FULLTEXT DEL 3 AV 5
10-K – 2026-02-13 – reg-20251231.htm
Supplemental Earnings Information on Non-GAAP Financial Measures
We use certain non-GAAP financial measures, in addition to certain performance metrics determined under GAAP, as we believe these measures improve the understanding of the operating results. We believe these non-GAAP financial measures provide useful information to our Board of Directors, management and investors regarding certain trends relating to our financial condition and results of operations. Our management uses these non-GAAP measures to compare our performance to that of prior periods for trend analyses, purposes of determining management incentive compensation and budgeting, forecasting and planning purposes. We provide Pro-rata financial information because we believe it assists investors and analysts in estimating our economic interest in our consolidated and unconsolidated real estate partnerships, when read in conjunction with our reported results under GAAP. We believe presenting our Pro-rata share of operating results, along with other non-GAAP financial measures, may assist in comparing our operating results to other REITs. We continually evaluate the usefulness, relevance, limitations, and calculation of our reported non-GAAP measures to determine how best to provide relevant information to the public, and thus such reported non-GAAP financial measures could change. See "Non-GAAP Financial Measures" in "Item 1. Business " for additional information regarding the definition of and other information regarding the non-GAAP financial measures we present in this Report.
We do not consider non-GAAP financial measures as an alternative to financial measures determined in accordance with GAAP, rather they supplement GAAP measures by providing additional information we believe to be useful to our shareholders. The principal limitation of these non-GAAP financial measures is that they may exclude significant expense and income items that are required by GAAP to be recognized in our Consolidated Financial Statements. In addition, they reflect the exercise of management's judgment about which expense and income items are excluded or included in determining these non-GAAP financial measures. In order to compensate for these limitations, reconciliations of the non-GAAP financial measures we use to their most directly comparable GAAP measures are provided, including as set forth below. Non-GAAP financial measures should not be relied upon in evaluating the financial condition, results of operations, or future prospects.
Pro-rata Same Property NOI (Non-GAAP Financial Measures):
Year ended December 31,
(in thousands)
2025
2024
Change
Base rent
$
1,130,009
1,085,391
44,618
Recoveries from tenants
404,326
378,076
26,250
Percentage rent
15,468
15,210
258
Termination fees
6,983
6,502
481
Uncollectible lease income
(2,644
)
(3,695
)
1,051
Other lease income
20,131
19,412
719
Other property income
11,932
11,655
277
Total real estate revenue
1,586,205
1,512,551
73,654
Operating and maintenance
265,592
252,950
12,642
Termination expense
35
30
5
Real estate taxes
205,725
199,700
6,025
Ground rent
15,045
15,181
(136
)
Total real estate operating expenses
486,397
467,861
18,536
Pro-rata same property NOI
$
1,099,808
1,044,690
55,118
Less: Termination fees
6,948
6,472
476
Pro-rata same property NOI, excluding termination fees
$
1,092,860
1,038,218
54,642
Pro-rata same property NOI growth, excluding termination fees
5.3
%
Pro-rata same property NOI, excluding termination fees/expenses, changed from the following major components:
Total real estate revenue increased by $73.7 million, on a net basis, as follows:
• Base rent increased by $44.6 million due to contractual rent steps in existing leases, positive rental spreads on new and renewal leases, and increases in occupancy, as well as redevelopment projects completing and operating.
• Recoveries from tenants increased by $26.3 million due to higher recoverable expenses and increased occupancy.
• Uncollectible lease income decreased by $1.1 million primarily driven by higher collection rates in the current period resulting in reduced levels of uncollectible lease income.
48
Total real estate operating expenses increased by $18.5 million, on a net basis, as follows:
• Operating and maintenance increased by $12.6 million primarily due to increases in common area maintenance, management fees, utility costs and other tenant-recoverable costs.
• Real estate taxes increased by $6.0 million primary due to an increase in real estate assessments across the portfolio.
Reconciliation of Pro-rata Same Property NOI to Net Income Attributable to Common Shareholders:
Year ended December 31,
(in thousands)
2025
2024
Net income attributable to common shareholders
$
513,810
386,738
Less:
Management, transaction, and other fees
28,358
27,874
Other (1)
53,842
49,944
Plus:
Depreciation and amortization
405,044
394,714
General and administrative
99,407
101,465
Other operating expense
8,849
10,867
Other expense, net
175,613
154,260
Equity in income of investments in real estate excluded from NOI (2)
(24,223
)
54,040
Net income attributable to noncontrolling interests
13,491
9,452
Preferred stock dividends
13,650
13,650
NOI
1,123,441
1,047,368
Less non-same property NOI (3)
(23,633
)
(2,678
)
Pro-rata same property NOI
$
1,099,808
1,044,690
Less: Termination fees
(6,948
)
(6,472
)
Pro-rata same property NOI excluding termination fees.
$
1,092,860
1,038,218
(1) Includes straight-line rental income and expense, net of reserves, above and below market rent amortization, other fees, and noncontrolling interests.
(2) Includes non-NOI income earned and expenses incurred at our unconsolidated real estate partnerships, including those separated out above for our consolidated properties.
(3) Includes revenues and expenses attributable to Non-Same Property, Projects in Development, corporate activities, and noncontrolling interests.
Same Property Roll-forward:
Our same property pool includes the following property count, Pro-rata GLA, and changes therein:
2025
2024
(GLA in thousands)
Property
Count
GLA
Property
Count
GLA
Beginning same property count
397
42,510
394
42,135
Acquired properties owned for entirety of comparable periods
3
220
4
441
Acquisition of UBP
70
4,858
—
—
Developments that reached completion by beginning of earliest comparable period presented
—
—
3
278
Disposed properties
(11
)
(504
)
(4
)
(415
)
SF adjustments (1)
—
165
—
71
Change in intended property use
—
270
—
—
Ending same property count
459
47,519
397
42,510
(1) SF adjustments arising from re-measurements or redevelopments.
49
Nareit FFO, Core Operating Earnings and AFFO:
Our reconciliation of net income attributable to common shareholders to Nareit FFO, to Core Operating Earnings, and to AFFO is as follows:
Year ended December 31,
(in thousands, except share information)
2025
2024
Reconciliation of Net income attributable to common shareholders to Nareit FFO
Net income attributable to common shareholders
$
513,810
386,738
Adjustments to reconcile to Nareit FFO: (1)
Depreciation and amortization (excluding FF&E)
430,684
422,581
Provision for impairment of real estate
4,606
14,304
Gain on sale of real estate, net of tax
(100,444
)
(35,069
)
EOP units
7,069
2,338
Nareit FFO attributable to common stock and unit holders
$
855,725
790,892
Reconciliation of Nareit FFO to Core Operating Earnings
Nareit FFO
$
855,725
790,892
Adjustments to reconcile to Core Operating Earnings: (1)
Not Comparable Items
Merger transition costs
—
7,718
Loss on early extinguishment of debt
—
180
Certain Non-Cash Items
Straight-line rent
(27,319
)
(22,980
)
Uncollectible straight-line rent
1,299
2,446
Above/below market rent amortization, net
(23,087
)
(23,431
)
Debt and derivative mark-to-market amortization
6,631
5,837
Core Operating Earnings
$
813,249
760,662
Reconciliation of Core Operating Earnings to AFFO:
Core Operating Earnings
$
813,249
760,662
Adjustments to reconcile to AFFO: (1)
Operating capital expenditures
(137,335
)
(138,229
)
Debt cost and derivative adjustments
9,074
8,391
Stock-based compensation
21,648
18,549
AFFO
$
706,636
649,373
(1) Includes Regency's share of unconsolidated investment partnerships, net of amounts attributable to noncontrolling interests.
Liquidity and Capital Resources
General
We use cash flows generated from operating, investing, and financing activities to strengthen our balance sheet, finance our development and redevelopment projects, fund our investment activities, and maintain financial flexibility. A significant portion of our cash flows from operations is distributed to our common shareholders in the form of dividends in order to maintain our status as a REIT.
Except for $200 million of private placement debt, our Parent Company has no capital commitments other than its guarantees of the commitments of our Operating Partnership. All remaining debt is held by our Operating Partnership, its subsidiaries, or by our real estate partnerships. The Operating Partnership is a guarantor of the $200 million of outstanding debt of our Parent Company, which we expect to pay off at maturity in 2026 using available liquidity. The Parent Company will from time to time access the capital markets for the purpose of issuing new equity, and will simultaneously contribute all of the offering proceeds to the Operating Partnership in exchange for additional partnership units.
We continually assess our available liquidity and our expected cash requirements, including monitoring our tenant rent collections. We have access to and draw on multiple financing sources to fund our operations and our long-term capital needs, including the requirements of our in process and planned developments, redevelopments, other capital expenditures, and the repayment of debt. We expect to meet these needs by using a combination of the following: cash flows from operations after funding our common stock and preferred stock dividends, borrowings from our Line, proceeds from the sale of real estate, mortgage loan and unsecured bank financing, distributions received from our real estate partnerships, and when the capital markets are favorable, proceeds from the sale of equity securities or the issuance of new unsecured debt. We continually evaluate alternative financing options, and we believe we can obtain new financing on reasonable terms, although likely at higher interest rates than that of our debt currently outstanding, due to the current interest rate environment.
50
On May 13, 2025, the Company issued $400 million of senior unsecured notes due 2032, at a par value of 99.279% and a coupon of 5.0%. The net proceeds were used (i) to reduce the outstanding balance on the Line, (ii) for the repayment of $250 million of 3.90% unsecured public debt due November 1, 2025, upon its maturity and (iii) for general corporate purposes, which may include the future repayment of other outstanding debt.
As of December 31, 2025, we had $441.8 million of loans maturing during the next 12 months, including Regency's share of maturities within our unconsolidated real estate partnerships, which we intend to refinance or pay off as they mature. We actively monitor the capital markets and maintain flexibility to access them opportunistically, while proactively managing our debt maturity profile to support a strong balance sheet. We currently expect to address these maturing obligations through a combination of cash flows from operations, refinancing, available liquidity under our Line, and proceeds from potential property sales. Of this amount, $88 million was repaid upon maturity on February 2, 2026.
Based upon our available cash balance, sources of capital, our current credit ratings, and the number of high quality, unencumbered properties we own, we believe our available capital resources are sufficient to meet our expected capital needs for the next year, although, in the longer term, we can provide no assurances.
In addition to our $104.7 million of unrestricted cash, we have the following additional sources of capital available:
(in thousands)
December 31, 2025
ATM program (see note 11 to our Consolidated Financial Statements)
Original offering amount
$
500,000
Available capacity
$
400,000
Line of Credit (see note 8 to our Consolidated Financial Statements)
Total commitment amount
$
1,500,000
Available capacity (1)
$
1,367,940
Maturity (2)
March 23, 2028
(1) Net of letters of credit issued against our Line.
(2) The Company has the option to extend the maturity for two additional six-month periods.
The declaration of dividends is determined quarterly by, and in the discretion of, our Board of Directors.
Subsequent to December 31, 2025, our Board of Directors declared the following dividends:
Dividend Declared, per share
Declaration Date
Record Date
Payable Date
Common Stock
$
0.755000
February 4, 2026
March 11, 2026
April 1, 2026
Series A Preferred Stock
$
0.390625
February 4, 2026
April 15, 2026
April 30, 2026
Series B Preferred Stock
$
0.367200
February 4, 2026
April 15, 2026
April 30, 2026
While future dividends on shares of our common stock will be determined at the discretion of our Board of Directors, we plan to continue paying an aggregate amount of distributions to our stock and unit holders that, at a minimum, meet the requirements to continue qualifying as a REIT for federal income tax purposes.
We have historically generated sufficient cash flow from operations to fund our dividend distributions. During the years ended December 31, 2025 and 2024, we generated cash flows from operating activities of $827.7 million and $790.2 million, respectively, and paid $530.2 million and $507.0 million in dividends to our common and preferred stock and unit holders, in the same respective periods.
We currently have development and redevelopment projects in various stages of planning, design and construction, along with a pipeline of potential projects for future development or redevelopment. After funding the January 2026 dividends for our common and preferred stock and Operating Partnership units, we estimate that we will require capital during the next 12 months of approximately $910 million related to leasing commissions, tenant improvements, in-process developments and redevelopments, capital contributions to our real estate partnerships, and repaying maturing debt. These capital requirements may be impacted by increased costs of construction caused by, without limitation, tariffs and inflation affecting materials, labor, and services from third party contractors and suppliers. We continue to implement mitigation strategies including, but not limited to, entering into fixed cost construction contracts, pre-ordering materials, and other planning efforts. Further, continued challenges from permitting delays and labor and material shortages may extend the time to completion of these projects.
If we start new developments or redevelopments, commit to property acquisitions, repay debt with cash, declare future dividends, or repurchase shares of our common stock, our cash requirements will increase. If we refinance maturing debt, our cash requirements will decrease.
51
We endeavor to maintain a high percentage of unencumbered assets. As of December 31, 2025, 87.3% of our consolidated real estate assets were unencumbered. Our low level of encumbered assets allows us to more readily access the secured and unsecured debt markets and to maintain borrowing capacity on the Line.
Our Line and unsecured debt require that we remain in compliance with various customary financial covenants, which are described in Note 8 of the Consolidated Financial Statements. We were in compliance with these covenants at December 31, 2025, and expect to remain in compliance.
Summary of Cash Flow Activity
The following table summarizes net cash flows related to operating, investing, and financing activities of the Company:
(in thousands)
2025
2024
Change
Net cash provided by operating activities
$
827,692
790,198
37,494
Net cash used in investing activities
(421,140
)
(326,644
)
(94,496
)
Net cash used in financing activities
(347,775
)
(493,024
)
145,249
Net change in cash, cash equivalents and restricted cash
58,777
(29,470
)
88,247
Total cash, cash equivalents, and restricted cash
$
120,661
61,884
58,777
Net cash provided by operating activities:
Net cash provided by operating activities increased by $37.5 million due to:
• $42.2 million increase in cash from operations due to the timing of receipts and payments, partially offset by
• $4.7 million decrease in operating cash flow distributions from Investments in real estate partnerships.
Net cash used in investing activities:
Net cash used in investing activities increased by $94.5 million as follows:
(in thousands)
2025
2024
Change
Cash flows from investing activities:
Acquisition of operating real estate, net of cash acquired of $4,273 in 2025
$
(104,153
)
(45,405
)
(58,748
)
Real estate development and capital improvements
(435,112
)
(343,368
)
(91,744
)
Proceeds from sale of real estate
124,992
108,615
16,377
Proceeds from property insurance casualty claims
—
5,286
(5,286
)
Issuance of notes receivable
(838
)
(32,651
)
31,813
Collection of notes receivable
687
3,115
(2,428
)
Investments in real estate partnerships
(44,323
)
(41,345
)
(2,978
)
Return of capital from investments in real estate partnerships
32,549
13,034
19,515
Dividends on investment securities
1,389
453
936
Purchase of investment securities
(103,312
)
(101,044
)
(2,268
)
Proceeds from sale of investment securities
106,981
106,666
315
Net cash used in investing activities
$
(421,140
)
(326,644
)
(94,496
)
Significant changes in investing activities include:
• We paid $104.2 million in 2025 to purchase nine operating properties. In 2024, we paid $45.4 million to purchase one operating property.
• During 2025, we invested $91.7 million more on real estate development and capital improvements than the comparable prior year period, as further detailed in a table below.
• We sold seven operating properties and three land parcels in 2025 for proceeds of $125.0 million compared to six operating properties in 2024 for proceeds of $108.6 million.
• We received property insurance claim proceeds of $5.3 million in 2024 primarily attributable to a single property that was impacted by a weather event in 2019.
• During 2024, in connection with a secured lending transaction entered into by the Company, we issued a note receivable in the amount of $29.8 million at an interest rate of 6.8% maturing in January 2027, secured by a grocery-anchored shopping center. In addition, we issued $2.9 million of short-term notes receivable to real estate partners in 2024.
• We collected $0.7 million in short-term note receivables from real estate partners in 2025, compared to $3.1 million in 2024.
• Investments in real estate partnerships:
52
o In 2025, we invested $44.3 million, including $32.6 million to fund our share of debt repayments, $3.2 million to fund our share of an acquisition of an operating property, and $8.6 million to fund our share of development and redevelopment activities.
o In 2024, we invested $41.3 million, to fund our share of acquiring one operating property within an existing real estate partnership, and for our share of development and redevelopment activities, including investing in two new ground-up development projects.
• Return of capital from our unconsolidated investments in real estate partnerships includes sales or financing proceeds:
o During 2025, we received $32.5 million, from our share of proceeds from outparcel sales and debt financing activities.
o During 2024, we received $13.0 million, from our share of proceeds from debt financing activities and for the partial sale of an ownership interest in a real estate partnership.
• Purchase of investment securities and proceeds from sale of investment securities pertain to investment activities held in our captive insurance company and our deferred compensation plan, as well as:
o During 2025, we invested approximately $90 million in commercial time deposits with proceeds received from the 2025 Notes. These commercial deposits were subsequently settled at maturity during the third and fourth quarters of 2025.
o During 2024, we invested approximately $90 million in commercial deposits with proceeds received from the sale of the January 2024 public offering of senior unsecured notes. These commercial deposits were subsequently settled at maturity during the second quarter of 2024.
We plan to continue developing and redeveloping shopping centers for long-term investment. During 2025, we deployed capital of $435.1 million for the development, redevelopment, and capital improvement of our real estate properties, comprised of the following:
(in thousands)
2025
2024
Change
Capital expenditures:
Land acquisitions - Development
$
19,136
16,885
2,251
Land acquisitions - Redevelopment
3,607
—
3,607
Building and tenant improvements
120,686
113,550
7,136
Redevelopment costs
122,565
129,553
(6,988
)
Development costs
134,838
61,902
72,936
Capitalized interest
10,122
6,487
3,635
Capitalized direct compensation
24,158
14,991
9,167
Real estate development and capital improvements
$
435,112
343,368
91,744
• We acquired four land parcels for development and one for redevelopment in 2025, compared to three land parcels for development and two income-producing outparcels in 2024.
• Building and tenant improvements increased $7.1 million in 2025, primarily related to the timing and volume of capital projects.
• Redevelopment costs are $7.0 million lower than the prior year. We intend to continuously improve our portfolio of shopping centers through redevelopment which can include adjacent land acquisition, existing building expansions, facade renovations, new out-parcel building construction, and redevelopments related to tenant improvement costs. The size and magnitude of each redevelopment project varies with each redevelopment plan. The timing and duration of these projects could also result in volatility in NOI. See the tables below for more details about our redevelopment projects.
• Development costs are higher in 2025 due to the progress towards completion of our development projects in process. See the tables below for more details about our development projects.
• Interest is capitalized on our development and redevelopment projects and is based on cumulative actual costs incurred. We cease interest capitalization when the property is no longer being developed or is available for occupancy upon substantial completion of tenant improvements, but in no event would we capitalize interest on the project beyond 12 months after the anchor tenant opens for business. If we reduce our development and redevelopment activity, the amount of interest that we capitalize may be lower than historical averages.
• We have a dedicated staff of employees who directly support our development program, which includes redevelopment of our existing properties. Internal compensation costs directly attributable to these activities are capitalized as part of each project.
53
The following table summarizes our development projects in-process and completed:
(in thousands, except cost PSF)
December 31, 2025
Property Name
Market
Ownership (1)
Start Date
Estimated Stabilization Year (2)
Estimated / Actual Net
Development
Costs (1) (3)
% of
Costs
Incurred
GLA (1)
Cost PSF
of GLA (1) (3)
Developments In-Process
Sienna Grande Shops
Houston, TX
75%
Q2-2023
2027
$
9,391
92
%
23
408
The Shops at SunVet
Long Island, NY
100%
Q2-2023
2027
95,233
89
%
170
560
Oakley Shops at Laurel Fields
Bay Area, CA
100%
Q3-2024
2026
35,814
88
%
78
459
The Village at Seven Pines
Jacksonville, FL
100%
Q3-2025
2028
112,302
16
%
239
470
Ellis Village Center (South)
Bay Area, CA
100%
Q3-2025
2028
29,660
16
%
49
605
Culver Commons
Los Angeles, CA
100%
Q4-2025
2028
15,852
6
%
13
1,219
Lone Tree Village
Denver, CO
100%
Q4-2025
2028
30,658
17
%
158
194
Oak Valley Village
Los Angeles, CA
75%
Q4-2025
2028
43,534
3
%
173
252
Total Developments In-Process
$
372,444
41
%
903
$
412
Developments Completed
Baybrook East - Phase 1B (4)
Houston, TX
50%
Q2-2022
2026
$
9,500
98
%
83
114
The Shops at Stone Bridge
Cheshire, CT
100%
Q1-2024
2026
67,260
90
%
162
415
Jordan Ranch Market
Houston, TX
50%
Q3-2024
2026
24,189
92
%
78
310
Total Developments Completed
$
100,949
91
%
323
$
313
(1) Estimated net development costs and GLA are reported based on the Company’s ownership interest in the real estate partnership at completion.
(2) Estimated Stabilization Year represents the estimated first full calendar year that the project will reach our expected stabilized yield.
(3) Includes leasing costs and is net of tenant reimbursements.
(4) The values are reflected at the Company's pro-rata share of 50.0%, as the project was completed prior to the Company's purchase of its partner's 50.0% ownership interest.
The following table summarizes our redevelopment projects in process and completed:
(in thousands)
December 31, 2025
Property Name
Market
Ownership (1)
Start Date
Estimated Stabilization Year (2)
Estimated Net Project Costs (1) (3)
% of Costs Incurred
Redevelopments In-Process
Bloom on Third
Los Angeles, CA
35%
Q4-2022
2027
$
24,525
73
%
Serramonte Center - Phase 3
San Francisco, CA
100%
Q2-2023
2026
36,989
48
%
West Chester Plaza
Cincinnati, OH
100%
Q4-2024
2028
15,442
34
%
Willows Shopping Center
Bay Area, CA
100%
Q4-2024
2027
16,807
40
%
The Crossing Clarendon
Metro DC
100%
Q2-2025
2027
13,679
35
%
East Meadow Plaza - Phase 1
Long Island, NY
100%
Q3-2024
2026
11,736
68
%
East Meadow Plaza - Phase 2A
Long Island, NY
100%
Q3-2025
2027
15,969
37
%
Various Redevelopments
Various
Various
Various
Various
89,834
44
%
Total Redevelopments In-Process
$
224,981
47
%
Redevelopments Completed
Circle Marina Shops & Marketplace
Los Angeles, CA
100%
Q3-2023
2025
$
15,486
99
%
Avenida Biscayne
Miami, FL
100%
Q4-2023
2025
21,780
93
%
Anastasia Plaza
Jacksonville, FL
100%
Q3-2024
2025
15,217
90
%
Cambridge Square
Atlanta, GA
100%
Q4-2023
2025
13,027
93
%
Various Properties
Various
Various
Various
Various
47,096
95
%
Total Redevelopments Completed
$
112,606
94
%
(1) Estimated net development costs are reported based on the Company's ownership interest in the real estate partnership at completion.
(2) Estimated Stabilization Year represents the estimated first full calendar year that the project will reach our expected stabilized yield.
(3) Includes leasing costs and is net of tenant reimbursements.
54
Net cash used in financing activities:
Net cash flows used in financing activities decreased by $145.2 million during 2025, as follows:
(in thousands)
2025
2024
Change
Cash flows from financing activities:
Net proceeds from common stock issuance
$
98,167
—
98,167
Tax withholding on stock-based compensation
(6,794
)
(19,540
)
12,746
Common shares repurchased through share repurchase program
—
(200,066
)
200,066
Redemption of exchangeable operating partnership units
(2,046
)
—
(2,046
)
Proceeds from sale of treasury stock
502
210
292
Contributions from noncontrolling interests
16,594
6,789
9,805
Distributions to and redemptions of noncontrolling interests
(40,994
)
(12,185
)
(28,809
)
Distributions to exchangeable operating partnership unit holders
(5,007
)
(2,952
)
(2,055
)
Dividends paid to common shareholders
(511,564
)
(490,365
)
(21,199
)
Dividends paid to preferred shareholders
(13,650
)
(13,650
)
—
Repayment of fixed rate unsecured notes
(250,000
)
(250,000
)
—
Proceeds from issuance of fixed rate unsecured notes, net of debt discount
397,116
722,860
(325,744
)
Proceeds from unsecured credit facilities
650,000
722,419
(72,419
)
Repayment of unsecured credit facilities
(595,000
)
(809,419
)
214,419
Proceeds from notes payable
10,000
12,000
(2,000
)
Repayment of notes payable
(80,130
)
(131,261
)
51,131
Scheduled principal payments
(11,144
)
(11,209
)
65
Payment of financing costs
(3,825
)
(16,655
)
12,830
Net cash used in financing activities
$
(347,775
)
(493,024
)
145,249
Significant changes in financing activities include the following:
• During 2025, we received $98.2 million in Net proceeds from common stock issuance upon settling forward sales agreements under our ATM program.
• Tax withholding on stock-based compensation totaled $6.8 million and $19.5 million during the years ended December 31, 2025 and 2024, respectively.
• During 2024, we paid $200.1 million to repurchase 3,306,709 shares of our common stock under our prior stock repurchase program.
• During 2025, we paid $2.0 million for the Redemption of exchangeable operating partnership units.
• During 2025, we received $16.6 million in Contributions from noncontrolling interests for the limited partners' share of development funding compared to $6.8 million in 2024.
• During 2025, we distributed $41.0 million to limited partners, including redemption of non-controlling interest in two real estate partnerships. During 2024, we distributed $12.2 million to limited partners, including proceeds to partially redeem a non-controlling interest in one real estate partnership.
• We paid $23.3 million more in Dividends paid to common shareholders and Distributions to exchangeable operating partnership unit holders in 2025 as a result of a higher dividend rate and an increase in the total number of shares and units outstanding.
• We had the following debt related activity during 2025:
o We repaid $250.0 million in unsecured public debt,
o We received $397.1 million in proceeds from issuing unsecured public debt,
o We received $55.0 million in net proceeds from our Line,
o We received $10.0 million in proceeds from a mortgage refinancing,
o We paid $91.3 million for debt repayments, including:
▪ $80.1 million for repaying seven mortgage loans at maturity, and
▪ $11.1 million in principal mortgage payments.
o We paid $3.8 million in loan costs relating to the unsecured public debt offering.
• We had the following debt related activity during 2024:
o We repaid $250.0 million in unsecured public debt,
o We received $722.9 million from issuing unsecured public debt
o We repaid a net $87.0 million on our Line,
55
o We received $12.0 million from a mortgage refinancing,
o We paid $142.5 million for debt repayments, including:
▪ $131.3 million for repaying three mortgage loans at maturity, and
▪ $11.2 million in principal mortgage payments.
o We paid $16.7 million in loan costs relating to the recast of the Line as well as the unsecured public debt offering.
Contractual Obligations and Other Commitments
We have material cash obligations at December 31, 2025, which are discussed in our notes to Consolidated Financial Statements and include:
• Mortgage loans, unsecured notes, and unsecured credit facilities as discussed in note 8, and related interest rate swaps as discussed in note 9;
• We have shopping centers that are subject to non-cancelable long-term ground leases where a third party owns and has leased the underlying land to us to construct and/or operate a shopping center. We also have non-cancelable operating leases pertaining to office space from which we conduct our business. These lease obligations are discussed in note 7;
• Our share of mortgage loans within our Investments in real estate partnerships, as discussed in note 4;
• Letters of credit of $12.9 million issued to cover our captive insurance program and performance obligations on certain development projects, the latter of which will be satisfied upon completion of the development projects;
• Obligations for retirement savings plans due to uncertainty around timing of participant withdrawals, which are solely within the control of the participant, and are further discussed in note 13; and
• We will also incur obligations related to construction or development contracts on projects in process, as further described in the Liquidity and Capital Resources section; however, future amounts under these construction contracts are not due until future satisfactory performance under the contracts.
Critical Accounting Estimates
Knowledge about our significant accounting policies is necessary for a complete understanding of our Consolidated Financial Statements. The preparation of our Consolidated Financial Statements requires that we make certain estimates, judgments, and assumptions that impact the balance of assets and liabilities as of the financial statement date and the reported amount of income and expenses during the financial reporting period. These accounting estimates, judgments and assumptions are based upon, but not limited to historical experience, current trends, expected future results, current market conditions, and interpretation of industry accounting standards. While the following is not intended to be a comprehensive list of our accounting estimates, the estimates discussed below are believed to be critical because of their significance to the Consolidated Financial Statements and the possibility that future events may differ from those judgments, or that the use of different assumptions could result in materially different estimates. We review these estimates on a periodic basis to ensure reasonableness; however, the amounts we may ultimately realize could differ from such estimates.
Impairment of Real Estate Investments
In accordance with GAAP, we evaluate our real estate for impairment whenever there are events or changes in circumstances, including property operating performance, general market conditions or changes in expected hold periods, that indicate that the carrying value of our real estate properties (including any related amortizable intangible assets or liabilities) may not be recoverable. If such events or changes occur, we compare the current carrying value of the asset to the estimated undiscounted cash flows that are directly associated with the use and ultimate disposition of the asset. Our estimated cash flows are based on several key assumptions, including rental rates, expected leasing activity, costs of tenant improvements, leasing commissions, expected hold period, comparable sales information, and assumptions regarding the residual value upon disposition, including the exit capitalization rate. These key assumptions are subjective in nature and the resulting impairment, if any, could differ from the actual gain or loss recognized upon ultimate sale in an arm's length transaction. If the carrying value of the asset exceeds the estimated undiscounted cash flows, an impairment loss is recognized equal to the excess of carrying value over the estimated fair value.
The estimated fair value of real estate assets is subjective and is estimated through comparable sales information and other market data if available, as well as the use of an income approach such as the direct capitalization method or the discounted cash flow approach. The discounted cash flow method uses similar assumptions to the undiscounted cash flow method above, as well as a discount rate. Such cash flow projections and rates are subject to management judgment and changes in those assumptions could impact the estimation of fair value. In estimating the fair value of undeveloped land, we generally use market data and comparable sales information. Changes in events or changes in circumstances may alter the expected hold period of an asset or asset group, which may result in an impairment loss and such loss could be material to the Company's financial condition or operating performance.
56
Recent Accounting Pronouncements
See note 1 to Consolidated Financial Statements.
Item 7A. Quantitative and Qualita tive Disclosures about Market Risk
We are exposed to two significant components of interest rate risk:
• Under the Line, as further described in note 8 to the Consolidated Financial Statements, we have a variable interest rate that, as of December 31, 2025, was based upon an annual rate of Secured Overnight Financing Rate ("SOFR") plus a 0.10% market adjustment ("Adjusted SOFR") plus an applicable margin of 0.685%. SOFR rates charged on our Line change daily, and the applicable margin on the Line is dependent upon maintaining specific credit ratings or leverage targets, as well as meeting specific sustainability target thresholds. If our credit ratings were downgraded or if we fail to meet the leverage targets or sustainability target thresholds, the applicable margin on the Line would increase, resulting in higher interest costs. As of December 31, 2025 the Adjusted SOFR plus the applicable margin of 0.685% was 4.445%.
• We are also exposed to changes in interest rates when we refinance our existing long-term fixed rate debt. The objective of our interest rate risk management program is to limit the impact of interest rate changes on earnings and cash flows. To achieve these objectives, we borrow primarily at fixed interest rates and may also enter into derivative financial instruments such as interest rate swaps, caps, or treasury locks in order to mitigate our interest rate risk on a related financial instrument. We do not enter into derivative or interest rate transactions for speculative purposes. Our interest rate swaps are structured solely for the purpose of interest rate protection.
We continuously monitor capital market conditions and assess our ability to favorably refinance maturing debt and to fund our commitments. Based on our current credit ratings, the available capacity under our unsecured credit facility, and the number of unencumbered high quality properties we own that could serve as collateral, we believe we will be able to issue new secured or unsecured debt to finance maturing debt obligations; however, the extent to which capital market volatility and changes in interest rates may adversely affect the cost or availability of such financing remains uncertain.
The table below presents the principal cash flows, weighted average interest rates of remaining debt, and the fair value of total debt as of December 31, 2025. For variable rate mortgages and unsecured credit facilities for which we have interest rate swaps in place to fix the interest rate, they are included in the Fixed rate debt section below at their all-in fixed rate. The table is presented by year of expected maturity to evaluate the expected cash flows and sensitivity to interest rate changes. Although the average interest rate for variable rate debt is included in the table, those rates represent rates that existed as of December 31, 2025, and are subject to change. In addition, we continually assess the market risk for floating rate debt and believe that an increase of 100 basis points in interest rates would decrease future earnings and cash flows by approximately $1.2 million per year based on $120.0 million floating rate line of credit balance outstanding at December 31, 2025.
Further, the table below incorporates only those exposures that exist as of December 31, 2025, and does not consider exposures or positions that could arise after that date or obligations repaid before maturity. Since firm but unused commitments are not presented, the table has limited predictive value. As a result, our ultimate realized gain or loss with respect to interest rate fluctuations will depend on the exposures that arise during the period, our hedging strategies at that time, and actual interest rates.
The table below presents the principal cash flow payments associated with our outstanding debt by year, weighted average interest rates on debt outstanding at each year-end, and fair value of total debt as of December 31, 2025:
(dollars in thousands)
2026
2027
2028
2029
2030
Thereafter
Total
Fair Value
Fixed rate debt (1)
$
360,684
757,610
360,305
527,739
607,608
2,064,885
4,678,831
4,554,628
Average interest rate for all fixed rate debt (2)
4.21
%
4.33
%
4.32
%
4.54
%
4.79
%
4.81
%
Variable rate SOFR debt (1)
$
—
—
120,000
—
—
—
120,000
120,000
Average interest rate for all variable rate debt (2)
4.45
%
4.45
%
4.45
%
—
%
—
%
—
%
(1) Reflects amount of debt maturities during each of the years presented as of December 31, 2025.
(2) Reflects weighted average interest rates of debt outstanding at the end of each year presented. For variable rate debt, the rate as of December 31, 2025, was used to determine the average interest rate for all future periods.
57
Item 8. Financial Statements and Supplementary Data
Regency Centers Corporation and Regency Centers, L.P.
Index to Financial Statements
Reports of Independent Registered Public Accounting Firm (PCAOB ID No. 185)
59
Regency Centers Corporation:
Consolidated Balance Sheets as of December 31, 2025 and 2024
65
Consolidated Statements of Operations for the years ended December 31, 2025, 2024, and 2023
66
Consolidated Statements of Comprehensive Income for the years ended December 31, 2025, 2024, and 2023
67
Consolidated Statements of Equity for the years ended December 31, 2025, 2024, and 2023
68
Consolidated Statements of Cash Flows for the years ended December 31, 2025, 2024, and 2023
71
Regency Centers, L.P.:
Consolidated Balance Sheets as of December 31, 2025 and 2024
73
Consolidated Statements of Operations for the years ended December 31, 2025, 2024, and 2023
74
Consolidated Statements of Comprehensive Income for the years ended December 31, 2025, 2024, and 2023
75
Consolidated Statements of Capital for the years ended December 31, 2025, 2024, and 2023
76
Consolidated Statements of Cash Flows for the years ended December 31, 2025, 2024, and 2023
78
Notes to Consolidated Financial Statements
80
Financial Statement Schedule
Schedule III - Consolidated Real Estate and Accumulated Depreciation - December 31, 2025
0
All other schedules are omitted because of the absence of conditions under which they are required, materiality or because information required therein is shown in the Consolidated Financial Statements or notes thereto.
58
Rep ort of Independent Regist ered Public Accounting Firm
To the Shareholders and the Board of Directors of
Regency Centers Corporation:
Opinion on the Consolidated Financial Statements
We have audited the accompanying consolidated balance sheets of Regency Centers Corporation and subsidiaries (the Company) as of December 31, 2025 and 2024, the related consolidated statements of operations, comprehensive income, equity, and cash flows for each of the years in the three-year period ended December 31, 2025, and the related notes and financial statement schedule III - Consolidated Real Estate and Accumulated Depreciation (collectively, the consolidated financial statements). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2025 and 2024, and the results of its operations and its cash flows for each of the years in the three-year period ended December 31, 2025, in conformity with U.S. generally accepted accounting principles.
We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company’s internal control over financial reporting as of December 31, 2025, based on criteria established in Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission, and our report dated February 13, 2026 expressed an unqualified opinion on the effectiveness of the Company’s internal control over financial reporting.
Basis for Opinion
These consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these consolidated financial statements based on our audits. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud. Our audits included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. We believe that our audits provide a reasonable basis for our opinion.
Critical Audit Matter
The critical audit matter communicated below is a matter arising from the current period audit of the consolidated financial statements that was communicated or required to be communicated to the audit committee and that: (1) relates to accounts or disclosures that are material to the consolidated financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of a critical audit matter does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.
Evaluation of expected hold periods for certain real estate assets
As discussed in Note 1 to the consolidated financial statements and presented on the consolidated balance sheet, real estate assets, less accumulated depreciation was $11.3 billion as of December 31, 2025. The Company evaluates real estate properties (including any related amortizable intangible assets or liabilities) for impairment whenever there are events or changes in circumstances that indicate the carrying value of the real estate properties may not be recoverable.
We identified the Company’s assessment of events or changes in circumstances that could indicate a shortened expected hold period for certain real estate properties as a critical audit matter. Subjective auditor judgment was required to evaluate the events or changes in circumstances assessed by the Company that could indicate shortened expected hold periods for certain real estate properties. A shortening of the expected hold period could indicate a potential impairment.
The following are the primary procedures we performed to address this critical audit matter. We evaluated the design and tested the operating effectiveness of a control related to the Company’s assessment of events or changes in circumstances that
59
could indicate shortened expected hold periods for certain real estate properties. To evaluate relevant events or changes in circumstances indicating a potential shortening of the expected holding period, we:
• inquired of management and obtained written representations regarding potential property disposal plans, if any
• read minutes of the meetings of the Company’s board of directors
• inquired of the Company’s plans with those in the organization who are responsible for, and have authority over, potential disposition activities
• compared management’s assessment of properties with potential shortened expected hold periods to information obtained from those in the organization responsible for disposition activity
• inspected listings from external sources of real estate properties for sale by the Company.
/s/ KPMG LLP
We have served as the Company's auditor since 1993.
Jacksonville, Florida
February 13, 2026
60
Report of Independent Registered Public Accounting Firm
To the Shareholders and the Board of Directors of
Regency Centers Corporation:
Opinion on Internal Control Over Financial Reporting
We have audited Regency Centers Corporation and subsidiaries' (the Company) internal control over financial reporting as of December 31, 2025, based on criteria established in Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission. In our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, 2025, based on criteria established in Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission.
We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated balance sheets of the Company as of December 31, 2025 and 2024, the related consolidated statements of operations, comprehensive income, equity, and cash flows for each of the years in the three-year period ended December 31, 2025, and the related notes and financial statement schedule III - Consolidated Real Estate and Accumulated Depreciation (collectively, the consolidated financial statements), and our report dated February 13, 2026 expressed an unqualified opinion on those consolidated financial statements.
Basis for Opinion
The Company’s management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying Management's Report on Internal Control Over Financial Reporting. Our responsibility is to express an opinion on the Company’s internal control over financial reporting based on our audit. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects. Our audit of internal control over financial reporting included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. Our audit also included performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion.
Definition and Limitations of Internal Control Over Financial Reporting
A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.
Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
/s/ KPMG LLP
Jacksonville, Florida
February 13, 2026
61
Report of Independent Registered Public Accounting Firm
To the Board of Directors of Regency Centers Corporation
and the Partners of Regency Centers, L.P.:
Opinion on the Consolidated Financial Statements
We have audited the accompanying consolidated balance sheets of Regency Centers, L.P. and subsidiaries (the Partnership) as of December 31, 2025 and 2024, the related consolidated statements of operations, comprehensive income, capital, and cash flows for each of the years in the three-year period ended December 31, 2025, and the related notes and financial statement schedule III - Consolidated Real Estate and Accumulated Depreciation (collectively, the consolidated financial statements). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Partnership as of December 31, 2025 and 2024, and the results of its operations and its cash flows for each of the years in the three-year period ended December 31, 2025, in conformity with U.S. generally accepted accounting principles.
We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Partnership’s internal control over financial reporting as of December 31, 2025, based on criteria established in Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission, and our report dated February 13, 2026 expressed an unqualified opinion on the effectiveness of the Partnership’s internal control over financial reporting.
Basis for Opinion
These consolidated financial statements are the responsibility of the Partnership’s management. Our responsibility is to express an opinion on these consolidated financial statements based on our audits. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Partnership in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud. Our audits included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. We believe that our audits provide a reasonable basis for our opinion.
Critical Audit Matter
The critical audit matter communicated below is a matter arising from the current period audit of the consolidated financial statements that was communicated or required to be communicated to the audit committee and that: (1) relates to accounts or disclosures that are material to the consolidated financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of a critical audit matter does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.
Evaluation of expected hold periods for certain real estate assets
As discussed in Note 1 to the consolidated financial statements and presented on the consolidated balance sheet, real estate assets, less accumulated depreciation was $11.3 billion as of December 31, 2025. The Partnership evaluates real estate properties (including any related amortizable intangible assets or liabilities) for impairment whenever there are events or changes in circumstances that indicate the carrying value of the real estate properties may not be recoverable.
We identified the Partnership’s assessment of events or changes in circumstances that could indicate a shortened expected hold period for certain real estate properties as a critical audit matter. Subjective auditor judgment was required to evaluate the events or changes in circumstances assessed by the Partnership that could indicate shortened expected hold periods for certain real estate properties. A shortening of the expected hold period could indicate a potential impairment.
62
The following are the primary procedures we performed to address this critical audit matter. We evaluated the design and tested the operating effectiveness of a control related to the Partnership’s assessment of events or changes in circumstances that could indicate shortened expected hold periods for certain real estate properties. To evaluate relevant events or changes in circumstances indicating a potential shortening of the expected holding period, we:
• inquired of management and obtained written representations regarding potential property disposal plans, if any
• read minutes of the meetings of the general partner’s board of directors
• inquired of the Partnership’s plans with those in the organization who are responsible for, and have authority over, potential disposition activities
• compared management’s assessment of properties with potential shortened expected hold periods to information obtained from those in the organization responsible for disposition activity
• inspected listings from external sources of real estate properties for sale by the Partnership.
/s/ KPMG LLP
We have served as the Partnership's auditor since 1998.
Jacksonville, Florida
February 13, 2026
63
Report of Independent Registered Public Accounting Firm
To the Board of Directors of Regency Centers Corporation
and the Partners of Regency Centers, L.P.:
Opinion on Internal Control Over Financial Reporting
We have audited Regency Centers, L.P. and subsidiaries' (the Partnership) internal control over financial reporting as of December 31, 2025, based on criteria established in Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission. In our opinion, the Partnership maintained, in all material respects, effective internal control over financial reporting as of December 31, 2025, based on criteria established in Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission.
We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated balance sheets of the Partnership as of December 31, 2025 and 2024, the related consolidated statements of operations, comprehensive income, capital, and cash flows for each of the years in the three-year period ended December 31, 2025, and the related notes and financial statement schedule III - Consolidated Real Estate and Accumulated Depreciation (collectively, the consolidated financial statements), and our report dated February 13, 2026 expressed an unqualified opinion on those consolidated financial statements.
Basis for Opinion
The Partnership’s management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying Management's Report on Internal Control Over Financial Reporting. Our responsibility is to express an opinion on the Partnership’s internal control over financial reporting based on our audit. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Partnership in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects. Our audit of internal control over financial reporting included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. Our audit also included performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion.
Definition and Limitations of Internal Control Over Financial Reporting
A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.
Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
/s/ KPMG LLP
Jacksonville, Florida
February 13, 2026
64
RE GENCY CENTERS CORPORATION
Consolidated Balance Sheets
December 31, 2025 and 2024
(in thousands, except share data)
2025
2024
Assets
Net real estate investments:
Real estate assets, at cost
$
14,561,924
13,698,419
Less: accumulated depreciation
3,267,728
2,960,399
Real estate assets, net
11,294,196
10,738,020
Investments in sales-type leases, net
16,727
16,291
Investments in real estate partnerships
349,856
399,044
Net real estate investments
11,660,779
11,153,355
Cash, cash equivalents, and restricted cash, including $ 16,004 and $ 5,601 of restricted cash at December 31, 2025 and 2024, respectively
120,661
61,884
Tenant and other receivables, net
273,862
255,495
Deferred leasing costs, less accumulated amortization of $ 138,391 and $ 131,080 at December 31, 2025 and 2024, respectively
97,253
79,911
Acquired lease intangible assets, less accumulated amortization of $ 421,433 and $ 395,209 at December 31, 2025 and 2024, respectively
254,201
229,983
Right of use assets, net
315,804
322,287
Other assets
278,723
289,046
Total assets
$
13,001,283
12,391,961
Liabilities and Equity
Liabilities:
Notes payable, net
$
4,619,301
4,343,700
Unsecured credit facility
120,000
65,000
Accounts payable and other liabilities
391,847
392,302
Acquired lease intangible liabilities, less accumulated amortization of $ 243,040 and $ 222,052 at December 31, 2025 and 2024, respectively
356,454
364,608
Lease liabilities
242,368
244,861
Tenants' security, escrow deposits and prepaid rent
89,707
81,183
Total liabilities
5,819,677
5,491,654
Commitments and contingencies
—
—
Equity:
Shareholders' equity:
Preferred stock $ 0.01 par value per share, 30,000,000 shares authorized; 9,000,000 shares issued and outstanding, in the aggregate, in Series A and Series B at December 31, 2025 and 2024
225,000
225,000
Common stock $ 0.01 par value per share, 220,000,000 shares authorized; 182,902,234 and 181,361,454 shares issued and outstanding at December 31, 2025 and 2024, respectively
1,829
1,814
Treasury stock at cost, 494,307 and 479,251 shares held at December 31, 2025 and 2024, respectively
( 31,075
)
( 28,045
)
Additional paid-in-capital
8,704,138
8,503,227
Accumulated other comprehensive (loss) income
( 4,220
)
2,226
Distributions in excess of net income
( 1,988,782
)
( 1,980,076
)
Total shareholders' equity
6,906,890
6,724,146
Noncontrolling interests:
Exchangeable operating partnership units, aggregate redemption value of $ 264,950 and $ 81,076 at December 31, 2025 and 2024, respectively
144,940
40,744
Limited partners' interests in consolidated partnerships
129,776
135,417
Total noncontrolling interests
274,716
176,161
Total equity
7,181,606
6,900,307
Total liabilities and equity
$
13,001,283
12,391,961
The accompanying notes are an integral part of the consolidated financial statements.
65
RE GENCY CENTERS CORPORATION
Consolidated Statements of Operations
For the years ended December 31, 2025, 2024, and 2023
(in thousands, except per share data)
2025
2024
2023
Revenues:
Lease income
$
1,511,425
1,411,379
1,283,939
Other property income
13,741
14,651
11,573
Management, transaction, and other fees
28,358
27,874
26,954
Total revenues
1,553,524
1,453,904
1,322,466
Operating expenses:
Depreciation and amortization
405,044
394,714
352,282
Property operating expense
264,877
248,637
229,209
Real estate taxes
192,282
184,415
165,560
General and administrative
99,407
101,465
97,806
Other operating expenses
8,849
10,867
9,459
Total operating expenses
970,459
940,098
854,316
Other expense, net:
Interest expense, net
199,548
180,119
154,249
Provision for impairment of real estate
4,606
14,304
—
Gain on sale of real estate, net of tax
( 24,464
)
( 34,162
)
( 661
)
Loss (gain) on early extinguishment of debt
—
180
( 99
)
Net investment income
( 4,077
)
( 6,181
)
( 5,665
)
Total other expense, net
175,613
154,260
147,824
Income before equity in income of investments in real estate partnerships
407,452
359,546
320,326
Equity in income of investments in real estate partnerships
133,499
50,294
50,541
Net income
540,951
409,840
370,867
Noncontrolling interests:
Exchangeable operating partnership units ("EOP")
( 7,069
)
( 2,338
)
( 2,008
)
Limited partners' interests in consolidated partnerships
( 6,422
)
( 7,114
)
( 4,302
)
Net income attributable to noncontrolling interests
( 13,491
)
( 9,452
)
( 6,310
)
Net income attributable to the Company
527,460
400,388
364,557
Preferred stock dividends
( 13,650
)
( 13,650
)
( 5,057
)
Net income attributable to common shareholders
$
513,810
386,738
359,500
Net income attributable to common shareholders:
Per common share - basic
$
2.82
2.12
2.04
Per common share - diluted
$
2.82
2.11
2.04
The accompanying notes are an integral part of the consolidated financial statements.
66
REG ENCY CENTERS CORPORATION
Consolidated Statements of Comprehensive Income
For the years ended December 31, 2025, 2024, and 2023
(in thousands)
2025
2024
2023
Net income
$
540,951
409,840
370,867
Other comprehensive (loss) income:
Effective portion of change in fair value of derivative instruments:
Effective portion of change in fair value of derivative instruments
( 2,659
)
12,523
( 2,448
)
Reclassification adjustment of derivative instruments included in net income
( 4,738
)
( 8,895
)
( 7,536
)
Unrealized gain (loss) on available-for-sale debt securities
436
( 32
)
337
Other comprehensive (loss) income
( 6,961
)
3,596
( 9,647
)
Comprehensive income
533,990
413,436
361,220
Less: comprehensive income attributable to noncontrolling interests:
Net income attributable to noncontrolling interests
13,491
9,452
6,310
Other comprehensive (loss) income attributable to noncontrolling interests
( 515
)
62
( 779
)
Comprehensive income attributable to noncontrolling interests
12,976
9,514
5,531
Comprehensive income attributable to the Company
$
521,014
403,922
355,689
The accompanying notes are an integral part of the consolidated financial statements.
67
REG ENCY CENTERS CORPORATION
Consolidated Statements of Equity
For the years ended December 31, 2025, 2024, and 2023
(in thousands, except per share data)
Shareholders' Equity
Noncontrolling Interests
Preferred
Stock
Common
Stock
Treasury
Stock
Additional
Paid In
Capital
Accumulated
Other
Comprehensive
Loss
Distributions
in Excess of
Net Income
Total
Shareholders'
Equity
Exchangeable
Operating
Partnership
Units
Limited
Partners'
Interest in
Consolidated
Partnerships
Total
Noncontrolling
Interests
Total
Equity
Balance at December 31, 2022
$
—
1,711
( 24,461
)
7,877,152
7,560
( 1,764,977
)
6,096,985
34,489
46,565
81,054
6,178,039
Net income
—
—
—
—
—
364,557
364,557
2,008
4,302
6,310
370,867
Other comprehensive loss
Other comprehensive loss before reclassification
—
—
—
—
( 2,063
)
—
( 2,063
)
( 9
)
( 39
)
( 48
)
( 2,111
)
Amounts reclassified from accumulated other comprehensive loss
—
—
—
—
( 6,805
)
—
( 6,805
)
( 39
)
( 692
)
( 731
)
( 7,536
)
Adjustment for noncontrolling interests
—
—
—
13,518
—
—
13,518
( 13,518
)
—
( 13,518
)
—
Deferred compensation plan, net
—
—
( 1,027
)
1,027
—
—
—
—
—
—
—
Amortization of equity awards
—
2
—
20,439
—
—
20,441
—
—
—
20,441
Tax withholding on stock-based compensation
—
—
—
( 7,074
)
—
—
( 7,074
)
—
—
—
( 7,074
)
Common stock repurchased and retired
—
( 3
)
—
( 20,003
)
—
—
( 20,006
)
—
—
—
( 20,006
)
Repurchase of EOP units
—
—
—
—
—
—
—
( 9,163
)
—
( 9,163
)
( 9,163
)
Common stock issued under dividend reinvestment plan
—
—
—
622
—
—
622
—
—
—
622
Common stock issued for exchangeable units exchanged
—
—
—
198
—
—
198
( 198
)
—
( 198
)
—
Common stock issued, net of issuance costs
—
136
—
818,361
—
—
818,497
—
—
—
818,497
Issuance of EOP units
—
—
—
—
—
—
—
31,253
—
31,253
31,253
Issuance of preferred stock
225,000
—
—
—
—
—
225,000
—
—
—
225,000
Contributions from partners
—
—
—
—
—
—
—
—
74,730
74,730
74,730
Distributions to partners
—
—
—
—
—
—
—
—
( 7,813
)
( 7,813
)
( 7,813
)
Dividends declared:
Preferred stock stock/unit (Series A: $ 0.781250 per share/unit; Series B: $ 0.734400 per share/unit)
—
—
—
—
—
( 5,057
)
( 5,057
)
—
—
—
( 5,057
)
Common stock/unit ($ 2.620 per share/unit)
—
—
—
—
—
( 466,126
)
( 466,126
)
( 2,628
)
—
( 2,628
)
( 468,754
)
Balance at December 31, 2023
$
225,000
1,846
( 25,488
)
8,704,240
( 1,308
)
( 1,871,603
)
7,032,687
42,195
117,053
159,248
7,191,935
68
Shareholders' Equity
Noncontrolling Interests
Preferred
Stock
Common
Stock
Treasury
Stock
Additional
Paid In
Capital
Accumulated
Other
Comprehensive
Income (Loss)
Distributions
in Excess of
Net Income
Total
Shareholders'
Equity
Exchangeable
Operating
Partnership
Units
Limited
Partners'
Interest in
Consolidated
Partnerships
Total
Noncontrolling
Interests
Total
Equity
Balance at December 31, 2023
$
225,000
1,846
( 25,488
)
8,704,240
( 1,308
)
( 1,871,603
)
7,032,687
42,195
117,053
159,248
7,191,935
Net income
—
—
—
—
—
400,388
400,388
2,338
7,114
9,452
409,840
Other comprehensive income
Other comprehensive income before reclassification
—
—
—
—
11,845
—
11,845
70
576
646
12,491
Amounts reclassified from accumulated other comprehensive income
—
—
—
—
( 8,311
)
—
( 8,311
)
( 50
)
( 534
)
( 584
)
( 8,895
)
Adjustment for noncontrolling interests
—
—
—
( 10,833
)
—
—
( 10,833
)
2,119
8,714
10,833
—
Deferred compensation plan, net
—
—
( 2,557
)
2,557
—
—
—
—
—
—
—
Amortization of equity awards
—
1
—
24,916
—
—
24,917
—
—
—
24,917
Tax withholding on stock-based compensation
—
—
—
( 19,012
)
—
—
( 19,012
)
—
—
—
( 19,012
)
Common stock repurchased and retired
—
( 33
)
—
( 200,033
)
—
—
( 200,066
)
—
—
—
( 200,066
)
Common stock issued under dividend reinvestment plan
—
—
—
657
—
—
657
—
—
—
657
Common stock issued for exchangeable units exchanged
—
—
—
735
—
—
735
( 735
)
—
( 735
)
—
Contributions from partners
—
—
—
—
—
—
—
—
14,679
14,679
14,679
Distributions to partners
—
—
—
—
—
—
—
—
( 12,185
)
( 12,185
)
( 12,185
)
Dividends declared:
Preferred stock stock/unit (Series A: $ 1.562500 per share/unit; Series B: $ 1.468800 per share/unit)
—
—
—
—
—
( 13,650
)
( 13,650
)
—
—
—
( 13,650
)
Common stock/unit ($ 2.715 per share/unit)
—
—
—
—
—
( 495,211
)
( 495,211
)
( 5,193
)
—
( 5,193
)
( 500,404
)
Balance at December 31, 2024
$
225,000
1,814
( 28,045
)
8,503,227
2,226
( 1,980,076
)
6,724,146
40,744
135,417
176,161
6,900,307
69
Shareholders' Equity
Noncontrolling Interests
Preferred
Stock
Common
Stock
Treasury
Stock
Additional
Paid In
Capital
Accumulated
Other
Comprehensive
Income (Loss)
Distributions
in Excess of
Net Income
Total
Shareholders'
Equity
Exchangeable
Operating
Partnership
Units
Limited
Partners'
Interest in
Consolidated
Partnerships
Total
Noncontrolling
Interests
Total
Equity
Balance at December 31, 2024
$
225,000
1,814
( 28,045
)
8,503,227
2,226
( 1,980,076
)
6,724,146
40,744
135,417
176,161
6,900,307
Net income
—
—
—
—
—
527,460
527,460
7,069
6,422
13,491
540,951
Other comprehensive loss
Other comprehensive loss before reclassification
—
—
—
—
( 2,070
)
—
( 2,070
)
( 2
)
( 151
)
( 153
)
( 2,223
)
Amounts reclassified from accumulated other comprehensive loss
—
—
—
—
( 4,376
)
—
( 4,376
)
( 42
)
( 320
)
( 362
)
( 4,738
)
Adjustment for noncontrolling interests
—
—
—
83,514
—
—
83,514
( 95,323
)
11,809
( 83,514
)
—
Deferred compensation plan, net
—
—
( 3,030
)
3,030
—
—
—
—
—
—
—
Amortization of equity awards
—
2
—
22,085
—
—
22,087
—
—
—
22,087
Tax withholding on stock-based compensation
—
—
—
( 6,794
)
—
—
( 6,794
)
—
—
—
( 6,794
)
Repurchase of EOP units
—
—
—
—
—
—
—
( 2,046
)
—
( 2,046
)
( 2,046
)
Common stock issued under dividend reinvestment plan
—
—
—
722
—
—
722
—
—
—
722
Common stock issued for exchangeable units exchanged
—
—
—
200
—
—
200
( 200
)
—
( 200
)
—
Common stock issued, net of issuance costs
—
13
—
98,154
—
—
98,167
—
—
—
98,167
Contributions from partners
—
—
—
—
—
—
—
201,872
17,593
219,465
219,465
Distributions to partners
—
—
—
—
—
—
—
—
( 40,994
)
( 40,994
)
( 40,994
)
Dividends declared:
Preferred stock stock/unit (Series A: $ 1.562500 per share/unit; Series B: $ 1.468800 per share/unit)
—
—
—
—
—
( 13,650
)
( 13,650
)
—
—
—
( 13,650
)
Common stock/unit ($ 2.870 per share/unit)
—
—
—
—
—
( 522,516
)
( 522,516
)
( 7,132
)
—
( 7,132
)
( 529,648
)
Balance at December 31, 2025
$
225,000
1,829
( 31,075
)
8,704,138
( 4,220
)
( 1,988,782
)
6,906,890
144,940
129,776
274,716
7,181,606
The accompanying notes are an integral part of the consolidated financial statements.
70
REG ENCY CENTERS CORPORATION
Consolidated Statements of Cash Flows
For the years ended December 31, 2025, 2024, and 2023
(in thousands)
2025
2024
2023
Cash flows from operating activities:
Net income
$
540,951
409,840
370,867
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization
405,044
394,714
352,282
Amortization of deferred financing costs and debt premiums
15,011
13,096
8,252
Amortization of above and below market lease intangibles, net
( 22,290
)
( 22,701
)
( 29,130
)
Stock-based compensation, net of capitalization
19,459
23,504
20,075
Equity in income of investments in real estate partnerships
( 133,499
)
( 50,294
)
( 50,541
)
Gain on sale of real estate, net of tax
( 24,464
)
( 34,162
)
( 661
)
Provision for impairment of real estate, net of tax
4,606
14,304
—
Loss (gain) on early extinguishment of debt
—
180
( 99
)
Distribution of earnings from investments in real estate partnerships
64,471
69,156
66,531
Deferred compensation expense
3,272
5,256
4,782
Realized and unrealized gain on investments
( 4,119
)
( 5,930
)
( 5,571
)
Changes in assets and liabilities:
Tenant and other receivables
( 18,519
)
( 24,219
)
( 13,904
)
Deferred leasing costs
( 18,961
)
( 11,703
)
( 11,156
)
Other assets
( 1,962
)
1,818
3,028
Accounts payable and other liabilities
( 7,868
)
4,253
5,152
Tenants' security, escrow deposits and prepaid rent
6,560
3,086
( 316
)
Net cash provided by operating activities
827,692
790,198
719,591
Cash flows from investing activities:
Acquisition of operating real estate, net of cash acquired of $ 4,273 in 2025
( 104,153
)
( 45,405
)
( 45,386
)
Acquisition of UBP, net of cash acquired of $ 14,143
—
—
( 82,389
)
Real estate development and capital improvements
( 435,112
)
( 343,368
)
( 232,855
)
Proceeds from sale of real estate
124,992
108,615
11,167
Proceeds from property insurance casualty claims
—
5,286
—
Issuance of notes receivable
( 838
)
( 32,651
)
( 4,000
)
Collection of notes receivable
687
3,115
4,000
Investments in real estate partnerships
( 44,323
)
( 41,345
)
( 13,119
)
Return of capital from investments in real estate partnerships
32,549
13,034
11,308
Dividends on investment securities
1,389
453
1,283
Purchase of investment securities
( 103,312
)
( 101,044
)
( 7,990
)
Proceeds from sale of investment securities
106,981
106,666
16,003
Net cash used in investing activities
( 421,140
)
( 326,644
)
( 341,978
)
71
2025
2024
2023
Cash flows from financing activities:
Net proceeds from common stock issuance
$
98,167
—
( 33
)
Tax withholding on stock-based compensation
( 6,794
)
( 19,540
)
( 7,662
)
Common shares repurchased through share repurchase program
—
( 200,066
)
( 20,006
)
Redemption of exchangeable operating partnership units
( 2,046
)
—
( 9,163
)
Proceeds from sale of treasury stock
502
210
103
Contributions from noncontrolling interests
16,594
6,789
10,238
Distributions to and redemptions of noncontrolling interests
( 40,994
)
( 12,185
)
( 7,813
)
Distributions to exchangeable operating partnership unit holders
( 5,007
)
( 2,952
)
( 2,368
)
Dividends paid to common shareholders
( 511,564
)
( 490,365
)
( 453,065
)
Dividends paid to preferred shareholders
( 13,650
)
( 13,650
)
( 3,413
)
Repayment of fixed rate unsecured notes
( 250,000
)
( 250,000
)
—
Proceeds from issuance of fixed rate unsecured notes, net of debt discount
397,116
722,860
—
Proceeds from unsecured credit facilities
650,000
722,419
557,000
Repayment of unsecured credit facilities
( 595,000
)
( 809,419
)
( 405,000
)
Proceeds from notes payable
10,000
12,000
59,500
Repayment of notes payable
( 80,130
)
( 131,261
)
( 61,592
)
Scheduled principal payments
( 11,144
)
( 11,209
)
( 11,235
)
Payment of financing costs
( 3,825
)
( 16,655
)
( 526
)
Net cash used in financing activities
( 347,775
)
( 493,024
)
( 355,035
)
Net change in cash, cash equivalents and restricted cash
58,777
( 29,470
)
22,578
Cash, cash equivalents, and restricted cash at beginning of the year
61,884
91,354
68,776
Cash, cash equivalents, and restricted cash at end of the year
$
120,661
$
61,884
91,354
Supplemental disclosure of cash flow information:
Cash paid for interest (net of capitalized interest of $ 10,289 , $ 6,627 , and $ 5,695 in 2025, 2024, and 2023, respectively)
$
179,216
161,356
147,176
Supplemental disclosure of non-cash transactions:
Common and Preferred stock, and exchangeable operating partnership dividends declared but not paid
$
143,260
133,114
126,683
Right of use assets obtained in exchange for new operating lease liabilities
$
278
1,271
36,577
Sale of leased asset in exchange for net investment in sales-type lease
$
—
2,846
8,510
Acquisition of operating real estate:
Tenant and other receivable and other assets
$
1,389
231
37,799
Acquired lease intangible assets
$
55,081
5,359
136,652
Notes payable assumed in acquisition, at fair value
$
166,480
—
284,706
Intangible liabilities, accounts payable and other liabilities
$
23,198
6,580
119,750
Noncontrolling interest assumed in acquisition, at fair value
$
—
—
64,492
Common stock exchanged for UBP shares
$
—
—
818,530
Preferred stock exchanged for UBP shares
$
—
—
225,000
Acquisition of previously unconsolidated real estate investments:
Acquired lease intangible assets
$
23,237
—
—
Notes payable assumed in acquisition, at fair value
$
38,485
—
—
Intangible liabilities, Accounts payable and other liabilities
$
9,918
—
—
Acquisition of real estate assets
$
127,820
—
—
Exchangeable operating partnership units issued for acquisition of real estate
$
199,662
—
31,253
Change in accrued capital expenditures
$
8,207
14,036
8,877
Contributions to investments in real estate partnerships
$
1,050
18,459
920
Contributions from limited partners in consolidated partnerships
$
3,209
7,890
—
The accompanying notes are an integral part of the consolidated financial statements.
72
RE GENCY CENTERS, L.P.
Consolidated Balance Sheets
December 31, 2025 and 2024
(in thousands, except unit data)
2025
2024
Assets
Net real estate investments:
Real estate assets, at cost
$
14,561,924
13,698,419
Less: accumulated depreciation
3,267,728
2,960,399
Real estate assets, net
11,294,196
10,738,020
Investments in sales-type leases, net
16,727
16,291
Investments in real estate partnerships
349,856
399,044
Net real estate investments
11,660,779
11,153,355
Cash, cash equivalents, and restricted cash, including $ 16,004 and $ 5,601 of restricted cash at December 31, 2025 and 2024, respectively
120,661
61,884
Tenant and other receivables, net
273,862
255,495
Deferred leasing costs, less accumulated amortization of $ 138,391 and $ 131,080 at December 31, 2025 and 2024, respectively
97,253
79,911
Acquired lease intangible assets, less accumulated amortization of $ 421,433 and $ 395,209 at December 31, 2025 and 2024, respectively
254,201
229,983
Right of use assets, net
315,804
322,287
Other assets
278,723
289,046
Total assets
$
13,001,283
12,391,961
Liabilities and Capital
Liabilities:
Notes payable, net
$
4,619,301
4,343,700
Unsecured credit facility
120,000
65,000
Accounts payable and other liabilities
391,847
392,302
Acquired lease intangible liabilities, less accumulated amortization of $ 243,040 and $ 222,052 at December 31, 2025 and 2024, respectively
356,454
364,608
Lease liabilities
242,368
244,861
Tenants' security, escrow deposits and prepaid rent
89,707
81,183
Total liabilities
5,819,677
5,491,654
Commitments and contingencies
—
—
Capital:
Partners' capital:
Preferred units $ 0.01 par value per unit, 30,000,000 units authorized; 9,000,000 units issued and outstanding, in the aggregate, in Series A and Series B at December 31, 2025 and 2024
225,000
225,000
General partner's common units, 182,902,234 and 181,361,454 units issued and outstanding at December 31, 2025 and 2024, respectively
6,686,110
6,496,920
Limited partners' common units, 3,838,188 and 1,096,659 units issued and outstanding at December 31, 2025 and 2024, respectively
144,940
40,744
Accumulated other comprehensive (loss) income
( 4,220
)
2,226
Total partners' capital
7,051,830
6,764,890
Noncontrolling interest: Limited partners' interests in consolidated partnerships
129,776
135,417
Total capital
7,181,606
6,900,307
Total liabilities and capital
$
13,001,283
12,391,961
The accompanying notes are an integral part of the consolidated financial statements.
73
REG ENCY CENTERS, L.P.
Consolidated Statements of Operations
For the years ended December 31, 2025, 2024, and 2023
(in thousands, except per unit data)
2025
2024
2023
Revenues:
Lease income
$
1,511,425
1,411,379
1,283,939
Other property income
13,741
14,651
11,573
Management, transaction, and other fees
28,358
27,874
26,954
Total revenues
1,553,524
1,453,904
1,322,466
Operating expenses:
Depreciation and amortization
405,044
394,714
352,282
Property operating expense
264,877
248,637
229,209
Real estate taxes
192,282
184,415
165,560
General and administrative
99,407
101,465
97,806
Other operating expenses
8,849
10,867
9,459
Total operating expenses
970,459
940,098
854,316
Other expense, net:
Interest expense, net
199,548
180,119
154,249
Provision for impairment of real estate
4,606
14,304
—
Gain on sale of real estate, net of tax
( 24,464
)
( 34,162
)
( 661
)
Loss (gain) on early extinguishment of debt
—
180
( 99
)
Net investment income
( 4,077
)
( 6,181
)
( 5,665
)
Total other expense, net
175,613
154,260
147,824
Income before equity in income of investments in real estate partnerships
407,452
359,546
320,326
Equity in income of investments in real estate partnerships
133,499
50,294
50,541
Net income
540,951
409,840
370,867
Limited partners' interests in consolidated partnerships
( 6,422
)
( 7,114
)
( 4,302
)
Net income attributable to the Partnership
534,529
402,726
366,565
Preferred unit distributions
( 13,650
)
( 13,650
)
( 5,057
)
Net income attributable to common unit holders
$
520,879
389,076
361,508
Net income attributable to common unit holders:
Per common unit - basic
$
2.83
2.12
2.04
Per common unit - diluted
$
2.82
2.11
2.04
The accompanying notes are an integral part of the consolidated financial statements.
74
REG ENCY CENTERS, L.P.
Consolidated Statements of Comprehensive Income
For the years ended December 31, 2025, 2024, and 2023
(in thousands)
2025
2024
2023
Net income
$
540,951
409,840
370,867
Other comprehensive (loss) income:
Effective portion of change in fair value of derivative instruments:
Effective portion of change in fair value of derivative instruments
( 2,659
)
12,523
( 2,448
)
Reclassification adjustment of derivative instruments included in net income
( 4,738
)
( 8,895
)
( 7,536
)
Unrealized gain (loss) on available-for-sale debt securities
436
( 32
)
337
Other comprehensive (loss) income
( 6,961
)
3,596
( 9,647
)
Comprehensive income
533,990
413,436
361,220
Less: comprehensive income attributable to noncontrolling interests:
Net income attributable to noncontrolling interests
6,422
7,114
4,302
Other comprehensive (loss) income attributable to noncontrolling interests
( 471
)
42
( 731
)
Comprehensive income attributable to noncontrolling interests
5,951
7,156
3,571
Comprehensive income attributable to the Partnership
$
528,039
406,280
357,649
The accompanying notes are an integral part of the consolidated financial statements.
75
REG ENCY CENTERS, L.P.
Consolidated Statements of Capital
For the years ended December 31, 2025, 2024, and 2023
(in thousands)
General Partner
Preferred and
Common Units
Limited
Partners
Accumulated
Other
Comprehensive
Income (Loss)
Total
Partners'
Capital
Noncontrolling
Interests in
Limited Partners'
Interest in
Consolidated
Partnerships
Total
Capital
Balance at December 31, 2022
$
6,089,425
34,489
7,560
6,131,474
46,565
6,178,039
Net income
364,557
2,008
—
366,565
4,302
370,867
Other comprehensive loss
Other comprehensive loss before reclassification
—
( 9
)
( 2,063
)
( 2,072
)
( 39
)
( 2,111
)
Amounts reclassified from accumulated other comprehensive loss
—
( 39
)
( 6,805
)
( 6,844
)
( 692
)
( 7,536
)
Adjustment for noncontrolling interests in the Operating Partnership
13,518
( 13,518
)
—
—
—
—
Contributions from partners
—
—
—
—
74,730
74,730
Issuance of EOP units
—
31,253
—
31,253
—
31,253
Distributions to partners
( 466,126
)
( 2,628
)
—
( 468,754
)
( 7,813
)
( 476,567
)
Preferred unit distributions
( 5,057
)
—
—
( 5,057
)
—
( 5,057
)
Restricted units issued as a result of restricted stock issued by Parent Company, net of amortization
20,441
—
—
20,441
—
20,441
Repurchase of EOP units
—
( 9,163
)
—
( 9,163
)
—
( 9,163
)
Preferred units issued as a result of preferred stock issued by Parent Company, net of issuance costs
225,000
—
—
225,000
—
225,000
Common units repurchased and retired as a result of common stock repurchased and retired by Parent Company
( 20,006
)
—
—
( 20,006
)
—
( 20,006
)
Common units issued as a result of common stock issued by Parent Company, net of issuance costs
818,497
—
—
818,497
—
818,497
Common units repurchased as a result of common stock repurchased by Parent Company, net of issuances
( 6,452
)
—
—
( 6,452
)
—
( 6,452
)
EOP units exchanged for common stock of Parent Company
198
( 198
)
—
—
—
—
Balance at December 31, 2023
$
7,033,995
42,195
( 1,308
)
7,074,882
117,053
7,191,935
Net income
400,388
2,338
—
402,726
7,114
409,840
Other comprehensive income
Other comprehensive income before reclassification
—
70
11,845
11,915
576
12,491
Amounts reclassified from accumulated other comprehensive income
—
( 50
)
( 8,311
)
( 8,361
)
( 534
)
( 8,895
)
Adjustment for noncontrolling interests in the Operating Partnership
( 10,833
)
2,119
—
( 8,714
)
8,714
—
Contributions from partners
—
—
—
—
14,679
14,679
Distributions to partners
( 495,211
)
( 5,193
)
—
( 500,404
)
( 12,185
)
( 512,589
)
Preferred unit distributions
( 13,650
)
—
—
( 13,650
)
—
( 13,650
)
Restricted units issued as a result of restricted stock issued by Parent Company, net of amortization
24,917
—
—
24,917
—
24,917
Common units repurchased and retired as a result of common stock repurchased and retired by Parent Company
( 200,066
)
—
—
( 200,066
)
—
( 200,066
)
Common units repurchased as a result of common stock repurchased by Parent Company, net of issuances
( 18,355
)
—
—
( 18,355
)
—
( 18,355
)
EOP units exchanged for common stock of Parent Company
735
( 735
)
—
—
—
—
Balance at December 31, 2024
$
6,721,920
40,744
2,226
6,764,890
135,417
6,900,307
76
General Partner
Preferred and
Common Units
Limited
Partners
Accumulated
Other
Comprehensive
Income (Loss)
Total
Partners'
Capital
Noncontrolling
Interests in
Limited Partners'
Interest in
Consolidated
Partnerships
Total
Capital
Balance at December 31, 2024
$
6,721,920
40,744
2,226
6,764,890
135,417
6,900,307
Net income
527,460
7,069
—
534,529
6,422
540,951
Other comprehensive loss
Other comprehensive loss before reclassification
—
( 2
)
( 2,070
)
( 2,072
)
( 151
)
( 2,223
)
Amounts reclassified from accumulated other comprehensive loss
—
( 42
)
( 4,376
)
( 4,418
)
( 320
)
( 4,738
)
Adjustment for noncontrolling interests in the Operating Partnership
83,514
( 95,323
)
—
( 11,809
)
11,809
—
Contributions from partners
—
201,872
—
201,872
17,593
219,465
Distributions to partners
( 522,516
)
( 7,132
)
—
( 529,648
)
( 40,994
)
( 570,642
)
Preferred unit distributions
( 13,650
)
—
—
( 13,650
)
—
( 13,650
)
Restricted units issued as a result of restricted stock issued by Parent Company, net of amortization
22,087
—
—
22,087
—
22,087
Repurchase of EOP units
—
( 2,046
)
—
( 2,046
)
—
( 2,046
)
Common units issued as a result of common stock issued by Parent Company, net of issuance costs
98,167
—
—
98,167
—
98,167
Common units repurchased as a result of common stock repurchased by Parent Company, net of issuances
( 6,072
)
—
—
( 6,072
)
—
( 6,072
)
EOP units exchanged for common stock of Parent Company
200
( 200
)
—
—
—
—
Balance at December 31, 2025
$
6,911,110
144,940
( 4,220
)
7,051,830
129,776
7,181,606
The accompanying notes are an integral part of the consolidated financial statements.
77
REG ENCY CENTERS, L.P.
Consolidated Statements of Cash Flows
For the years ended December 31, 2025, 2024, and 2023
(in thousands)
2025
2024
2023
Cash flows from operating activities:
Net income
$
540,951
409,840
370,867
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization
405,044
394,714
352,282
Amortization of deferred financing costs and debt premiums
15,011
13,096
8,252
Amortization of above and below market lease intangibles, net
( 22,290
)
( 22,701
)
( 29,130
)
Stock-based compensation, net of capitalization
19,459
23,504
20,075
Equity in income of investments in real estate partnerships
( 133,499
)
( 50,294
)
( 50,541
)
Gain on sale of real estate, net of tax
( 24,464
)
( 34,162
)
( 661
)
Provision for impairment of real estate, net of tax
4,606
14,304
—
Loss (gain) on early extinguishment of debt
—
180
( 99
)
Distribution of earnings from investments in real estate partnerships
64,471
69,156
66,531
Deferred compensation expense
3,272
5,256
4,782
Realized and unrealized gain on investments
( 4,119
)
( 5,930
)
( 5,571
)
Changes in assets and liabilities:
Tenant and other receivables
( 18,519
)
( 24,219
)
( 13,904
)
Deferred leasing costs
( 18,961
)
( 11,703
)
( 11,156
)
Other assets
( 1,962
)
1,818
3,028
Accounts payable and other liabilities
( 7,868
)
4,253
5,152
Tenants' security, escrow deposits and prepaid rent
6,560
3,086
( 316
)
Net cash provided by operating activities
827,692
790,198
719,591
Cash flows from investing activities:
Acquisition of operating real estate, net of cash acquired of $ 4,273 in 2025
( 104,153
)
( 45,405
)
( 45,386
)
Acquisition of UBP, net of cash acquired of $ 14,143
—
—
( 82,389
)
Real estate development and capital improvements
( 435,112
)
( 343,368
)
( 232,855
)
Proceeds from sale of real estate
124,992
108,615
11,167
Proceeds from property insurance casualty claims
—
5,286
—
Issuance of notes receivable
( 838
)
( 32,651
)
( 4,000
)
Collection of notes receivable
687
3,115
4,000
Investments in real estate partnerships
( 44,323
)
( 41,345
)
( 13,119
)
Return of capital from investments in real estate partnerships
32,549
13,034
11,308
Dividends on investment securities
1,389
453
1,283
Purchase of investment securities
( 103,312
)
( 101,044
)
( 7,990
)
Proceeds from sale of investment securities
106,981
106,666
16,003
Net cash used in investing activities
( 421,140
)
( 326,644
)
( 341,978
)
78
2025
2024
2023
Cash flows from financing activities:
Net proceeds from common stock issuance
$
98,167
—
( 33
)
Tax withholding on stock-based compensation
( 6,794
)
( 19,540
)
( 7,662
)
Common units repurchased through share repurchase program
—
( 200,066
)
( 20,006
)
Redemption of exchangeable operating partnership units
( 2,046
)
—
( 9,163
)
Proceeds from sale of treasury stock
502
210
103
Contributions from noncontrolling interests
16,594
6,789
10,238
Distributions to and redemptions of noncontrolling interests
( 40,994
)
( 12,185
)
( 7,813
)
Distributions to partners
( 516,571
)
( 493,317
)
( 455,433
)
Dividends paid to preferred unit holders
( 13,650
)
( 13,650
)
( 3,413
)
Repayment of fixed rate unsecured notes
( 250,000
)
( 250,000
)
—
Proceeds from issuance of fixed rate unsecured notes, net of debt discount
397,116
722,860
—
Proceeds from unsecured credit facilities
650,000
722,419
557,000
Repayment of unsecured credit facilities
( 595,000
)
( 809,419
)
( 405,000
)
Proceeds from notes payable
10,000
12,000
59,500
Repayment of notes payable
( 80,130
)
( 131,261
)
( 61,592
)
Scheduled principal payments
( 11,144
)
( 11,209
)
( 11,235
)
Payment of financing costs
( 3,825
)
( 16,655
)
( 526
)
Net cash used in financing activities
( 347,775
)
( 493,024
)
( 355,035
)
Net change in cash, cash equivalents and restricted cash
58,777
( 29,470
)
22,578
Cash, cash equivalents, and restricted cash at beginning of the year
61,884
91,354
68,776
Cash, cash equivalents, and restricted cash at end of the year
$
120,661
61,884
91,354
Supplemental disclosure of cash flow information:
Cash paid for interest (net of capitalized interest of $ 10,289 , $ 6,627 , and $ 5,695 in 2025, 2024, and 2023, respectively)
$
179,216
161,356
147,176
Supplemental disclosure of non-cash transactions:
Common and Preferred stock, and exchangeable operating partnership dividends declared but not paid
$
143,260
133,114
126,683
Right of use assets obtained in exchange for new operating lease liabilities
$
278
1,271
36,577
Sale of leased asset in exchange for net investment in sales-type lease
$
—
2,846
8,510
Acquisition of operating real estate:
Tenant and other receivable and other assets
$
1,389
231
37,799
Acquired lease intangible assets
$
55,081
5,359
136,652
Notes payable assumed in acquisition, at fair value
$
166,480
—
284,706
Intangible liabilities, accounts payable and other liabilities
$
23,198
6,580
119,750
Noncontrolling interest assumed in acquisition, at fair value
$
—
—
64,492
Common stock exchanged for UBP shares
$
—
—
818,530
Preferred stock exchanged for UBP shares
$
—
—
225,000
Acquisition of previously unconsolidated real estate investments:
Acquired lease intangible assets
$
23,237
—
—
Notes payable assumed in acquisition, at fair value
$
38,485
—
—
Intangible liabilities, Accounts payable and other liabilities
$
9,918
—
—
Acquisition of real estate assets
$
127,820
—
—
Exchangeable operating partnership units issued for acquisition of real estate
$
199,662
—
31,253
Change in accrued capital expenditures
$
8,207
14,036
8,877
Contributions to investments in real estate partnerships
$
1,050
18,459
920
Contributions from limited partners in consolidated partnerships
$
3,209
7,890
—
The accompanying notes are an integral part of the consolidated financial statements.
79
REGENCY CENTERS CORPORATION AND REGENCY CENTERS, L.P.
Notes to Consolidated Financial Statements
December 31, 2025
1. Su mmary of Significant Accounting Policies
(a) Organization and Principles of Consolidation
General
Regency Centers Corporation (the "Parent Company") began its operations as a REIT in 1993 and is the general partner of Regency Centers, L.P. (the "Operating Partnership"). The Parent Company primarily engages in the ownership, management, leasing, acquisition, development, and redevelopment of shopping centers through the Operating Partnership and has no other assets other than through its investment in the Operating Partnership. Its only indebtedness consists of $ 200 million of unsecured private placement notes, which are guaranteed by the Operating Partnership, which the Company plans to payoff at maturity in 2026. The Parent Company guarantees all of the unsecured debt of the Operating Partnership.
As of December 31, 2025, the Parent Company, the Operating Partnership, and their controlled subsidiaries on a consolidated basis (the "Company" or "Regency") owned 391 properties and held partial interests in an additional 90 properties through unconsolidated Investments in real estate partnerships (also referred to as "joint ventures" or "investment partnerships").
Acquisition of Urstadt Biddle Properties Inc.
On August 18, 2023 , the Company acquired Urstadt Biddle Properties Inc. ("UBP") which was accounted for as an asset acquisition. Under the terms of the merger agreement, each share of Urstadt Biddle common stock and Urstadt Biddle Class A common stock was converted into 0.347 of a share of common stock of the Parent Company. Additionally, each share of UBP’s 6.25 % Series H Cumulative Redeemable Preferred Stock and 5.875 % Series K Cumulative Redeemable Preferred Stock was converted into one share of newly issued Parent Company 6.25 % Series A Cumulative Redeemable Preferred Stock ("Parent Company Series A preferred stock") and 5.875 % Series B Cumulative Redeemable Preferred Stock ("Parent Company Series B preferred stock"), respectively (collectively referred to as the "Preferred Stock").
As a result of the acquisition, the Company acquired 74 properties representing 5.3 million square feet of GLA, including 10 properties held through real estate partnerships.
Estimates, Risks and Uncert ainties
The preparation of the Consolidated Financial Statements in conformity with U.S. GAAP requires the Company's management to make estimates and assumptions that affect the reported amounts of assets and liabilities, and disclosure of commitments and contingent assets and liabilities, as of the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. The most significant estimates in the Company's financial statements relate to the net carrying values of its real estate investments, collectibility of lease income, and acquired lease intangible assets and liabilities. It is possible that the estimates and assumptions that have been utilized in the preparation of the Consolidated Financial Statements could change significantly if economic conditions were to change .
The success of the Company's tenants in operating their businesses and their corresponding ability to pay rent may be influenced by evolving political, economic, trade, tax and immigration policies and macroeconomic uncertainty, and the success of the Company's tenants, in the aggregate, is important to the operating and financial success of the Company. These include, without limitation, changes in trade and tariff policies (as well as potential trade disputes and retaliatory actions by other countries), entry into and termination of treaties and trade agreements, and economic sanctions. Additionally, geopolitical and macroeconomic challenges, including the war involving Russia and Ukraine, conflicts and instability in the Middle East and Venezuela, and economic conflicts with China, as well as the slowing of its economy, could impact aspects of the U.S. economy and, therefore, consumer confidence and spending.
The policies implemented by the U.S. government to address these and related issues, including changes by the Board of Governors of the Federal Reserve System of its benchmark federal funds rate, increases or decreases in federal government spending, and economic sanctions and tariffs, could result in adverse impacts on the U.S. economy, including inflation, reduction in consumer confidence and spending, a slowing of growth, and potentially a recession, thereby adversely impacting the costs to our tenants of operating their businesses, demand for their products and services, and their ability to pay rent, and/or decreasing future demand for space in shopping centers, which could adversely impact occupancy rates and rents. The potential impact of current macroeconomic and geopolitical challenges on the Company's financial condition,
80
REGENCY CENTERS CORPORATION AND REGENCY CENTERS, L.P.
Notes to Consolidated Financial Statements
December 31, 2025
results of operations, and cash flows is subject to change and continues to depend on the extent and duration of these risks and uncertainties.
Consolidation
The accompanying Consolidated Financial Statements include the accounts of the Parent Company, the Operating Partnership, its wholly-owned subsidiaries, and consolidated partnerships in which the Company has a controlling financial interest. Investments in real estate partnerships not controlled by the Company are accounted for under the equity method of accounting. All significant inter-company balances and transactions are eliminated in the Consolidated Financial Statements.
The Company consolidates properties that are wholly-owned and properties where it owns less than 100% but holds a controlling financial interest in the entity. Controlling financial interest is determined using an evaluation based on accounting standards related to the consolidation of Variable Interest Entities ("VIEs") and voting interest entities. For joint ventures that are determined to be a VIE, the Company consolidates the entity where it is deemed to be the primary beneficiary. Determination of the primary beneficiary is based on whether an entity has (1) the power to direct the activities of the VIE that most significantly impact the entity's economic performance, and (2) the obligation to absorb losses of the entity that could potentially be significant to the VIE or the right to receive benefits from the entity that could potentially be significant to the VIE.
Ownership of the Parent Company
The Parent Company currently has a single class of common stock and two series of preferred stock outstanding.
Ownership of the Operating Partnership
The Operating Partnership's capital includes Common Units and Preferred Units. As of December 31, 2025, the Parent Company owned approximately 97.9 % or 182,902,234 of the 186,740,422 of the outstanding Common Units, with the remaining limited partner's Common Units held by third parties ("Exchangeable operating partnership units" or "EOP units"). The Parent Company currently owns all of the Preferred Units.
Each EOP unit is exchangeable for cash or one share of common stock of the Parent Company, at the discretion of the Parent Company, and the unit holder cannot require redemption in cash or common stock (i.e., registered shares of the Parent). The Parent Company has evaluated the conditions as specified under Accounting Standards Codification ("ASC") Topic 480, Distinguishing Liabilities from Equity , as it relates to EOP units outstanding and concluded that the Parent Company has the right to satisfy the redemption requirements of the units by delivering shares of unregistered common stock. Accordingly, the Parent Company classifies EOP units as permanent equity in the accompanying Consolidated Balance Sheets and Consolidated Statements of Equity and Comprehensive Income. The Parent Company serves as general partner of the Operating Partnership. The EOP unit holders have limited rights over the Operating Partnership such that they do not have the power to direct the activities that most significantly impact the Operating Partnership’s economic performance. As such, the Operating Partnership is considered a VIE, and the Parent Company, which consolidates it, is the primary beneficiary. The Parent Company's only investment is the Operating Partnership. Net income and distributions of the Operating Partnership are allocable to the general and limited common Partnership Units in accordance with their ownership percentages.
Real Estate Partnerships
As of December 31, 2025, the Company held partial ownership interests in 108 properties through various real estate partnerships, of which 18 are consolidated. These partnerships were formed for the purpose of owning and operating real estate properties. The Company's partners in these arrangements include institutional investors, real estate developers or operators, and passive investors (collectively, the "Partners" or "Limited Partners"). The Company’s involvement in these partnerships is through its ownership of its equity interests and its role in property-level management. The entities were deemed VIEs primarily because the unrelated investors do not have substantive kick-out rights to remove the general or managing partner by a vote of a simple majority or less, and they do not have substantive participating rights. Regency has variable interests in these entities through its equity ownership, with Regency being the primary beneficiary in certain of these real estate partnerships. Regency consolidates the partnerships into its financial statements for which it is the primary beneficiary and reports the limited partners' interests as noncontrolling interests. For those partnerships which Regency is not the primary beneficiary and does not have a controlling financial interest, but has significant influence, Regency recognizes its equity investments in them in accordance with the equity method of accounting.
81
REGENCY CENTERS CORPORATION AND REGENCY CENTERS, L.P.
Notes to Consolidated Financial Statements
December 31, 2025
The assets of these partnerships are restricted to use by the respective partnerships and cannot be directly reached by general creditors of the Company. Similarly, the obligations of the partnerships are backed by, and can only be settled through the assets of these partnerships or by additional capital contributions by the partners, except to the extent that the Company has provided contractual payment guarantees.. As managing member, Regency maintains the books and records and typically provides leasing property and asset management services to the partnerships. The Partners' level of involvement in these partnerships varies from protective decisions (debt, bankruptcy, selling primary asset(s) of business) to participating involvement such as approving leases, operating budgets, and capital budgets.
Some of these entities have been determined to be VIEs under applicable accounting guidelines. This determination is primarily based on the assessment that the Limited Partners lack substantive kick-out rights (i.e., the ability to remove the general or managing partner with a simple majority vote or less) and do not possess substantive participating rights. Those partnerships for which the Partners are involved in the day to day decisions and do not have any other aspects that would cause them to be considered VIEs, are evaluated for consolidation using the voting interest model.
Those partnerships in which Regency does not have a controlling financial interest are accounted for using the equity method of accounting and Regency's ownership interest is recognized through single-line presentation as Investments in real estate partnerships, in the Consolidated Balance Sheet, and Equity in income of investments in real estate partnerships, in the Consolidated Statements of Operations. Cash distributions of earnings from operations from Investments in real estate partnerships are presented in Cash flows provided by operating activities in the accompanying Consolidated Statements of Cash Flows. Cash distributions from the sale of a property or loan proceeds received from the placement of debt on a property included in Investments in real estate partnerships are presented in Cash flows provided by investing activities in the accompanying Consolidated Statements of Cash Flows. If distributed proceeds from debt refinancing and real estate sales in excess of Regency's carrying value of its investment results in a negative investment balance for a partnership, it is recorded within Accounts payable and other liabilities in the Consolidated Balance Sheets.
The net difference in the carrying amount of investments in real estate partnerships and the underlying equity in net assets is accreted to earnings and recorded in Equity in income of investments in real estate partnerships in the accompanying Consolidated Statements of Operations over the expected useful lives of the properties and other intangible assets, which range from 10 to 40 years .
The majority of the operations of the VIEs are funded with cash flows generated by the properties, or in the case of developments, with capital contributions or third-party construction loans.
The carrying amounts of VIEs' assets and liabilities included in the Company's consolidated financial statements, exclusive of the Operating Partnership, are as follows:
(in thousands)
December 31, 2025
December 31, 2024
Assets
Real estate assets, net
$
332,759
312,873
Cash, cash equivalents and restricted cash
21,890
16,687
Tenant and other receivables, net
7,614
5,833
Deferred costs, net
6,715
3,178
Acquired lease intangible assets, net
4,328
6,293
Right of use assets, net
17,656
18,148
Other assets
775
597
Total Assets
$
391,737
363,609
Liabilities
Notes payable
$
23,771
32,653
Accounts payable and other liabilities
12,758
16,149
Acquired lease intangible liabilities, net
10,119
10,627
Tenants' security, escrow deposits and prepaid rent
960
1,260
Lease liabilities
19,559
19,370
Total Liabilities
$
67,167
80,059
82
REGENCY CENTERS CORPORATION AND REGENCY CENTERS, L.P.
Notes to Consolidated Financial Statements
December 31, 2025
Noncontrolling Interests
The Company accounts for noncontrolling interests in accordance with the Consolidation guidance and the Distinguishing Liabilities from Equity guidance issued by the FASB. Noncontrolling interests represent the portion of equity that the Company does not own in those entities it consolidates. Noncontrolling interests also include amounts related to partnership units issued by consolidated subsidiaries of the Company in connection with certain property acquisitions. These partnership units have a defined redemption amount and the unit holders generally have the right to redeem their units at any time after a certain period from issuance. For these partnership units, the Company has the option to settle redemption amounts in cash or common stock. The Company evaluates the terms of the partnership units issued in accordance with the FASB’s Distinguishing Liabilities from Equity guidance. The partnership units for which the Company has the option to settle redemption amounts in cash or common stock are included in the caption Noncontrolling interests within the equity section on the Company’s Consolidated Balance Sheets.
Noncontrolling Interests of the Parent Company
The Consolidated Financial Statements of the Parent Company include the following ownership interests held by owners other than the common shareholders of the Parent Company: (i) the EOP units and (ii) the minority-owned interest held by third parties in consolidated partnerships ("Limited partners' interests in consolidated partnerships"). The Parent Company has included all of these noncontrolling interests in permanent equity, separate from the Parent Company's shareholders' equity, in the accompanying Consolidated Balance Sheets and Consolidated Statements of Equity. The portion of net income or comprehensive income attributable to these noncontrolling interests is included in net income and comprehensive income in the accompanying Consolidated Statements of Operations and Consolidated Statements of Comprehensive Income of the Parent Company.
The Parent Company also evaluated its fiduciary duties to itself, its shareholders, and, as the managing general partner of the Operating Partnership, to the Operating Partnership, and concluded its fiduciary duties are not in conflict with each other or the underlying agreements. Therefore, the Parent Company classifies such units and interests as permanent equity in the accompanying Consolidated Balance Sheets and Consolidated Statements of Equity.
Noncontrolling Interests of the Operating Partnership
The Operating Partnership has determined that limited partners' interests in consolidated partnerships are noncontrolling interests. Subject to certain conditions and pursuant to the terms of the partnership agreements, the Company generally has the right, but not the obligation, to purchase the other members' interest or sell its own interest in these consolidated partnerships. The Operating Partnership has included these noncontrolling interests in permanent capital, separate from partners' capital, in the accompanying Consolidated Balance Sheets and Consolidated Statements of Capital. The portion of net income (loss) or comprehensive income (loss) attributable to these noncontrolling interests is included in Net income and Comprehensive income in the accompanying Consolidated Statements of Operations and Consolidated Statements Comprehensive Income of the Operating Partnership.
(b) Revenues, and Tenant and other Receivables
Leasing Income and Tenant Receivables
The Company leases space to tenants under agreements with varying terms that generally provide for fixed payments of base rent, with stated increases over the term of the lease. Some of the lease agreements contain provisions that provide for additional rents based on tenants' sales volume ("percentage rent"), which are recognized when the tenants achieve the specified targets as defined in their lease agreements. Additionally, most lease agreements contain provisions for reimbursement of the tenants' share of actual real estate taxes and insurance and common area maintenance ("CAM") costs (collectively "Recoverable Costs") incurred.
Lease terms generally range from three to seven years for tenant spaces under 10,000 square feet ("Shop Space") and in excess of five years for spaces greater than 10,000 square feet ("Anchor Space"). Many leases also provide tenants the option to extend their lease beyond the initial term of the lease. If a tenant does not exercise its option or otherwise negotiate to renew, the lease expires and the lease contains an obligation for the tenant to relinquish its space, allowing it to be re-leased to a new tenant. This generally involves some level of cost to prepare the space for re-leasing, which is capitalized and depreciated over the shorter period of the life of the subsequent lease or the useful life of the improvement.
83
REGENCY CENTERS CORPORATION AND REGENCY CENTERS, L.P.
Notes to Consolidated Financial Statements
December 31, 2025
The Company accounts for its leases under ASC Topic 842, Leases ("Topic 842"), as follows:
Classification
Under Topic 842, new leases or modifications thereto must be evaluated against specific classification criteria, which, based on the customary terms of the Company's leases, are classified as operating leases. However, certain longer-term leases (both lessee and lessor leases) may be classified as direct financing or sales type leases, which may result in selling profit and an accelerated pattern of earnings recognition. At December 31, 2025, the Company classified three leases as sales type leases, with all others classified as operating leases.
Recognition and Presentation
Lease income for operating leases with fixed payment terms is recognized on a straight-line basis over the expected term of the lease for all leases for which collectibility is considered probable. CAM is considered a non-lease component of the lease contract under Topic 842. However, as the timing and pattern of providing the CAM service to the tenant is the same as the timing and pattern of the tenant's use of the underlying lease asset, the Company elected, as part of an available practical expedient, to combine CAM with the remaining lease components, along with tenant's reimbursement of real estate taxes and insurance, and recognize them together as Lease income in the accompanying Consolidated Statements of Operations.
For sales type leases, the Company records any selling profit or loss arising from the lease at inception within Gain on sale of real estate, net of tax in the accompanying Consolidated Statement of Operations, as well as any initial direct costs recorded as an expense if, at commencement, the fair value of the underlying asset differs from its carrying amount, otherwise, they are deferred and included in the net investment in the lease. The net investment in the sales-type lease represents the lease receivable, the components of which are the future lease payments and any guaranteed residual value for the underlying assets, as well as any unguaranteed residual asset expected at the end of the lease term, each measured at net present value discounted using a rate implicit in the lease. Interest income is recorded within Lease income in the accompanying Consolidated Statements of Operations over the lease term so as to produce a constant periodic rate of return on the Company’s net investment in the leases. At the commencement date, the Company derecognizes the carrying amount of the underlying asset. When measuring the net investment in a long-term ground lease, the undiscounted residual value of the land will be limited to its fair value at commencement which will likely equate to its cost.
Collectibility
At lease commencement, the Company generally expects that collectibility of substantially all payments due under the lease is probable due to the Company's credit checks on tenants and other creditworthiness analysis undertaken before entering into a new lease; therefore, income from most operating leases is initially recognized on a straight-line basis. For operating leases in which collectibility of Lease income is not considered probable, Lease income is recognized on a cash basis and all previously recognized straight-line rent receivables are reversed in the period in which the Lease income is determined not to be probable of collection. Should collectibility of Lease income become probable again, through evaluation of qualitative and quantitative measures on a tenant by tenant basis, accrual basis accounting resumes and all commencement-to-date straight-line rent is recognized in that period.
In addition to the lease-specific collectibility assessment performed under Topic 842, the Company may also recognize a general reserve, as a reduction to Lease income, for its portfolio of operating lease receivables which are not expected to be fully collectible based on the Company's historical collection experience. The Company estimates the collectibility of the accounts receivable related to base rents, straight-line rents, recoveries from tenants, and other revenue taking into consideration the Company's historical write-off experience, tenant credit-worthiness, current economic trends, and remaining lease terms. Uncollectible lease income is a direct charge against Lease income. Although we estimate uncollectible receivables and provide for them through charges against income, actual experience may differ from those estimates.
84
REGENCY CENTERS CORPORATION AND REGENCY CENTERS, L.P.
Notes to Consolidated Financial Statements
December 31, 2025
The following table represents the components of Tenant and other receivables, net of amounts considered uncollectible, in the accompanying Consolidated Balance Sheets:
December 31,
(in thousands)
2025
2024
Tenant receivables
$
29,578
35,306
Straight-line rent receivables
180,871
157,507
Other receivables (1)
63,413
62,682
Total tenant and other receivables, net
$
273,862
255,495
(1) Other receivables include notes receivables, construction receivables, insurance receivables, and amounts due from real estate partnerships for Management, transaction and other fee income.
Other Property Income and Management Services
The Company recognizes revenue under ASC Topic 606, Revenue from Contracts with Customers ("Topic 606") , when or as control of the promised services are transferred to its customers, in an amount that reflects the consideration the Company expects to be entitled to in exchange for those services. The following is a description of the Company's revenue from contracts with customers within the scope of Topic 606.
Other Property Income
Other property income includes parking fees and other incidental income from the properties and is generally recognized at the point in time that the performance obligation is met.
Management, Transaction, and other fees
Property and Asset Management Services
The Company is engaged under agreements with its joint venture partnerships, which are generally perpetual in nature and cancellable through unanimous partner approval, absent an event of default and, in certain cases, specified intentional misconduct. Under these agreements, the Company is to provide asset and property management and leasing services for the joint ventures' shopping centers. The fees are market-based, generally calculated as a percentage of either revenues earned or the estimated values of the properties managed or the proceeds received, and are recognized over the monthly or quarterly periods as services are rendered. Property management and asset management services represent a series of distinct daily services. Accordingly, the Company satisfies its performance obligation as service is rendered each day and the variability associated with that compensation is resolved each day. Amounts due from the partnerships for such services are paid during the month following the monthly or quarterly service periods.
Several of the Company's joint venture partnership agreements provide for incentive payments, generally referred to as "promotes" or "earnouts," to Regency for appreciation in property values while Regency is managing member of the partnership. The terms of these promotes are based on appreciation in real estate value over designated time intervals or upon designated events. The Company evaluates its expected promote payout at each reporting period, which generally does not result in revenue recognition until the measurement period has completed, when the amount can be reasonably determined and the amount is not probable of significant reversal.
Leasing Services
Leasing service fees are based on a percentage of the total rent due under the lease. The leasing service is considered performed upon successful execution of an acceptable tenant lease for the joint ventures' shopping centers, at which time revenue is recognized. Payment of the first half of the fee is generally due upon lease execution and the second half is generally due upon tenant opening or the commencement of rent payments.
Transaction Services
The Company also receives transaction fees, as contractually agreed upon with in each joint venture, which include acquisition fees, disposition fees, and financing service fees. Control of these services is generally transferred at the time the related transaction closes, which is the point in time when the Company recognizes the related fee revenue. Any unpaid amounts related to transaction-based fees are included in Tenant and other receivables within the Consolidated Balance Sheets.
85
REGENCY CENTERS CORPORATION AND REGENCY CENTERS, L.P.
Notes to Consolidated Financial Statements
December 31, 2025
Income within Management, transaction, and other fees is primarily derived from contracts with the Company's unconsolidated real estate partnerships. The primary components of these revenue streams, the timing of satisfying the performance obligations, and amounts are as follows:
Year ended December 31,
(in thousands)
Timing of
satisfaction of
performance
obligations
2025
2024
2023
Management, transaction, and other fees:
Property management services
Over time
$
16,323
15,767
14,075
Asset management services
Over time
6,967
6,548
6,542
Leasing services
Point in time
3,631
3,738
3,908
Other transaction fees
Point in time
1,437
1,821
2,429
Total management, transaction, and other fees
$
28,358
27,874
26,954
The accounts receivable for Total management, transactions, and other fees, which are included within Tenant and other receivables, net in the accompanying Consolidated Balance Sheets, are $ 17.8 million and $ 19.7 million , as of December 31, 2025 and 2024, respectively.
Real Estate Sales
The Company accounts for sales of nonfinancial assets under ASC Subtopic 610-20, Other Income - Gains and Losses from the Derecognition of Nonfinancial Assets , whereby the Company derecognizes real estate and recognizes a gain or loss on sales when a contract exists and control of the property has transferred to the buyer. Control of the property, including controlling financial interest, is generally considered to transfer upon closing through transfer of the legal title and possession of the property. While generally rare, any retained noncontrolling interest is measured at fair value at that time.
(c) Real Estate Assets
The following table details the components of Real estate assets in the Consolidated Balance Sheets:
(in thousands)
December 31, 2025
December 31, 2024
Land
$
4,932,642
4,757,704
Land improvements
899,472
807,881
Buildings
6,948,538
6,456,719
Building and tenant improvements
1,634,065
1,461,003
Construction in progress
147,207
215,112
Total real estate assets
$
14,561,924
13,698,419
Capitalization and Depreciation
Real estate assets are stated at cost, less accumulated depreciation, and amortization. The Company periodically assesses the useful lives of its depreciable real estate assets, including those intended to be redeveloped in the near term, and accounts for any revisions prospectively. Expenditures for maintenance, repairs and demolition costs are charged to operations as incurred. Significant renovations and replacements, which improve or extend the life of the asset, are capitalized.
As part of the leasing process, the Company may provide lessees with allowances for the construction of leasehold improvements. These leasehold improvements are capitalized and recorded as tenant improvements and depreciated over the shorter of the useful life of the improvements or the remaining lease term. If the allowance represents a payment for a purpose other than funding leasehold improvements, or in the event the Company is not considered the owner of the improvements, the allowance is considered to be a lease incentive and is recognized over the lease term as a reduction of Lease income. Factors considered during this evaluation include, among other things, who holds legal title to the improvements as well as other controlling rights provided by the lease agreement and provisions for substantiation of such costs (e.g. unilateral control of the tenant space during the build-out process). Determination of the appropriate accounting for the payment of a tenant allowance is made on a lease-by-lease basis, considering the facts and circumstances of the individual tenant lease.
Depreciation is computed using the straight-line method over estimated useful lives of approximately 15 years for land improvements, 40 years for buildings and improvements, and the shorter of the useful life or the remaining lease term.
86
REGENCY CENTERS CORPORATION AND REGENCY CENTERS, L.P.
Notes to Consolidated Financial Statements
December 31, 2025
Development and Redevelopment Costs
All specifically identifiable costs related to development and redevelopment activities are capitalized into Real estate assets in the accompanying Consolidated Balance Sheets, and are included in Construction in progress within the above table. The capitalized costs include pre-development costs essential to the development or redevelopment of the property, construction costs, interest costs, real estate taxes, insurance, legal costs, salaries and related costs of personnel directly involved and other costs incurred during the period of development or redevelopment.
Pre-development costs represent the costs the Company incurs prior to land acquisition or pursuing a redevelopment including contract deposits, as well as legal, engineering, and other external professional fees related to evaluating the feasibility of developing or redeveloping a shopping center. As of December 31, 2025 and 2024, the Company had nonrefundable deposits and other pre-development costs of approximately $ 14.8 million and $ 10.2 million , respectively. If the Company determines that the development or redevelopment of a particular shopping center is no longer probable, any related pre-development costs previously capitalized are immediately expensed. During the years ended December 31, 2025, 2024, and 2023, the Company expensed pre-development costs of approximately $ 2.3 million , $ 0.9 million , and $ 0.1 million , respectively, in Other operating expenses in the accompanying Consolidated Statements of Operations.
Interest costs are capitalized into each development and redevelopment project based upon applying the Company's weighted average borrowing rate to that portion of the actual development or redevelopment costs incurred. The Company discontinues interest and real estate tax capitalization when a project is no longer being developed or is available for occupancy upon substantial completion of tenant improvements, but in no event would the Company capitalize interest on a project beyond 12 months after substantial comple tion of the building. During the years ended December 31, 2025, 2024, and 2023, the Company capitalized interest of $ 10.3 million , $ 6.6 million , and $ 5.7 million , respectively, on our development and redevelopment projects.
We have a staff of employees directly supporting our development and redevelopment program. All direct internal costs attributable to these development activities are capitalized as part of each development and redevelopment project. The capitalization of costs is directly related to the actual level of development activity occurring. During the years ended December 31, 2025, 2024, and 2023, we capitalized $ 24.9 million , $ 19.8 million , and $ 13.3 million , respectively, of direct internal costs incurred to support our development and redevelopment program.
Acquisitions
Upon acquisition of operating real estate properties, the Company estimates the fair value of acquired tangible assets (consisting of land, land improvements, buildings, building improvements and tenant improvements) and identified intangible assets and liabilities (consisting of above and below-market leases and in-place leases), assumed debt, and any noncontrolling interest in the acquiree at the date of acquisition, based on evaluation of information and estimates available at that date. Based on these estimates, the Company allocates the purchase price of the acquired properties based on their relative fair value to the applicable assets and liabilities. Acquisitions of operating properties are generally considered asset acquisitions and therefore transaction costs are capitalized. Fair value is determined based on an exit price approach, which contemplates the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date.
The Company's methodology includes estimating an "as-if vacant" fair value of the physical property, which includes land, building, and improvements. In addition, the Company determines the estimated fair value of identifiable intangible assets and liabilities, considering the following categories: (i) value of in-place leases, and (ii) above and below-market value of in-place leases.
The value of in-place leases is estimated based on the value associated with the costs avoided in originating leases compared to the acquired in-place leases as well as the value associated with lost rental and recovery revenue during the assumed lease-up period. The value of in-place leases is recorded to Depreciation and amortization expense in the Consolidated Statements of Operations over the remaining expected term of the respective leases.
Above-market and below-market in-place lease values for acquired properties are recorded based on the present value of the difference between (i) the contractual amounts to be paid pursuant to the in-place leases and (ii) management's estimate of market lease rates for comparable in-place leases, measured over a period equal to the remaining non-cancelable term of the lease, including below-market renewal options, if applicable. The value of above-market leases is amortized as a reduction of Lease income over the remaining terms of the respective leases and the value of below-market leases is accreted to Lease income over the remaining terms of the respective leases, including below-market renewal options, if applicable.
87
REGENCY CENTERS CORPORATION AND REGENCY CENTERS, L.P.
Notes to Consolidated Financial Statements
December 31, 2025
The Company does not assign value to customer relationship intangibles if it has pre-existing business relationships with major retailers at the acquired property since they do not provide incremental value over the Company's existing relationships.
Held for Sale
The Company classifies real estate assets as held-for-sale upon satisfaction of all the following criteria: (i) management commits to a plan to sell a property (or group of properties), (ii) the property is available for immediate sale in its present condition subject only to terms that are usual and customary for sales of such properties, (iii) an active program to locate a buyer and other actions required to complete the plan to sell the property have been initiated, (iv) the sale of the property is probable and transfer of the asset is expected to be completed within one year, (v) the property is being actively marketed for sale, and (vi) actions required to complete the plan indicate that it is unlikely that significant changes to the plan will be made or that the plan will be withdrawn. Upon the determination to classify a property as held for sale, the Company ceases depreciation and amortization on the real estate property held for sale, as well as the amortization of any related intangible assets. Such properties are recorded at the lesser of the carrying value or estimated fair value less estimated costs to sell.
Valuation of Real Estate Investments and Impairments
The Company continually evaluates whether there are any events or changes in circumstances, that could indicate the carrying values of the real estate properties (including any related amortizable intangible assets or liabilities) may not be recoverable. When indicators of potential impairment suggest that the carrying value of real estate assets may not be recoverable, the Company assesses the recoverability of the asset group by estimating whether the Company will recover the carrying value of the asset group through its undiscounted future cash flows, including eventual disposition. Based on this analysis, if the Company does not believe that it will be able to recover the carrying value of the asset group, an impairment charge will be recorded to the extent that the carrying value exceeds the estimated fair value of the asset group.
Estimated cash flows are based on several key assumptions, including rental rates, expected leasing activity, costs of tenant improvements, leasing commissions, expected hold period, and assumptions regarding the residual value upon disposition, including the exit capitalization rate. These key assumptions are subjective in nature and could differ materially from actual results. Changes in events or changes in circumstances may alter the hold period of an asset or asset group which may result in an impairment loss and such loss could be material to the Company's financial condition or operating performance. If a property previously classified as held and used is changed to held for sale, the Company estimates fair value, less expected costs to sell, which could cause the Company to determine that the property is impaired.
The estimated fair value of real estate assets is subjective and is estimated through comparable sales information and other market data if available, or through use of an income approach such as the direct capitalization method or the discounted cash flow approach. The discounted cash flow approach uses similar assumptions to the undiscounted cash flow approach above, as well as a discount rate. Such cash flow projections and rates are subject to management judgment and changes in those assumptions could impact the estimate of fair value. In estimating the fair value of undeveloped land, the Company generally uses market data and comparable sales information.
(d) Cash, Cash Equivalents, and Restricted Cash
Any instruments which have an original maturity of 90 days or less when purchased are considered cash equivalents. As of December 31, 2025 and 2024, $ 16.0 million and $ 5.6 million , respectively, of cash was restricted through escrow agreements and certain mortgage loans.
(e) Other Assets
Goodwill
Goodwill represents the excess of the purchase price consideration from the Equity One merger in 2017 over the fair value of the assets acquired and liabilities assumed. The Company accounts for goodwill in accordance with ASC Topic 350, Intangibles - Goodwill and Other , and allocates its goodwill to its reporting units, which have been determined to be at the individual property level. The Company performs an impairment evaluation of its goodwill at least annually, in November of each year, or more frequently as triggers occur. See Note 5.
The goodwill impairment evaluation is completed using either a qualitative or quantitative approach. Under a qualitative approach, the impairment review for goodwill consists of an assessment of whether it is more-likely-than-not that the reporting unit's fair value is less than its carrying value, including goodwill. If a qualitative approach indicates it is more
88
REGENCY CENTERS CORPORATION AND REGENCY CENTERS, L.P.
Notes to Consolidated Financial Statements
December 31, 2025
likely-than-not that the estimated carrying value of a reporting unit (including goodwill) exceeds its fair value, or if the Company chooses to bypass the qualitative approach for any reporting unit, the Company will perform the quantitative approach described below.
The quantitative approach consists of estimating the fair value of each reporting unit using discounted projected future cash flows and comparing those estimated fair values with the carrying values, which include the allocated goodwill. If the estimated fair value is less than the carrying value, the Company would then recognize a goodwill impairment charge for the amount by which the carrying amount exceeds the reporting unit's fair value, not to exceed the total amount of goodwill allocated to that reporting unit.
Investments
The Company determines the appropriate classification of its investments in debt and equity securities at the time of purchase and reevaluates such determinations at each balance sheet date. The fair value of securities is determined using quoted market prices.
Debt securities are classified as held to maturity when the Company has the positive intent and ability to hold the securities to maturity. Debt securities that are bought and held principally for the purpose of selling them in the near term are classified as trading securities and are reported at fair value, with unrealized gains and losses recognized through earnings in Net investment income in the Consolidated Statements of Operations. Debt securities not classified as held to maturity or as trading, are classified as available-for-sale, and are carried at fair value, with the unrealized gains and losses, net of tax, included in the determination of comprehensive income and reported in the Consolidated Statements of Comprehensive Income.
Equity securities with readily determinable fair values are measured at fair value with changes in the fair value recognized through net income and presented within Net investment income in the Consolidated Statements of Operations.
Derivative Instruments
The Company manages economic risks, including interest rate, liquidity, and credit risk primarily by managing the amount, sources, and duration of its debt funding and the use of derivative instruments. Specifically, the Company enters into derivative instruments to manage exposures that arise from business activities that result in the receipt or future payment of known and uncertain cash amounts, the amount of which are determined by interest rates. The Company's derivative instruments are used to manage fluctuations in the amount, timing, and duration of the Company's known or expected cash payments principally related to the Company's borrowings.
All derivative instruments, whether designated in hedging relationships or not, are recorded on the accompanying Consolidated Balance Sheets at their fair value. The accounting for changes in the fair value of derivatives depends on the intended use of the derivative, whether the Company has elected to designate a derivative in a hedging relationship and apply hedge accounting, and whether the hedging relationship has satisfied the criteria necessary to apply hedge accounting. Derivatives designated and qualifying as a hedge of the exposure to variability in expected future cash flows, or other types of forecasted transactions, are considered cash flow hedges. Hedge accounting generally provides for the matching of the timing of gain or loss recognition on the hedging instrument with the earnings effect of the hedged forecasted transactions in a cash flow hedge. The Company may enter into derivative contracts that are intended to economically hedge certain risks, even though hedge accounting does not apply or the Company elects not to apply hedge accounting.
The Company uses interest rate swaps to mitigate its interest rate risk on a related financial instrument or forecasted transaction, and the Company designates these interest rate swaps as cash flow hedges. Interest rate swaps designated as cash flow hedges generally involve the receipt of variable-rate amounts from a counterparty in exchange for the Company making fixed-rate payments over the life of the agreements without exchange of the underlying notional amount. The Company may also utilize cash flow hedges to lock U.S. Treasury rates in anticipation of future fixed-rate debt issuances. The gains or losses resulting from changes in fair value of derivatives that qualify as cash flow hedges are recognized in Accumulated other comprehensive income (loss) ("AOCI"). Upon the settlement of a hedge, gains and losses remaining in AOCI are amortized through earnings over the underlying term of the hedged transaction. The cash receipts or payments related to interest rate swaps are presented in cash flows provided by operating activities in the accompanying Consolidated Statements of Cash Flows.
89
REGENCY CENTERS CORPORATION AND REGENCY CENTERS, L.P.
Notes to Consolidated Financial Statements
December 31, 2025
The Company formally documents all relationships between hedging instruments and hedged items, as well as its risk management objectives and strategies for undertaking various hedge transactions. The Company assesses, both at inception of the hedge and on an ongoing basis, whether the derivatives that are used in hedging transactions are highly effective in offsetting changes in the cash flows and/or forecasted cash flows of the hedged items.
In assessing the valuation of the hedges, the Company uses standard market conventions and techniques such as discounted cash flow analysis, option pricing models, and termination costs at each balance sheet date. All methods of assessing fair value result in a general approximation of value, and such value may never actually be realized.
(f) Deferred Leasing Costs
Deferred leasing costs consist of costs associated with leasing the Company's shopping centers, and are presented net of accumulated amortization. Such costs are amortized over the period through lease expiration. If the lease is terminated early, the remaining leasing costs are written off.
Under ASC Topic 842, the Company, as a lessor, may only defer as initial direct costs the incremental costs of a tenant's operating lease that would not have been incurred if the lease had not been obtained. These costs generally consist of third party broker payments and internal leasing commissions paid to employees for successful execution of lease agreements. Non-contingent internal leasing and legal costs associated with leasing activities are expensed within General and administrative expenses.
(g) Income Taxes
The Parent Company believes it qualifies, and intends to continue to qualify, as a REIT under the Internal Revenue Code (the “Code”). As a REIT, the Parent Company will generally not be subject to federal income tax, provided that distributions to its shareholders are at least equal to REIT taxable income. All wholly-owned corporate subsidiaries of the Operating Partnership have elected to be a taxable REIT subsidiary (“TRS”) or qualify as a REIT. The TRSs are subject to federal and state income taxes and file separate tax returns. As a pass through entity, the Operating Partnership generally does not pay income taxes, but its taxable income or loss is reported by its partners, of which the Parent Company, as general partner and approximately 97.9 % owner, is allocated its Pro-rata share of tax attributes.
Distributions to shareholders are usually taxable as ordinary dividends, although a portion of the distributions may be designated as qualified dividends, capital gains or may constitute a return of capital. The Company’s distributions for 2025 consisted o f a 98.69 % ordinary dividend (which includes a 3.37 % qualified dividend), and a 1.31 % capital gain distribution.
The Company is subject to a 4 % federal excise tax if it fails to distribute sufficient taxable income within prescribed time limits. The excise tax equals 4 % of the excess, if any, of (a) 85 % of the Company’s ordinary income for the calendar year (determined without regard to capital gains), (b) 95 % of the Company’s net capital gains for the calendar year, and (c) 100 % of the Company’s prior-year undistributed taxable income, over the sum of cash distributions paid during the year and certain taxes paid by the Company. No excise tax was incurred in 2025, 2024, or 2023.
The Company accounts for income taxes related to its taxable REIT subsidiaries in accordance with ASC 740, Income Taxes. Deferred tax assets and liabilities are recognized for temporary differences between the financial statement and tax bases of assets and liabilities using enacted tax rates expected to apply in the periods in which the differences reverse. Deferred tax liabilities are included in Accounts payable and other liabilities, and net deferred tax assets are included in Other assets in the Consolidated Balance Sheets. Our TRSs had a net deferred tax liability of $ 1.1 million and $ 10.3 million as of December 31, 2025 and 2024, respectively. The Company evaluates the realizability of deferred tax assets and records a valuation allowance when it is more likely than not that such assets will not be realized. There are no net deferred tax assets as of December 31, 2025 and 2024. The Company believes its income tax positions are adequately supported and that its accruals for income taxes are sufficient for all open tax years. The Company had no material uncertain tax positions as of December 31, 2025 .
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REGENCY CENTERS CORPORATION AND REGENCY CENTERS, L.P.
Notes to Consolidated Financial Statements
December 31, 2025
(h) Lease Obligations
The Company has certain properties within its consolidated real estate portfolio that are either partially or completely on land subject to ground leases with third parties, which are all classified as operating leases. Accordingly, the Company owns only a long-term leasehold or similar interest in these properties. The building and improvements constructed on the leased land are capitalized as Real estate assets in the accompanying Consolidated Balance Sheets and depreciated over the shorter of the useful life of the improvements or the lease term.
In addition, the Company has non-cancelable operating leases pertaining to office space from which it conducts its business. Leasehold improvements are capitalized as tenant improvements, presented in Other assets in the Consolidated Balance Sheets, and depreciated over the shorter of the useful life of the improvements or the lease term.
Under Topic 842, the Company recognizes Lease liabilities on its Consolidated Balance Sheets for its ground and office leases and corresponding Right of use assets related to these same ground and office leases which are classified as operating leases. A key input in estimating the Lease liabilities and resulting Right of use assets is establishing the discount rate in the lease, which since the rates implicit in the lease contracts are not readily determinable, requires additional inputs for the longer-term ground leases, including market-based interest rates that correspond with the remaining term of the lease, the Company's credit spread, and a securitization adjustment necessary to reflect the collateralized payment terms present in the lease. This discount rate is applied to the remaining unpaid minimum rental payments for each lease to measure the operating lease liabilities.
The ground and office lease expenses are recognized on a straight-line basis over the term of the leases, including management's estimate of expected optional renewal periods. For ground leases, the Company generally assumes it will exercise options through the latest option date of that shopping center's anchor tenant lease.
(i) Forward Equity Sales
Our at-the-market (“ATM”) program allows for the sale of common stock through forward sales contracts. These contracts meet all conditions for equity classification, and as such, common stock is recorded at the offering price specified in the contract upon settlement. The Company also accounts for the potential dilution from forward sales contracts in its earnings per share calculations, using the treasury stock method to determine any dilutive impact before settlement. For further details on forward equity sales transactions, refer to Note 11 in the consolidated financial statements.
(j) Earnings per Share and Unit
Basic earnings per share of common stock and unit are computed based upon the weighted average number of common shares and units, respectively, outstanding during the period. Diluted earnings per share and unit reflect the conversion of obligations and the assumed exercises of securities including the effects of shares issuable under the Company's share-based payment arrangements, if dilutive. Dividends paid on the Company's share-based compensation awards are not participating securities as they are forfeitable.
(k) Stock-Based Compensation
The Company grants stock-based compensation to its employees and directors and recognizes the cost of stock-based compensation based on the grant-date fair value of the award, which is expensed over the vesting period.
When the Parent Company issues common stock as compensation, it simultaneously receives an equal number of common units from the Operating Partnership. The Company contributes all deemed proceeds from the share-based awards granted under the Parent Company's Long-Term Omnibus Plan (the "Plan") to the operating partnership. Consequently, the Parent Company's ownership in the Operating Partnership increases in proportion to the deemed proceeds contributed in exchange for the common units received. As a result of the issuance of common units to the Parent Company for stock-based compensation, the Operating Partnership records the effect of stock-based compensation for awards of equity in the Parent Company.
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REGENCY CENTERS CORPORATION AND REGENCY CENTERS, L.P.
Notes to Consolidated Financial Statements
December 31, 2025
(l) Segment Reporting