Financial Data and Key Metrics Changes - Same center NOI increased by 4.2% and core FFO per share increased by 8.5% year-over-year [5][26] - NAREIT FFO for the second quarter increased to $86 million or $0.62 per diluted share, reflecting year-over-year per share growth of 8.8% [26] - Core FFO for the second quarter increased to $88.2 million or $0.64 per diluted share, reflecting year-over-year per share growth of 8.5% [26] - The company raised its full-year 2025 earnings guidance for same center NOI, core FFO per share, and NAREIT FFO per share [5][29] Business Line Data and Key Metrics Changes - The company reported strong leasing momentum with comparable renewal rent spreads of 19.1% and comparable new leasing rent spreads of 34.6% for the second quarter [18][19] - Portfolio occupancy remained high at 97.4% leased, with anchor occupancy at 98.9% [19][20] - Bad debt increased from a year ago but remained within guidance range, indicating strong retailer demand [21] Market Data and Key Metrics Changes - Approximately 70% of the company's ABR comes from necessity-based goods and services, providing predictable cash flows [10] - The average population in the three-mile trade area is 68,000 with a median household income of $92,000, which is 15% above the US median [22] - The company has limited exposure to distressed retailers, with the top 10 neighbors on the watch list representing about 2% of ABR [23] Company Strategy and Development Direction - The company focuses on a grocery-anchored portfolio and necessity-based neighbor mix to drive growth and stability [6][17] - The acquisition strategy emphasizes disciplined buying and targeting high-quality centers below replacement costs [14][30] - The company aims for mid to high single-digit core FFO per share growth annually on a long-term basis [9][31] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the resilience of the consumer and the portfolio's ability to outperform despite potential tariff impacts [15][72] - The company anticipates continued strong demand from retailers, particularly in grocery-anchored centers [12][99] - Management noted that while consumer sentiment appears negative, sales continue to grow, indicating strong foot traffic at their centers [99][100] Other Important Information - The company has approximately $972 million of liquidity to support acquisition plans and no meaningful debt maturities until 2027 [27] - The weighted average interest rate on debt is 4.4%, with 95% of total debt being fixed rate [28] - The company completed a bond offering of 5.25% senior notes due in 2032 to replenish liquidity [28] Q&A Session Summary Question: What has allowed the company to win transactions in a competitive market? - The company has been active in multiple markets, acquiring properties one at a time, which has contributed to strong acquisition volume [33][34] Question: When will the headwinds from tenant turnover be resolved? - The company has backfilled about 70% of vacancies and expects continued strong leasing demand, with rent coming online in 2026 [36][39] Question: What is the outlook for same store NOI growth in the second half? - The company projects consistent growth for the remainder of the year, with expectations for sequential improvement from Q2 [44][46] Question: How is the company managing variable rate debt? - The company maintains a target of 90% fixed rate debt and is cautious about increasing variable rate exposure [58][61] Question: What is the impact of tariffs on the company's portfolio? - The company has limited exposure to tariffs, with most tenants able to pass costs onto suppliers, resulting in minimal impact on leasing [72] Question: Are there any grocers expanding in the company's markets? - Grocers such as Sprouts, Kroger, Publix, Whole Foods, and Walmart are actively expanding, with Kroger's store closures being managed effectively [107][108]