Financial Performance - Net income attributable to common shareholders for the six months ended June 30, 2024, was $205.6 million, an increase from $184.1 million for the same period in 2023[138]. - Net income attributable to common shareholders increased by $12.5 million to $99.3 million for the three months ended June 30, 2024[152]. - Net income for the six months ended June 30, 2024, increased by $30.9 million to $217.6 million[160]. - Nareit FFO attributable to common stock and unit holders increased to $196.368 million for the three months ended June 30, 2024, compared to $176.773 million in 2023[167]. - Core Operating Earnings for the three months ended June 30, 2024, were $189.253 million, an increase from $164.688 million in 2023[167]. Property and Leasing - As of June 30, 2024, the company owned 380 properties with a gross leasable area (GLA) of 43.8 million square feet, compared to 381 properties and 43.8 million square feet as of December 31, 2023[138]. - The overall percentage leased for operating and development properties remained stable at 94.9% as of June 30, 2024[138]. - The percentage leased for operating properties was 95.3%, slightly down from 95.4% as of December 31, 2023[138]. - Total property portfolio was 95.0% leased as of June 30, 2024, compared to 94.6% a year earlier[139]. - Executed 984 new and renewal leasing transactions totaling 4.1 million Pro-rata SF with positive rent spreads of 8.9% for the six months ended June 30, 2024, compared to 842 transactions with 9.2% rent spreads in the same period of 2023[139]. Revenue and Income - Total lease income increased by $43.4 million to $347.8 million for the three months ended June 30, 2024, primarily due to a $31.5 million increase in base rent[144][146]. - Total lease income increased by $87.7 million to $700.9 million, driven by a $62.7 million increase in base rent[154]. - Base rent increased by $6.4 million and $12.7 million during the three and six months ended June 30, 2024, due to positive rental spreads and increased occupancy[165]. - The company recognized gains on sale of real estate totaling $11.1 million for the three months ended June 30, 2024[148]. Expenses and Costs - Operating expenses rose to $233.2 million for the three months ended June 30, 2024, an increase of $30.4 million compared to the same period in 2023[147]. - Total operating expenses rose by $67.4 million to $467.2 million, with depreciation and amortization costs increasing by $32.7 million[156]. - Interest expense, net increased by $6.2 million, reaching $43.2 million, mainly due to higher interest on notes payable[148]. - Interest expense, net for the six months ended June 30, 2024, increased by $12.7 million to $86.0 million[159]. Capital Structure and Liquidity - The company focuses on maintaining a conservative capital structure and sufficient liquidity to fund investment opportunities and debt maturities[138]. - The company has $73.8 million of unrestricted cash and additional capital sources including a $1.5 billion line of credit with $1.18 billion available[173]. - The company estimates a capital requirement of approximately $530.6 million over the next 12 months for leasing commissions, tenant improvements, and debt repayment[176]. - Compliance with financial covenants was maintained as of June 30, 2024, ensuring continued borrowing capacity[179]. Development and Redevelopment - The company continues to develop and redevelop high-quality shopping centers to enhance its portfolio[138]. - Estimated Pro-rata project costs for ongoing development projects reached $577.6 million as of June 30, 2024, up from $468.1 million at December 31, 2023[139]. - The company has ongoing development projects with estimated net development costs totaling $220.5 million as of June 30, 2024[185]. - Redevelopment projects in process have total estimated net project costs of $357.1 million, with 49% of costs incurred[187]. - The company plans to continue developing and redeveloping shopping centers for long-term investment, focusing on enhancing its portfolio[186]. Shareholder Value and Dividends - The company aims to create shareholder value by increasing earnings and dividends per share, targeting total returns at or near the top of its shopping center peers[137]. - The company declared a common stock dividend of $0.67 per share, payable on October 3, 2024[174]. - The company plans to continue paying dividends that meet REIT qualification requirements, having paid $255.4 million in dividends to common and preferred stockholders during the six months ended June 30, 2024[175]. Credit and Ratings - Regency received a credit rating upgrade to A3 with a stable outlook from Moody's Investors Service[139]. - The company drew $158.0 million in net proceeds from its Line of credit and received $398.5 million from issuing unsecured public debt in 2024, while repaying $344.2 million in debt[191]. Inflation and Cost Management - The company has implemented strategies to mitigate inflation impacts on construction costs, including fixed cost contracts and pre-ordering materials[176]. - The average interest rate for fixed rate debt was 4.00% to 4.36% across different maturities, while the average interest rate for variable rate debt was 6.16% as of June 30, 2024[201]. - The company expects that an increase of 100 basis points in interest rates could decrease future earnings and cash flows by approximately $3.1 million per year based on $313.8 million of floating rate mortgage debt[198]. Team and Governance - The company emphasizes the importance of a talented and diverse team to drive performance and innovation[137]. - The company is committed to implementing leading environmental, social, and governance (ESG) practices through its Corporate Responsibility program[137].
Regency Centers(REGCO) - 2024 Q2 - Quarterly Report