period | Common Shares Repurchased | Weighted Average Purchase Price Per Share | | :-------------------------------------- | :------------------------ | :---------------------------------------- | | Three months ended June 30, 2024 | 4.7 | $14.62 | | Three months ended June 30, 2023 | 9.3 | $14.54 | | Six months ended June 30, 2024 | 7.7 | $15.35 | | Six months ended June 30, 2023 | 10.5 | $14.79 | | Program total through June 30, 2024 | 53.6 | $20.09 | Earnings (Loss) Per Common Share (In thousands, except per share amounts) | Item | Three Months Ended June 30, 2024 | Three Months Ended June 30, 2023 | Six Months Ended June 30, 2024 | Six Months Ended June 30, 2023 | | :------------------------------------------------------------------------ | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Net income (loss) attributable to common shareholders | $(24,373) | $(10,545) | $(56,649) | $10,626 | | Net income (loss) available to common shareholders - basic and diluted | $(24,876) | $(11,262) | $(57,806) | $9,909 | | Weighted average number of common shares outstanding - basic and diluted | 91,030 | 109,695 | 91,832 | 111,862 | | **Earnings (loss) per common share - basic and diluted** | **$(0.27)** | **$(0.10)** | **$(0.63)** | **$0.09** | - On July 24, 2024, a quarterly dividend of **$0.175 per common share** was declared, payable on August 21, 2024[274](index=274&type=chunk) [15. Fair Value Measurements](index=32&type=section&id=15.%20Fair%20Value%20Measurements) - The company uses derivative financial instruments (interest rate swaps and caps) to manage interest rate risk, with a net unrealized gain of **$33.1 million** on effective hedges as of June 30, 2024[275](index=275&type=chunk)[276](index=276&type=chunk) Assets and Liabilities Measured at Fair Value on a Recurring Basis (In thousands) | Item | June 30, 2024 (Total) | June 30, 2024 (Level 2) | December 31, 2023 (Total) | December 31, 2023 (Level 2) | | :---------------------------------------------------------------- | :-------------------- | :---------------------- | :------------------------ | :-------------------------- | | Derivative financial instruments designated as effective hedges: | | | | | | Classified as assets in "Other assets, net" | $36,606 | $36,606 | $35,632 | $35,632 | | Classified as liabilities in "Other liabilities, net" | $0 | $0 | $7,936 | $7,936 | | Non-designated derivatives: | | | | | | Classified as assets in "Other assets, net" | $5,510 | $5,510 | $6,709 | $6,709 | | Classified as liabilities in "Other liabilities, net" | $5,458 | $5,458 | $6,508 | $6,508 | - An impairment loss of **$18.2 million** was recognized for two development parcels during the six months ended June 30, 2024, writing them down to their estimated fair value of **$24.7 million**[286](index=286&type=chunk) [16. Segment Information](index=36&type=section&id=16.%20Segment%20Information) - The company aggregates its operating segments into three reportable segments: multifamily, commercial, and third-party asset management and real estate services[289](index=289&type=chunk) - The Chief Operating Decision Maker (CODM) evaluates multifamily and commercial segments based on Net Operating Income (NOI), which includes property rental and parking revenue, less operating expenses and real estate taxes[290](index=290&type=chunk) Consolidated NOI by Segment (In thousands) | Segment | Three Months Ended June 30, 2024 | Three Months Ended June 30, 2023 | Six Months Ended June 30, 2024 | Six Months Ended June 30, 2023 | | :---------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Multifamily | $28,190 | $28,696 | $56,454 | $55,767 | | Commercial | $34,559 | $42,300 | $71,260 | $89,983 | | Other | $2,395 | $4,055 | $4,409 | $6,917 | | **Total Consolidated NOI** | **$65,144** | **$75,051** | **$132,123** | **$152,667** | [17. Commitments and Contingencies](index=40&type=section&id=17.%20Commitments%20and%20Contingencies) - The company maintains general liability insurance (**$150.0 million per occurrence**) and property/rental value insurance (**$1.0 billion per occurrence**), with additional coverage for terrorist acts through a captive insurance subsidiary[299](index=299&type=chunk) - As of June 30, 2024, assets under construction require an additional **$98.5 million** to complete, primarily over the next two years, to be financed by debt, asset sales, and available cash[302](index=302&type=chunk) - Environmental liabilities totaled **$17.5 million** as of June 30, 2024, included in 'Other liabilities, net' on the balance sheet[305](index=305&type=chunk) - The company had committed tenant-related obligations of **$44.4 million** and additional capital commitments and guarantees to unconsolidated real estate ventures totaling **$58.0 million** as of June 30, 2024[306](index=306&type=chunk)[309](index=309&type=chunk) [18. Transactions with Related Parties](index=42&type=section&id=18.%20Transactions%20with%20Related%20Parties) - Third-party real estate services revenue from JBG Legacy Funds and WHI Impact Pool affiliates decreased to **$3.2 million** for the three months ended June 30, 2024, from **$5.9 million** in the prior year[316](index=316&type=chunk) - The company incurred **$1.3 million** and **$2.8 million** in rent expense for its corporate offices from an unconsolidated real estate venture for the three and six months ended June 30, 2024, respectively[317](index=317&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=44&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses financial condition, operating results, portfolio overview, strategic outlook, and liquidity for Q2 2024 [Overview and Outlook](index=48&type=section&id=Overview%20and%20Outlook) - As of June 30, 2024, the operating portfolio consisted of **40 assets** (15 multifamily, 23 commercial, 2 land assets) and a development pipeline of **two under-construction multifamily assets** (**1,583 units**) and **18 assets** (**11.4 million sq ft**) in the development pipeline[214](index=214&type=chunk) - The company's strategy focuses on repositioning holdings in National Landing through placemaking initiatives, including new multifamily and office developments, retail amenities, and public infrastructure improvements, with 1900 Crystal Drive (The Grace and Reva) delivered in Q2 2024[215](index=215&type=chunk) - Multifamily portfolio occupancy was **94.3%** as of June 30, 2024, with effective rents increasing by **4.6%** blended across new and renewal leases, and 1900 Crystal Drive began leasing in January 2024 and was **38.5% leased** by June 30, 2024[217](index=217&type=chunk) - Office portfolio occupancy decreased to **80.6%** as of June 30, 2024, down **250 basis points** from March 31, 2024, due to hybrid work trends, with plans to repurpose older, obsolete office buildings for redevelopment or conversion[218](index=218&type=chunk)[219](index=219&type=chunk) [Operating Results](index=50&type=section&id=Operating%20Results) [Key Highlights](index=50&type=section&id=Key%20Highlights) Key Operating Results Highlights (In millions, except per share data) | Metric | Three Months Ended June 30, 2024 | Three Months Ended June 30, 2023 | Six Months Ended June 30, 2024 | Six Months Ended June 30, 2023 | | :------------------------------------------------------------------ | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Net loss attributable to common shareholders | $(24.4) | $(10.5) | $(56.6) | $10.6 | | Diluted common share (loss) / earnings | $(0.27) | $(0.10) | $(0.63) | $0.09 | | Third-party real estate services revenue (incl. reimbursements) | $17.4 | $22.9 | $35.3 | $45.6 | | Same store NOI increase | 3.2% | | 5.2% | | Portfolio Occupancy and Leasing Highlights (at our share) | Metric | June 30, 2024 | March 31, 2024 | June 30, 2023 | | :------------------------------------------------------------------ | :------------ | :------------- | :------------ | | Operating multifamily portfolio leased percentage | 96.9% | 95.9% | 96.8% | | Operating multifamily portfolio occupied percentage | 94.3% | 94.3% | 93.7% | | Operating commercial portfolio leased percentage | 82.3% | 84.6% | 86.3% | | Operating commercial portfolio occupied percentage | 80.6% | 83.1% | 84.0% | | Square feet leased (3 months ended June 30, 2024) | 248,000 | | | | Initial rent per square foot (3 months ended June 30, 2024) | $46.61 | | | | GAAP-basis weighted average rent per square foot (3 months ended June 30, 2024) | $47.34 | | | - Subsequent to June 30, 2024, the company declared a quarterly dividend of **$0.175 per common share**, repurchased **897,531 common shares** for **$14.0 million**, and entered a contract to sell a multifamily asset for **$86.8 million**[53](index=53&type=chunk)[224](index=224&type=chunk) [Comparison of the Three Months Ended June 30, 2024 to 2023](index=52&type=section&id=Comparison%20of%20the%20Three%20Months%20Ended%20June%2030%2C%202024%20to%202023) Three Months Ended June 30, 2024 vs. 2023 (In thousands, % Change) | Item | 2024 | 2023 | % Change | | :---------------------------------------------------------------- | :-------- | :-------- | :------- | | Property rental revenue | $112,536 | $120,592 | (6.7)% | | Third-party real estate services revenue, including reimbursements | $17,397 | $22,862 | (23.9)% | | Depreciation and amortization expense | $51,306 | $49,218 | 4.2% | | Property operating expense | $36,254 | $35,912 | 1.0% | | Real estate taxes expense | $14,399 | $14,424 | (0.2)% | | General and administrative expense: Corporate and other | $17,001 | $15,093 | 12.6% | | General and administrative expense: Third-party real estate services | $18,650 | $22,105 | (15.6)% | | Income (loss) from unconsolidated real estate ventures, net | $(226) | $510 | (144.3)% |\n| Interest expense | $31,973 | $25,835 | 23.8% | - Property rental revenue decreased by **$8.1 million**, primarily due to commercial assets taken out of service (1800 South Bell Street, 2100 Crystal Drive) and disposed properties, partially offset by 1900 Crystal Drive and lease termination revenue[56](index=56&type=chunk)[57](index=57&type=chunk) - Interest expense increased by **$6.1 million**, driven by higher outstanding debt and rising interest rates on variable rate mortgage loans, partially offset by a decrease in capitalized interest[190](index=190&type=chunk) [Comparison of the Six Months Ended June 30, 2024 to 2023](index=56&type=section&id=Comparison%20of%20the%20Six%20Months%20Ended%20June%2030%2C%202024%20to%202023) Six Months Ended June 30, 2024 vs. 2023 (In thousands, % Change) | Item | 2024 | 2023 | % Change | | :---------------------------------------------------------------- | :-------- | :-------- | :------- | | Property rental revenue | $235,172 | $244,625 | (3.9)% | | Third-party real estate services revenue, including reimbursements | $35,265 | $45,646 | (22.7)% | | Depreciation and amortization expense | $108,161 | $102,649 | 5.4% | | Property operating expense | $71,533 | $71,524 | — | | Real estate taxes expense | $28,194 | $29,648 | (4.9)% | | General and administrative expense: Corporate and other | $31,974 | $31,216 | 2.4% | | General and administrative expense: Third-party real estate services | $40,977 | $45,928 | (10.8)% | | Income from unconsolidated real estate ventures, net | $749 | $943 | (20.6)% | | Interest expense | $62,133 | $52,677 | 18.0% | | Gain on the sale of real estate, net | $286 | $40,700 | (99.3)% | - Property rental revenue decreased by **$9.5 million**, primarily due to a **$23.0 million** decrease from commercial assets (Disposed Properties, 1800 South Bell Street, 2100 Crystal Drive), partially offset by lease termination revenue and multifamily asset increases[192](index=192&type=chunk) - Interest expense increased by **$9.5 million**, mainly due to higher outstanding debt and rising interest rates, partially offset by decreases from derivative expirations and repaid mortgage loans[39](index=39&type=chunk) [Liquidity and Capital Resources](index=68&type=section&id=Liquidity%20and%20Capital%20Resources) - Primary sources of operating cash flow are property rental income and fee-based real estate services, with other liquidity sources including financings, asset sales, and securities issuance[49](index=49&type=chunk) - The company anticipates that cash flows from operations, financings, asset sales, and existing cash will be adequate to fund business operations, debt service, capital expenditures, and dividends over the next **12 months**[49](index=49&type=chunk) [Mortgage Loans](index=68&type=section&id=Mortgage%20Loans) Summary of Mortgage Loans (In thousands) | Item | Effective Interest Rate (June 30, 2024) | June 30, 2024 | December 31, 2023 | | :------------------------------------------ | :-------------------------------------- | :------------ | :---------------- | | Variable rate | 6.23% | $701,283 | $608,582 | | Fixed rate | 4.78% | $1,188,709 | $1,189,643 | | Mortgage loans | | $1,889,992 | $1,798,225 | | Unamortized deferred financing costs and premium/discount, net | | $(13,533) | $(15,211) | | **Mortgage loans, net** | | **$1,876,459**| **$1,783,014** | - As of June 30, 2024, the net carrying value of real estate collateralizing mortgage loans totaled **$2.2 billion** and the company had interest rate swap and cap agreements on certain mortgage loans with an aggregate notional value of **$1.6 billion**[64](index=64&type=chunk)[65](index=65&type=chunk) [Revolving Credit Facility and Term Loans](index=68&type=section&id=Revolving%20Credit%20Facility%20and%20Term%20Loans) - As of June 30, 2024, the unsecured revolving credit facility and term loans totaled **$1.5 billion**, consisting of a **$750.0 million** revolving credit facility, a **$200.0 million** Tranche A-1 Term Loan, a **$400.0 million** Tranche A-2 Term Loan, and a **$120.0 million** 2023 Term Loan[66](index=66&type=chunk) Summary of Revolving Credit Facility and Term Loans (In thousands) | Item | Effective Interest Rate (June 30, 2024) | June 30, 2024 | December 31, 2023 | | :------------------------------------------ | :-------------------------------------- | :------------ | :---------------- | | Revolving credit facility | 6.78% | $40,000 | $62,000 | | Tranche A-1 Term Loan | 2.70% | $200,000 | $200,000 | | Tranche A-2 Term Loan | 3.58% | $400,000 | $400,000 | | 2023 Term Loan | 5.31% | $120,000 | $120,000 | | Term loans | | $720,000 | $720,000 | | Unamortized deferred financing costs, net | | $(2,390) | $(2,828) | | **Term loans, net** | | **$717,610** | **$717,172** | - Interest rate swaps fix SOFR at weighted average rates of **1.46%** for Tranche A-1, **2.29%** for Tranche A-2, and **4.01%** for the 2023 Term Loan as of June 30, 2024[70](index=70&type=chunk) [Common Shares Repurchased](index=70&type=section&id=Common%20Shares%20Repurchased) - The Board of Trustees authorized the repurchase of up to **$1.5 billion** of common shares, with **$1.1 billion** repurchased and retired since the program began in March 2020[71](index=71&type=chunk) Common Shares Repurchased (In millions, except per share data) | Period | Common Shares Repurchased | Weighted Average Purchase Price Per Share | | :-------------------------------------- | :------------------------ | :---------------------------------------- | | Three months ended June 30, 2024 | 4.7 | $14.62 | | Three months ended June 30, 2023 | 9.3 | $14.54 | | Six months ended June 30, 2024 | 7.7 | $15.35 | | Six months ended June 30, 2023 | 10.5 | $14.79 | | Program total through June 30, 2024 | 53.6 | $20.09 | - In July 2024, an additional **897,531 common shares** were repurchased for **$14.0 million** at **$15.55 per share**[72](index=72&type=chunk) [Material Cash Requirements](index=70&type=section&id=Material%20Cash%20Requirements) - Material cash requirements include normal recurring expenses, debt service (**$120.9 million mortgage loan maturing in August 2024**, **$424.0 million in 2025**), capital expenditures (**$44.4 million committed tenant-related obligations**), and development expenditures (**$98.5 million** for assets under construction)[79](index=79&type=chunk)[81](index=81&type=chunk) - Other cash requirements include dividends to shareholders (**$0.175 per common share** declared July 2024), possible common share repurchases, and potential property acquisitions[81](index=81&type=chunk) - These needs are expected to be met by cash and cash equivalents (**$163.5 million** as of June 30, 2024), cash flows from operations, distributions from real estate ventures, borrowing capacity (**$694.3 million** available under revolving credit facility), and proceeds from financings, asset sales, or securities issuance[82](index=82&type=chunk) [Summary of Cash Flows](index=72&type=section&id=Summary%20of%20Cash%20Flows) Summary of Cash Flows (Six Months Ended June 30, In thousands) | Cash Flow Activity | 2024 | 2023 | | :------------------------------------------------ | :----------- | :----------- | | Net cash provided by operating activities | $60,813 | $89,431 | | Net cash provided by (used in) investing activities | $61,992 | $(135,500) |\n| Net cash used in financing activities | $(117,344) | $(25,160) | | Cash and cash equivalents, and restricted cash, end of period | $205,902 | $202,844 | - Net cash from operating activities was **$60.8 million**, driven by net income (before non-cash items), return on capital from unconsolidated ventures, and changes in operating assets/liabilities[84](index=84&type=chunk) - Net cash from investing activities was **$62.0 million**, primarily from distributions of capital from unconsolidated ventures (**$163.9 million**) and proceeds from real estate sales (**$12.4 million**), partially offset by development costs (**$113.4 million**)[86](index=86&type=chunk) - Net cash used in financing activities was **$117.3 million**, mainly due to repayments on the revolving credit facility (**$195.0 million**), common share repurchases (**$116.4 million**), and dividends paid (**$32.2 million**), partially offset by borrowings[87](index=87&type=chunk) [Unconsolidated Real Estate Ventures](index=74&type=section&id=Unconsolidated%20Real%20Estate%20Ventures) - As of June 30, 2024, investments in unconsolidated real estate ventures totaled **$101.0 million**, accounted for using the equity method[89](index=89&type=chunk) - The company may guarantee portions of borrowings, provide environmental indemnifications, and completion guarantees for unconsolidated ventures, with agreements for partners to reimburse their share of payments[90](index=90&type=chunk) - Additional capital commitments and recorded guarantees to unconsolidated real estate ventures totaled **$58.0 million** as of June 30, 2024, with no debt principal payment guarantees[91](index=91&type=chunk) [Commitments and Contingencies](index=74&type=section&id=Commitments%20and%20Contingencies) - The company maintains general liability insurance (**$150.0 million per occurrence**) and property/rental value insurance (**$1.0 billion per occurrence**), with additional coverage for terrorist acts through a captive insurance subsidiary[92](index=92&type=chunk) - As of June 30, 2024, assets under construction require an additional **$98.5 million** to complete, primarily over the next two years, to be financed by debt, asset sales, and available cash[97](index=97&type=chunk) - Environmental liabilities totaled **$17.5 million** as of June 30, 2024. The company is potentially liable for investigation and remediation costs of hazardous substances on its real estate[106](index=106&type=chunk) - Committed tenant-related obligations totaled **$44.4 million** as of June 30, 2024. The aggregate amount of debt principal payment guarantees for consolidated entities was **$8.3 million**[98](index=98&type=chunk)[100](index=100&type=chunk) [Item 3. Quantitative and Qualitative Disclosures about Market Risk](index=78&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20about%20Market%20Risk) Details market risk exposure, primarily interest rate risk, and management strategies through hedging activities [Interest Rate Risk](index=78&type=section&id=Interest%20Rate%20Risk) Debt (Contractual Balances) and Effect of 1% Change in Rates (In thousands) | Debt Type | June 30, 2024 Balance | Weighted Average Effective Interest Rate (June 30, 2024) | Annual Effect of 1% Change in Base Rates | | :---------------------------------------- | :-------------------- | :------------------------------------------------------- | :--------------------------------------- | | **Mortgage loans:** | | | | | Variable rate | $701,283 | 6.23% | $1,445 | | Fixed rate | $1,188,709 | 4.78% | — | | **Total Mortgage loans** | **$1,889,992** | | **$1,445** | | **Revolving credit facility and term loans:** | | | | | Revolving credit facility | $40,000 | 6.78% | $406 | | Tranche A-1 Term Loan | $200,000 | 2.70% | — | | Tranche A-2 Term Loan | $400,000 | 3.58% | — | | 2023 Term Loan | $120,000 | 5.31% | — | | **Total Revolving credit facility and term loans** | **$760,000** | | **$406** | | **Pro rata share of debt of unconsolidated real estate ventures:** | | | | | Variable rate | $35,000 | 5.73% | $— | | Fixed rate | $33,000 | 4.13% | — | | **Total Unconsolidated Real Estate Ventures Debt** | **$68,000** | | **$—** | - As of June 30, 2024, the one-month term Secured Overnight Financing Rate (SOFR) was **5.34%**, with the weighted average interest rate cap strike for mortgage loans at **3.52%** and a weighted average maturity date of June 2025 (extended to October 2025 in July 2024)[108](index=108&type=chunk) - The estimated fair value of consolidated debt was **$2.6 billion** as of June 30, 2024, compared to **$2.5 billion** as of December 31, 2023[114](index=114&type=chunk) [Hedging Activities](index=80&type=section&id=Hedging%20Activities) - As of June 30, 2024, the company had interest rate swap and cap agreements with an aggregate notional value of **$2.3 billion** designated as effective hedges, primarily consisting of assets totaling **$36.6 million**[111](index=111&type=chunk) - Within the next **12 months**, **$20.7 million** of net unrealized gain from effective hedges is expected to be reclassified as a decrease to interest expense[276](index=276&type=chunk) - Non-designated derivative financial instruments, primarily interest rate cap agreements, had an aggregate notional value of **$475.2 million** as of June 30, 2024, with their fair value changes recorded in 'Interest expense'[112](index=112&type=chunk) [Item 4. Controls and Procedures](index=82&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded disclosure controls and procedures effective as of June 30, 2024, with no material internal control changes - As of June 30, 2024, the company's disclosure controls and procedures were deemed **effective** by the Chief Executive Officer and Chief Financial Officer[119](index=119&type=chunk) - There were no material changes in internal control over financial reporting during the quarter ended June 30, 2024[120](index=120&type=chunk) PART II – OTHER INFORMATION [Item 1. Legal Proceedings](index=82&type=section&id=Item%201.%20Legal%20Proceedings) The company is involved in ordinary course legal actions, not expected to materially affect financial position or results - The company is involved in ordinary course legal actions, but their outcome is not expected to materially affect financial condition, results of operations, or cash flows[121](index=121&type=chunk) [Item 1A. Risk Factors](index=82&type=section&id=Item%201A.%20Risk%20Factors) No material changes to risk factors previously disclosed in the Annual Report on Form 10-K - No material changes to the risk factors previously disclosed in the Annual Report[122](index=122&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=82&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) Details common share repurchase activities, including shares purchased, average price, and remaining authorized amount Purchases of Equity Securities by the Issuer (Common Shares) | Period | Total Number Of Common Shares Purchased | Average Price Paid Per Common Share | Shares Purchased As Part Of Publicly Announced Plans Or Programs | Approximate Dollar Value Of Common Shares That May Yet Be Purchased Under the Plan Or Programs | | :-------------------------------------- | :-------------------------------------- | :---------------------------------- | :--------------------------------------------------------------- | :--------------------------------------------------------------------------------------------- | | May 1, 2024 - May 31, 2024 | 494,539 | $14.02 | 494,539 | $484,844,099 | | June 1, 2024 - June 30, 2024 | 4,198,777 | $14.69 | 4,198,777 | $423,075,016 | | Total for the three months ended June 30, 2024 | 4,693,316 | $14.62 | 4,693,316 | | | Total for the six months ended June 30, 2024 | 7,684,176 | $15.35 | 7,684,176 | | | Program total since inception in March 2020 | 53,558,179

[Letter to Shareholders](index=4&type=section&id=LETTER%20TO%20SHAREHOLDERS%20SECTION%20ONE) [Management's Strategic Overview and Q2 Highlights](index=4&type=section&id=Management%20Letter) JBG SMITH's management highlights a macroeconomic landscape poised for recovery, with a continued strategic shift towards a majority multifamily portfolio. The company reported strong multifamily performance, significant progress on public infrastructure in National Landing, and active capital allocation through asset dispositions and share repurchases, despite a slow investment sales market - Multifamily portfolio exhibited strong performance with climbing occupancy, **4.6%** blended effective rent increase (**8.6%** upon renewal), and a **50.9%** renewal rate. Multifamily Same Store NOI increased **3.4%**[5](index=5&type=chunk) - National Landing public infrastructure projects achieved key milestones, including groundbreaking on the new Crystal City Metro entrance (expected completion **2027**) and capital allocation for the pedestrian bridge to Reagan National Airport (design-build in **2025**)[6](index=6&type=chunk) - Investment sales activity remains slow across all asset types, but a modest pick-up in multifamily transactions is observed in Northern Virginia. The company continues to seek opportunities to dispose of an additional **$200 – $300 million** of assets[7](index=7&type=chunk) - The **9.3 million square foot** Development Pipeline is expected to be entitled by the end of **2025**, preparing for land sales, ground leases, or joint ventures when construction costs and interest rates normalize[8](index=8&type=chunk) Key Financial Leverage Metrics (as of June 30, 2024) | Metric | Value | | :-------------------------------- | :------ | | Net Debt / Total Enterprise Value | 62.1% | | Net Debt to Annualized Adjusted EBITDA | 11.9x | Share Repurchase Program Highlights | Period | Shares Repurchased (millions) | Total Value (millions) | Weighted Average Price per Share | | :---------------- | :---------------------------- | :--------------------- | :------------------------------- | | Year-to-date | 8.6 | $132.1 | $15.37 | | Since inception (2020) | 54.5 | $1,100 | $20.01 | [Operating Portfolio Performance and Market Trends](index=6&type=section&id=Operating%20Portfolio) JBG SMITH's operating portfolio shows strong lease-up for new multifamily deliveries like 1900 Crystal Drive, outperforming other projects. The DC-area multifamily market is robust, ranking high for rent growth. Conversely, the broader DC metro office market faces challenges with high vacancy and reduced demand, though National Landing's office sector demonstrates resilience due to strategic positioning and amenity-rich environments - 1900 Crystal Drive, delivered in **Q2 2024**, was **38.5% leased** at quarter-end and **49.5% leased** by **July 28th**, exceeding the leasing pace of all five other multifamily deliveries since 2017[11](index=11&type=chunk) - The DC-area multifamily market is performing strongly, ranked as the **top large market** in the nation for year-over-year rent growth by CoStar. Apartment List data shows **3.3% rent growth** in DC metro versus **0.5%** in other Gateway markets, with comparable occupancy[11](index=11&type=chunk) - Executed **166,000 square feet** of new office leases in **Q2 2024**, marking the **strongest quarter** for new office leasing in **three years**. Defense and technology tenants drove **88%** of total leasing activity in National Landing[32](index=32&type=chunk) - Anticipate approximately **485,000 square feet** (approximately **$22 million** of annualized rent) in National Landing to be vacated in the second half of **2024** and **2025**[14](index=14&type=chunk) - The broader DC metro office market faces challenges with a **22.1% total vacancy rate** and nearly net-zero demand. Northern Virginia's overall leasing activity has stabilized at **1.7 million square feet** per quarter, down from a pre-pandemic average of **2.7 million square feet**[15](index=15&type=chunk) - National Landing remains a focal point for future office demand in Northern Virginia, driven by proximity to the Pentagon, local tech talent, and placemaking attractions. The area also benefits from the lowest new construction pipeline ever reported by JLL (**539,000 square feet**)[17](index=17&type=chunk) - The company is taking 1800 South Bell and 2100 Crystal Drive out of service and phasing out 2200 Crystal Drive, reducing office stock by approximately **743,000 square feet** (**12%**) to repurpose older buildings for redevelopment, multifamily conversion, hospitality, or other specialty uses[40](index=40&type=chunk) [Q2 2024 Earnings Release](index=9&type=section&id=Q2%202024%20EARNINGS%20RELEASE%20SECTION%20TWO) [Financial Performance Summary](index=10&type=section&id=Financial%20Performance%20Summary) JBG SMITH reported a net loss for Q2 2024 and year-to-date, with FFO and Core FFO also decreasing compared to the prior year. However, Same Store NOI increased, driven by strong multifamily performance, while the commercial portfolio experienced a slight decline in occupancy Net Income (Loss), FFO, and Core FFO Attributable to Common Shareholders | Metric (in millions, except per share amounts) | Three Months Ended June 30, 2024 Amount | Three Months Ended June 30, 2024 Per Diluted Share | Three Months Ended June 30, 2023 Amount | Three Months Ended June 30, 2023 Per Diluted Share | | :--------------------------------------------- | :-------------------------------------- | :------------------------------------------------- | :-------------------------------------- | :------------------------------------------------- | | Net income (loss) | $(24.4) | $(0.27) | $(10.5) | $(0.10) | | FFO | $14.3 | $0.16 | $33.4 | $0.30 | | Core FFO | $16.1 | $0.18 | $39.8 | $0.36 | - Annualized Net Operating Income (NOI) for **Q2 2024** was **$286.4 million**, down from **$307.5 million** in **Q1 2024**. Excluding sold or out-of-service assets, Annualized NOI was **$283.9 million**, down from **$292.6 million** in **Q1 2024**[73](index=73&type=chunk) - Same Store NOI (SSNOI) increased **3.2%** quarter-over-quarter to **$71.4 million** for **Q2 2024**, primarily due to higher rents and occupancy in the multifamily portfolio, and lower real estate taxes and operating expenses in the commercial portfolio (partially offset by lower occupancy)[23](index=23&type=chunk) Operating Portfolio Occupancy and Rent Growth (as of June 30, 2024) | Portfolio | Leased % (Q2 2024) | Leased % (Q1 2024) | Occupied % (Q2 2024) | Occupied % (Q1 2024) | Effective Blended Rent Growth | Effective Renewal Rent Growth | | :---------------- | :----------------- | :----------------- | :------------------- | :------------------- | :---------------------------- | :---------------------------- | | Multifamily | 96.9% | 95.9% | 94.3% | 94.3% | 4.6% | 8.6% | | Commercial | 82.3% | 84.6% | 80.6% | 83.1% | N/A | N/A | - Executed approximately **248,000 square feet** of office leases in **Q2 2024**, including **166,000 square feet** of new leases. Second-generation leases generated a **2.0%** rental rate increase on a cash basis and a **12.7%** rental rate increase on a GAAP basis[47](index=47&type=chunk) [Portfolio Development and Capital Structure](index=11&type=section&id=Development%20Portfolio) JBG SMITH is actively developing multifamily assets, with 1900 Crystal Drive recently delivered and leasing ahead of expectations. The company maintains a strong balance sheet with a total enterprise value of $4.1 billion, a significant portion of debt fixed or hedged, and a focus on managing near-term maturities - As of **June 30, 2024**, **two** multifamily assets totaling **1,583 units** were under construction, including 1900 Crystal Drive, which delivered in **Q2** and was **49.5% leased** by **July 28, 2024**[48](index=48&type=chunk) - The development pipeline includes **18 assets** with an estimated **9.3 million square feet** of potential development density at the company's share[48](index=48&type=chunk) Key Capital Structure Metrics (as of June 30, 2024) | Metric | Value | | :-------------------------------- | :------------ | | Total Enterprise Value | $4.1 billion | | Common Shares and Units Value | $1.5 billion | | Debt (net of premium/discount) | $2.7 billion | | Cash and Cash Equivalents (at share) | $169.3 million | | Net Debt to Annualized Adjusted EBITDA | 11.9x | | Net Debt / Total Enterprise Value | 62.1% | - As of **June 30, 2024**, the company had **$163.5 million** of cash and cash equivalents (**$169.3 million** at its share) and **$694.3 million** of availability under its revolving credit facility[26](index=26&type=chunk) - **93.3%** of the company's debt was fixed or hedged as of the end of **Q2 2024**, with a weighted average debt maturity of **3.2 years**[35](index=35&type=chunk) - Near-term debt maturities include **$121 million** (**4.4%** of total debt) next month, related to a non-core office asset, and **$424 million** (**15.6%** of total debt) in **2025**, with the majority secured by readily financeable multifamily assets[35](index=35&type=chunk)[36](index=36&type=chunk) [Dividends and Forward-Looking Statements](index=12&type=section&id=Dividends) The Board of Trustees declared a quarterly dividend of $0.175 per common share. The company also provides extensive forward-looking statements, cautioning investors about inherent risks and uncertainties in its projections and strategic plans, emphasizing that actual outcomes may differ materially from expectations - On **July 24, 2024**, the Board of Trustees declared a quarterly dividend of **$0.175 per common share**, payable on **August 21, 2024**, to shareholders of record as of **August 7, 2024**[76](index=76&type=chunk) - Forward-looking statements represent intentions, plans, expectations, and beliefs, but are subject to numerous assumptions, risks, and uncertainties, meaning future results, financial condition, and business may differ materially from those expressed[52](index=52&type=chunk)[78](index=78&type=chunk) [Non-GAAP Financial Measures and Definitions](index=13&type=section&id=Pro%20Rata%20Information) This section provides detailed explanations and reconciliations for various non-GAAP financial measures used by JBG SMITH, such as 'at JBG SMITH Share,' EBITDA, FFO, Core FFO, FAD, Net Debt, and NOI. These measures are presented to offer valuable insights into the company's performance and financial condition, supplementing GAAP reporting - The company presents financial information 'at JBG SMITH Share' to reflect its economic interests in partially owned entities, calculated by applying its ownership percentage to each asset's financial information. This is a non-GAAP presentation intended to provide valuable investor information[79](index=79&type=chunk) - Key non-GAAP measures defined and reconciled include Earnings Before Interest, Taxes, Depreciation and Amortization (**EBITDA**), EBITDA for Real Estate (**EBITDAre**), **Adjusted EBITDA**, Funds from Operations (**FFO**), **Core FFO**, Funds Available for Distribution (**FAD**), **Net Debt**, Net Operating Income (**NOI**), and **Annualized NOI**[81](index=81&type=chunk)[82](index=82&type=chunk)[83](index=83&type=chunk)[193](index=193&type=chunk)[121](index=121&type=chunk)[157](index=157&type=chunk) Condensed Consolidated Balance Sheets (in thousands) | ASSETS | June 30, 2024 | December 31, 2023 | | :------------------------------------------- | :------------ | :---------------- | | Real estate, net | $4,526,415 | $4,536,759 | | Cash and cash equivalents | $163,536 | $164,773 | | Investments in unconsolidated real estate ventures | $101,043 | $264,281 | | **TOTAL ASSETS** | **$5,325,116**| **$5,518,515** | | LIABILITIES | June 30, 2024 | December 31, 2023 | | Mortgage loans, net | $1,876,459 | $1,783,014 | | Revolving credit facility | $40,000 | $62,000 | | Term loans, net | $717,610 | $717,172 | | **Total liabilities** | **$2,853,861**| **$2,825,929** | Condensed Consolidated Statements of Operations (in thousands) | REVENUE | Three Months Ended June 30, 2024 | Three Months Ended June 30, 2023 | Six Months Ended June 30, 2024 | Six Months Ended June 30, 2023 | | :------------------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Property rental | $112,536 | $120,592 | $235,172 | $244,625 | | Third-party real estate services, including reimbursements | $17,397 | $22,862 | $35,265 | $45,646 | | Other revenue | $5,387 | $8,641 | $10,067 | $14,786 | | **Total revenue** | **$135,320** | **$152,095** | **$280,504** | **$305,057** | | **NET INCOME (LOSS) ATTRIBUTABLE TO COMMON SHAREHOLDERS** | **$(24,373)** | **$(10,545)** | **$(56,649)** | **$10,626** | | **EARNINGS (LOSS) PER COMMON SHARE - BASIC AND DILUTED** | **$(0.27)** | **$(0.10)** | **$(0.63)** | **$0.09** | [Q2 2024 Supplemental Information](index=24&type=section&id=Q2%202024%20SUPPLEMENTAL%20INFORMATION%20SECTION%20THREE) [Overview and Company Profile](index=27&type=section&id=Overview%20Disclosures) JBG SMITH is a Maryland REIT focused on mixed-use properties in the Washington, DC market, particularly National Landing, with a strategic emphasis on placemaking. The company's portfolio is heavily concentrated in National Landing, anchored by key demand drivers, and it also provides third-party asset management services. The section provides a snapshot of the company's executive leadership and key financial metrics as of June 30, 2024 - JBG SMITH owns, operates, invests in, and develops mixed-use properties in high growth and high barrier-to-entry submarkets in and around Washington, DC, most notably National Landing. Approximately **75.0%** of its holdings are in National Landing, anchored by Amazon's new headquarters, Virginia Tech's Innovation Campus, proximity to the Pentagon, and placemaking initiatives[77](index=77&type=chunk)[103](index=103&type=chunk) - The company's dynamic portfolio comprises **13.4 million square feet** of high-growth multifamily, office, and retail assets at share, with **98%** being Metro-served. It also maintains a development pipeline encompassing **9.3 million square feet** of mixed-use, primarily multifamily, development opportunities[77](index=77&type=chunk) - JBG SMITH's executive officers include **W. Matthew Kelly (CEO)**, **M. Moina Banerjee (CFO)**, **Kevin P. Reynolds (Chief Development Officer)**, **George L. Xanders (Chief Investment Officer)**, **Steven A. Museles (Chief Legal Officer)**, **David Ritchey (Chief Commercial Officer)**, and **Evan Regan-Levine (Chief Strategy Officer)**[72](index=72&type=chunk) Company Snapshot (as of June 30, 2024) | Metric | Value | | :------------------------------------------ | :------------ | | Exchange/ticker | NYSE: JBGS | | Indicated annual dividend per share | $0.70 | | Dividend yield | 4.6% | | Common share price | $15.23 | | Common shares and OP Units outstanding (in millions) | 101.10 | | Total market capitalization | $1.54 billion | | Net Debt | $2.52 billion | | Total Enterprise Value | $4.06 billion | | Net Debt / Total Enterprise Value | 62.1% | [Financial Highlights](index=31&type=section&id=Financial%20Highlights) JBG SMITH's Q2 2024 financial highlights show a net loss attributable to common shareholders, but positive operating portfolio NOI. Key non-GAAP metrics like FFO, Core FFO, and Adjusted EBITDA are presented, along with leverage ratios, indicating the company's financial position and operational performance Summary Financial Results (in thousands, except per share data) | Metric | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2024 | | :-------------------------------------- | :------------------------------- | :----------------------------- | | Total revenue | $135,320 | $280,504 | | Net loss attributable to common shareholders | $(24,373) | $(56,649) | | Per diluted common share | $(0.27) | $(0.63) | | Operating portfolio NOI | $71,594 | $148,457 | | FFO | $16,927 | $29,526 | | Core FFO | $18,962 | $50,755 | | FAD | $19,728 | $55,090 | | FAD payout ratio | 96.4% | 69.0% | | EBITDA | $52,292 | $98,201 | | EBITDAre | $52,203 | $97,435 | | Adjusted EBITDA | $52,980 | $116,666 | | Net Debt / total enterprise value | 62.1% | 62.1% | | Net Debt to annualized Adjusted EBITDA | 11.9x | 10.8x | [Portfolio Overview](index=32&type=section&id=Portfolio%20Overview) JBG SMITH's operating portfolio consists of 15 multifamily assets and 23 commercial assets, with a significant concentration in National Landing. The portfolio demonstrates high occupancy rates and substantial annualized rent and NOI, reflecting the company's strategic focus on multifamily development and strong market positioning Operating Portfolio Summary (at JBG SMITH Share, as of June 30, 2024) | Operating Portfolio | Number of Assets | Units / Square Feet | % Leased | % Occupied | Annualized Rent (in thousands) | Annualized NOI (in thousands) | | :--------------------------------------- | :--------------- | :-------------------------- | :------- | :--------- | :----------------------------- | :---------------------------- | | Multifamily - National Landing | 4 | 2,856 Units | 97.3% | 94.9% | $73,597 | $52,076 | | Multifamily - DC | 10 | 3,140 Units | 96.6% | 93.6% | $98,321 | $66,504 | | Multifamily - MD | 1 | 322 Units | 97.4% | 96.6% | $14,021 | $9,492 | | **Multifamily – total / weighted average** | **15** | **6,318 Units** | **96.9%**| **94.3%** | **$185,939** | **$128,072** | | Commercial - National Landing | 18 | 5,828,015 SF | 81.5% | 79.5% | $206,076 | $135,760 | | Commercial - Other | 5 | 1,069,047 SF | 86.3% | 86.1% | $47,732 | $18,752 | | **Commercial - total / weighted average** | **23** | **6,897,062 SF** | **82.3%**| **80.6%** | **$253,808** | **$154,512** | | Ground Leases | 2 | — | — | — | — | $3,792 | | **Operating - Total / Weighted Average** | **40** | **6,318 Units/ 6,897,062 SF** | **88.5%**| **86.4%** | **$439,747** | **$286,376** | - Adjusted Annualized NOI, which includes annualized base rent of signed but not yet commenced leases, totaled **$294,256 thousand**[245](index=245&type=chunk) [Financial Information](index=33&type=section&id=Financial%20Information%20Condensed%20Consolidated%20Balance%20Sheets) This section provides a detailed overview of JBG SMITH's financial position, including condensed consolidated balance sheets, statements of operations, and information on unconsolidated real estate ventures and other tangible assets and liabilities. It highlights a slight decrease in total assets driven by reduced investments in unconsolidated ventures, alongside a modest increase in total liabilities [Condensed Consolidated Balance Sheets](index=33&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) Condensed Consolidated Balance Sheets (in thousands) | ASSETS | June 30, 2024 | December 31, 2023 | Change | | :------------------------------------------- | :------------ | :---------------- | :----- | | Real estate, net | $4,526,415 | $4,536,759 | $(10,344) | | Cash and cash equivalents | $163,536 | $164,773 | $(1,237) | | Investments in unconsolidated real estate ventures | $101,043 | $264,281 | $(163,238) | | **TOTAL ASSETS** | **$5,325,116**| **$5,518,515** | **$(193,399)** | | LIABILITIES | June 30, 2024 | December 31, 2023 | Change | | Mortgage loans, net | $1,876,459 | $1,783,014 | $93,445 | | Revolving credit facility | $40,000 | $62,000 | $(22,000) | | Term loans, net | $717,610 | $717,172 | $438 | | **Total liabilities** | **$2,853,861**| **$2,825,929** | **$27,932** | [Condensed Consolidated Statements of Operations](index=34&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) Condensed Consolidated Statements of Operations (in thousands, except per share data) | REVENUE | Three Months Ended June 30, 2024 | Three Months Ended June 30, 2023 | Six Months Ended June 30, 2024 | Six Months Ended June 30, 2023 | | :------------------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Property rental | $112,536 | $120,592 | $235,172 | $244,625 | | Third-party real estate services, including reimbursements | $17,397 | $22,862 | $35,265 | $45,646 | | Other revenue | $5,387 | $8,641 | $10,067 | $14,786 | | **Total revenue** | **$135,320** | **$152,095** | **$280,504** | **$305,057** | | **NET INCOME (LOSS) ATTRIBUTABLE TO COMMON SHAREHOLDERS** | **$(24,373)** | **$(10,545)** | **$(56,649)** | **$10,626** | | **EARNINGS (LOSS) PER COMMON SHARE - BASIC AND DILUTED** | **$(0.27)** | **$(0.10)** | **$(0.63)** | **$0.09** | [Unconsolidated Real Estate Ventures](index=35&type=section&id=Unconsolidated%20Real%20Estate%20Ventures%20-%20Balance%20Sheet%20and%20Operating%20Information) Unconsolidated Real Estate Ventures (in thousands, at JBG SMITH Share) | Metric | June 30, 2024 | | :---------------------------------------- | :------------ | | Total assets | $170,351 | | Borrowings, net | $66,553 | | Total liabilities | $78,914 | | Total revenue (Three Months Ended June 30, 2024) | $2,278 | | Net loss (Three Months Ended June 30, 2024) | $(714) | [Other Tangible Assets and Liabilities](index=36&type=section&id=Other%20Tangible%20Assets%20and%20Liabilities) Other Tangible Assets and Liabilities (in thousands, at JBG SMITH Share) | Metric | June 30, 2024 | | :---------------------------------------- | :------------ | | Restricted cash | $42,504 | | Tenant and other receivables, net | $32,055 | | Other assets, net | $115,007 | | **Total Other Tangible Assets, Net** | **$189,566** | | Accounts payable and accrued liabilities | $109,133 | | Other liabilities, net | $73,571 | | **Total Other Tangible Liabilities, Net** | **$182,704** | [Non-GAAP Reconciliations](index=37&type=section&id=EBITDA%2C%20EBITDAre%20and%20Adjusted%20EBITDA%20Reconciliations%20%28Non-GAAP%29) This section provides detailed reconciliations for key non-GAAP financial measures, including EBITDA, EBITDAre, Adjusted EBITDA, FFO, Core FFO, and FAD, along with an analysis of the Third-Party Asset Management and Real Estate Services Business and Pro Rata Adjusted General and Administrative Expenses. These reconciliations offer a clearer view of the company's operational performance and profitability, adjusted for non-recurring or non-cash items [EBITDA, EBITDAre and Adjusted EBITDA Reconciliations](index=37&type=section&id=EBITDA%2C%20EBITDAre%20and%20Adjusted%20EBITDA%20Reconciliations) EBITDA, EBITDAre and Adjusted EBITDA (in thousands) | Metric | Three Months Ended June 30, 2024 | Three Months Ended June 30, 2023 | Six Months Ended June 30, 2024 | Six Months Ended June 30, 2023 | | :------------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | EBITDA | $52,292 | $67,996 | $98,201 | $176,257 | | EBITDAre | $52,203 | $67,996 | $97,435 | $135,557 | | Adjusted EBITDA | $52,980 | $71,969 | $116,666 | $140,327 | | Net Debt to Annualized Adjusted EBITDA | 11.9x | 8.3x | 10.8x | 8.5x | | Net Debt (at JBG SMITH Share) | $2,522,604 | $2,376,363 | $2,522,604 | $2,376,363 | [FFO, Core FFO and FAD Reconciliations](index=38&type=section&id=FFO%2C%20Core%20FFO%20and%20FAD%20Reconciliations) FFO, Core FFO and FAD (in thousands, except per share data) | Metric | Three Months Ended June 30, 2024 | Three Months Ended June 30, 2023 | Six Months Ended June 30, 2024 | Six Months Ended June 30, 2023 | | :------------------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | FFO Attributable to Common Shareholders | $14,335 | $33,423 | $25,013 | $66,425 | | FFO per common share - diluted | $0.16 | $0.30 | $0.27 | $0.59 | | Core FFO Attributable to Common Shareholders | $16,058 | $39,755 | $43,002 | $76,933 | | Core FFO per common share - diluted | $0.18 | $0.36 | $0.47 | $0.69 | | FAD available to OP Units | $19,728 | $39,520 | $55,090 | $77,896 | | FAD Payout Ratio | 96.4% | 70.1% | 69.0% | 73.6% | [Third-Party Asset Management and Real Estate Services Business](index=40&type=section&id=Third-Party%20Asset%20Management%20and%20Real%20Estate%20Services%20Business%20%28Non-GAAP%29) Third-Party Asset Management and Real Estate Services Business (in thousands, at JBG SMITH Share) | Service Revenue | Three Months Ended June 30, 2024 | | :------------------------------------------------- | :------------------------------- | | Property management fees | $3,874 | | Asset management fees | $1,242 | | Development fees | $421 | | Leasing fees | $1,128 | | Construction management fees | $177 | | Other service revenue | $1,260 | | **Total Revenue** | **$8,102** | | Pro rata adjusted general and administrative expense: third-party real estate services | $(9,126) | | **Total Services Revenue Less Allocated General and Administrative Expenses** | **$(1,024)** | [Pro Rata Adjusted General and Administrative Expenses](index=41&type=section&id=Pro%20Rata%20Adjusted%20General%20and%20Administrative%20Expenses%20%28Non-GAAP%29) Pro Rata Adjusted General and Administrative Expenses (in thousands) | General and Administrative Expenses | Three Months Ended June 30, 2024 | | :---------------------------------- | :------------------------------- | | Corporate and other | $17,001 | | Third-party real estate services | $18,650 | | **Total** | **$35,651** | | Adjustments | $(9,082) | | **Pro Rata Adjusted** | **$26,569** | [Net Operating Income (NOI) Analysis](index=42&type=section&id=Same%20Store%20NOI%20%28Non-GAAP%29) This section provides a detailed breakdown of Net Operating Income (NOI), including Same Store NOI, Summary NOI, and specific analyses for multifamily and commercial portfolios. It highlights the overall increase in Same Store NOI, driven by strong performance in both multifamily and commercial segments, and provides granular data on revenue, expenses, and occupancy rates across different property types and submarkets [Same Store NOI](index=42&type=section&id=Same%20Store%20NOI) Same Store NOI (in thousands, at JBG SMITH share) | Same Store NOI | Three Months Ended June 30, 2024 | Three Months Ended June 30, 2023 | % Change | Six Months Ended June 30, 2024 | Six Months Ended June 30, 2023 | % Change | | :------------------------------------------------ | :------------------------------- | :------------------------------- | :------- | :----------------------------- | :----------------------------- | :------- | | Multifamily | $32,026 | $30,967 | 3.4% | $64,695 | $60,385 | 7.1% | | Commercial | $38,395 | $37,563 | 2.2% | $78,097 | $76,285 | 2.4% | | Ground Leases | $948 | $597 | 58.8% | $2,276 | $1,215 | 87.3% | | **Total Same Store NOI** | **$71,369** | **$69,127** | **3.2%** | **$145,068** | **$137,885** | **5.2%** | | Non-Same Store NOI | $225 | $10,853 | (97.9%) | $3,389 | $23,317 | (85.5%) | | **Total Operating Portfolio NOI** | **$71,594** | **$79,980** | **(10.5%)**| **$148,457** | **$161,202** | **(7.9%)** | [Summary NOI](index=43&type=section&id=Summary%20NOI%20%28Non-GAAP%29) Summary NOI (in thousands, at JBG SMITH Share) | Summary NOI | Three Months Ended June 30, 2024 | Annualized NOI | | :--------------------------------------------- | :------------------------------- | :------------- | | Multifamily Operating Portfolio NOI | $32,018 | $128,072 | | Commercial Operating Portfolio NOI | $38,628 | $154,512 | | Ground Leases Operating Portfolio NOI | $948 | $3,792 | | **Total Operating Portfolio NOI** | **$71,594** | **$286,376** | | % occupied (at JBG SMITH Share) | 86.4% | | [Summary NOI - Multifamily](index=44&type=section&id=Summary%20NOI%20-%20Multifamily%20%28Non-GAAP%29) Summary NOI - Multifamily (in thousands, at JBG SMITH Share) | Multifamily NOI | Three Months Ended June 30, 2024 | Annualized NOI | | :------------------------------------------------- | :------------------------------- | :------------- | | National Landing Operating Portfolio NOI | $13,019 | $52,076 | | DC Operating Portfolio NOI | $16,626 | $66,504 | | MD Operating Portfolio NOI | $2,373 | $9,492 | | **Total Operating Portfolio NOI** | **$32,018** | **$128,072** | | % occupied (at JBG SMITH Share) | 94.3% | | [Summary NOI - Commercial](index=45&type=section&id=Summary%20NOI%20-%20Commercial%20%28Non-GAAP%29) Summary NOI - Commercial (in thousands, at JBG SMITH Share) | Commercial NOI | Three Months Ended June 30, 2024 | Annualized NOI | | :------------------------------------------------ | :------------------------------- | :------------- | | National Landing Operating Portfolio NOI | $33,940 | $135,760 | | Other Operating Portfolio NOI | $4,688 | $18,752 | | **Total Operating Portfolio NOI** | **$38,628** | **$154,512** | | % occupied (at JBG SMITH Share) | 80.6% | | [Leasing Activity](index=46&type=section&id=Leasing%20Activity) This section details JBG SMITH's leasing performance across multifamily and office portfolios, including signed but not yet commenced leases, rent rate changes, lease expirations, and tenant diversification. It highlights strong multifamily rent growth and significant office leasing activity, while also outlining future lease expirations and the concentration of key tenants and industries [Signed But Not Yet Commenced Leases](index=46&type=section&id=Signed%20But%20Not%20Yet%20Commenced%20Leases) Annualized Estimated Rent from Signed But Not Yet Commenced Leases (in thousands, at JBG SMITH Share) | Asset Type | Total Annualized Estimated Rent | September 30, 2024 | December 31, 2024 | March 31, 2025 | June 30, 2025 | September 30, 2025 | December 31, 2025 | | :----------------------------------------- | :------------------------------ | :----------------- | :---------------- | :------------- | :------------ | :----------------- | :---------------- | | Multifamily (Operating & Under Construction) | $2,268 | $138 | $463 | $498 | $513 | $532 | $557 | | Commercial (Operating) | $6,936 | $1,153 | $1,664 | $1,684 | $1,684 | $1,684 | $1,684 | | **Total** | **$9,204** | **$1,291** | **$2,127** | **$2,182** | **$2,197** | **$2,216** | **$2,241** | [Leasing Activity - Multifamily](index=47&type=section&id=Leasing%20Activity%20-%20Multifamily) Multifamily Leasing Activity (Three Months Ended June 30) | Metric | 2024 | 2023 | | :-------------------------- | :---- | :---- | | Effective new lease rates | 0.4% | 2.0% | | Effective renewal lease rates | 8.6% | 7.0% | | Effective blended lease rates | 4.6% | 4.5% | | Renewal rate | 50.9% | 47.4% | [Leasing Activity - Office](index=48&type=section&id=Leasing%20Activity%20-%20Office) Office Leasing Activity (in thousands of square feet, at JBG SMITH Share) | Metric | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2024 | | :------------------------------------------- | :------------------------------- | :----------------------------- | | Square feet leased | 248 | 347 | | First-generation space: New | 16 | 46 | | Second-generation space: New | 150 | 151 | | Second-generation space: Renewal | 82 | 150 | | Weighted average lease term (years) | 7.3 | 5.8 | | Weighted average Free Rent period (months) | 6.1 | 4.8 | | Second-generation space: Cash basis % change | 2.0% | 1.6% | | Second-generation space: GAAP basis % change | 12.7% | 10.0% | [Lease Expirations](index=49&type=section&id=Lease%20Expirations) Lease Expirations (at JBG SMITH Share, as of June 30, 2024) | Year of Lease Expiration | Number of Leases | Square Feet | % of Total Square Feet | Annualized Rent (in thousands) | % of Total Annualized Rent | | :----------------------- | :--------------- | :---------- | :--------------------- | :----------------------------- | :------------------------- | | Month-to-Month | 36 | 195,268 | 3.3% | $6,821 | 2.5% | | 2024 | 48 | 582,497 | 9.7% | $26,745 | 10.0% | | 2025 | 58 | 514,100 | 8.6% | $23,862 | 8.9% | | 2026 | 44 | 227,703 | 3.8% | $11,221 | 4.2% | | 2027 | 39 | 621,682 | 10.4% | $29,772 | 11.1% | | 2028 | 29 | 366,479 | 6.1% | $16,916 | 6.3% | | 2029 | 32 | 255,057 | 4.3% | $12,124 | 4.5% | | 2030 | 23 | 624,204 | 10.4% | $30,641 | 11.4% | | 2031 | 24 | 542,724 | 9.1% | $20,691 | 7.7% | | 2032 | 19 | 651,033 | 10.9% | $26,697 | 10.0% | | Thereafter | 65 | 1,393,895 | 23.4% | $62,239 | 23.4% | | **Total / Weighted Average** | **417** | **5,974,642** | **100.0%** | **$267,729** | **100.0%** | - The weighted average remaining lease term for the entire portfolio is **5.7 years**[204](index=204&type=chunk) [Tenant Concentration](index=50&type=section&id=Tenant%20Concentration) Top Tenant Concentration (in thousands, at JBG SMITH Share, as of June 30, 2024) | Tenant | Number of Leases | Square Feet | % of Total Square Feet | Annualized Rent | % of Total Annualized Rent | | :---------------------------- | :--------------- | :---------- | :--------------------- | :-------------- | :------------------------- | | U.S. Government (GSA) | 36 | 1,712,823 | 28.7% | $68,038 | 25.4% | | Amazon | 3 | 357,339 | 6.0% | $16,317 | 6.1% | | Lockheed Martin Corporation | 2 | 207,095 | 3.5% | $10,056 | 3.8% | | Public Broadcasting Service | 1 | 120,328 | 2.0% | $4,962 | 1.9% | | Accenture LLP | 2 | 102,756 | 1.7% | $4,942 | 1.8% | [Industry Diversity](index=51&type=section&id=Industry%20Diversity) Industry Diversity (in thousands, at JBG SMITH Share, as of June 30, 2024) | Industry | Number of Leases | Square Feet | % of Total Square Feet | Annualized Rent | % of Total Annualized Rent | | :---------------------------- | :--------------- | :---------- | :--------------------- | :-------------- | :------------------------- | | Government | 40 | 1,722,180 | 28.8% | $68,512 | 25.6% | | Government Contractors | 94 | 1,416,484 | 23.7% | $68,156 | 25.5% | | Business Services | 25 | 721,831 | 12.1% | $34,526 | 12.9% | | Member Organizations | 36 | 493,335 | 8.3% | $24,512 | 9.2% | | Health Services | 26 | 244,267 | 4.1% | $10,947 | 4.1% | | Food and Beverage | 51 | 161,829 | 2.7% | $9,179 | 3.4% | | Real Estate | 24 | 191,477 | 3.2% | $7,981 | 3.0% | | Communications | 3 | 160,690 | 2.7% | $6,844 | 2.6% | | Legal Services | 11 | 97,545 | 1.6% | $6,293 | 2.4% | | Educational Services | 6 | 62,506 | 1.0% | $2,980 | 1.1% | | Other | 101 | 702,498 | 11.8% | $27,799 | 10.2% | | **Total** | **417** | **5,974,642** | **100.0%** | **$267,729** | **100.0%** | [Property Data](index=52&type=section&id=Property%20Data%20Property%20Tables%3A) This section provides detailed property tables for JBG SMITH's multifamily, commercial, under-construction, and development pipeline assets, along with disposition activity. It offers granular insights into the portfolio's composition, occupancy, rent metrics, and future development potential, highlighting the company's strategic focus on National Landing and multifamily growth [Property Tables - Multifamily](index=52&type=section&id=Property%20Tables%3A%20Multifamily) Multifamily Assets (at JBG SMITH Share, as of June 30, 2024) | Submarket | Number of Units | Total Square Feet | % Leased | % Occupied | Annualized Rent (in thousands) | Monthly Rent Per Unit | Monthly Rent Per Square Foot | | :---------------- | :-------------- | :---------------- | :------- | :--------- | :----------------------------- | :-------------------- | :--------------------------- | | National Landing | 2,856 | 2,315,347 | 97.3% | 94.9% | $73,597 | $2,389 | $2.89 | | DC | 3,140 | 2,643,750 | 96.6% | 93.6% | $98,321 | $2,551 | $3.43 | | MD | 322 | 363,947 | 97.4% | 96.6% | $14,021 | $3,473 | $3.25 | | **Operating - Total / Weighted Average** | **6,318** | **5,323,044** | **96.9%**| **94.3%** | **$185,939** | **$2,530** | **$3.17** | [Property Tables - Commercial](index=54&type=section&id=Property%20Tables%3A%20Commercial) Commercial Assets (at JBG SMITH Share, as of June 30, 2024) | Submarket | Total Square Feet | % Leased | % Occupied | Annualized Rent (in thousands) | Office Annualized Rent Per Square Foot | Retail Annualized Rent Per Square Foot | | :---------------- | :---------------- | :------- | :--------- | :----------------------------- | :------------------------------------- | :------------------------------------- | | National Landing | 5,828,015 | 81.5% | 79.5% | $206,076 | $44.79 | $38.03 | | Other | 1,069,047 | 86.3% | 86.1% | $47,732 | $51.54 | $56.38 | | **Total at JBG SMITH Share** | **6,897,062** | **82.3%**| **80.6%** | **$253,808** | **$45.99** | **$40.00** | - In **Q2 2024**, 2100 Crystal Drive, **18,789 SF** of office space at 2200 Crystal Drive, and **2,480 SF** of retail space at various National Landing assets were taken out of service[128](index=128&type=chunk) [Property Tables - Under-Construction](index=56&type=section&id=Property%20Tables%3A%20Under-Construction) Under-Construction Assets (at JBG SMITH Share, as of June 30, 2024) | Asset | Submarket | % Ownership | Estimated Square Feet | Estimated Number of Units | Estimated Completion Date | Estimated Stabilization Date | Estimated Stabilized NOI (in millions) | | :------------------ | :---------------- | :---------- | :-------------------- | :------------------------ | :------------------------ | :--------------------------- | :------------------------------------- | | 1900 Crystal Drive | National Landing | 100.0% | 633,985 | 808 | Q1 2024 - Q3 2024 | Q1 2026 | $44.2 | [Property Tables - Development Pipeline](index=57&type=section&id=Property%20Tables%3A%20Development%20Pipeline) Development Pipeline (at JBG SMITH Share, as of June 30, 2024) | Location | Estimated Total Potential Development Density (SF) | Multifamily (SF) | Office (SF) | Retail (SF) | Estimated Number of Units | | :---------------- | :------------------------------------------------- | :--------------- | :---------- | :---------- | :------------------------ | | National Landing | 7,224,100 | 5,713,600 | 1,375,900 | 134,600 | 5,565 | | DC | 2,107,000 | 1,840,200 | 149,600 | 117,200 | 1,935 | | **Total** | **9,331,100** | **7,553,800** | **1,525,500** | **251,800** | **7,500** | | Fully Entitled | 4,734,200 | 3,729,800 | 806,000 | 198,400 | 4,145 | [Disposition Activity](index=59&type=section&id=Disposition%20Activity) Disposition Activity (Q1 2024, in thousands, at JBG SMITH Share) | Asset | % Ownership | Asset Type | Location | Date Disposed | Total Square Feet | Gross Sales Price | | :-------------------- | :---------- | :--------- | :--------------- | :------------ | :---------------- | :---------------- | | North End Retail | 100.0% | Multifamily| Washington, DC | January 22, 2024 | 27,355 SF | $14,250 | | Central Place Tower | 50.0% | Commercial | Arlington, VA | February 13, 2024 | 275,797 SF | $162,500 | | **Subtotal** | | | | | | **$176,750** | | Q2 2024 | None | | | | | | [Debt Information](index=60&type=section&id=Debt%20Debt%20Summary) This section provides a comprehensive overview of JBG SMITH's debt structure, including a summary of principal balances, maturity profiles, and interest rates, as well as a detailed breakdown by instrument. It highlights the company's significant portion of fixed or hedged debt and its liquidity position, while outlining near-term debt maturities [Debt Summary](index=60&type=section&id=Debt%20Summary) Debt Summary (in thousands, at JBG SMITH Share, as of June 30, 2024) | Debt Type | Total Principal Balance | % of Total Debt Maturing | % Floating Rate | % Fixed Rate | Weighted Average Interest Rate | | :---------------------------------------------- | :---------------------- | :----------------------- | :-------------- | :----------- | :----------------------------- | | Unsecured Debt | $760,000 | 27.9% | 0% | 100% | 3.79% | | Secured Debt | $1,957,992 | 72.1% | 39.8% | 60.2% | 5.30% | | **Total Consolidated and Unconsolidated Principal Balance** | **$2,717,992** | **100.0%** | **28.6%** | **71.4%** | **4.88%** | - Debt maturing in **2024** totals **$120.9 million** (**4.4%** of total debt), and in **2025** totals **$624.0 million** (**23.0%** of total debt)[113](index=113&type=chunk) - The company has an undrawn capacity of **$694.3 million** under its revolving credit facility[113](index=113&type=chunk) [Debt by Instrument](index=61&type=section&id=Debt%20by%20Instrument) Consolidated Debt by Instrument (in thousands, as of June 30, 2024) | Asset | Principal Balance | Stated Interest Rate | Interest Rate Hedge | Current Annual Interest Rate | Initial Maturity Date | | :------------------------------------ | :---------------- | :------------------- | :------------------ | :--------------------------- | :-------------------- | | 2101 L Street | $120,933 | 3.97% | Fixed | 3.97% | 08/15/24 | | RiverHouse Apartments | $307,710 | S + 1.39% | Swap | 3.55% | 04/01/25 | | 1900 Crystal Drive | $206,980 | S + 2.61% | Cap | 7.11% | 04/25/26 | | Tranche A-1 Term Loan | $200,000 | S + 1.24% | Swap | 2.70% | 01/14/25 | | Revolving Credit Facility | $40,000 | S + 1.45% | — | 6.78% | 06/29/27 | | **Total Consolidated Principal Balance** | **$2,649,992** | | | | | | **Total Consolidated Indebtedness** | **$2,625,329** | | | | | Unconsolidated Debt by Instrument (in thousands, as of June 30, 2024) | Asset | Principal Balance | Stated Interest Rate | Interest Rate Hedge | Current Annual Interest Rate | Initial Maturity Date | | :-------------------- | :---------------- | :------------------- | :------------------ | :--------------------------- | :-------------------- | | 1101 17th Street | $60,000 | S + 1.31% | Swap | 4.13% | 06/13/25 | | 4747 Bethesda Avenue | $175,000 | S + 1.35% | Cap | 5.73% | 02/20/27 | | **Total Unconsolidated Principal Balance** | **$235,000** | | | | | | **Total Unconsolidated Indebtedness** | **$227,837** | | | | | [Definitions](index=63&type=section&id=Definitions) This section provides a comprehensive glossary of key terms and non-GAAP financial measures used throughout the investor package. It defines various financial, operational, and property-related metrics, ensuring clarity and consistency in understanding JBG SMITH's reporting and strategic communications - The section defines key terms such as '**Annualized Rent**,' '**Development Pipeline**,' '**EBITDA**,' '**EBITDAre**,' '**Adjusted EBITDA**,' '**FFO**,' '**Core FFO**,' '**FAD**,' '**Net Debt**,' '**NOI**,' '**Annualized NOI**,' '**Same Store**,' '**Percent Leased**,' '**Percent Occupied**,' and '**Under-Construction**,' among others, to provide a clear understanding of the company's financial and operational metrics[193](index=193&type=chunk)[121](index=121&type=chunk)[157](index=157&type=chunk)[63](index=63&type=chunk)[64](index=64&type=chunk)[65](index=65&type=chunk)[66](index=66&type=chunk)[67](index=67&type=chunk)[217](index=217&type=chunk)[228](index=228&type=chunk) [Appendix](index=68&type=section&id=Appendix%20%E2%80%93%20Interest%20Expense%2C%20Transaction%20and%20Other%20Costs%2C%20and%20NOI%20Reconciliations%20%28Non-GAAP%29) The appendix provides detailed reconciliations for interest expense, transaction and other costs, and Net Operating Income (NOI). These reconciliations offer transparency into the components of these financial figures, highlighting specific adjustments and changes over time, and supporting the non-GAAP measures presented in the main report [Interest Expense Reconciliation](index=68&type=section&id=APPENDIX%20%E2%80%93%20INTEREST%20EXPENSE) Interest Expense (in thousands) | Metric | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2024 | | :------------------------------------------- | :------------------------------- | :----------------------------- | | Interest expense before capitalized interest | $32,090 | $63,724 | | Amortization of deferred financing costs | $4,354 | $8,485 | | Capitalized interest | $(3,467) | $(8,092) | | **Total** | **$33,004** | **$64,225** | [Transaction and Other Costs Reconciliation](index=69&type=section&id=APPENDIX%20%E2%80%93%20TRANSACTION%20AND%20OTHER%20COSTS) Transaction and Other Costs (in thousands) | Cost Type | Three Months Ended June 30, 2024 | Three Months Ended June 30, 2023 | Six Months Ended June 30, 2024 | Six Months Ended June 30, 2023 | | :---------------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Completed, potential and pursued transaction expenses | $34 | $227 | $1,541 | $274 | | Severance and other costs | $505 | $1,799 | $512 | $3,247 | | Demolition costs | $285 | $1,466 | $285 | $2,443 | | **Total** | **$824** | **$3,492** | **$2,338** | **$5,964** | [NOI Reconciliations](index=70&type=section&id=APPENDIX%20%E2%80%93%20NOI%20RECONCILIATIONS) NOI Reconciliation (in thousands) | Metric | Three Months Ended June 30, 2024 | Three Months Ended June 30, 2023 | Six Months Ended June 30, 2024 | Six Months Ended June 30, 2023 | | :------------------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Net income (loss) attributable to common shareholders | $(24,373) | $(10,545) | $(56,649) | $10,626 | | Consolidated NOI | $65,144 | $75,051 | $132,123 | $152,667 | | NOI attributable to unconsolidated real estate ventures at our share | $1,168 | $5,175 | $4,215 | $9,604 | | Total adjustments | $4,109 | $4,027 | $10,960 | $6,924 | | NOI | $69,253 | $79,078 | $143,083 | $159,591 | | Operating Portfolio NOI | $71,594 | $79,980 | $148,457 | $161,202 | | Same Store NOI | $71,369 | $69,127 | $145,068 | $137,885 | | Change in Same Store NOI | 3.2% | | 5.2% | |