RETAIL PROPERTIES OF AMERICA, INC.
Certain statements in this "Management's Discussion and Analysis of Financial
Condition and Results of Operations" and elsewhere in this Quarterly Report on
Form 10-Q may constitute "forward-looking statements" within the meaning of the
safe harbor from civil liability provided for such statements by the Private
Securities Litigation Reform Act of 1995 (set forth in Section 27A of the
Securities Act of 1933, as amended, or the Securities Act, and Section 21E of
the Securities Exchange Act of 1934, as amended, or the Exchange Act).
Forward-looking statements involve numerous risks and uncertainties and you
should not rely on them as predictions of future events. Forward-looking
statements depend on assumptions, data or methods which may be incorrect or
imprecise and we may not be able to realize them. We do not guarantee that the
transactions and events described will happen as described or that they will
happen at all. You can identify forward-looking statements by the use of
forward-looking terminology such as "believes," "expects," "may," "should,"
"intends," "plans," "estimates" or "anticipates" and variations of such words or
similar expressions or the negative of such words. You can also identify
forward-looking statements by discussions of strategies, plans or intentions.
Risks, uncertainties and changes in the following factors, among others, could
cause actual results and future events to differ materially from those set forth
or contemplated in the forward-looking statements:
•economic, business and financial conditions, and changes in our industry and
changes in the real estate markets in particular;
•economic and other developments in markets where we have a high concentration
of properties;
•our business strategy;
•our projected operating results;
•rental rates and/or vacancy rates;
•frequency and magnitude of defaults on, early terminations of or non-renewal of
leases by tenants;
•bankruptcy, insolvency or general downturn in the business of a major tenant or
a significant number of smaller tenants;
•adverse impact of e-commerce developments and shifting consumer retail behavior
on our tenants;
•interest rates or operating costs;
•the discontinuation of London Interbank Offered Rate (LIBOR);
•real estate and zoning laws and changes in real property tax rates;
•real estate valuations;
•our leverage;
•our ability to generate sufficient cash flows to service our outstanding
indebtedness and make distributions to our shareholders;
•changes in the dividend policy for our Class A common stock;
•our ability to obtain necessary outside financing;
•the availability, terms and deployment of capital;
•general volatility of the capital and credit markets and the market price of
our Class A common stock;
•risks generally associated with real estate acquisitions and dispositions,
including our ability to identify and pursue acquisition and disposition
opportunities;
•risks generally associated with redevelopment, including the impact of
construction delays and cost overruns and related impact on our estimated
investments in such redevelopment, our ability to lease redeveloped space, our
ability to identify and pursue redevelopment opportunities and the risk that it
takes longer than expected for development assets to stabilize or that we do not
achieve our estimated returns on such investments;
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•composition of members of our senior management team;
•our ability to attract and retain qualified personnel;
•our ability to continue to qualify as a real estate investment trust (REIT);
•governmental regulations, tax laws and rates and similar matters;
•our compliance with laws, rules and regulations;
•environmental uncertainties and exposure to natural disasters;
•pandemics or other public health crises, such as the novel coronavirus
(COVID-19) pandemic, and the related impact on (i) our ability to manage our
properties, finance our operations and perform necessary administrative and
reporting functions and (ii) our tenants' ability to operate their businesses,
generate sales and meet their financial obligations, including the obligation to
pay rent and other charges as specified in their leases;
•insurance coverage; and
•the likelihood or actual occurrence of terrorist attacks in the U.S.
The extent to which COVID-19 ultimately impacts us and our tenants will depend,
in part, on future developments, which are highly uncertain and cannot be
predicted with confidence, including the scope, severity and duration of the
pandemic, the actions taken to contain the pandemic or mitigate its impact,
including the adoption of available COVID-19 vaccines, and the direct and
indirect economic effects of the pandemic and containment measures, among
others. For a further discussion of these and other factors that could impact
our future results, performance or transactions, see Part II, "Item 1A. Risk
Factors" in this document and in our Annual Report on Form 10-K for the year
ended December 31, 2020 , which you should interpret as being heightened as a
result of the numerous and ongoing adverse impacts of COVID-19. Readers should
not place undue reliance on any forward-looking statements, which are based only
on information currently available to us (or to third parties making the
forward-looking statements). We undertake no obligation to publicly release any
revisions to such forward-looking statements to reflect events or circumstances
after the date of this Quarterly Report on Form 10-Q, except as required by
applicable law.
The following discussion and analysis should be read in conjunction with our
condensed consolidated financial statements and the related notes included in
this report.
Impact of the COVID-19 Pandemic
The global outbreak of COVID-19 has caused, and could continue to cause,
significant disruptions to the U.S. and global economy, including the retail
sector within the U.S. Additionally, the COVID-19 pandemic has had, and could
continue to have, a significant adverse impact on the underlying industries of
many of our tenants. As a result of the pandemic and the measures implemented to
control the spread of COVID-19, our tenants and their operations, and their
ability to pay rent in full, on time or at all, have been, and may continue to
be, adversely impacted, including because of required temporary closures of
their stores or modifications to, or restrictions placed on, their operations.
While many U.S. states and cities have eased or lifted such restrictions,
continued mitigation efforts or the effect of any relaxation or revocation of
restrictions, including the impact on and of consumer behavior, all of which
vary by geography, will continue to impact our business and such impacts may be
significant and materially adverse to us. While we have been negatively impacted
by the COVID-19 pandemic, including a decline in our retail portfolio occupancy
of 260 basis points from 94.1% as of March 31, 2020 to 91.5% as of March 31,
2021 and a 4.0% decrease in annualized base rent (ABR) within our retail
operating portfolio from $366,285 at March 31, 2020 to $351,686 at March 31,
2021 , we also note recent positive trends, including continued improvement in
base rent collection since the start of the pandemic, positive blended
re-leasing spreads throughout the pandemic and increased leasing demand over the
previous three quarters. However, due to numerous uncertainties, it is not
possible to accurately predict the ultimate impact the pandemic will have on our
financial condition, results of operations and cash flows and we continue to
closely monitor the impact of the pandemic on all aspects of our business.
In response to COVID-19 and its related impact on many of our tenants, we
reached agreements with tenants regarding lease concessions. The majority of the
amounts addressed by the lease concessions are base rent, although certain
concessions also address tenant recoveries and other charges. The majority of
these concessions were agreed to and, in the majority of these circumstances,
executed during the year ended December 31, 2020 . As of March 31, 2021 , we have
agreed in principle and/or executed additional lease concessions to defer,
without an extension of the lease term, $36 of previously uncollected base rent
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charges and to address an additional $1,877 of previously uncollected base rent
charges through abatement, a combination of deferral and abatement or a
concession with the extension of the lease term.
As of April 26, 2021 , we have collected 96% of base rent charges related to the
three months ended March 31, 2021 and have executed lease concession agreements
to address an additional 1% of base rent related to the three months ended
March 31, 2021 . Uncollected billed base rent related to tenants who have
declared bankruptcy represents an additional 0.2% for the three months ended
March 31, 2021 . As of April 26, 2021 , we have collected 81%, 89% and 95% of
billed base rent charges related to the three months ended June 30, 2020 ,
September 30, 2020 and December 31, 2020 , respectively, as compared to 78%, 88%
and 94% as of February 8, 2021 , respectively.
As of March 31, 2021 , we have collected 93% of the base rent charges that had
previously been deferred under executed lease concession agreements and were due
to be paid during the three months ended March 31, 2021 . As of March 31, 2021 ,
the amounts that have been deferred to future periods under executed lease
concessions, on a weighted average basis, are expected to be received over a
period of approximately nine months. While we have reached agreement with the
majority of tenants that have requested lease concessions as a result of
COVID-19, we can provide no assurances whether certain tenants may request
additional concessions in the future. As of March 31, 2021 , all of our
properties were open for the benefit of the communities and customers that our
tenants serve and approximately 98% of our tenants (based on gross leasable area
(GLA)), or 97% of our tenants (based on ABR), were open.
The following ABR information is based on ABR of leases in our retail operating
portfolio that were in effect as of March 31, 2021 , and is being provided to
assist with analysis of the actual and potential impact of COVID-19. The
information may not be indicative of collection, lease concession activity and
cash-basis designation in future periods. The classification of tenant type,
including the classification between essential and non-essential, is based on
management's understanding of the tenant's operations and may not be comparative
to similarly titled classifications by other companies.
Billed Base Rent Collections as of April 26, 2021
Q1 2021
3/31/2021 % of Billed Base
Resiliency Category/Tenant Type ABR 3/31/2021 ABR Rent Collected
Essential $ 113,070 32 % 100 %
Office 23,483 7 % 96 %
Non-Essential 158,788 45 % 94 %
Restaurants
Restaurants - Full Service 28,683 8 % 90 %
Restaurants - Quick Service 27,662 8 % 95 %
Total Restaurants 56,345 16 % 93 %
Total Retail Operating Portfolio - Billed
base rent collected $ 351,686 100 % 96 %
Addressed through executed lease amendments 1 % (a)
Total Retail Operating Portfolio - Billed
base rent addressed 97 %
(a)We have executed lease amendments to address an additional 1% of billed base
rent related to Q1 2021 through abatements, combinations and/or modifications.
Executive Summary
Retail Properties of America, Inc. (we, our, us) is a REIT that owns and
operates high quality, strategically located open-air shopping centers,
including properties with a mixed-use component. As of March 31, 2021 , we owned
102 retail operating properties in the United States representing 19,928,000
square feet of GLA and had four expansion and redevelopment projects. Our retail
operating portfolio includes (i) neighborhood and community centers, (ii) power
centers, and (iii) lifestyle centers and multi-tenant retail-focused mixed-use
properties, as well as single-user retail properties.
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The following table summarizes our portfolio as of March 31, 2021 :
Percent Leased
Number of GLA Including Leases
Property Type Properties (in thousands) Occupancy Signed (a)
Retail operating portfolio
Multi-tenant retail:
Neighborhood and community centers 62 10,337 92.5 % 93.6 %
Power centers 22 4,784 94.8 % 95.7 %
Lifestyle centers and mixed-use
properties (b) 16 4,546 85.5 % 87.1 %
Total multi-tenant retail 100 19,667 91.4 % 92.6 %
Single-user retail 2 261 100.0 % 100.0 %
Total retail operating properties 102 19,928 91.5 % 92.7 %
Expansion and redevelopment projects:
Circle East 1
One Loudoun Downtown - Pads G & H (c) -
Carillon 1
The Shoppes at Quarterfield 1
Total number of properties 105
(a)Includes leases signed but not commenced.
(b)Excludes the 18 multi-family rental units at Plaza del Lago . As of March 31,
2021 , 17 multi-family rental units were leased at an average monthly rental rate
per unit of $1,370 .
(c)The operating portion of this property is included in the property count of
lifestyle centers and mixed-use properties within our retail operating
portfolio.
We are a prominent owner of multi-tenant retail properties, many with a
mixed-use component, primarily located in the following markets: Dallas ,
Washington, D.C. /Baltimore , New York , Chicago , Seattle , Atlanta , Houston , San
Antonio , Phoenix and Austin . Since our inaugural investor day in 2013, we have:
•improved our retail ABR by 33% to $19.28 per square foot as of March 31, 2021
from $14.46 per square foot as of March 31, 2013 ;
•increased our concentration in lifestyle and mixed-use properties based on
multi-tenant retail ABR by 1,700 basis points to 33% as of March 31, 2021 from
16% as of March 31, 2013 ;
•reduced our top 20 retail tenant concentration of total ABR by 1,040 basis
points to 27.5% as of March 31, 2021 from 37.9% as of March 31, 2013 ; and
•reduced our indebtedness by 32% to $1,761,558 as of March 31, 2021 from
$2,601,912 as of March 31, 2013 .
Additionally, as of March 31, 2021 , approximately 88.4% of our multi-tenant
retail ABR was generated in the top 25 metropolitan statistical areas (MSAs), as
determined by the United States Census Bureau and ranked based on the most
recently available population estimates.
We are focused on optimizing our tenancy, asset level configurations and
merchandising through accretive leasing activity and growth-producing mixed-use
expansion and redevelopment projects. For the three months ended March 31, 2021 ,
we achieved a blended re-leasing spread of positive 5.8% consisting of
comparable cash leasing spreads of positive 21.3% on new leases and positive
3.0% on renewal leases. During this period, we achieved average annual
contractual rent increases on comparable signed new leases of approximately 180
basis points. As of March 31, 2021 , we have $16,882 of ABR related to 791 square
feet of GLA pertaining to 2021 lease expirations and $5,891 of ABR related to
233 square feet of GLA pertaining to leases signed but not yet commenced.
Our active expansion and redevelopment projects consist of approximately
$179,000 to $192,000 of expected investment through 2022, equivalent to
approximately 6% of the net book value of our investment properties as of
March 31, 2021 . These predominantly mixed-use-focused projects include the
redevelopment at Circle East, the expansion projects of Pads G & H at One
Loudoun Downtown and site and building reconfiguration at The Shoppes at
Quarterfield as well as the vacant pad development at Southlake Town Square . Our
current portfolio of assets contains numerous additional projects in the
longer-term pipeline, including, among others, redevelopment at Carillon,
additional pad developments at One Loudoun Downtown,
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pad developments and expansions at Main Street Promenade and Downtown Crown, and
future projects at Merrifield Town Center , Tysons Corner, Southlake Town Square ,
Lakewood Towne Center and One Loudoun Uptown.
Company Highlights - Three Months Ended March 31, 2021
Developments in Progress
During the three months ended March 31, 2021 , we:
•invested $15,411 in our expansion and redevelopment projects at Circle East,
One Loudoun Downtown, The Shoppes at Quarterfield and Southlake Town Square . We
expect the majority of our 2021 project spend will be for the One Loudoun
Downtown project; and
•placed a portion of Circle East and The Shoppes at Quarterfield in service and
reclassified the related costs from "Developments in progress" into "Land" and
"Building and other improvements" in the accompanying condensed consolidated
balance sheets.
The following table summarizes the carrying amount of our developments in
progress as of March 31, 2021 and December 31, 2020 :
December 31,
Property Name MSA March 31, 2021 2020
Expansion and redevelopment
projects
Circle East Baltimore $ 34,075 $ 38,180
One Loudoun Downtown Washington, D.C. 101,493 89,103
Carillon (a) Washington, D.C. 33,393 33,463
The Shoppes at Quarterfield Baltimore 923 865
Pad development projects
Southlake Town Square Dallas 2,119 1,495
172,003 163,106
Land held for future development
One Loudoun Uptown Washington, D.C. 25,450 25,450
Total developments in progress $ 197,453 $ 188,556
(a)In response to macroeconomic conditions due to the COVID-19 pandemic, we
halted plans for vertical construction at the redevelopment during 2020. As of
March 31, 2021 , we continue to evaluate scenarios in anticipation of restarting
future development.
Acquisitions and Dispositions
We did not acquire or sell any properties during the three months ended
March 31, 2021 .
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Market Summary
The following table summarizes our retail operating portfolio by market as of
March 31, 2021 . Square feet of GLA is presented in thousands.
% of Total ABR per % of Total % Leased
Number of Multi-Tenant Occupied Multi-Tenant Including
Property Type/Market Properties ABR (a) Retail ABR (a) Sq. Ft. GLA (a) Retail GLA (a) Occupancy Signed
Multi-Tenant Retail:
Top 25 MSAs (b)
Dallas 19 $ 79,898 23.1 % $ 23.15 3,943 20.0 % 87.5 % 88.1 %
New York 9 36,460 10.5 % 30.02 1,292 6.6 % 94.0 % 96.7 %
Washington, D.C. 8 35,716 10.3 % 28.78 1,388 7.1 % 89.4 % 90.0 %
Chicago 8 27,346 7.9 % 23.58 1,358 6.9 % 85.4 % 85.9 %
Seattle 9 23,690 6.9 % 16.46 1,516 7.7 % 94.9 % 95.9 %
Baltimore 4 22,669 6.6 % 16.08 1,542 7.9 % 91.4 % 93.2 %
Atlanta 9 20,908 6.0 % 14.09 1,513 7.7 % 98.1 % 98.5 %
Houston 9 14,169 4.1 % 13.19 1,141 5.8 % 94.2 % 94.4 %
San Antonio 3 12,373 3.6 % 17.67 722 3.7 % 97.0 % 97.0 %
Phoenix 3 10,384 3.0 % 17.71 632 3.2 % 92.8 % 94.8 %
Los Angeles 1 6,894 2.0 % 17.97 396 2.0 % 96.9 % 97.2 %
Riverside 1 4,663 1.3 % 16.26 292 1.5 % 98.1 % 100.0 %
Charlotte 1 4,181 1.2 % 13.97 319 1.6 % 93.8 % 97.5 %
St. Louis 1 4,067 1.2 % 9.72 453 2.3 % 92.3 % 92.3 %
Tampa 1 2,339 0.7 % 19.19 126 0.6 % 97.0 % 97.0 %
Subtotal 86 305,757 88.4 % 20.02 16,633 84.6 % 91.8 % 92.7 %
Non-Top 25 MSAs (b) 14 40,065 11.6 % 14.78 3,034 15.4 % 89.4 % 92.0 %
Total Multi-Tenant Retail 100 345,822 100.0 % 19.23 19,667 100.0 % 91.4 % 92.6 %
Single-User Retail 2 5,864 22.49 261 100.0 % 100.0 %
Total Retail
Operating Portfolio (c) 102 $ 351,686 $ 19.28 19,928 91.5 % 92.7 %
(a)Excludes $2,731 of multi-tenant retail ABR and 176 square feet of
multi-tenant retail GLA attributable to Circle East and The Shoppes at
Quarterfield, located in the Baltimore MSA, and Carillon, located in the
Washington, D.C. MSA, all three of which are in redevelopment. Including these
amounts, 88.5% of our multi-tenant retail ABR and 84.7% of our multi-tenant
retail GLA is located in the top 25 MSAs.
(b)Top 25 MSAs are determined by the United States Census Bureau and ranked
based on the most recently available population estimates.
(c)Excludes the 18 multi-family rental units at Plaza del Lago . As of March 31,
2021 , 17 multi-family rental units were leased at an average monthly rental rate
per unit of $1,370 .
Leasing Activity
The following table summarizes the leasing activity in our retail operating
portfolio and our active expansion and redevelopment projects during the three
months ended March 31, 2021 . New leases with terms of less than 12 months and
renewal leases that extend the lease term by less than 12 months have been
excluded from the table.
New
Contractual Prior % Change Weighted Tenant
Number of GLA Signed Rent per Square Contractual over Prior Average Allowances
Leases Signed (in thousands) Foot (PSF) (a) Rent PSF (a) ABR (a) Lease Term PSF (b)Comparable Renewal Leases 59 320 $ 22.08$ 21.44 3.0 % 3.6$ 0.82 Comparable New Leases 17 47 $ 31.60$ 26.05 21.3 % 7.3$ 41.41 Non-Comparable New and Renewal Leases (c) 37 320 $ 16.58 N/A N/A 7.2$ 11.09 Total 113 687 $ 23.30$ 22.03 5.8 % 5.4$ 8.25
(a)Total excludes the impact of Non-Comparable New and Renewal Leases.
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(b)Excludes tenant allowances and related square foot amounts at our active
expansion and redevelopment projects. These tenant allowances, if any, are
included in the expected investment for each project.
(c)Includes (i) leases signed on units that were vacant for over 12 months, (ii)
leases signed with variable lease payment terms and (iii) leases signed where
the previous and current lease do not have a consistent lease structure.
Our near-term leasing efforts are primarily focused on (i) vacant anchor and
small shop space, (ii) upcoming lease expirations and (iii) spaces within our
expansion and redevelopment projects. Through these collective efforts, we look
to situationally focus on stability and tenancy, and to optimize the mix of
operators and unique retailers at our properties. As of March 31, 2021 , we have
$16,882 of ABR related to 791 square feet of GLA pertaining to 2021 lease
expirations and $5,891 of ABR related to 233 square feet of GLA pertaining to
leases signed but not commenced.
Capital Markets
During the three months ended March 31, 2021 , we made scheduled principal
payments of $598 related to amortizing loans.
Distributions
We declared a quarterly distribution of $0.07 per share of common stock during
the three months ended March 31, 2021 . During the three months ended March 31,
2021 , we paid the fourth quarter 2020 distribution of $0.06 per share in January
2021 .
Results of Operations
Comparison of Results for the Three Months Ended March 31, 2021 and 2020
Three Months Ended March 31,
2021 2020 Change
Revenues:
Lease income $ 119,380 $ 118,695 $ 685
Expenses:
Operating expenses 18,065 16,414 1,651
Real estate taxes 18,934 18,533 401
Depreciation and amortization 47,867 40,173 7,694
Provision for impairment of investment properties - 346 (346)
General and administrative expenses 11,118 9,165 1,953
Total expenses 95,984 84,631 11,353
Other (expense) income:
Interest expense (18,752) (17,046) (1,706)
Gain on litigation settlement - 6,100 (6,100)
Other income (expense), net 69 (761) 830
Net income 4,713 22,357 (17,644)
Net income attributable to noncontrolling interests - - -
Net income attributable to common shareholders $ 4,713 Net income attributable to common shareholders was$4,713 for the three months endedMarch 31, 2021 compared to$22,357 for the three months endedMarch 31, 2020 . The$17,644 decrease was primarily due to the following: •a$7,694 increase in depreciation and amortization primarily due to the write-off of assets taken out of service due to the demolition of a retail outparcel at our Tacoma South investment property during the three months endedMarch 31, 2021 . No such write-off occurred during the three months endedMarch 31, 2020 ; •a$6,100 gain on litigation settlement recognized during the three months endedMarch 31, 2020 related to litigation with a former tenant. No such gain was recognized during the three months endedMarch 31, 2021 ; •a$1,953 increase in general and administrative expenses primarily due to the timing of recognition of cash bonus expense; 26 -------------------------------------------------------------------------------- Table of Contents •a$1,706 increase in interest expense primarily consisting of: •a$4,750 increase in interest on our 4.75% senior unsecured notes due 2030 (Notes Due 2030), which were issued inAugust 2020 ; and •a$1,000 increase in interest on our additional$100,000 4.00% senior unsecured notes due 2025 (Notes Due 2025), which were issued inJuly 2020 ; partially offset by •a$1,960 decrease in interest on our$250,000 unsecured term loan due 2021, which was repaid inAugust 2020 ; •a$1,030 decrease in interest on our 4.12% senior unsecured notes due 2021, the remaining$100,000 principal balance of which was repaid inSeptember 2020 ; and •a$778 decrease in interest on our unsecured revolving line of credit as it was undrawn as ofMarch 31, 2021 ; and •a$1,651 increase in operating expenses primarily due to higher snow-related expenses in 2021. Net operating income (NOI) We define NOI as all revenues other than (i) straight-line rental income (non-cash), (ii) amortization of lease inducements, (iii) amortization of acquired above and below market lease intangibles and (iv) lease termination fee income, less real estate taxes and all operating expenses other than lease termination fee expense and non-cash ground rent expense, which is comprised of amortization of right-of-use lease assets and amortization of lease liabilities. NOI consists of same store NOI (Same Store NOI) and NOI from other investment properties (NOI fromOther Investment Properties ). We believe that NOI, Same Store NOI and NOI fromOther Investment Properties , which are supplemental non-GAAP financial measures, provide an additional and useful operating perspective not immediately apparent from "Net income" or "Net income attributable to common shareholders" in accordance with accounting principles generally accepted inthe United States (GAAP). We use these measures to evaluate our performance on a property-by-property basis because they allow management to evaluate the impact that factors such as lease structure, lease rates and tenant base have on our operating results. NOI, Same Store NOI and NOI fromOther Investment Properties do not represent alternatives to "Net income" or "Net income attributable to common shareholders" in accordance with GAAP as indicators of our financial performance. Comparison of our presentation of NOI, Same Store NOI and NOI fromOther Investment Properties to similarly titled measures for other REITs may not necessarily be meaningful due to possible differences in definition and application by such REITs. For reference and as an aid in understanding our computation of NOI, a reconciliation of net income attributable to common shareholders as computed in accordance with GAAP to Same Store NOI has been presented for each comparable period presented. Same store portfolio For the three months endedMarch 31, 2021 , our same store portfolio consisted of 102 retail operating properties acquired or placed in service and stabilized prior toJanuary 1, 2020 . The number of properties in our same store portfolio increased to 102 as ofMarch 31, 2021 from 101 as ofDecember 31, 2020 as a result of the addition of North Benson Center, a same store investment property that was acquired onMarch 7, 2019 . The properties and financial results reported in "Other investment properties" primarily include the following: •properties acquired or placed in service and stabilized during 2020 and 2021; •the multi-family rental units atPlaza del Lago ; •Circle East, which is in active redevelopment; •One Loudoun Downtown - Pads G & H, which are in active development; •Carillon, a redevelopment project where we halted plans for vertical construction during 2020 in response to macroeconomic conditions due to the impact of the COVID-19 pandemic; •The Shoppes at Quarterfield, which is in active redevelopment; 27 -------------------------------------------------------------------------------- Table of Contents •land held for future development; •investment properties that were sold or classified as held for sale during 2020; and •the net income from our wholly owned captive insurance company. The following tables present a reconciliation of net income attributable to common shareholders to Same Store NOI and details of the components of Same Store NOI for the three months endedMarch 31, 2021 and 2020: Three
Months Ended
2021 2020 Change
Net income attributable to common shareholders $ 4,713 $ 22,357 $ (17,644)
Adjustments to reconcile to Same Store NOI:
Gain on litigation settlement - (6,100) 6,100
Depreciation and amortization 47,867 40,173 7,694
Provision for impairment of investment properties - 346 (346)
General and administrative expenses 11,118 9,165 1,953
Interest expense 18,752 17,046 1,706
Straight-line rental income, net (420) (341) (79)
Amortization of acquired above and below market lease intangibles, net
(1,225) (976) (249)
Amortization of lease inducements 423 419 4
Lease termination fees, net (679) (124) (555)
Non-cash ground rent expense, net 212 333 (121)
Other (income) expense, net (69) 761 (830)
NOI 80,692 83,059 (2,367)
NOI from Other Investment Properties (326) (811) 485
Same Store NOI $ 80,366 $ 82,248 $ (1,882)
Three Months Ended March 31,
2021 2020 Change
Same Store NOI:
Base rent $ 85,003 $ 89,370 $ (4,367)
Percentage and specialty rent 521 864 (343)
Tenant recoveries 26,112 25,549 563 Other lease-related income 1,285
1,468 (183)
Uncollectible lease income, net 3,758
(822) 4,580
Property operating expenses (17,190) (15,802) (1,388) Real estate taxes (19,123) (18,379) (744) Same Store NOI$ 80,366 $ 82,248 $ (1,882) Same Store NOI decreased$1,882 , or 2.3%, primarily due to the following: •a$4,367 decrease in base rent primarily as a result of (i) a$3,680 decrease from occupancy declines, (ii) a$2,609 decrease from lease concession agreements that do not meet deferral accounting treatment, partially offset by$1,230 related to the repayment of amounts previously deferred under lease concessions that did not meet deferral accounting treatment, and (iii) an increase of$645 from contractual rent changes. The aggregate$2,609 decrease from lease concession agreements was associated with billed base rent of$1,254 from the three months endedMarch 31, 2021 and$1,355 from prior periods; and •a$1,569 increase in property operating expenses and real estate taxes, net of tenant recoveries, primarily due to (i) decreases in tenant recoveries as a result of a decline in occupancy and (ii) an increase in certain net recoverable property operating expenses; partially offset by •a$4,580 decrease in reserve for uncollectible lease income primarily due to (i) collection of amounts related to previous periods from tenants accounted for on the cash basis of accounting, (ii) the execution of lease concessions that did not meet deferral accounting treatment, however, were agreed in previous periods; as a result, the impact of 28 -------------------------------------------------------------------------------- Table of Contents these concessions was included within the reserve for uncollectible lease income until executed, and (iii) a decrease in the general reserve due to collections from accrual-basis tenants, partially offset by (iv) the uncollected portion of current period charges related to cash-basis tenants and (v) the impact of lease concessions we have agreed in principle as ofMarch 31, 2021 that are not expected to meet deferral accounting treatment, however, such agreements have not been executed as ofMarch 31, 2021 ; as a result, the impact of these anticipated concessions are included within the reserve for uncollectible lease income until executed. Funds From Operations Attributable to Common ShareholdersThe National Association of Real Estate Investment Trusts , or NAREIT, an industry trade group, has promulgated a financial measure known as funds from operations (FFO). As defined by NAREIT, FFO means net income computed in accordance with GAAP, excluding (i) depreciation and amortization related to real estate, (ii) gains from sales of real estate assets, (iii) gains and losses from change in control and (iv) impairment write-downs of real estate assets and investments in entities directly attributable to decreases in the value of real estate held by the entity. We have adopted the NAREIT definition in our computation of FFO attributable to common shareholders. Management believes that, subject to the following limitations, FFO attributable to common shareholders provides a basis for comparing our performance and operations to those of other REITs. We define Operating FFO attributable to common shareholders as FFO attributable to common shareholders excluding the impact of discrete non-operating transactions and other events that we do not consider representative of the comparable operating results of our real estate operating portfolio, which is our core business platform. Specific examples of discrete non-operating transactions and other events include, but are not limited to, (i) the impact on earnings from gains or losses associated with the early extinguishment of debt or other liabilities, (ii) litigation involving the Company, including gains recognized as a result of settlement and costs to engage outside counsel related to litigation with former tenants, (iii) the impact on earnings from executive separation, and (iv) the excess of redemption value over carrying value of preferred stock redemption, which are not otherwise adjusted in our calculation of FFO attributable to common shareholders. We believe that FFO attributable to common shareholders and Operating FFO attributable to common shareholders, which are supplemental non-GAAP financial measures, provide an additional and useful means to assess the operating performance of REITs. FFO attributable to common shareholders and Operating FFO attributable to common shareholders do not represent alternatives to (i) "Net Income" or "Net income attributable to common shareholders" as indicators of our financial performance, or (ii) "Cash flows from operating activities" in accordance with GAAP as measures of our capacity to fund cash needs, including the payment of dividends. Comparison of our presentation of Operating FFO attributable to common shareholders to similarly titled measures for other REITs may not necessarily be meaningful due to possible differences in definition and application by such REITs. The following table presents a reconciliation of net income attributable to common shareholders to FFO attributable to common shareholders and Operating FFO attributable to common shareholders:
Three Months Ended
2021 2020
Net income attributable to common shareholders $ 4,713 $ 22,357
Depreciation and amortization of real estate (a) 47,540 39,838
Provision for impairment of investment properties - 346
FFO attributable to common shareholders $
52,253
$
0.24
FFO attributable to common shareholders$ 52,253 $ 62,541 Impact on earnings from the early extinguishment of debt, net (b) 64 - Gain on litigation settlement - (6,100) Other (c) 28 1,011 Operating FFO attributable to common shareholders $
52,345
$
0.24
(a)Includes$7,527 of accelerated depreciation recorded in connection with the write-off of assets taken out of service due to the demolition of a retail outparcel at our Tacoma South investment property during the three months endedMarch 31, 2021 . (b)Included within "Interest expense" in the accompanying condensed consolidated statements of operations and other comprehensive income (loss). 29 -------------------------------------------------------------------------------- Table of Contents (c)Primarily consists of the impact on earnings from litigation involving the Company, including costs to engage outside counsel related to litigation with former tenants, which is included within "Other income (expense), net" in the accompanying condensed consolidated statements of operations and other comprehensive income (loss). Liquidity and Capital Resources We anticipate that cash flows from the below-listed sources will provide adequate capital for the next 12 months and beyond for all scheduled principal and interest payments on our outstanding indebtedness, including maturing debt, current and anticipated tenant allowances or other capital obligations, the shareholder distributions required to maintain our REIT status and compliance with the financial covenants of our unsecured debt agreements. Our primary expected sources and uses of liquidity are as follows: SOURCES
USES
? Operating cash flow ? Tenant allowances
and leasing costs
? Cash and cash equivalents ? Improvements made
to individual properties,
certain of which are not
? Available borrowings under our unsecured recoverable through common area maintenance
revolving charges to tenants
line of credit ? Debt repayments
? Proceeds from capital markets transactions ? Distribution payments
? Proceeds from asset dispositions ? Redevelopment,
expansion and pad development
activities
? Proceeds from the sales of air rights ? Acquisitions
? New development
? Repurchases of our common stock
Over the last several years, we have made substantial progress in reinforcing
the strength of our balance sheet, as demonstrated by our financial flexibility
and abundant liquidity. We believe this progress places us in a position to be
able to better withstand the current unprecedented macroeconomic environment.
However, there can be no assurances in this regard or that additional financing
or capital will be available to us going forward on favorable terms, or at all.
Additionally, as of April 26, 2021 , we have collected 96% of base rent charges
related to the three months ended March 31, 2021 and have executed lease
concession agreements for an additional 1% of billed base rent related to the
three months ended March 31, 2021 . Uncollected billed base rent related to
tenants who have declared bankruptcy represents an additional 0.2% for the three
months ended March 31, 2021 . As of April 26, 2021 , we have collected 81%, 89%
and 95% of billed base rent charges related to the three months ended June 30,
2020 , September 30, 2020 and December 31, 2020 , respectively, as compared to
78%, 88% and 94% as of February 8, 2021 , respectively. If our cash collection
activity deteriorates, and if we reach additional agreements with tenants to
defer or abate rent, our operating cash flows and liquidity will be negatively
impacted. We can make no assurances that the in-process lease amendments will
ultimately be executed in the lease concession type being actively negotiated,
or at all. Over the last several years as we worked to fortify our balance
sheet, we funded debt maturities primarily through capital markets transactions,
including public and private offerings of senior unsecured notes, as well as
asset dispositions. As of March 31, 2021 , we have no scheduled debt maturities
and $1,811 of principal amortization due through the end of 2021, which we plan
on satisfying through a combination of cash flows from operations, working
capital and our unsecured revolving line of credit.
30--------------------------------------------------------------------------------
Table of Contents The table below summarizes our consolidated indebtedness as ofMarch 31, 2021 : Aggregate Weighted Weighted Principal Average Average Years Debt Amount Interest Rate Maturity Date to Maturity Fixed rate mortgages payable (a)$ 91,558 4.36 % Various 3.8 years Unsecured notes payable: Senior notes - 4.58% due 2024 150,000 4.58 % June 30, 2024 3.3 years Senior notes - 4.00% due 2025 350,000 4.00 % March 15, 2025 4.0 years Senior notes - 4.08% due 2026 100,000 4.08 % September 30, 2026 5.5 years Senior notes - 4.24% due 2028 100,000 4.24 % December 28, 2028 7.8 years Senior notes - 4.82% due 2029 100,000 4.82 % June 28, 2029 8.2 years Senior notes - 4.75% due 2030 400,000 4.75 % September 15, 2030 9.5 years Total unsecured notes payable (a) 1,200,000 4.42 % 6.5 years Unsecured credit facility: Revolving line of credit - variable rate - 1.21 % April 22, 2022 (b) 1.1 years Unsecured term loans: Term Loan Due 2023 - fixed rate (c) 200,000 4.10 % November 22, 2023 2.6 years Term Loan Due 2024 - fixed rate (d) 120,000 2.88 % July 17, 2024 3.3 years Term Loan Due 2026 - fixed rate (e) 150,000 3.37 % July 17, 2026 5.3 years Total unsecured term loans (a) 470,000 3.56 % 3.7 years Total consolidated indebtedness$ 1,761,558 4.19 % 5.6 years (a)Fixed rate mortgages payable excludes mortgage discount of$(439) and capitalized loan fees of$(176) , net of accumulated amortization, as ofMarch 31, 2021 . Unsecured notes payable excludes discount of$(6,258) and capitalized loan fees of$(7,220) , net of accumulated amortization, as ofMarch 31, 2021 . Unsecured term loans exclude capitalized loan fees of$(2,273) , net of accumulated amortization, as ofMarch 31, 2021 . Capitalized loan fees related to the revolving line of credit are included within "Other assets, net" in the accompanying condensed consolidated balance sheets. (b)We have two six-month extension options on the revolving line of credit, which we may exercise as long as we are in compliance with the terms of the unsecured credit agreement and we pay an extension fee equal to 0.075% of the commitment amount being extended. (c)Reflects$200,000 of LIBOR-based variable rate debt that has been swapped to a fixed rate of 2.85% plus a credit spread based on a leverage grid ranging from 1.20% to 1.85% throughNovember 22, 2023 . The applicable credit spread was 1.25% as ofMarch 31, 2021 . (d)Reflects$120,000 of LIBOR-based variable rate debt that has been swapped to a fixed rate of 1.68% plus a credit spread based on a leverage grid ranging from 1.20% to 1.70% throughJuly 17, 2024 . The applicable credit spread was 1.20% as ofMarch 31, 2021 . (e)Reflects$150,000 of LIBOR-based variable rate debt that has been swapped to a fixed rate of 1.77% plus a credit spread based on a leverage grid ranging from 1.50% to 2.20% throughJuly 17, 2026 . The applicable credit spread was 1.60% as ofMarch 31, 2021 . Mortgages Payable During the three months endedMarch 31, 2021 , we made scheduled principal payments of$598 related to amortizing loans. Unsecured Term Loans and Revolving Line of Credit Unsecured Credit Facility OnApril 23, 2018 , we entered into our fifth amended and restated credit agreement with a syndicate of financial institutions to provide for an unsecured credit facility aggregating$1,100,000 , consisting of an$850,000 unsecured revolving line of credit that matures onApril 22, 2022 and a$250,000 unsecured term loan that was scheduled to mature onJanuary 5, 2021 and was repaid during 2020 (Unsecured Credit Facility). The unsecured revolving line of credit is priced on a leverage grid at a rate of LIBOR plus a credit spread. In accordance with the unsecured credit agreement, the credit spread set forth in the leverage grid resets quarterly based on our leverage, as calculated at the previous quarter end, and we have the option to make an irrevocable election to convert to an investment grade pricing grid. As ofMarch 31, 2021 , making such an election would have resulted in a higher interest rate and, as such, we have not made the election to convert to an investment grade pricing grid. 31 -------------------------------------------------------------------------------- Table of Contents The following table summarizes the key terms of the unsecured revolving line of credit: Leverage-Based Pricing Investment Grade Pricing Unsecured Credit Facility Maturity Date Extension Option Extension Fee Credit Spread Facility Fee Credit Spread Facility Fee$850,000 unsecured revolving line of credit 4/22/2022 2 six-month 0.075% 1.05%-1.50% 0.15%-0.30%
0.825%-1.55% 0.125%-0.30%
The Unsecured Credit Facility has a$500,000 accordion option that allows us, at our election, to increase the total Unsecured Credit Facility up to$1,350,000 , subject to (i) customary fees and conditions including, but not limited to, the absence of an event of default as defined in the unsecured credit agreement and (ii) our ability to obtain additional lender commitments. As ofMarch 31, 2021 , we had letters of credit outstanding totaling$291 that serve as collateral for certain capital improvements at one of our properties and reduce the available borrowings on our unsecured revolving line of credit. Unsecured Term Loans As ofMarch 31, 2021 , we have the following unsecured term loans: (i) a seven-year$200,000 unsecured term loan (Term Loan Due 2023), (ii) a five-year$120,000 unsecured term loan (Term Loan Due 2024) and (iii) a seven-year$150,000 unsecured term loan (Term Loan Due 2026), each of which bears interest at a rate of LIBOR plus a credit spread based on a leverage grid. In accordance with the respective term loan agreements, the credit spread set forth in the leverage grid resets quarterly based on our leverage, as calculated at the previous quarter end, and we have the option to make an irrevocable election to convert to an investment grade pricing grid. As ofMarch 31, 2021 , making such an election would not have changed the interest rate for the Term Loan Due 2023 and would have resulted in higher interest rates for the Term Loan Due 2024 and Term Loan Due 2026 and, as such, we have not made the election to convert to an investment grade pricing grid. The following table summarizes the key terms of the unsecured term loans: Leverage-Based Pricing Investment Grade Pricing Unsecured Term Loans Maturity Date Credit Spread Credit Spread$200,000 unsecured term loan due 2023 11/22/2023 1.20% - 1.85% 0.85% - 1.65%$120,000 unsecured term loan due 2024 7/17/2024 1.20% - 1.70% 0.80% - 1.65%$150,000 unsecured term loan due 2026 7/17/2026 1.50% - 2.20% 1.35% - 2.25% The Term Loan Due 2023 has a$100,000 accordion option that allows us, at our election, to increase the Term Loan Due 2023 up to$300,000 , subject to (i) customary fees and conditions, including the absence of an event of default as defined in the amended term loan agreement and (ii) our ability to obtain additional lender commitments. The Term Loan Due 2024 has a$130,000 accordion option and the Term Loan Due 2026 has a$100,000 accordion option that, collectively, allow us, at our election, to increase the total of the Term Loan Due 2024 and Term Loan Due 2026 up to$500,000 , subject to (i) customary fees and conditions, including the absence of an event of default as defined in the term loan agreement and (ii) our ability to obtain additional lender commitments. 32 -------------------------------------------------------------------------------- Table of Contents Debt Maturities The following table summarizes the scheduled maturities and principal amortization of our indebtedness as ofMarch 31, 2021 for the remainder of 2021, each of the next four years and thereafter, and the weighted average interest rates by year, as well as the fair value of our indebtedness as ofMarch 31, 2021 . 2021 2022 2023 2024 2025 Thereafter Total Fair Value Debt: Fixed rate debt: Mortgages payable (a)$ 1,811 $ 26,641 $ 31,758 $ 1,737 $ 1,809 $ 27,802 $ 91,558 $ 93,180 Fixed rate term loans (b) - - 200,000 120,000 - 150,000 470,000 468,294 Unsecured notes payable (c) - - - 150,000 350,000 700,000 1,200,000 1,272,721 Total fixed rate debt 1,811 26,641 231,758 271,737 351,809 877,802 1,761,558 1,834,195 Variable rate debt: Variable rate revolving line of credit - - - - - - - - Total debt (d)$ 1,811 $ 26,641 $ 231,758 $ 271,737 $ 351,809 $ 877,802 $ 1,761,558 $ 1,834,195 Weighted average interest rate on debt: Fixed rate debt 4.08 % 4.81 % 4.10 % 3.83 % 4.00 % 4.37 % 4.19 % Variable rate debt (e) - 1.21 % - - - - 1.21 % Total 4.08 % 4.81 % 4.10 % 3.83 % 4.00 % 4.37 % 4.19 % (a)Excludes mortgage discount of$(439) and capitalized loan fees of$(176) , net of accumulated amortization, as ofMarch 31, 2021 . (b)Excludes capitalized loan fees of$(2,273) , net of accumulated amortization, as ofMarch 31, 2021 . The following variable rate term loans have been swapped to fixed rate debt: (i)$200,000 of LIBOR-based variable rate debt has been swapped to a fixed rate of 2.85% plus a credit spread based on a leverage grid throughNovember 22, 2023 ; (ii)$120,000 of LIBOR-based variable rate debt has been swapped to a fixed rate of 1.68% plus a credit spread based on a leverage grid throughJuly 17, 2024 ; and (iii)$150,000 of LIBOR-based variable rate debt has been swapped to a fixed rate of 1.77% plus a credit spread based on a leverage grid throughJuly 17, 2026 . As ofMarch 31, 2021 , the applicable credit spread for (i) was 1.25%, for (ii) was 1.20% and for (iii) was 1.60%. (c)Excludes discount of $(6,258) and capitalized loan fees of$(7,220) , net of accumulated amortization, as ofMarch 31, 2021 . (d)The weighted average years to maturity of consolidated indebtedness was 5.6 years as ofMarch 31, 2021 . (e)Represents interest rate as ofMarch 31, 2021 , however, the revolving line of credit was not drawn as ofMarch 31, 2021 . Our unsecured debt agreements, consisting of the (i) unsecured credit agreement, as amended governing the Unsecured Credit Facility, (ii) term loan agreement, as amended governing the Term Loan Due 2023, (iii) term loan agreement, as amended governing the Term Loan Due 2024 and Term Loan Due 2026, (iv) note purchase agreement governing the 4.58% senior unsecured notes due 2024 (Notes Due 2024), (v) indenture, as supplemented, governing the Notes Due 2025, (vi) note purchase agreement governing the 4.08% senior unsecured notes due 2026 and the 4.24% senior unsecured notes due 2028 (Notes Due 2026 and 2028), (vii) note purchase agreement governing the 4.82% senior unsecured notes due 2029 (Notes Due 2029) and (viii) indenture, as supplemented, governing the Notes Due 2030, contain customary representations, warranties and covenants, and events of default. These include financial covenants such as (i) maximum unencumbered, secured and consolidated leverage ratios; (ii) minimum interest coverage ratios; (iii) minimum fixed charge coverage ratios; (iv) minimum unencumbered interest coverage ratios; (v) a minimum debt service coverage ratio; and (vi) a minimum unencumbered assets to unsecured debt ratio. All financial covenants that include operating results, or derivations thereof, in the covenant calculations are based on the most recent four fiscal quarters of activity. As such, the impact of short-term relative adverse operating results, if any, on our financial covenants is partially mitigated by previous and/or subsequent operating results. As ofMarch 31, 2021 , we believe we were in compliance with the financial covenants and default provisions under the unsecured debt agreements. We plan on addressing our debt maturities through a combination of (i) cash flows generated from operations, (ii) working capital, (iii) capital markets transactions and (iv) our unsecured revolving line of credit. Distributions and Equity Transactions Our distributions of current and accumulated earnings and profits forU.S. federal income tax purposes are taxable to shareholders, generally, as ordinary income. Distributions in excess of these earnings and profits generally are treated as a non-taxable reduction of the shareholders' basis in the shares to the extent thereof (non-dividend distributions) and thereafter as taxable gain. We intend to continue to qualify as a REIT forU.S. federal income tax purposes. The Internal Revenue Code of 33 -------------------------------------------------------------------------------- Table of Contents 1986, as amended (the Code) generally requires that a REIT annually distributes to its shareholders at least 90% of its REIT taxable income, determined without regard to the dividends paid deduction and excluding net capital gains. The Code imposes tax on any undistributed REIT taxable income. To satisfy the requirements for qualification as a REIT and generally not be subject toU.S. federal income and excise tax, we intend to make distributions of all, or substantially all, of our taxable income to shareholders. Our future distributions will be at the discretion of our board of directors and are required to be declared 10 days prior to the record date. When determining the amount of future distributions, we expect to consider, among other factors, (i) the amount of cash generated from our operating activities, (ii) our expectations of future cash flow, (iii) our determination of near-term cash needs for debt repayments and potential future share repurchases, (iv) the market of available acquisitions of new properties and redevelopment, expansion and pad development opportunities, (v) the timing of significant re-leasing activities and the establishment of additional cash reserves for anticipated tenant allowances and general property capital improvements, (vi) our ability to continue to access additional sources of capital, and (vii) the amount required to be distributed to maintain our status as a REIT, which is a requirement of our unsecured credit agreement, and to avoid or minimize any income and excise taxes that we otherwise would be required to pay. Under certain circumstances, we may be required to make distributions in excess of cash available for distribution in order to meet the REIT distribution requirements. We declared a quarterly distribution of$0.07 per share of common stock during the three months endedMarch 31, 2021 . We have an existing common stock repurchase program under which we may repurchase, from time to time, up to a maximum of$500,000 of shares of our Class A common stock. The shares may be repurchased in the open market or in privately negotiated transactions and are canceled upon repurchase. The timing and actual number of shares repurchased will depend on a variety of factors, including price in absolute terms and in relation to the value of our assets, corporate and regulatory requirements, market conditions and other corporate liquidity requirements and priorities. The common stock repurchase program may be suspended or terminated at any time without prior notice. We did not repurchase any shares during the three months endedMarch 31, 2021 . As ofMarch 31, 2021 ,$189,105 remained available for repurchases of shares of our common stock under our common stock repurchase program. OnApril 1, 2021 , we established an at-the-market (ATM) equity program under which we may issue and sell shares of our Class A common stock, having an aggregate offering price of up to$250,000 , from time to time. Actual sales may depend on a variety of factors, including, among others, market conditions and the trading price of our Class A common stock. Any net proceeds are expected to be used for general corporate purposes, which may include funding acquisitions and redevelopment activities and repaying debt. Capital Expenditures and Redevelopment Activity We anticipate that obligations related to capital improvements and redevelopments, including expansions and pad developments, in 2021 can be met with (i) cash flows generated from operations, (ii) working capital, (iii) capital markets transactions and (iv) our unsecured revolving line of credit. As ofMarch 31, 2021 , we have active expansion and redevelopment projects at Circle East, One Loudoun Downtown, The Shoppes at Quarterfield and a vacant pad development atSouthlake Town Square and we have invested a total of approximately$117,000 in these projects, which is net of proceeds of$11,820 from the sale of air rights at Circle East and net of contributions from our joint venture partner at One Loudoun Downtown. These projects are at various stages of completion, and based on our current plans and estimates, we anticipate that it will require approximately$62,000 to$75,000 of additional investment from us to complete these projects. We capitalized$716 and$626 of internal salaries and related benefits of personnel directly involved in capital upgrades and tenant improvements during the three months endedMarch 31, 2021 and 2020, respectively. We also capitalized$57 and$60 of internal leasing incentives, all of which were incremental to signed leases, during the three months endedMarch 31, 2021 and 2020, respectively. In addition, we capitalized$1,811 and$1,316 of indirect project costs, which includes, among other costs,$409 and$372 of internal salaries and related benefits of personnel directly involved in the redevelopment projects and$1,292 and$785 of interest, related to expansion and redevelopment projects during the three months endedMarch 31, 2021 and 2020, respectively. 34 -------------------------------------------------------------------------------- Table of Contents Dispositions We did not sell any properties during the three months endedMarch 31, 2021 . The following table highlights our property disposition during 2020: Aggregate Number of Square Proceeds, Net Debt Properties Sold Footage Consideration (a) Extinguished 2020 Disposition 1 105,900$ 13,900 $ 12,695 $ - (a)Represents total consideration net of transaction costs. In addition to the transaction presented in the preceding table, during the year endedDecember 31, 2020 , we received proceeds of$26 from a condemnation award. Acquisitions We did not acquire any properties during the three months endedMarch 31, 2021 . The following table highlights our asset acquisition during 2020: Number of Assets Acquired Square Footage Acquisition Price Mortgage Debt 2020 Acquisition (a) 1 154,700 $ 55,000 $ - (a)2020 acquisition is the fee interest in our Fullerton Metrocenter multi-tenant retail operating property. In connection with this acquisition, we also assumed the lessor position in a ground lease with a shadow anchor. The total number of properties in our portfolio was not affected by this transaction.
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