Regency Centers(REGCP) - 2023 Q3 - Quarterly Report

Financial Performance - Net income attributable to common shareholders for the nine months ended September 30, 2023, was $273.1 million, down from $387.6 million in the same period of 2022, which included gains on sale of real estate of $106.5 million [129]. - Net income attributable to common shareholders for the three months ended September 30, 2023, was $89.1 million, a slight increase from $87.6 million in the same period of 2022 [169]. - Total lease income for the nine months ended September 30, 2023, was $934.2 million, an increase of $51.9 million compared to $882.3 million in 2022 [151]. - Total lease income for the three months ended September 30, 2023, was $320,921,000, an increase of $25,165,000 compared to the same period in 2022 [142]. - The company recognized a gain on sale of real estate of $0.5 million during the nine months ended September 30, 2023, compared to a gain of $106.5 million in the same period of 2022 [155]. - Total equity in income of investments in real estate partnerships decreased by $11.6 million, with net income attributable to common shareholders dropping to $273.1 million from $387.6 million, a decline of 29.5% [158]. Leasing and Occupancy - A total of 1,310 new and renewal leasing transactions were executed, representing 4.8 million Pro-rata square feet, with positive rent spreads of 9.2% during the nine months ended September 30, 2023 [130]. - The total property portfolio was 94.6% leased as of September 30, 2023, compared to 94.8% and 94.6% for December 31, 2022, and September 30, 2022, respectively [130]. - The Same Property portfolio was 95.4% leased as of September 30, 2023, compared to 95.1% and 94.7% for December 31, 2022, and September 30, 2022, respectively [130]. - The percentage leased for operating and development properties was 94.6% as of September 30, 2023, slightly down from 94.8% as of December 31, 2022 [133]. - Pro-rata same property NOI, excluding termination fees, increased by 2.0% compared to the nine months ended September 30, 2022, driven by improvements in base rent and occupancy rates [130]. - Pro-rata Same Property NOI for the nine months ended September 30, 2023, was $683.0 million, compared to $666.9 million for the same period in 2022, reflecting a growth of 2.4% [169]. Acquisitions and Investments - The company completed the acquisition of UBP in an all-stock transaction, adding 74 properties to its portfolio of grocery-anchored shopping centers [130]. - The acquisition of UBP was completed on August 18, 2023, with a total purchase price of $1,140,061,000, including $818,530,000 in common stock issued and $225,000,000 in preferred stock issuance [132]. - The company acquired a 75% share in four properties held in the RegCal partnership for a total purchase price of $88.5 million, impacting consolidated results [156]. - The company invested $159.0 million in development, redevelopment, and improvement of real estate properties during 2023 [185]. - The company has access to a line of credit with a total commitment amount of $1.25 billion, with available capacity of $1.16 billion as of September 30, 2023 [174]. Financial Stability and Capital Structure - The company maintains a conservative capital structure with a strong balance sheet and sufficient liquidity to meet capital needs [129]. - The Pro-rata net debt and Preferred Stock-to-operating EBITDAre ratio was 5.5x on a trailing 12-month basis as of September 30, 2023, compared to 5.0x at December 31, 2022 [134]. - The company has no unsecured debt maturities until June 2024, with $1.2 billion available on the line of credit as of September 30, 2023 [134]. - The trailing 12-month fixed charge coverage ratio was 5.0x as of September 30, 2023, compared to 4.7x at the end of 2022, indicating improved financial stability [178]. - The company reported net cash used in financing activities of $303.9 million for the nine months ended September 30, 2023, a decrease of $52.6 million from the previous year [189]. Operating Expenses - Total operating expenses for the three months ended September 30, 2023, were $211.3 million, an increase of $22.3 million compared to $189.0 million in 2022 [146]. - General and administrative costs increased by $14.5 million for the nine months ended September 30, 2023, primarily due to higher compensation costs and professional fees [153]. - Total real estate operating expenses increased by $16.3 million for the nine months ended September 30, 2023, primarily due to higher operating and maintenance costs [164]. Environmental and Social Responsibility - The company is committed to implementing leading environmental, social, and governance (ESG) practices through its Corporate Responsibility Program [129]. - The company has secured environmental insurance policies for properties with known contamination to mitigate environmental risk [195]. - The company is actively working to require tenants to convert dry cleaning plants to more environmentally friendly systems in accordance with lease terms [195]. - The company acknowledges potential risks related to environmental liabilities and changing regulations that could impact its operations [196]. - The company is in the process of remediating certain sites with known environmental issues, demonstrating a commitment to compliance and risk management [195]. Shareholder Returns - The company aims to create shareholder value by increasing earnings and dividends per share to generate total returns at or near the top of its shopping center peers [129]. - The company declared a common stock dividend of $0.67 per share, payable on January 3, 2024, to shareholders of record as of December 14, 2023 [180].