Item 8. Consolidated Financial Statements and Supplementary Data

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Item 8. Consolidated Financial Statements and Supplementary Data

Regency Centers Corporation and Regency Centers, L.P.

Index to Financial Statements



Reports of Independent Registered Public Accounting Firm	67

Regency Centers Corporation:
Consolidated Balance Sheets as of December 31, 2016 and 2015	71
Consolidated Statements of Operations for the years ended December 31, 2016, 2015, and 2014	72
Consolidated Statements of Comprehensive Income for the years ended December 31, 2016, 2015, and 2014	73
Consolidated Statements of Equity for the years ended December 31, 2016, 2015, and 2014	74
Consolidated Statements of Cash Flows for the years ended December 31, 2016, 2015, and 2014	76

Regency Centers, L.P.:
Consolidated Balance Sheets as of December 31, 2016 and 2015	78
Consolidated Statements of Operations for the years ended December 31, 2016, 2015, and 2014	79
Consolidated Statements of Comprehensive Income for the years ended December 31, 2016, 2015, and 2014	80
Consolidated Statements of Capital for the years ended December 31, 2016, 2015, and 2014	81
Consolidated Statements of Cash Flows for the years ended December 31, 2016, 2015, and 2014	83

Notes to Consolidated Financial Statements	85

Financial Statement Schedule
Schedule III - Consolidated Real Estate and Accumulated Depreciation - December 31, 2016	127

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.

Report of Independent Registered Public Accounting Firm

The Board of Directors and Stockholders

Regency Centers Corporation:

We have audited the accompanying consolidated balance sheets of Regency Centers Corporation and subsidiaries as of December 31, 2016 and 2015, and 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, 2016. In connection with our audits of the consolidated financial statements, we also have audited the financial statement schedule III. These consolidated financial statements and financial statement schedule are the responsibility of the Company’s management. Our responsibility is to express an opinion on these consolidated financial statements and financial statement schedule based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of Regency Centers Corporation and subsidiaries as of December 31, 2016 and 2015, and the results of their operations and their cash flows for each of the years in the three‑year period ended December 31, 2016, in conformity with U.S. generally accepted accounting principles. Also in our opinion, the related financial statement schedule, when considered in relation to the basic consolidated financial statements taken as a whole, present fairly, in all material respects, the information set forth therein.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), Regency Centers Corporation’s internal control over financial reporting as of December 31, 2016, based on criteria established in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO), and our report dated February 27, 2017 expressed an unqualified opinion on the effectiveness of the Company’s internal control over financial reporting.

/s/ KPMG LLP

February 27, 2017

Jacksonville, Florida

Certified Public Accountants

Report of Independent Registered Public Accounting Firm

The Board of Directors and Stockholders

Regency Centers Corporation:

We have audited Regency Centers Corporation’s internal control over financial reporting as of December 31, 2016, based on criteria established in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Regency Centers Corporation’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 conducted our audit in accordance with the standards of the Public Company Accounting Oversight Board (United States). 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 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.

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.

In our opinion, Regency Centers Corporation maintained, in all material respects, effective internal control over financial reporting as of December 31, 2016, 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), the consolidated balance sheets of Regency Centers Corporation and subsidiaries as of December 31, 2016 and 2015, and 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, 2016, and our report dated February 27, 2017 expressed an unqualified opinion on those consolidated financial statements.

/s/ KPMG LLP

February 27, 2017

Jacksonville, Florida

Certified Public Accountants

Report of Independent Registered Public Accounting Firm

The Partners

Regency Centers, L.P.:

We have audited the accompanying consolidated balance sheets of Regency Centers, L.P. and subsidiaries as of December 31, 2016 and 2015, and 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, 2016. In connection with our audits of the consolidated financial statements, we also have audited the financial statement schedule III. These consolidated financial statements and financial statement schedule are the responsibility of the Partnership’s management. Our responsibility is to express an opinion on these consolidated financial statements and financial statement schedule based on our audits.

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of Regency Centers, L.P. and subsidiaries as of December 31, 2016 and 2015, and the results of their operations and their cash flows for each of the years in the three‑year period ended December 31, 2016, in conformity with U.S. generally accepted accounting principles. Also in our opinion, the related financial statement schedule, when considered in relation to the basic consolidated financial statements taken as a whole, present fairly, in all material respects, the information set forth therein.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), Regency Centers, L.P.’s internal control over financial reporting as of December 31, 2016, based on criteria established in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO), and our report dated February 27, 2017 expressed an unqualified opinion on the effectiveness of the Partnership’s internal control over financial reporting.

/s/ KPMG LLP

February 27, 2017

Jacksonville, Florida

Certified Public Accountants

Report of Independent Registered Public Accounting Firm

The Partners

Regency Centers, L.P.:

We have audited Regency Centers, L.P.’s internal control over financial reporting as of December 31, 2016, based on criteria established in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Regency Centers, L.P.’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.

In our opinion, Regency Centers, L.P. maintained, in all material respects, effective internal control over financial reporting as of December 31, 2016, 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), the consolidated balance sheets of Regency Centers, L.P. and subsidiaries as of December 31, 2016 and 2015, and 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, 2016, and our report dated February 27, 2017 expressed an unqualified opinion on those consolidated financial statements.

/s/ KPMG LLP

February 27, 2017

Jacksonville, Florida

Certified Public Accountants

REGENCY CENTERS CORPORATION

Consolidated Balance Sheets

December 31, 2016 and 2015

(in thousands, except share data)



	2016			2015
Assets
Real estate investments at cost (notes 1, 2 and 3):
Land	$	1,660,424		1,479,814
Buildings and improvements	3,092,197			2,896,396
Properties in development	180,878			169,690
	4,933,499			4,545,900
Less: accumulated depreciation	1,124,391			1,043,787
	3,809,108			3,502,113
Investments in real estate partnerships (note 4)	296,699			306,206
Net real estate investments	4,105,807			3,808,319
Cash and cash equivalents	13,256			36,856
Restricted cash	4,623			3,767
Tenant and other receivables, net (note 1):	111,722			106,164
Deferred leasing costs, less accumulated amortization of $83,529 and $76,823 at December 31, 2016 and 2015, respectively	69,000			66,367
Acquired lease intangible assets, less accumulated amortization of $56,695 and $45,639 at December 31, 2016 and 2015, respectively (note 5)	118,831			105,380
Trading securities held in trust, at fair value (note 11)	28,588			29,093
Other assets	37,079			26,935
Total assets	$	4,488,906		4,182,881
Liabilities and Equity
Liabilities:
Notes payable (note 6)	$	1,363,925		1,699,771
Unsecured credit facilities (note 6)	278,495			164,514
Accounts payable and other liabilities	138,936			164,515
Acquired lease intangible liabilities, less accumulated amortization of $23,538 and $17,555 at December 31, 2016 and 2015, respectively (note 5)	54,180			42,034
Tenants’ security and escrow deposits and prepaid rent	28,868			29,427
Total liabilities	1,864,404			2,100,261
Commitments and contingencies (notes 13 and 14)	—			—
Equity:
Stockholders’ equity (note 9):
Preferred stock, $0.01 par value per share, 30,000,000 shares authorized; 13,000,000 Series 6 and 7 shares issued and outstanding at December 31, 2016 and 2015, with liquidation preferences of $25 per share	325,000			325,000
Common stock $0.01 par value per share,150,000,000 shares authorized; 104,497,286 and 97,212,638 shares issued at December 31, 2016 and 2015, respectively	1,045			972
Treasury stock at cost, 347,903 and 417,862 shares held at December 31, 2016 and 2015, respectively	(17,062		)	(19,658	)
Additional paid in capital	3,294,923			2,742,508
Accumulated other comprehensive loss	(18,346		)	(58,693	)
Distributions in excess of net income	(994,259		)	(936,020	)
Total stockholders’ equity	2,591,301			2,054,109
Noncontrolling interests (note 9):
Exchangeable operating partnership units, aggregate redemption value of $10,630 and $10,502 at December 31, 2016 and 2015, respectively	(1,967		)	(1,975	)
Limited partners’ interests in consolidated partnerships	35,168			30,486
Total noncontrolling interests	33,201			28,511
Total equity	2,624,502			2,082,620
Total liabilities and equity	$	4,488,906		4,182,881

See accompanying notes to consolidated financial statements.

REGENCY CENTERS CORPORATION

Consolidated Statements of Operations

For the years ended December 31, 2016, 2015, and 2014

(in thousands, except per share data)



	2016			2015		2014
Revenues:
Minimum rent	$	444,305		415,155		390,697
Percentage rent	4,128			3,750		3,488
Recoveries from tenants and other income	140,611			125,295		119,618
Management, transaction, and other fees	25,327			25,563		24,095
Total revenues	614,371			569,763		537,898
Operating expenses:
Depreciation and amortization	162,327			146,829		147,791
Operating and maintenance	95,022			82,978		77,788
General and administrative	65,327			65,600		60,242
Real estate taxes	66,395			61,855		59,031
Other operating expenses	14,081			7,836		8,496
Total operating expenses	403,152			365,098		353,348
Other expense (income):
Interest expense, net of interest income of $1,180 , $1,590, and $1,210 in 2016, 2015, and 2014, respectively	90,712			102,622		109,491
Provision for impairment	4,200			—		1,257
Early extinguishment of debt	14,240			8,239		18
Net investment income, including unrealized (gains) losses of ($773), $1,734, and $1,058 in 2016, 2015, and 2014, respectively (notes 11)	(1,672		)	(625	)	(9,449	)
Gain on remeasurement of investment in real estate partnership	—			—		(18,271	)
Loss on derivative instruments	40,586			—		—
Total other expense (income)	148,066			110,236		83,046
Income from operations before equity in income of investments in real estate partnerships	63,153			94,429		101,504
Equity in income of investments in real estate partnerships (note 4)	56,518			22,508		31,270
Income tax (benefit) of taxable REIT subsidiary	—			—		(996	)
Income from operations	119,671			116,937		133,770
Gain on sale of real estate, net of tax	47,321			35,606		55,077
Net income	166,992			152,543		188,847
Noncontrolling interests:
Exchangeable operating partnership units	(257		)	(240	)	(319	)
Limited partners’ interests in consolidated partnerships	(1,813		)	(2,247	)	(1,138	)
Income attributable to noncontrolling interests	(2,070		)	(2,487	)	(1,457	)
Net income attributable to the Company	164,922			150,056		187,390
Preferred stock dividends	(21,062		)	(21,062	)	(21,062	)
Net income attributable to common stockholders	$	143,860		128,994		166,328

Income per common share - basic (note 12):	$	1.43		1.37		1.80
Income per common share - diluted (note 12):	$	1.42		1.36		1.80

See accompanying notes to consolidated financial statements.

REGENCY CENTERS CORPORATION

Consolidated Statements of Comprehensive Income

For the years ended December 31, 2016, 2015, and 2014

(in thousands)



	2016			2015		2014
Net income	$	166,992		152,543		188,847
Other comprehensive (loss) income:
Effective portion of change in fair value of derivative instruments:
Effective portion of change in fair value of derivative instruments	(10,332		)	(10,089	)	(49,968	)
Reclassification adjustment of derivative instruments included in net income	51,139			9,152		9,353
Unrealized gain (loss) on available-for-sale securities	24			(43	)	7,765
Less: realized gains on sale of available-for-sale securities recognized in net income	—			—		(7,765	)
Other comprehensive income (loss)	40,831			(980	)	(40,615	)
Comprehensive income	207,823			151,563		148,232
Less: comprehensive income (loss) attributable to noncontrolling interests:
Net income attributable to noncontrolling interests	2,070			2,487		1,457
Other comprehensive income (loss) attributable to noncontrolling interests	484			(35	)	(271	)
Comprehensive income attributable to noncontrolling interests	2,554			2,452		1,186
Comprehensive income attributable to the Company	$	205,269		149,111		147,046

See accompanying notes to consolidated financial statements.

REGENCY CENTERS CORPORATION Consolidated Statements of Equity For the years ended December 31, 2016, 2015, and 2014 (in thousands, except per share data)

														Noncontrolling Interests
		Preferred Stock	Common Stock	Treasury Stock		Additional Paid In Capital		Accumulated Other Comprehensive Loss		Distributions in Excess of Net Income		Total Stockholders’ Equity			Exchangeable Operating Partnership Units		Limited Partners’ Interest in Consolidated Partnerships		Total Noncontrolling Interests		Total Equity
Balance at December 31, 2013	$	325,000	923	(16,726	)	2,426,477		(17,404	)	(874,916	)	1,843,354			(1,426	)	19,206		17,780		1,861,134
Net income		—	—	—		—		—		187,390		187,390			319		1,138		1,457		188,847
Other comprehensive income (loss)		—	—	—		—		(40,344	)	—		(40,344	)		(70	)	(201	)	(271	)	(40,615	)
Deferred compensation plan, net		—	—	(2,656	)	2,656		—		—		—			—		—		—		—
Amortization of restricted stock issued		—	—	—		12,161		—		—		12,161			—		—		—		12,161
Common stock redeemed for taxes withheld for stock based compensation, net		—	—	—		(3,493	)	—		—		(3,493	)		—		—		—		(3,493	)
Common stock issued for dividend reinvestment plan		—	—	—		1,184		—		—		1,184			—		—		—		1,184
Common stock issued for stock offerings, net of issuance costs		—	18	—		102,435		—		—		102,453			—		—		—		102,453
Redemption of preferred units		—	—	—		—		—		—		—			(300	)	—		(300	)	(300	)
Common stock issued for partnership units exchanged		—	—	—		137		—		—		137			(137	)	—		(137	)	—
Contributions from partners		—	—	—		—		—		—		—			—		16,204		16,204		16,204
Distributions to partners		—	—	—		(1,404	)	—		—		(1,404	)		—		(4,543	)	(4,543	)	(5,947	)
Cash dividends declared:
Preferred stock/unit		—	—	—		—		—		(21,062	)	(21,062	)		—		—		—		(21,062	)
Common stock/unit ($1.88 per share)		—	—	—		—		—		(173,784	)	(173,784	)		(300	)	—		(300	)	(174,084	)
Balance at December 31, 2014	$	325,000	941	(19,382	)	2,540,153		(57,748	)	(882,372	)	1,906,592			(1,914	)	31,804		29,890		1,936,482
Net income		—	—	—		—		—		150,056		150,056			240		2,247		2,487		152,543
Other comprehensive income (loss)		—	—	—		—		(945	)	—		(945	)		(2	)	(33	)	(35	)	(980	)
Deferred compensation plan, net		—	—	(276	)	276		—		—		—			—		—		—		—
Amortization of restricted stock issued		—	—	—		13,869		—		—		13,869			—		—		—		13,869
Common stock redeemed for taxes withheld for stock based compensation, net		—	—	—		(9,706	)	—		—		(9,706	)		—		—		—		(9,706	)
Common stock issued for dividend reinvestment plan		—	—	—		1,250		—		—		1,250			—		—		—		1,250
Common stock issued for stock offerings, net of issuance costs		—	31	—		198,463		—		—		198,494			—		—		—		198,494
Contributions from partners		—	—	—		—		—		—		—			—		717		717		717

REGENCY CENTERS CORPORATION Consolidated Statements of Equity For the years ended December 31, 2016, 2015, and 2014 (in thousands, except per share data)

														Noncontrolling Interests
		Preferred Stock	Common Stock	Treasury Stock		Additional Paid In Capital		Accumulated Other Comprehensive Loss		Distributions in Excess of Net Income		Total Stockholders’ Equity			Exchangeable Operating Partnership Units		Limited Partners’ Interest in Consolidated Partnerships		Total Noncontrolling Interests		Total Equity
Distributions to partners		—	—	—		(1,797	)	—		—		(1,797	)		—		(4,249	)	(4,249	)	(6,046	)
Cash dividends declared:
Preferred stock/unit		—	—	—		—		—		(21,062	)	(21,062	)		—		—		—		(21,062	)
Common stock/unit ($1.94 per share)		—	—	—		—		—		(182,642	)	(182,642	)		(299	)	—		(299	)	(182,941	)
Balance at December 31, 2015	$	325,000	972	(19,658	)	2,742,508		(58,693	)	(936,020	)	2,054,109			(1,975	)	30,486		28,511		2,082,620
Net income		—	—	—		—		—		164,922		164,922			257		1,813		2,070		166,992
Other comprehensive income (loss)		—	—	—		—		40,347		—		40,347			58		426		484		40,831
Deferred compensation plan, net		—	—	2,596		(2,596	)	—		—		—			—		—		—		—
Amortization of restricted stock issued		—	2	—		13,419		—		—		13,421			—		—		—		13,421
Common stock redeemed for taxes withheld for stock based compensation, net		—	—	—		(7,789	)	—		—		(7,789	)		—		—		—		(7,789	)
Common stock issued for dividend reinvestment plan		—	—	—		1,070		—		—		1,070			—		—		—		1,070
Common stock issued for stock offerings, net of issuance costs		—	71	—		548,849		—		—		548,920			—		—		—		548,920
Reallocation of limited partners' interest		—	—	—		(538	)	—		—		(538	)		—		538		538		—
Contributions from partners		—	—	—		—		—		—		—			—		8,760		8,760		8,760
Distributions to partners		—	—	—		—		—		—		—			—		(6,855	)	(6,855	)	(6,855	)
Cash dividends declared:
Preferred stock/unit		—	—	—		—		—		(21,062	)	(21,062	)		—		—		—		(21,062	)
Common stock/unit ($2.00 per share)		—	—	—		—		—		(202,099	)	(202,099	)		(307	)	—		(307	)	(202,406	)
Balance at December 31, 2016	$	325,000	1,045	(17,062	)	3,294,923		(18,346	)	(994,259	)	2,591,301			(1,967	)	35,168		33,201		2,624,502

See accompanying notes to consolidated financial statements.



REGENCY CENTERS CORPORATION Consolidated Statements of Cash Flows For the years ended December 31, 2016, 2015, and 2014 (in thousands)
	2016			2015		2014
Cash flows from operating activities:
Net income	$	166,992		152,543		188,847
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	162,327			146,829		147,791
Amortization of deferred loan cost and debt premium	9,762			9,677		10,521
Amortization and (accretion) of above and below market lease intangibles, net	(3,879		)	(1,598	)	(3,101	)
Stock-based compensation, net of capitalization	10,652			11,081		9,662
Equity in income of investments in real estate partnerships	(56,518		)	(22,508	)	(31,270	)
Gain on remeasurement of investment in real estate partnership	—			—		(18,271	)
Gain on sale of real estate, net of tax	(47,321		)	(35,606	)	(55,077	)
Provision for impairment	4,200			—		1,257
Early extinguishment of debt	14,240			8,239		18
Distribution of earnings from operations of investments in real estate partnerships	50,361			46,646		42,767
Settlement of derivative instruments	—			(7,267	)	4,648
Gain on derivative instruments	—			—		(13	)
Deferred compensation expense	1,655			207		1,386
Realized and unrealized gain on investments (note 11)	(1,673		)	(626	)	(9,158	)
Changes in assets and liabilities:
Restricted cash	59			1,926		848
Accounts receivable, net	(9,565		)	(11,965	)	(6,225	)
Straight-line rent receivable, net	(7,219		)	(8,231	)	(6,544	)
Deferred leasing costs	(10,349		)	(12,949	)	(8,252	)
Other assets	673			(496	)	89
Accounts payable and other liabilities	5,543			(3,810	)	6,201
Tenants’ security and escrow deposits and prepaid rent	(564		)	3,545		1,618
Net cash provided by operating activities	289,376			275,637		277,742
Cash flows from investing activities:
Acquisition of operating real estate	(333,220		)	(42,983	)	(112,120	)
Advance deposits paid on acquisition of operating real estate	(750		)	(2,250	)	—
Real estate development and capital improvements	(234,598		)	(205,103	)	(238,237	)
Proceeds from sale of real estate investments	135,269			108,822		118,787
Collection of notes receivable	—			1,719		—
Investments in real estate partnerships	(37,879		)	(20,054	)	(23,577	)
Distributions received from investments in real estate partnerships	58,810			23,801		37,152
Dividends on investment securities	330			243		243
Acquisition of securities	(55,223		)	(31,941	)	(23,760	)
Proceeds from sale of securities	57,590			28,400		31,222
Net cash used in investing activities	(409,671		)	(139,346	)	(210,290	)



REGENCY CENTERS CORPORATION Consolidated Statements of Cash Flows For the years ended December 31, 2016, 2015, and 2014 (in thousands)
	2016			2015		2014
Cash flows from financing activities:
Net proceeds from common stock issuance	548,920			198,494		102,453
Proceeds from sale of treasury stock	957			—		—
Acquisition of treasury stock	(29		)	—		—
Redemption of preferred stock and partnership units	—			—		(300	)
Distributions to limited partners in consolidated partnerships, net	(4,213		)	(5,341	)	(5,303	)
Distributions to exchangeable operating partnership unit holders	(307		)	(299	)	(300	)
Dividends paid to common stockholders	(201,029		)	(181,392	)	(172,600	)
Dividends paid to preferred stockholders	(21,062		)	(21,062	)	(21,062	)
Repayment of fixed rate unsecured notes	(300,000		)	(450,000	)	(150,000	)
Proceeds from issuance of fixed rate unsecured notes, net	—			248,160		248,705
Proceeds from unsecured credit facilities	460,000			445,000		255,000
Repayment of unsecured credit facilities	(345,000		)	(355,000	)	(255,000	)
Proceeds from notes payable	53,446			4,316		12,739
Repayment of notes payable	(72,803		)	(76,168	)	(38,717	)
Scheduled principal payments	(5,860		)	(5,878	)	(6,909	)
Payment of loan costs	(2,233		)	(5,998	)	(3,066	)
Early redemption costs	(14,092		)	(8,043	)	—
Net cash provided by (used in) financing activities	96,695			(213,211	)	(34,360	)
Net decrease in cash and cash equivalents	(23,600		)	(76,920	)	33,092
Cash and cash equivalents at beginning of the year	36,856			113,776		80,684
Cash and cash equivalents at end of the year	$	13,256		36,856		113,776
Supplemental disclosure of cash flow information:
Cash paid for interest (net of capitalized interest of $3,482, $6,740, and $7,142 in 2016, 2015, and 2014, respectively)	$	82,950		101,527		109,425
Cash paid for income taxes	$	—		1,015		2,169
Supplemental disclosure of non-cash transactions:
Common stock issued for partnership units exchanged	$	—		—		137
Mortgage loans assumed for the acquisition of real estate	$	—		42,799		103,187
Change in fair value of securities available-for-sale	$	24		(43	)	—
Initial fair value of non-controlling interest recorded at acquisition	$	—		—		15,385
Acquisition of previously unconsolidated real estate investments	$	—		—		16,182
Change in fair value of derivative instruments	$	(10,332	)	(9,012	)	(49,968	)
Common stock issued for dividend reinvestment plan	$	1,070		1,250		1,184
Stock-based compensation capitalized	$	2,963		2,988		2,707
Contributions from limited partners in consolidated partnerships, net	$	8,755		13		1,579
Common stock issued for dividend reinvestment in trust	$	728		833		779
Contribution of stock awards into trust	$	1,538		1,651		1,881
Distribution of stock held in trust	$	4,114		1,898		4
Deconsolidation of previously consolidated partnership:
Real estate, net	$	14,144		—		—
Investments in real estate partnerships	$	(3,355	)	—		—
Notes payable	$	(9,415	)	—		—
Other assets and liabilities	$	571		—		—
Limited partners' interest in consolidated partnerships	$	(2,099	)	—		—

See accompanying notes to consolidated financial statements.

REGENCY CENTERS, L.P.

Consolidated Balance Sheets

December 31, 2016 and 2015

(in thousands, except unit data)



	2016			2015
Assets
Real estate investments at cost (notes 1, 2 and 3):
Land	$	1,660,424		1,479,814
Buildings and improvements	3,092,197			2,896,396
Properties in development	180,878			169,690
	4,933,499			4,545,900
Less: accumulated depreciation	1,124,391			1,043,787
	3,809,108			3,502,113
Investments in real estate partnerships (note 4)	296,699			306,206
Net real estate investments	4,105,807			3,808,319
Cash and cash equivalents	13,256			36,856
Restricted cash	4,623			3,767
Tenant and other receivables, net (note 1):	111,722			106,164
Deferred leasing costs, less accumulated amortization of $83,529 and $76,823 at December 31, 2016 and 2015, respectively	69,000			66,367
Acquired lease intangible assets, less accumulated amortization of $56,695 and $45,639 at December 31, 2016 and 2015, respectively (note 5)	118,831			105,380
Trading securities held in trust, at fair value (note 11)	28,588			29,093
Other assets	37,079			26,935
Total assets	$	4,488,906		4,182,881
Liabilities and Capital
Liabilities:
Notes payable (note 6)	$	1,363,925		1,699,771
Unsecured credit facilities (note 6)	278,495			164,514
Accounts payable and other liabilities	138,936			164,515
Acquired lease intangible liabilities, less accumulated amortization of $23,538 and $17,555 at December 31, 2016 and 2015, respectively (note 5)	54,180			42,034
Tenants’ security and escrow deposits and prepaid rent	28,868			29,427
Total liabilities	1,864,404			2,100,261
Commitments and contingencies (notes 13 and 14)	—			—
Capital:
Partners’ capital (note 9):
Preferred units of general partner, $0.01 par value per unit, 13,000,000 units issued and outstanding at December 31, 2016 and 2015, respectively, liquidation preference of $25 per unit	325,000			325,000
General partner; 104,497,286 and 97,212,638 units outstanding at December 31, 2016 and 2015, respectively	2,284,647			1,787,802
Limited partners; 154,170 units outstanding at December 31, 2016 and 2015	(1,967		)	(1,975	)
Accumulated other comprehensive loss	(18,346		)	(58,693	)
Total partners’ capital	2,589,334			2,052,134
Noncontrolling interests (note 9):
Limited partners’ interests in consolidated partnerships	35,168			30,486
Total noncontrolling interests	35,168			30,486
Total capital	2,624,502			2,082,620
Total liabilities and capital	$	4,488,906		4,182,881

See accompanying notes to consolidated financial statements.

REGENCY CENTERS, L.P.

Consolidated Statements of Operations

For the years ended December 31, 2016, 2015, and 2014

(in thousands, except per unit data)



	2016			2015		2014
Revenues:
Minimum rent	$	444,305		415,155		390,697
Percentage rent	4,128			3,750		3,488
Recoveries from tenants and other income	140,611			125,295		119,618
Management, transaction, and other fees	25,327			25,563		24,095
Total revenues	614,371			569,763		537,898
Operating expenses:
Depreciation and amortization	162,327			146,829		147,791
Operating and maintenance	95,022			82,978		77,788
General and administrative	65,327			65,600		60,242
Real estate taxes	66,395			61,855		59,031
Other operating expenses	14,081			7,836		8,496
Total operating expenses	403,152			365,098		353,348
Other expense (income):
Interest expense, net of interest income of $1,180 , $1,590, and $1,210 in 2016, 2015, and 2014, respectively	90,712			102,622		109,491
Provision for impairment	4,200			—		1,257
Early extinguishment of debt	14,240			8,239		18
Net investment income, including unrealized (gains) losses of ($773), $1,734, and $1,058 in 2016, 2015, and 2014, respectively (notes 11)	(1,672		)	(625	)	(9,449	)
Gain on remeasurement of investment in real estate partnership	—			—		(18,271	)
Loss on derivative instruments	40,586			—		—
Total other expense (income)	148,066			110,236		83,046
Income from operations before equity in income of investments in real estate partnerships	63,153			94,429		101,504
Equity in income of investments in real estate partnerships (note 4)	56,518			22,508		31,270
Income tax (benefit) of taxable REIT subsidiary	—			—		(996	)
Income from operations	119,671			116,937		133,770
Gain on sale of real estate, net of tax	47,321			35,606		55,077
Net income	166,992			152,543		188,847
Limited partners’ interests in consolidated partnerships	(1,813		)	(2,247	)	(1,138	)
Net income attributable to the Partnership	165,179			150,296		187,709
Preferred unit distributions	(21,062		)	(21,062	)	(21,062	)
Net income attributable to common unit holders	$	144,117		129,234		166,647

Income per common unit - basic (note 12):	$	1.43		1.37		1.80
Income per common unit - diluted (note 12):	$	1.42		1.36		1.80

See accompanying notes to consolidated financial statements.

REGENCY CENTERS, L.P.

Consolidated Statements of Comprehensive Income

For the years ended December 31, 2016, 2015, and 2014

(in thousands)



	2016			2015		2014
Net income	$	166,992		152,543		188,847
Other comprehensive (loss) income:
Effective portion of change in fair value of derivative instruments:
Effective portion of change in fair value of derivative instruments	(10,332		)	(10,089	)	(49,968	)
Reclassification adjustment of derivative instruments included in net income	51,139			9,152		9,353
Unrealized gain (loss) on available-for-sale securities	24			(43	)	7,765
Less: realized gains on sale of available-for-sale securities recognized in net income	—			—		(7,765	)
Other comprehensive income (loss)	40,831			(980	)	(40,615	)
Comprehensive income	207,823			151,563		148,232
Less: comprehensive income (loss) attributable to noncontrolling interests:
Net income attributable to noncontrolling interests	1,813			2,247		1,138
Other comprehensive income (loss) attributable to noncontrolling interests	426			(33	)	(201	)
Comprehensive income attributable to noncontrolling interests	2,239			2,214		937
Comprehensive income attributable to the Partnership	$	205,584		149,349		147,295

See accompanying notes to consolidated financial statements.

REGENCY CENTERS, L.P. Consolidated Statements of Capital For the years ended December 31, 2016, 2015, and 2014 (in thousands)

		General Partner Preferred and Common Units		Limited Partners		Accumulated Other Comprehensive Loss		Total Partners’ Capital		Noncontrolling Interests in Limited Partners’ Interest in Consolidated Partnerships		Total Capital
Balance at December 31, 2013	$	1,860,758		(1,426	)	(17,404	)	1,841,928		19,206		1,861,134
Net income		187,390		319		—		187,709		1,138		188,847
Other comprehensive income (loss)		—		(70	)	(40,344	)	(40,414	)	(201	)	(40,615	)
Contributions from partners		—		—		—		—		16,204		16,204
Distributions to partners		(175,188	)	(300	)	—		(175,488	)	(4,543	)	(180,031	)
Redemption of preferred units		—		(300	)	—		(300	)	—		(300	)
Preferred unit distributions		(21,062	)	—		—		(21,062	)	—		(21,062	)
Restricted units issued as a result of amortization of restricted stock issued by Parent Company		12,161		—		—		12,161		—		12,161
Common units exchanged for common stock of the Parent Company		137		(137	)	—		—		—		—
Common units issued as a result of common stock issued by Parent Company, net of repurchases		100,144		—		—		100,144		—		100,144
Balance at December 31, 2014	$	1,964,340		(1,914	)	(57,748	)	1,904,678		31,804		1,936,482
Net income		150,056		240		—		150,296		2,247		152,543
Other comprehensive income (loss)		—		(2	)	(945	)	(947	)	(33	)	(980	)
Contributions from partners		—		—		—		—		717		717
Distributions to partners		(184,439	)	(299	)	—		(184,738	)	(4,249	)	(188,987	)
Preferred unit distributions		(21,062	)	—		—		(21,062	)	—		(21,062	)
Restricted units issued as a result of amortization of restricted stock issued by Parent Company		13,869		—		—		13,869		—		13,869
Common units issued as a result of common stock issued by Parent Company, net of repurchases		190,038		—		—		190,038		—		190,038
Balance at December 31, 2015	$	2,112,802		(1,975	)	(58,693	)	2,052,134		30,486		2,082,620
Net income		164,922		257		—		165,179		1,813		166,992
Other comprehensive income (loss)		—		58		40,347		40,405		426		40,831
Contributions from partners		—		—		—		—		8,760		8,760
Distributions to partners		(202,099	)	(307	)	—		(202,406	)	(6,855	)	(209,261	)
Reallocation of limited partners' interest		(538	)	—		—		(538	)	538		—

REGENCY CENTERS, L.P. Consolidated Statements of Capital For the years ended December 31, 2016, 2015, and 2014 (in thousands)

		General Partner Preferred and Common Units		Limited Partners		Accumulated Other Comprehensive Loss		Total Partners’ Capital		Noncontrolling Interests in Limited Partners’ Interest in Consolidated Partnerships	Total Capital
Redemption of preferred units		—		—		—		—		—	—
Preferred unit distributions		(21,062	)	—		—		(21,062	)	—	(21,062	)
Restricted units issued as a result of amortization of restricted stock issued by Parent Company		13,421		—		—		13,421		—	13,421
Common units issued as a result of common stock issued by Parent Company, net of repurchases		542,201		—		—		542,201		—	542,201
Balance at December 31, 2016	$	2,609,647		(1,967	)	(18,346	)	2,589,334		35,168	2,624,502

See accompanying notes to consolidated financial statements.



REGENCY CENTERS, L.P. Consolidated Statements of Cash Flows For the years ended December 31, 2016, 2015, and 2014 (in thousands)
	2016			2015		2014
Cash flows from operating activities:
Net income	$	166,992		152,543		188,847
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	162,327			146,829		147,791
Amortization of deferred loan cost and debt premium	9,762			9,677		10,521
Amortization and (accretion) of above and below market lease intangibles, net	(3,879		)	(1,598	)	(3,101	)
Stock-based compensation, net of capitalization	10,652			11,081		9,662
Equity in income of investments in real estate partnerships	(56,518		)	(22,508	)	(31,270	)
Gain on remeasurement of investment in real estate partnership	—			—		(18,271	)
Gain on sale of real estate, net of tax	(47,321		)	(35,606	)	(55,077	)
Provision for impairment	4,200			—		1,257
Early extinguishment of debt	14,240			8,239		18
Deferred income tax expense of taxable REIT subsidiary	—			—		—
Distribution of earnings from operations of investments in real estate partnerships	50,361			46,646		42,767
Settlement of derivative instruments	—			(7,267	)	4,648
Gain on derivative instruments	—			—		(13	)
Deferred compensation expense	1,655			207		1,386
Realized and unrealized gain on investments (note 11)	(1,673		)	(626	)	(9,158	)
Changes in assets and liabilities:
Restricted cash	59			1,926		848
Accounts receivable, net	(9,565		)	(11,965	)	(6,225	)
Straight-line rent receivable, net	(7,219		)	(8,231	)	(6,544	)
Deferred leasing costs	(10,349		)	(12,949	)	(8,252	)
Other assets	673			(496	)	89
Accounts payable and other liabilities	5,543			(3,810	)	6,201
Tenants’ security and escrow deposits and prepaid rent	(564		)	3,545		1,618
Net cash provided by operating activities	289,376			275,637		277,742
Cash flows from investing activities:
Acquisition of operating real estate	(333,220		)	(42,983	)	(112,120	)
Advance deposits paid on acquisition of operating real estate	(750		)	(2,250	)	—
Real estate development and capital improvements	(234,598		)	(205,103	)	(238,237	)
Proceeds from sale of real estate investments	135,269			108,822		118,787
Collection of notes receivable	—			1,719		—
Investments in real estate partnerships	(37,879		)	(20,054	)	(23,577	)
Distributions received from investments in real estate partnerships	58,810			23,801		37,152
Dividends on investment securities	330			243		243
Acquisition of securities	(55,223		)	(31,941	)	(23,760	)
Proceeds from sale of securities	57,590			28,400		31,222
Net cash used in investing activities	(409,671		)	(139,346	)	(210,290	)



REGENCY CENTERS, L.P. Consolidated Statements of Cash Flows For the years ended December 31, 2016, 2015, and 2014 (in thousands)
	2016			2015		2014
Cash flows from financing activities:
Net proceeds from common units issued as a result of common stock issued by Parent Company	548,920			198,494		102,453
Proceeds from treasury units issued as a result of treasury stock sold by Parent Company	957			—		—
Acquisition of treasury units as a result of treasury stock acquired by Parent Company	(29		)	—		—
Redemption of preferred partnership units	—			—		(300	)
Distributions to limited partners in consolidated partnerships, net	(4,213		)	(5,341	)	(5,303	)
Distributions to partners	(201,336		)	(181,691	)	(172,900	)
Distributions to preferred unit holders	(21,062		)	(21,062	)	(21,062	)
Repayment of fixed rate unsecured notes	(300,000		)	(450,000	)	(150,000	)
Proceeds from issuance of fixed rate unsecured notes, net	—			248,160		248,705
Proceeds from unsecured credit facilities	460,000			445,000		255,000
Repayment of unsecured credit facilities	(345,000		)	(355,000	)	(255,000	)
Proceeds from notes payable	53,446			4,316		12,739
Repayment of notes payable	(72,803		)	(76,168	)	(38,717	)
Scheduled principal payments	(5,860		)	(5,878	)	(6,909	)
Payment of loan costs	(2,233		)	(5,998	)	(3,066	)
Early redemption costs	(14,092		)	(8,043	)	—
Net cash provided by (used in) financing activities	96,695			(213,211	)	(34,360	)
Net decrease in cash and cash equivalents	(23,600		)	(76,920	)	33,092
Cash and cash equivalents at beginning of the year	36,856			113,776		80,684
Cash and cash equivalents at end of the year	$	13,256		36,856		113,776
Supplemental disclosure of cash flow information:
Cash paid for interest (net of capitalized interest of $3,482, $6,740, and $7,142 in 2016, 2015, and 2014, respectively)	$	82,950		101,527		109,425
Cash paid for income taxes	$	—		1,015		2,169
Supplemental disclosure of non-cash transactions:
Common stock issued by Parent Company for partnership units exchanged	$	—		—		137
Mortgage loans assumed for the acquisition of real estate	$	—		42,799		103,187
Change in fair value of securities available-for-sale	$	24		(43	)	—
Initial fair value of non-controlling interest recorded at acquisition	$	—		—		15,385
Acquisition of previously unconsolidated real estate investments	$	—		—		16,182
Change in fair value of derivative instruments	$	(10,332	)	(9,012	)	(49,968	)
Common stock issued by Parent Company for dividend reinvestment plan	$	1,070		1,250		1,184
Stock-based compensation capitalized	$	2,963		2,988		2,707
Contributions from limited partners in consolidated partnerships, net	$	8,755		13		1,579
Common stock issued for dividend reinvestment in trust	$	728		833		779
Contribution of stock awards into trust	$	1,538		1,651		1,881
Distribution of stock held in trust	$	4,114		1,898		4
Deconsolidation of previously consolidated partnership:
Real estate, net	$	14,144		—		—
Investments in real estate partnerships	$	(3,355	)	—		—
Notes payable	$	(9,415	)	—		—
Other assets and liabilities	$	571		—		—
Limited partners' interest in consolidated partnerships	$	(2,099	)	—		—

See accompanying notes to consolidated financial statements.

REGENCY CENTERS CORPORATION AND REGENCY CENTERS, L.P.

Notes to Consolidated Financial Statements

December 31, 2016


1.	Summary of Significant Accounting Policies

(a) Organization and Principles of Consolidation

General

Regency Centers Corporation (the “Parent Company”) began its operations as a Real Estate Investment Trust (“REIT”) in 1993 and is the general partner of Regency Centers, L.P. (the “Operating Partnership”). The Parent Company engages in the ownership, management, leasing, acquisition, and development of retail shopping centers through the Operating Partnership, and has no other assets or liabilities other than through its investment in the Operating Partnership. The Parent Company guarantees all of the unsecured debt of the Operating Partnership. As of December 31, 2016, the Parent Company, the Operating Partnership, and their controlled subsidiaries on a consolidated basis (the "Company” or “Regency”) owned 198 retail shopping centers and held partial interests in an additional 109 retail shopping centers through unconsolidated investments in real estate partnerships (also referred to as "joint ventures" or "co-investment partnerships").

Estimates, Risks, and Uncertainties

The preparation of the consolidated financial statements in conformity with U.S. Generally Accepted Accounting Principles (“GAAP”) requires the Company's management to make estimates and assumptions that affect the reported amounts of assets and liabilities, and disclosure of contingent assets and liabilities, at 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, accounts receivable, and straight line rent receivable. 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 weaken.

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 interest. Investments in real estate partnerships not controlled by the Company are accounted for under the equity method. All significant inter-company balances and transactions are eliminated in the consolidated financial statements.

The Company consolidates properties that are wholly owned or properties where it owns less than 100%, but which it controls. Control is determined using an evaluation based on accounting standards related to the consolidation of voting interest entities and variable interest entities ("VIEs"). 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. The Company's determination of the primary beneficiary considers all relationships between it and the VIE, including management agreements and other contractual arrangements.

Ownership of the Parent Company

The Parent Company has a single class of common stock outstanding and two series of preferred stock outstanding (“Series 6 and 7 Preferred Stock”). The dividends on the Series 6 and 7 Preferred Stock are cumulative and payable in arrears quarterly.

Subsequent to December 31, 2016, on February 16, 2017, the Parent Company provided notice of its intent and redeemed all outstanding shares of Series 6 Preferred Stock, as discussed further in note 9.

REGENCY CENTERS CORPORATION AND REGENCY CENTERS, L.P.

Notes to Consolidated Financial Statements

December 31, 2016

Ownership of the Operating Partnership

The Operating Partnership's capital includes general and limited common Partnership Units. As of December 31, 2016, the Parent Company owned approximately 99.9% ,or 104,497,286, of the 104,651,456 outstanding common Partnership Units of the Operating Partnership, with the remaining limited Partnership Units held by third parties ("Exchangeable operating partnership units" or "EOP units"). 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 of the Operating Partnership. As such, the Operating Partnership is considered a variable interest entity, and the Parent Company is the primary beneficiary, which consolidates it. 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

Regency has an ownership interest in 120 properties through partnerships, of which 11 are consolidated. These partners include institutional investors, other real estate developers and/or operators, and individual parties who help Regency source transactions for development and investment (the "Partners" or "limited partners"). Regency has a variable interest in these entities through its equity interests. As managing member, Regency maintains the books and records and typically provides leasing and property management to the partnerships. The Partners’ level of involvement varies from protective decisions (debt, bankruptcy, selling primary asset(s) of business) to involvement in approving leases, operating budgets, and capital budgets.


•	Those partnerships for which the Partners only have protective rights are considered VIEs under ASC 810, Consolidation. Regency is the primary beneficiary of these VIEs as Regency has power over these partnerships and they operate primarily for the benefit of Regency. As such, Regency consolidates these entities and reports the limited partners’ interest as noncontrolling interests.

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. Regency does not provide financial support to the VIEs.


•	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 has a controlling financial interest are consolidated and the limited partners’ ownership interest and share of net income is recorded as noncontrolling interest.


◦	Those partnerships in which Regency does not have a controlling financial interest are accounted for using the equity method and its 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. The net difference in the carrying amount of investments in real estate partnerships and the underlying equity in net assets is either accreted to income 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 in lives from 10 to 40 years, or recognized at liquidation if the joint venture agreement includes a unilateral right to elect to dissolve the real estate partnership and, upon such an election, receive a distribution in-kind.

◦

Those partnerships in which Regency does not have a controlling financial interest are accounted for using the equity method and its 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. The net difference in the carrying amount of investments in real estate partnerships and the underlying equity in net assets is either accreted to income 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 in lives from 10 to 40 years, or recognized at liquidation if the joint venture agreement includes a unilateral right to elect to dissolve the real estate partnership and, upon such an election, receive a distribution in-kind.

REGENCY CENTERS CORPORATION AND REGENCY CENTERS, L.P.

Notes to Consolidated Financial Statements

December 31, 2016

The assets of these partnerships are restricted to the use of the partnerships and cannot be used by general creditors of the Company. And similarly, the obligations of these partnerships can only be settled by the assets of these partnerships.

The major classes of assets, liabilities, and non-controlling equity interests held by the Company's VIEs, exclusive of the Operating Partnership as a whole, are as follows:



(in thousands)	December 31, 2016		December 31, 2015
Assets
Real estate assets, net	$	86,440	81,424
Cash and cash equivalents	3,444		790
Liabilities
Notes payable	8,175		17,948
Equity
Limited partners’ interests in consolidated partnerships	17,565		11,058

Noncontrolling Interests

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 preferred and common stockholders of the Parent Company: (i) the limited Partnership Units in the Operating Partnership held by third parties 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 stockholders' equity, in the accompanying Consolidated Balance Sheets and Consolidated Statements of Equity and Comprehensive Income (Loss). 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 (Loss) of the Parent Company.

In accordance with the FASB ASC Topic 480, securities that are redeemable for cash or other assets at the option of the holder, not solely within the control of the issuer, are classified as redeemable noncontrolling interests outside of permanent equity in the Consolidated Balance Sheets. The Parent Company has evaluated the conditions as specified under the FASB ASC Topic 480 as it relates to exchangeable operating partnership units outstanding and concluded that it has the right to satisfy the redemption requirements of the units by delivering unregistered common stock. Each outstanding exchangeable operating partnership unit is exchangeable for one share of common stock of the Parent Company, and the unit holder cannot require redemption in cash or other assets. Limited partners' interests in consolidated partnerships are not redeemable by the holders. 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 agreement, the Company generally has the right, but not the obligation, to purchase the other member’s 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

REGENCY CENTERS CORPORATION AND REGENCY CENTERS, L.P.

Notes to Consolidated Financial Statements

December 31, 2016

(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 (Loss) of the Operating Partnership.

(b) Revenues and Tenant Receivable

Leasing Revenue and Receivables

The Company leases space to tenants under agreements with varying terms. Leases are accounted for as operating leases with minimum rent recognized on a straight-line basis over the term of the lease regardless of when payments are due. The Company estimates the collectibility of the accounts receivable related to base rents, straight-line rents, expense reimbursements, and other revenue taking into consideration the Company's historical write-off experience, tenant credit-worthiness, current economic trends, and remaining lease terms.

The Company recorded the following provisions for doubtful accounts:



	Year ended December 31,
(in thousands)	2016		2015	2014
Gross provision for doubtful accounts	$	1,705	2,364	2,192
Provision for straight line rent reserve	$	2,271	714	107

The following table represents the components of Tenant and other receivables, net in the accompanying Consolidated Balance Sheets:



	December 31,
(in thousands)	2016			2015
Billed tenant receivables	$	15,599		14,521
Accrued CAM, insurance and tax reimbursements	9,221			12,358
Other receivables	12,058			10,708
Straight-line rent receivables	73,384			64,757
Notes receivable	10,481			10,480
Less: allowance for doubtful accounts	(5,460		)	(5,295	)
Less: straight-line rent reserves	(3,561		)	(1,365	)
Total tenant and other receivables, net	$	111,722		106,164

More than half of all of the lease agreements with anchor tenants contain provisions that provide for additional rents based on tenants' sales volume ("percentage rent"). Percentage rents are recognized when the tenants achieve the specified targets as defined in their lease agreements. Substantially all lease agreements contain provisions for reimbursement of the tenants' share of real estate taxes, insurance and common area maintenance (“CAM”) costs. Recovery of real estate taxes, insurance, and CAM costs are recognized as the respective costs are incurred in accordance with the lease agreements.

When the Company is the owner of the leasehold improvements, recognition of straight line lease revenue commences when the lessee is given possession of the leased space upon completion of tenant improvements. However, when the leasehold improvements are owned by the tenant, the lease inception date is the date the tenant obtains possession of the leased space for purposes of constructing its leasehold improvements.

The Notes receivable balance represents a single note from a previous property sale, which has a fixed interest rate of 7.0%, a maturity date of January 2019, and is secured by real estate held as collateral.

REGENCY CENTERS CORPORATION AND REGENCY CENTERS, L.P.

Notes to Consolidated Financial Statements

December 31, 2016

Real Estate Sales

Profits from sales of real estate are recognized under the full accrual method by the Company when: (i) a sale is consummated; (ii) the buyer's initial and continuing investment is adequate to demonstrate a commitment to pay for the property; (iii) the Company's receivable, if applicable, is not subject to future subordination; (iv) the Company has transferred to the buyer the usual risks and rewards of ownership; and (v) the Company does not have substantial continuing involvement with the property.

The Company sells shopping centers to joint ventures in exchange for cash equal to the fair value of the ownership interest of its partners. The Company accounts for those sales as “partial sales” and recognizes gains on those partial sales in the period the properties were sold to the extent of the percentage interest sold, and in the case of certain real estate partnerships, applies a more restrictive method of recognizing gains, as discussed further below.

As of December 31, 2016, five of the Company's joint ventures (“DIK-JV”) give each partner the unilateral right to elect to dissolve the real estate partnership and, upon such an election, receive a distribution in-kind (“DIK”) of the assets of the real estate partnership equal to their respective capital account, which could include properties the Company previously sold to the real estate partnership.

Because the contingency associated with the possibility of receiving a particular property back upon liquidation is not satisfied at the property level, but at the aggregate level, no previously deferred gain is recognized by the Company on an individual property sold by the DIK-JV to a third party or received by the Company upon actual dissolution. Instead, the property received upon dissolution is recorded at the carrying value of the Company's investment in the DIK-JV on the date of dissolution. However, the deferred gain is recognized if and when all such properties in the DIK-JV are sold to a third party.

Management Services

The Company is engaged under agreements with its joint venture partners to provide asset management, property management, leasing, investing, and financing services for such 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 as services are rendered, when fees due are determinable, and collectibility is reasonably assured. The Company also receives transaction fees, as contractually agreed upon with a joint venture, which include fees such as acquisition fees, disposition fees, “promotes”, or “earnouts”, which are recognized as services are rendered, when fees due are determinable, and collectibility is reasonably assured.

Capitalization and Depreciation

Maintenance and repairs that do not improve or extend the useful lives of the respective assets are recorded in operating and maintenance expense.

As part of the leasing process, the Company may provide the lessee with an allowance 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 minimum rent. 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

REGENCY CENTERS CORPORATION AND REGENCY CENTERS, L.P.

Notes to Consolidated Financial Statements

December 31, 2016

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 40 years for buildings and improvements, the shorter of the useful life or the remaining lease term subject to a maximum of 10 years for tenant improvements, and three to seven years for furniture and equipment.

Development Costs

Land, buildings, and improvements are recorded at cost. All specifically identifiable costs related to development activities are capitalized into properties in development on the accompanying Consolidated Balance Sheets. Properties in development are defined as properties that are in the construction or initial lease-up phase. The capitalized costs include pre-development costs essential to the development of the property, development costs, construction costs, interest costs, real estate taxes, and allocated direct employee costs incurred during the period of development. Interest costs are capitalized into each development project based upon applying the Company's weighted average borrowing rate to that portion of the actual development costs expended. The Company discontinues interest and real estate tax 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 the Company capitalize interest on the project beyond 12 months after substantial completion of the building shell.

Pre-development costs represent the costs the Company incurs prior to land acquisition including contract deposits, as well as legal, engineering, and other external professional fees related to evaluating the feasibility of developing a shopping center. As of December 31, 2016 and 2015, the Company had refundable deposits of approximately $1.2 million and $1.3 million, respectively, included in pre-development costs. If the Company determines that the development 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, 2016, 2015, and 2014, the Company expensed pre-development costs of approximately $1.5 million, $1.7 million, and $2.3 million, respectively, in other operating expenses in the accompanying Consolidated Statements of Operations.

Acquisitions

The Company and the real estate partnerships account for business combinations using the acquisition method by recognizing and measuring the identifiable assets acquired, the liabilities assumed, and any noncontrolling interest in the acquiree at their acquisition date fair values. The Company expenses transaction costs associated with business combinations in the period incurred.

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 amortization expense 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 fair 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 minimum rent over the remaining terms of the respective leases and the value of below-market leases is accreted to minimum rent over the remaining terms of the respective leases, including below-market renewal options, if applicable. The Company does not assign value to customer

REGENCY CENTERS CORPORATION AND REGENCY CENTERS, L.P.

Notes to Consolidated Financial Statements

December 31, 2016

relationship intangibles if it has pre-existing business relationships with the 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 land, an operating property, or a property in development as held-for-sale upon satisfaction of 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. Operating properties held-for-sale are carried at the lower of cost or fair value less costs to sell.

Impairment

We evaluate whether there are any indicators, including property operating performance and general market conditions, that the value of the real estate properties (including any related amortizable intangible assets or liabilities) may not be recoverable. Through the evaluation, 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, costs of tenant improvements, leasing commissions, anticipated 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 our disposition strategy or changes in the marketplace 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. To the extent that 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 fair value. If such indicators are not identified, management will not assess the recoverability of a property's carrying value. 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 fair value of real estate assets is subjective and is determined 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 traditional discounted cash flow approach. Such cash flow projections consider factors such as expected future operating income, trends and prospects, as well as the effects of demand, competition and other factors, and therefore is subject to management judgment and changes in those factors could impact the determination of fair value. In estimating the fair value of undeveloped land, the Company generally uses market data and comparable sales information.

A loss in value of investments in real estate partnerships under the equity method of accounting, other than a temporary decline, must be recognized in the period in which the loss occurs. If management identifies indicators that the value of the Company's investment in real estate partnerships may be impaired, it evaluates the investment by calculating the fair value of the investment by discounting estimated future cash flows over the expected term of the investment.

Tax Basis

The net tax basis of the Company's real estate assets exceeds the book basis by approximately $190.3 million and $183.9 million at December 31, 2016 and 2015, respectively, primarily due to the property impairments recorded for book purposes and the cost basis of the assets acquired and their carryover basis recorded for tax purposes.

REGENCY CENTERS CORPORATION AND REGENCY CENTERS, L.P.

Notes to Consolidated Financial Statements

December 31, 2016

(d) Cash and Cash Equivalents

Any instruments which have an original maturity of 90 days or less when purchased are considered cash equivalents. As of December 31, 2016 and 2015, $4.6 million and $3.8 million, respectively, of cash was restricted through escrow agreements and certain mortgage loans.

(e) Securities

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. Debt securities are classified as held to maturity when the Company has the positive intent and ability to hold the securities to maturity. Marketable 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 in earnings. Debt and marketable equity 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. The fair value of securities is determined using quoted market prices.

(f) Deferred Leasing Costs

Deferred leasing costs consist of internal and external commissions associated with leasing the Company's shopping centers, and are presented net of accumulated amortization. Such costs are amortized over the periods through lease expiration or loan maturity, respectively. If the lease is terminated early, the remaining leasing costs are written off.

(g) Derivative Financial 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 financial instruments. Specifically, the Company enters into derivative financial 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 financial instruments are used to manage differences 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 changes in the fair value of an asset, liability, or firm commitment attributable to a particular risk, such as interest rate risk, are considered fair value hedges. 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 recognition of the changes in the fair value of the hedged asset or liability attributable to the hedged risk in a fair value hedge or 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 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 gains or losses resulting from changes in fair value of derivatives that qualify as cash flow hedges are recognized in other comprehensive income (“OCI”) while the ineffective portion of the derivative's change in fair value is recognized in the Statements of Operations as interest

REGENCY CENTERS CORPORATION AND REGENCY CENTERS, L.P.

Notes to Consolidated Financial Statements

December 31, 2016

expense. Upon the settlement of a hedge, gains and losses remaining in OCI are amortized through earnings over the underlying term of the hedged transaction.

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.

The cash receipts or payments to settle interest rate swaps are presented in cash flows provided by operating activities in the accompanying Consolidated Statements of Cash Flows.

(h) 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 stockholders are at least equal to REIT taxable income. Regency Realty Group, Inc. (“RRG”), a wholly-owned subsidiary of the Operating Partnership, is a Taxable REIT Subsidiary (“TRS”) as defined in Section 856(l) of the Code. RRG is subject to federal and state income taxes and files separate tax returns. As a pass through entity, the Operating Partnership's taxable income or loss is reported by its partners, of which the Parent Company, as general partner and approximately 99.9% owner, is allocated its pro-rata share of tax attributes.

Earnings and profits, which determine the taxability of dividends to stockholders, differs from net income reported for financial reporting purposes primarily because of differences in depreciable lives and cost bases of the shopping centers, as well as other timing differences.

Tax positions are initially recognized in the financial statements when it is more likely than not the position will be sustained upon examination by the tax authorities. Such tax positions shall initially and subsequently be measured as the largest amount of tax benefit that has a greater than 50% likelihood of being realized upon ultimate settlement with the tax authority assuming full knowledge of the position and relevant facts. The Company believes that it has appropriate support for the income tax positions taken and to be taken on its tax returns and that its accruals for tax liabilities are adequate for all open tax years (2013 and forward for federal and state) based on an assessment of many factors including past experience and interpretations of tax laws applied to the facts of each matter.

(i) 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.

REGENCY CENTERS CORPORATION AND REGENCY CENTERS, L.P.

Notes to Consolidated Financial Statements

December 31, 2016

(j) Stock-Based Compensation

The Company grants stock-based compensation to its employees and directors. The Company recognizes stock-based compensation based on the grant-date fair value of the award and the cost of the stock-based compensation is expensed over the vesting period.

When the Parent Company issues common shares as compensation, it receives a like number of common units from the Operating Partnership. The Company is committed to contributing to the Operating Partnership all proceeds from the exercise of stock options or other share-based awards granted under the Parent Company's Long-Term Omnibus Plan (the “Plan”). Accordingly, the Parent Company's ownership in the Operating Partnership will increase based on the amount of proceeds contributed to the Operating Partnership for the common units it receives. As a result of the issuance of common units to the Parent Company for stock-based compensation, the Operating Partnership records the effect of accounts for stock-based compensation for awards of equity in the Parent Company.

(k) Segment Reporting

The Company's business is investing in retail shopping centers through direct ownership or through joint ventures. The Company actively manages its portfolio of retail shopping centers and may from time to time make decisions to sell lower performing properties or developments not meeting its long-term investment objectives. The proceeds from sales are reinvested into higher quality retail shopping centers, through acquisitions or new developments, which management believes will generate sustainable revenue growth and attractive returns. It is management's intent that all retail shopping centers will be owned or developed for investment purposes; however, the Company may decide to sell all or a portion of a development upon completion. The Company's revenues and net income are generated from the operation of its investment portfolio. The Company also earns fees for services provided to manage and lease retail shopping centers owned through joint ventures.

The Company's portfolio is located throughout the United States. Management does not distinguish or group its operations on a geographical basis for purposes of allocating resources or capital. The Company reviews operating and financial data for each property on an individual basis; therefore, the Company defines an operating segment as its individual properties. The individual properties have been aggregated into one reportable segment based upon their similarities with regard to both the nature and economics of the centers, tenants and operational processes, as well as long-term average financial performance.

(l) Business Concentration

No single tenant accounts for 5% or more of revenue and none of the shopping centers are located outside the United States.

(m) Fair Value of Assets and Liabilities

Fair value is a market-based measurement, not an entity-specific measurement. Therefore, a fair value measurement is determined based on the assumptions that market participants would use in pricing the asset or liability. As a basis for considering market participant assumptions in fair value measurements, the Company uses a fair value hierarchy that distinguishes between market participant assumptions based on market data obtained from independent sources (observable inputs that are classified within Levels 1 and 2 of the hierarchy) and the Company's own assumptions about market participant assumptions (unobservable inputs classified within Level 3 of the hierarchy). The three levels of inputs used to measure fair value are as follows:


•	Level 1 - Quoted prices (unadjusted) in active markets for identical assets or liabilities that the Company has the ability to access.


•	Level 2 - Inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly or indirectly.

REGENCY CENTERS CORPORATION AND REGENCY CENTERS, L.P.

Notes to Consolidated Financial Statements

December 31, 2016


•	Level 3 - Unobservable inputs for the asset or liability, which are typically based on the Company's own assumptions, as there is little, if any, related market activity.

The Company also remeasures nonfinancial assets and nonfinancial liabilities, initially measured at fair value in a business combination or other new basis event, at fair value in subsequent periods if a remeasurement event occurs.

(n) Reclassifications

During the year ended December 31, 2016, the Company reclassified its land held for future development from Properties in development to Land within the accompanying Consolidated Balance Sheets. The Company reclassified prior period amounts of $47.3 million to conform to current period presentation.

REGENCY CENTERS CORPORATION AND REGENCY CENTERS, L.P.

Notes to Consolidated Financial Statements

December 31, 2016

(o) Recent Accounting Pronouncements

The following table provides a brief description of recent accounting pronouncements and expected impact on our financial statements:



Standard	Description	Date of adoption	Effect on the financial statements or other significant matters
Recently adopted:
ASU 2015-02, February 2015, Consolidation (Topic 810): Amendments to the Consolidation Analysis	ASU 2015-02 affects reporting entities that are required to evaluate whether they should consolidate certain legal entities. ASU 2015-02 modifies the evaluation of whether limited partnerships and similar legal entities are VIEs or voting interest entities, eliminates the presumption that a general partner should consolidate a limited partnership, and affects the consolidation analysis of reporting entities that are involved with VIEs.	January 2016	The adoption of this standard resulted in five additional investment partnerships being considered variable interest entities due to the limited partners' lack of substantive participation in the partnerships. This did not result in any impact to the Company's Consolidated Balance Sheets, Statements of Operations, or Cash Flows, but did result in additional disclosures about its relationships with and exposure to variable interest entities.

ASU 2015-03, April 2015, Interest - Imputation of Interest (Subtopic 835-30): Simplifying the Presentation of Debt Issuance Costs	ASU 2015-03 simplifies the presentation of debt issuance costs by requiring that debt issuance costs related to a recognized debt liability be presented in the balance sheet as a direct deduction from the carrying amount of that debt liability, consistent with debt discounts.	January 2016	The adoption and implementation of this standard has resulted in the retrospective presentation of debt issuance costs associated with the Company's notes payable and term loans as a direct deduction from the carrying amount of the related debt instruments (previously, included in deferred costs in the consolidated balance sheets). Unamortized debt issuance costs of $8.2 million has been reclassified to offset the related debt as of December 31, 2015.

ASU 2015-15, August 2015, Interest—Imputation of Interest (Subtopic 835-30): Presentation and Subsequent Measurement of Debt Issuance Costs Associated with Line-of-Credit Arrangements	ASU 2015-15 clarifies that debt issuance costs related to line-of-credit arrangements may be deferred and presented as an asset, amortized over the term of the line-of-credit arrangement, regardless of whether there are any outstanding borrowings.	January 2016	The adoption of this standard resulted in the continued presentation of debt issuance costs related to the Line of credit ("Line") as an asset in the Consolidated Balance Sheets, previously within deferred costs, and now presented within other assets.

ASU 2014-15, August 2014, Presentation of Financial Statements—Going Concern (Subtopic 205-40): Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern	The standard requires management to evaluate whether there are conditions or events that raise substantial doubt about the entity’s ability to continue as a going concern, and to provide certain disclosures when it is probable that the entity will be unable to meet its obligations as they become due within one year after the date that the financial statements are issued.	December 2016	The adoption of this standard did not have an impact on the Company's Consolidated Balance Sheets, Statements of Operations, or Cash Flows but did result in more disclosure surrounding the Company's plans for addressing significant upcoming debt maturities.

REGENCY CENTERS CORPORATION AND REGENCY CENTERS, L.P.

Notes to Consolidated Financial Statements

December 31, 2016



Standard	Description	Date of adoption	Effect on the financial statements or other significant matters
Not yet adopted:
ASU 2016-09, March 2016, Compensation-Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting	This ASU affects entities that issue share-based payment awards to their employees. The ASU is designed to simplify several aspects of accounting for share-based payment award transactions including income tax consequences, classification of awards as either equity or liabilities, an option to recognize stock compensation forfeitures as they occur, and changes to classification on the statement of cash flows.	January 2017	The Company does not expect the adoption of this standard to have an impact on its financial statements and related disclosures.

ASU 2016-01, January 2016, Financial Instruments—Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities	The standard amends the guidance to classify equity securities with readily-determinable fair values into different categories and requires equity securities to be measured at fair value with changes in the fair value recognized through net income. Equity investments accounted for under the equity method are not included in the scope of this amendment. Early adoption of this amendment is not permitted.	January 2018	The Company does not expect the adoption and implementation of this standard to have a material impact on its results of operations, financial condition or cash flows.

ASU 2016-15, August 2016, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments	The standard makes eight targeted changes to how cash receipts and cash payments are presented and classified in the statement of cash flows. Early adoption is permitted on a retrospective basis.	January 2018	The ASU is consistent with the Company's current treatment and the Company does not expect the adoption and implementation of this standard to have an impact on its cash flow statement.

ASU 2016-18, November 2016, Statement of Cash Flows (Topic 230): Restricted Cash	This ASU requires entities to show the changes in the total of cash, cash equivalents, restricted cash, and restricted cash equivalents in the statement of cash flows. Early adoption is permitted on a retrospective basis.	January 2018	The Company is currently evaluating the alternative methods of adoption and does not expect the adoption to have a material impact on its Statements of Cash Flows.

ASU 2017-01 January 2017, Business Combinations (Topic 805): Clarifying the Definition of a Business	The amendments in this update provide a screen to determine when an integrated set of assets and activities, collectively referred to as a "set", is not a business. The screen requires that when substantially all of the fair value of the gross assets acquired (or disposed of) is concentrated in a single identifiable asset or a group of similar identifiable assets, the set is not a business. This screen reduces the number of transactions that need to be further evaluated. If the screen is not met, the amendments in this update (1) require that to be considered a business, a set must include, at a minimum, an input and a substantive process that together significantly contribute to the ability to create output and (2) remove the evaluation of whether a market participant could replace missing elements. The amendments provide a framework to assist entities in evaluating whether both an input and a substantive process are present. Early adoption is permitted.	January 2018	The Company is currently evaluating the amendments from this Update, but expects it to change the treatment of individual operating properties from being considered a business to being considered an asset. This change will result in acquisition costs being capitalized as part of the asset acquisition, whereas current treatment has them recognized in earnings in the period incurred. Additional changes from the Update are still being evaluated to identify their impact to the Company's financial statements and related disclosures.

REGENCY CENTERS CORPORATION AND REGENCY CENTERS, L.P.

Notes to Consolidated Financial Statements

December 31, 2016



Standard	Description	Date of adoption	Effect on the financial statements or other significant matters
Revenue from Contracts with Customers (Topic 606): ASU 2014-09, May 2014, Revenue from Contracts with Customers (Topic 606) ASU 2016-08, March 2016, Revenue from Contracts with Customers (Topic 606): Principal versus Agent Considerations ASU 2016-10, April 2016, Revenue from Contracts with Customers (Topic 606): Identifying Performance Obligations and Licensing ASU 2016-12, May 2016, Revenue from Contracts with Customers (Topic 606): Narrow-Scope Improvements and Practical Expedients ASU 2016-19, December 2016, Technical Corrections and Improvements ASU 2016-20, December 2016, Technical Corrections and Improvements to Topic 606 Revenue From Contracts With Customers ASU 2017-05, February 2017, Clarifying the Scope of Asset Derecognition Guidance and Accounting for Partial Sales of Nonfinanial Assets	The standard will replace existing revenue recognition standards and significantly expand the disclosure requirements for revenue arrangements. It may be adopted either retrospectively or on a modified retrospective basis to new contracts and existing contracts with remaining performance obligations as of the effective date.	January 2018	The Company is completing its evaluation of the new ASU's as applied to its revenue streams and contracts within the scope of Topic 606. The Company currently does not expect the adoption of these new ASU's to result in a material change to its revenue recognition policies or practices, including timing or presentation. The Company is still evaluating the adoption method, which is dependent on final determination of the nature of any changes resulting from the new standard.

REGENCY CENTERS CORPORATION AND REGENCY CENTERS, L.P.

Notes to Consolidated Financial Statements

December 31, 2016



Standard	Description	Date of adoption	Effect on the financial statements or other significant matters

ASU 2016-02, February 2016, Leases (Topic 842)	The standard amends the existing accounting standards for lease accounting, including requiring lessees to recognize most leases on their balance sheets. It also makes targeted changes to lessor accounting, including a change to the treatment of initial direct leasing costs, which no longer considers fixed internal leasing salaries as capitalizable costs. Early adoption of this standard is permitted to coincide with adoption of ASU 2014-09. The standard requires a modified retrospective transition approach for all leases existing at, or entered into after, the date of initial application, with an option to use certain transition relief.	January 2019	The Company is currently evaluating the impact this standard will have on its financial statements and related disclosures.

ASU 2016-13, June 2016, Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments	The amendments in this update replace the incurred loss impairment methodology in current GAAP with a methodology that reflects expected credit losses and requires consideration of a broader range of reasonable and supportable information to inform credit loss estimates. This ASU applies to how the Company determines its allowance for doubtful accounts on tenant receivables.	January 2020	The Company is currently evaluating the alternative methods of adoption and the impact the ASU will have on its financial statements and related disclosures.

REGENCY CENTERS CORPORATION AND REGENCY CENTERS, L.P.

Notes to Consolidated Financial Statements

December 31, 2016


2.	Real Estate Investments

Acquisitions

The following tables detail the shopping centers acquired or land acquired for development.



(in thousands)		Year ended December 31, 2016
Date Purchased	Property Name	City/State	Property Type	Purchase Price		Debt Assumed, Net of Premiums	Intangible Assets	Intangible Liabilities
2/22/2016	Garden City Park	Garden City Park, NY	Operating	$	17,300	—	10,171	2,940
3/4/2016	The Market at Springwoods Village (1)	Houston, TX	Development	17,994		—	—	—
5/16/2016	Market Common Clarendon	Arlington, VA	Operating	280,500		—	15,428	15,662
7/15/2016	Klahanie Shopping Center	Sammamish, WA	Operating	35,988		—	2,264	539
8/4/2016	The Village at Tustin Legacy	Tustin, CA	Development	18,800		—	—	—
10/26/2016	Nocatee Phase III	Jacksonville, FL	Development	240		—	—	—
10/30/2016	Brooklyn Station Phase II	Jacksonville, FL	Development	50		—	—	—
12/6/2016	The Village at Riverstone	Houston, TX	Development	16,656		—	—	—
Total property acquisitions				$	387,528	—	27,863	19,141
(1) Regency acquired a 53% controlling interest in the Market at Springwoods Village partnership to develop a shopping center on land contributed by the partner. As a result of consolidation, the Company recorded the partner's non-controlling interest of $8.4 million in Limited partners' interests in consolidated partnerships in the accompanying Consolidated Balance Sheets.



(in thousands)		Year ended December 31, 2015
Date Purchased	Property Name	City/State	Property Type	Purchase Price		Debt Assumed, Net of Premiums	Intangible Assets	Intangible Liabilities
9/1/2015	University Commons	Boca Raton, FL	Operating	$	80,500	42,799	64,482	14,039
10/9/2015	CityLine Market Ph II	Dallas, TX	Development	2,157		—	—	—
12/29/2015	Northgate Ph II	Medford, OR	Development	4,000		—	—	—
Total property acquisitions				$	86,657	42,799	64,482	14,039

The results of operations from acquisitions are included in the Consolidated Statements of Operations beginning on the acquisition date. The real estate operations acquired, other than Market Common Clarendon, are not considered material to Company, individually or in the aggregate. Results of operations related to the acquisition of Market Common Clarendon resulted in the following impact to Revenues and Net income attributable to common stockholders, as follows:



(in thousands)	Year ended December 31, 2016
Increase in total revenues	$	11,427
Increase in net income attributable to common stockholders (1)	798

(1) Includes $1.6 million of transaction costs during the year ended December 31, 2016, which are recorded in Other operating expenses in the accompanying Consolidated Statements of Operations.

REGENCY CENTERS CORPORATION AND REGENCY CENTERS, L.P.

Notes to Consolidated Financial Statements

December 31, 2016

The following unaudited pro forma financial data includes the incremental revenues, operating expenses, depreciation and amortization, and costs of financing the Market Common Clarendon acquisition as if it had occurred on January 1, 2015:



		(Pro Forma)
		Year ended December 31,
(in thousands, except per share data)		2016	2015
Total revenues		622,124	589,506
Income from operations	(1)	121,921	119,339
Net income attributable to common stockholders	(1)	146,111	131,396
Income per common share - basic		1.42	1.37
Income per common share - diluted		1.42	1.36

(1) The pro forma earnings for the year ended December 31, 2016 were adjusted to exclude $1.6 million of acquisition costs, while 2015 pro forma earnings were adjusted to include those costs during the first quarter of 2015.

The pro forma financial data is not necessarily indicative of what the actual results of operations would have been assuming the transaction had been completed as set forth above, nor does it purport to represent the results of operations for future periods.

The following table details the weighted average amortization and net accretion periods, in years, of the major classes of intangible assets and intangible liabilities arising from the Market Common Clarendon acquisition, at the acquisition date:



		Weighted Average
		Amortization Period
Assets:		(in years)
In-place leases		7.4
Liabilities:
Acquired lease intangible liabilities		7.9

Pending Merger with Equity One

For more information about the shareholder approved but not yet consummated merger, see note 16, Subsequent Events.

REGENCY CENTERS CORPORATION AND REGENCY CENTERS, L.P.

Notes to Consolidated Financial Statements

December 31, 2016

Property Dispositions

Dispositions

The following table provides a summary of consolidated shopping centers and land parcels disposed of:



	Year ended December 31,
(in thousands)	2016			2015	2014
Net proceeds from sale of real estate investments	$	137,479	(1)	108,822	118,787
Gain on sale of real estate, net of tax	$	47,321		35,606	55,077
Provision for impairment of real estate sold	$	1,700		—	1,257
Number of operating properties sold	11			5	11
Number of land out-parcels sold	16			2	6

(1) Includes cash deposits received in the previous year.


4.	Investments in Real Estate Partnerships

The Company invests in real estate partnerships, which consist of the following:



	December 31, 2016
(in thousands)	Regency's Ownership	Number of Properties	Total Investment		Total Assets of the Partnership	Net Income of the Partnership	The Company's Share of Net Income of the Partnership
GRI - Regency, LLC (GRIR) (1)	40.00%	70	$	201,240	1,676,134	74,758	29,791
Columbia Regency Retail Partners, LLC (Columbia I) (1)	20.00%	7	9,687		145,192	21,024	4,180
Columbia Regency Partners II, LLC (Columbia II) (1)	20.00%	12	14,750		338,307	16,765	3,240
Cameron Village, LLC (Cameron)	30.00%	1	11,877		99,967	2,326	695
RegCal, LLC (RegCal) (1)	25.00%	7	21,516		141,827	4,358	1,080
US Regency Retail I, LLC (USAA) (1)	20.01%	8	13,176		109,665	5,901	1,180
Other investments in real estate partnerships	50.00%	4	24,453		97,650	35,915	16,352
Total investments in real estate partnerships		109	$	296,699	2,608,742	161,047	56,518



	December 31, 2015
(in thousands)	Regency's Ownership	Number of Properties	Total Investment		Total Assets of the Partnership	Net Income of the Partnership		The Company's Share of Net Income of the Partnership
GRI - Regency, LLC (GRIR) (1)	40.00%	73	$	220,099	1,744,017	45,761		18,148
Columbia Regency Retail Partners, LLC (Columbia I) (1)	20.00%	9	15,255		175,044	(1,396	)	(278	)
Columbia Regency Partners II, LLC (Columbia II) (1)	20.00%	14	8,496		290,064	3,794		755
Cameron Village, LLC (Cameron)	30.00%	1	11,857		100,124	2,195		643
RegCal, LLC (RegCal) (1)	25.00%	7	17,967		145,213	2,316		576
US Regency Retail I, LLC (USAA) (1)	20.01%	8	161		112,225	4,011		807
Other investments in real estate partnerships	50.00%	6	32,371		108,698	4,067		1,857
Total investments in real estate partnerships		118	$	306,206	2,675,385	60,748		22,508

(1) These partnership agreements have a unilateral right for election to dissolve the partnership and receive a DIK upon liquidation; therefore, the Company has applied the Restricted Gain Method to determine the amount of gain

REGENCY CENTERS CORPORATION AND REGENCY CENTERS, L.P.

Notes to Consolidated Financial Statements

December 31, 2016

recognized on property sales to these partnerships. During 2016 and 2015, the Company did not sell any properties to these real estate partnerships, and accordingly, the Restricted Gain Method was not applied.

The summarized balance sheet information for the investments in real estate partnerships, on a combined basis, is as follows:



	December 31,
(in thousands)	2016		2015
Investments in real estate, net	$	2,439,110	2,497,770
Acquired lease intangible assets, net	42,974		43,469
Other assets	126,658		134,146
Total assets	$	2,608,742	2,675,385

Notes payable	$	1,309,931	1,401,977
Acquired lease intangible liabilities, net	29,678		23,826
Other liabilities	64,979		66,061
Capital - Regency	405,722		414,681
Capital - Third parties	798,432		768,840
Total liabilities and capital	$	2,608,742	2,675,385

The following table reconciles the Company's capital recorded by the unconsolidated partnerships to the Company's investments in real estate partnerships reported in the accompanying consolidated balance sheet:



	December 31,
(in thousands)	2016			2015
Capital - Regency	$	405,722		414,681
less: Impairment of investment in real estate partnerships	(1,300		)	(1,300	)
less: Ownership percentage or Restricted Gain Method deferral	(29,520		)	(28,972	)
less: Net book equity in excess of purchase price	(78,203		)	(78,203	)
Investments in real estate partnerships	$	296,699		306,206

REGENCY CENTERS CORPORATION AND REGENCY CENTERS, L.P.

Notes to Consolidated Financial Statements

December 31, 2016

The revenues and expenses for the investments in real estate partnerships, on a combined basis, are summarized as follows:



	Year ended December 31,
(in thousands)	2016			2015		2014
Total revenues	$	364,087		363,745		361,103
Operating expenses:
Depreciation and amortization	99,252			111,648		117,780
Operating and maintenance	52,725			51,970		55,216
General and administrative	5,342			5,292		5,503
Real estate taxes	42,813			43,769		42,380
Other operating expenses	2,356			2,989		2,234
Total operating expenses	202,488			215,668		223,113
Other expense (income):
Interest expense, net	69,193			79,477		84,155
Gain on sale of real estate	(70,907		)	(2,766	)	(28,856	)
Provision for impairment	—			9,102		2,123
Early extinguishment of debt	69			—		114
Other expense (income)	2,197			1,516		988
Total other expense (income)	552			87,329		58,524
Net income of the Partnerships	$	161,047		60,748		79,466
The Company's share of net income of the Partnerships	$	56,518		22,508		31,270

Acquisitions

The following table provides a summary of shopping centers and land parcels acquired through our unconsolidated real estate partnerships, which had no acquisitions for the year ended December 31, 2015.



(in thousands)		Year ended December 31, 2016
Date Purchased	Property Name	City/State	Property Type	Co-investment Partner	Ownership %	Purchase Price		Debt Assumed, Net of Premiums	Intangible Assets	Intangible Liabilities
3/24/2016	Applewood Village Shops	Denver, CO	Operating (1)	GRIR	40.00%	$	200	—	—	—
12/20/2016	Plaza Venezia	Orlando, FL	Operating	Columbia II	20.00%	92,350		35,076	6,899	11,548
Total property acquisitions						$	92,550	35,076	6,899	11,548

(1) Land parcels purchased as additions to the operating property.

REGENCY CENTERS CORPORATION AND REGENCY CENTERS, L.P.

Notes to Consolidated Financial Statements

December 31, 2016

Dispositions

The following table provides a summary of shopping centers and land out-parcels disposed of through our unconsolidated real estate partnerships:



	Year ended December 31,
(in thousands)	2016		2015	2014
Proceeds from sale of real estate investments	$	174,090	39,459	88,106
Gain on sale of real estate	$	70,907	2,766	28,856
The Company's share of gain on sale of real estate	$	25,003	1,108	13,615
Number of operating properties sold	10		2	6
Number of land out-parcels sold	1		—	2

Notes Payable

Scheduled principal repayments on notes payable held by our unconsolidated investments in real estate partnerships as of December 31, 2016 were as follows:



Scheduled Principal Payments and Maturities by Year:	Scheduled Principal Payments		Mortgage Loan Maturities		Unsecured Maturities	Total		Regency’s Pro-Rata Share
2017	$	17,795	—		19,635	37,430		10,505
2018	18,983		67,022		—	86,005		27,799
2019	18,231		65,939		—	84,170		21,766
2020	15,133		222,199		—	237,332		85,660
2021	10,674		211,432		—	222,106		82,806
Beyond 5 Years	10,580		642,500		—	653,080		243,982
Net unamortized loan costs, debt premium / (discount)	—		(10,192	)	—	(10,192	)	(3,488	)
Total notes payable	$	91,396	1,198,900		19,635	1,309,931		469,030

These loans are all non-recourse. Maturities will be repaid from proceeds from refinancing, partner capital contributions, or a combination thereof. The Company is obligated to contribute its pro-rata share to fund maturities if the loans are not refinanced, and it has the capacity to do so from existing cash balances, availability on its line of credit, and operating cash flows. The Company believes that its partners are financially sound and have sufficient capital or access thereto to fund future capital requirements. In the event that a co-investment partner was unable to fund its share of the capital requirements of the co-investment partnership, the Company would have the right, but not the obligation, to loan the defaulting partner the amount of its capital call.

Management fee income

In addition to earning our pro-rata share of net income or loss in each of these co-investment partnerships, we receive fees, as follows:



	Year ended December 31,
(in thousands)	2016		2015	2014
Asset management, property management, leasing, and investment and financing services	$	24,595	24,519	22,983

REGENCY CENTERS CORPORATION AND REGENCY CENTERS, L.P.

Notes to Consolidated Financial Statements

December 31, 2016


5.	Acquired Lease Intangibles

The Company had the following acquired lease intangibles:



	December 31,
(in thousands)	2016			2015
In-place leases	$	96,178		77,691
Above-market leases	14,684			14,841
Below-market ground leases	64,664			58,487
Total intangible assets	$	175,526		151,019
Accumulated amortization	(56,695		)	(45,639	)
Acquired lease intangible assets, net	$	118,831		105,380

Below-market leases	$	71,996		53,868
Above-market ground leases	5,722			5,722
Accumulated amortization	(23,538		)	(17,555	)
Acquired lease intangible liabilities, net	$	54,180		42,034

The following table provides a summary of amortization and net accretion amounts from acquired lease intangibles:



	Year ended December 31,
(in thousands)	2016		2015	2014
In-place lease amortization	$	11,533	9,141	10,365
Above-market lease amortization (1)	1,742		1,950	1,795
Below-market ground lease amortization (3)	1,111		351	23
Acquired lease intangible asset amortization	$	14,386	11,442	12,183

Below-market lease amortization (2)	$	6,827	3,940	4,437
Above-market ground lease amortization (3)	$	167	215	153
Acquired lease intangible liability amortization	$	6,994	4,155	4,590

(1) Amounts are recorded as a reduction to minimum rent.

(2) Amounts are recorded as an increase to minimum rent.

(3) Above and below market ground lease amortization are recorded as offsets to other operating expenses.

The estimated aggregate amortization and net accretion amounts from acquired lease intangibles for the next five years are as follows:



(in thousands)
In Process Year Ending December 31,	Amortization Expense		Net Accretion
2017	$	12,073	6,834
2018	10,300		6,339
2019	8,945		5,919
2020	7,023		4,829
2021	6,081		4,509

REGENCY CENTERS CORPORATION AND REGENCY CENTERS, L.P.

Notes to Consolidated Financial Statements

December 31, 2016

Notes Payable and Unsecured Credit Facilities

The Company’s outstanding debt consists of the following:



	December 31,
(in thousands)	2016			2015
Notes payable:
Fixed rate mortgage loans	$	384,786		475,214
Variable rate mortgage loans	86,969		(1)	34,154
Fixed rate unsecured public debt	892,170			1,190,403
Total notes payable	1,363,925			1,699,771
Unsecured credit facilities:
Line	15,000			—
Term Loan	263,495			164,514
Total unsecured credit facilities	278,495			164,514
Total debt outstanding	$	1,642,420		1,864,285

(1) Includes three mortgages, whose interest varies on a LIBOR based formula. Each of these variable rate loans have interest rate swaps in place to fix the interest rates at a range of 2.8% to 3.7%.

Notes Payable

Notes payable consist of mortgage loans secured by properties and unsecured public debt. Mortgage loans may be prepaid, but could be subject to yield maintenance premiums. Mortgage loans are generally due in monthly installments of principal and interest or interest only, whereas, interest on unsecured public debt is payable semi-annually.

The Company is required to comply with certain financial covenants for its unsecured public debt as defined in the indenture agreements such as the following ratios: Consolidated Debt to Consolidated Assets, Consolidated Secured Debt to Consolidated Assets, Consolidated Income for Debt Service to Consolidated Debt Service, and Unencumbered Consolidated Assets to Unsecured Consolidated Debt. As of December 31, 2016, management of the Company believes it is in compliance with all financial covenants for its unsecured public debt.

As of December 31, 2016, the key interest rates of the Company's notes payables were as follows:



		Interest Rates
	Maturing Through	Minimum	Maximum	Weighted Average Effective Rate	Weighted Average Contractual Rate
Mortgage loans	2032	3.30%	8.40%	6.00%	5.80%
Fixed rate unsecured public debt	2025	3.75%	6.00%	5.30%	4.50%

Unsecured Credit Facilities

The Company has an unsecured line of credit commitment (the "Line") and an unsecured term loan commitment (the "Term Loan") under separate credit agreements with a syndicate of banks.

The Company is required to comply with certain financial covenants as defined in the Line and Term Loan credit agreements, such as Ratio of Indebtedness to Total Asset Value ("TAV"), Ratio of Unsecured Indebtedness to Unencumbered Asset Value, Ratio of Adjusted Earnings Before Interest Taxes Depreciation and Amortization (“EBITDA”) to Fixed Charges, Ratio of Secured Indebtedness to TAV, Ratio of Unencumbered Net Operating Income to Unsecured Interest Expense, and other covenants customary with

REGENCY CENTERS CORPORATION AND REGENCY CENTERS, L.P.

Notes to Consolidated Financial Statements

December 31, 2016

this type of unsecured financing. As of December 31, 2016, management of the Company believes it is in compliance with all financial covenants for the Line and Term Loan.

The key terms of the Line and Term Loan were as follows:



	December 31, 2016
(in thousands)	Total Capacity			Remaining Capacity			Maturing Through		Variable Interest Rate (5)		Fee			Weighted Average Effective Rate		Weighted Average Contractual Rate
Line (8)	$	800,000	(1)	$	779,200	(2)	5/13/2019	(3)	LIBOR plus 0.925%		0.15%		(4)	1.70	%	1.40	%
Term Loan (9)	$	265,000		—			1/5/2022		LIBOR plus 0.95%	(6)	$	35	(7)	2.10	%	2.00	%

(1) The Company has the ability to increase the Line through an accordion feature to $1.0 billion. See discussion below regarding expansion of Line subsequent to December 31, 2016.

(2) Borrowing capacity is reduced by the balance of outstanding borrowings and commitments under outstanding letters of credit.

(3) Maturity is subject to two six month extensions at the Company's option.

(4) The commitment fee is subject to an adjustment based on the higher of the Company's corporate credit ratings from Moody's and S&P.

(5) Interest rate spread is subject to Regency maintaining its corporate credit and senior unsecured ratings at BBB.

(6) Effective July 7, 2016, the interest rate on the underlying debt is LIBOR + 0.95%, with an interest rate swap in place to fix the interest on the entire balance at 2% through maturity.

(7) Annual fee, in thousands.

(8) Weighted average contractual and effective rates for the Line are calculated based on a fully drawn Line balance.

(9) Weighted average contractual and effective rates for the Term Loan are based on the fixed rate with the interest rate swap.

Scheduled principal payments and maturities on notes payable and unsecured credit facilities were as follows:



(in thousands)	December 31, 2016
Scheduled Principal Payments and Maturities by Year:	Scheduled Principal Payments		Mortgage Loan Maturities	Unsecured Maturities (1)		Total
2017	$	5,279	86,339	—		91,618
2018	4,829		57,358	—		62,187
2019	4,205		106,000	15,000		125,205
2020	4,636		84,411	150,000		239,047
2021	3,780		35,190	250,000		288,970
Beyond 5 Years	9,888		65,179	765,000		840,067
Unamortized debt premium/(discount) and issuance costs	—		4,662	(9,336	)	(4,674	)
Total notes payable	$	32,617	439,139	1,170,664		1,642,420

(1) Includes unsecured public debt and unsecured credit facilities.

The Company has $86.3 million of debt maturing over the next twelve months, which it currently intends to refinance. If market conditions change and refinancing is not an option, the Company has sufficient capacity on its Line to repay the maturing debt, all of which is in the form of non-recourse mortgage loans.

REGENCY CENTERS CORPORATION AND REGENCY CENTERS, L.P.

Notes to Consolidated Financial Statements

December 31, 2016

Financing - Subsequent Events

Subsequent to December 31, 2016, the Company priced a public offering of two tranches of senior unsecured notes:

•

$350.0 million of 3.6% notes due February 1, 2027, which priced at 99.741%. The Company intends to use the net proceeds in connection with the consummation of the previously announced pending merger with Equity One, Inc., including (i) to repay approximately $285.0 million in aggregate principal amount of debt of Equity One, and any related interest, fees and expenses and (ii) to pay transaction expenses related to the pending merger with Equity One. In the event that the merger agreement is not consummated, the Company will be required to redeem these notes then outstanding at a redemption price equal to 101% of the principal amount to be redeemed plus accrued and unpaid interest, if any.


•	$300.0 million of 4.4% notes due February 1, 2047, which priced at 99.110%. The Company used a portion of the net proceeds to redeem all of the outstanding shares of its 6.625% Series 6 preferred shares on February 16, 2017 and intends to use the balance to fund investment activities and for general corporate purposes.

In connection with the pending Merger, the Company has commitments to (i) amend its Line by increasing the borrowing capacity to $1.0 billion and (ii) enter a new $300.0 million term loan facility. Both of these transactions are contingent upon the consummation of the Merger and are scheduled to close simultaneously with the Merger. The Company plans to use the proceeds from the new term loan to repay existing term loans held by Equity One. The additional line capacity will accommodate the Company's increased property operations and development / redevelopment programs from the Merger.

REGENCY CENTERS CORPORATION AND REGENCY CENTERS, L.P.

Notes to Consolidated Financial Statements

December 31, 2016

Derivative Financial Instruments

The following table summarizes the terms and fair values of the Company's derivative financial instruments, as well as their classification on the Consolidated Balance Sheets:



								Fair Value at December 31,
(in thousands)								Assets (Liabilities) (2)
Effective Date	Maturity Date	Early Termination Date (1)	Notional Amount		Bank Pays Variable Rate of	Regency Pays Fixed Rate of		2016			2015
10/16/13	10/16/20	N/A	$	28,100	1 Month LIBOR	2.196%		$	(580	)	(898	)
8/1/16	1/5/22	N/A	200,000		1 Month LIBOR	1.048%		7,538			—
8/1/16	1/5/22	N/A	65,000		1 Month LIBOR	1.070%		2,351			—
4/7/16	4/1/23	N/A	20,000		1 Month LIBOR	1.303%		720			—
12/1/16	11/1/23	N/A	33,000		1 Month LIBOR	1.490%		1,013			—
6/15/17	6/15/27	12/15/17	20,000		3 Month LIBOR	3.488%	(3)	—			(1,798	)
6/15/17	6/15/27	12/15/17	100,000		3 Month LIBOR	3.480%	(3)	—			(8,922	)
6/15/17	6/15/27	12/15/17	100,000		3 Month LIBOR	3.480%	(3)	—			(8,921	)
Total derivative financial instruments								$	11,042		(20,539	)

(1) Represents the date specified in the agreement for either optional or mandatory early termination by the counterparty, which will result in cash settlement. The Company has the option to terminate and settle at any date prior to this.

(2) Derivatives in an asset position are included within Other assets in the accompanying Consolidated Balance Sheets, while those in a liability position are included within Accounts payable and other liabilities.

(3) In 2014, the Company entered into $220 million of forward starting interest rate swaps to hedge the interest rate on new fixed rate ten year debt that the Company expected to issue in June 2017 for the specific purpose of repaying at maturity the $300 million notes. These interest rate swaps locked in a weighted average fixed rate of 3.48%, before the Company's credit spread. These swaps were settled during the during the third quarter of 2016, as further described below.

These derivative financial instruments are all interest rate swaps, which are designated and qualify as cash flow hedges. The Company does not use derivatives for trading or speculative purposes and currently does not have any derivatives that are not designated as hedges. The Company has master netting agreements, however the Company does not have multiple derivatives subject to a single master netting agreement with the same counterparties. Therefore none are offset in the accompanying Consolidated Balance Sheets.

The effective portion of changes in the fair value of derivatives designated and qualifying as cash flow hedges is recorded in accumulated other comprehensive income (loss) ("AOCI") and subsequently reclassified into earnings in the period that the hedged forecasted transaction affects earnings. The ineffective portion of the change in fair value of the derivatives is recognized directly in earnings within interest expense, in the accompanying Consolidated Statements of Operations.

REGENCY CENTERS CORPORATION AND REGENCY CENTERS, L.P.

Notes to Consolidated Financial Statements

December 31, 2016

The following table represents the effect of the derivative financial instruments on the accompanying consolidated financial statements:



Derivatives in FASB ASC Topic 815 Cash Flow Hedging Relationships:	Amount of Gain (Loss) Recognized in OCI on Derivative (Effective Portion)							Location and Amount of Gain (Loss) Reclassified from Accumulated OCI into Income (Effective Portion)								Location and Amount of Gain or (Loss) Recognized in Income on Derivative (Ineffective Portion and Missed Forecast)
	Year ended December 31,								Year ended December 31,								Year ended December 31,
(in thousands)	2016			2015		2014			2016			2015		2014			2016			2015	2014
Interest rate swaps	$	(10,332	)	(10,089	)	(49,968	)	Interest expense	$	(51,139	)	(9,152	)	(9,353	)	Loss on derivative instruments	$	(40,586	)	—	—

As of December 31, 2016, the Company expects $9.8 million of net deferred losses on derivative instruments accumulated in other comprehensive income, including the Company's share from its Investments in real estate partnerships, to be reclassified into earnings during the next 12 months. Included in the reclass is $8.4 million which is related to previously settled swaps on the Company's ten year fixed rate unsecured loans.

Hedge Settlement

During the third quarter of 2016, the Company initiated and completed a $400.1 million equity offering, as further described in note 9, for the primary purpose of funding the early redemption of its $300 million notes. The Company also used $40.6 million from the net offering proceeds to settle $220 million of forward starting swaps related to new debt previously expected to be issued in 2017 to repay the notes at maturity. As a result of the equity offering, the Company believed that the issuance of new fixed rate debt within the remaining period of the forward starting swaps was probable not to occur. Accordingly, the Company ceased hedge accounting and reclassified the $40.6 million paid to settle the forward starting swaps from Accumulated other comprehensive loss to earnings during the third quarter of 2016.

Fair Value Measurements

(a) Disclosure of Fair Value of Financial Instruments

All financial instruments of the Company are reflected in the accompanying Consolidated Balance Sheets at amounts which, in management's estimation, reasonably approximates their fair values, except for the following:



	December 31,
	2016			2015
(in thousands)	Carrying Amount		Fair Value	Carrying Amount		Fair Value
Financial assets:
Notes receivable	$	10,481	10,380	$	10,480	10,620
Financial liabilities:
Notes payable	$	1,363,925	1,435,000	$	1,699,771	1,793,200
Unsecured credit facilities	$	278,495	279,700	$	164,514	165,300

The above fair values represent management's estimate of the amounts that would be received from selling those assets or that would be paid to transfer those liabilities in an orderly transaction between market participants as of December 31, 2016 and 2015. These fair value measurements maximize the use of observable inputs. However, in situations where there is little, if any, market activity for the asset or liability at the measurement date, the fair value measurement reflects the Company's own judgments about the assumptions that market participants would use in pricing the asset or liability.

The Company develops its judgments based on the best information available at the measurement date, including expected cash flows, appropriately risk-adjusted discount rates, and available observable and unobservable inputs. Service providers involved in fair value measurements are evaluated for competency and qualifications on an ongoing basis. As considerable judgment is often necessary to estimate the fair value of these financial instruments, the fair

REGENCY CENTERS CORPORATION AND REGENCY CENTERS, L.P.

Notes to Consolidated Financial Statements

December 31, 2016

values presented above are not necessarily indicative of amounts that will be realized upon disposition of the financial instruments.

The following methods and assumptions were used to estimate the fair value of these financial instruments:

Notes Receivable

The fair value of the Company's notes receivable is estimated by calculating the present value of future contractual cash flows discounted at interest rates available for notes of the same terms and maturities, adjusted for counter-party specific credit risk. The fair value of notes receivable was determined primarily using Level 3 inputs of the fair value hierarchy, which considered counter-party credit risk and collateral risk of the underlying property securing the note receivable.

Notes Payable

The fair value of the Company's unsecured debt is estimated based on the quoted market prices for the same or similar issues or on the current rates offered to the Company for debt of the same remaining maturities. The fair value of the unsecured debt was determined using Level 2 inputs of the fair value hierarchy.

The fair value of the Company's mortgage notes payable is estimated by discounting future cash flows of each instrument at rates that reflect the current market rates available to the Company for debt of the same terms and maturities. Fixed rate loans assumed in connection with real estate acquisitions are recorded in the accompanying consolidated financial statements at fair value at the time the property is acquired. The fair value of the mortgage notes payable was determined using Level 2 inputs of the fair value hierarchy.

Unsecured Credit Facilities

The fair value of the Company's Unsecured credit facilities is estimated based on the interest rates currently offered to the Company by financial institutions. The fair value of the credit facilities was determined using Level 2 inputs of the fair value hierarchy.

The following interest rates were used by the Company to estimate the fair value of its financial instruments:



	December 31,
	2016		2015
	Low	High	Low	High
Notes receivable	7.2%	7.2%	6.3%	6.3%
Notes payable	2.9%	3.9%	2.8%	4.2%
Unsecured credit facilities	1.5%	1.6%	1.1%	1.1%

(b) Fair Value Measurements

The following financial instruments are measured at fair value on a recurring basis:

Trading Securities Held in Trust

The Company has investments in marketable securities, which are assets of the non-qualified deferred compensation plan ("NQDCP"), that are classified as trading securities held in trust on the accompanying Consolidated Balance Sheets. The fair value of the trading securities held in trust was determined using quoted prices in active markets, which are considered Level 1 inputs of the fair value hierarchy. Changes in the value of trading securities are recorded within net investment (income) loss from deferred compensation plan in the accompanying Consolidated Statements of Operations.

REGENCY CENTERS CORPORATION AND REGENCY CENTERS, L.P.

Notes to Consolidated Financial Statements

December 31, 2016

Available-for-Sale Securities

Available-for-sale securities consist of investments in certificates of deposit and corporate bonds, and are recorded at fair value using matrix pricing methods to estimate fair value, which are considered Level 2 inputs of the fair value hierarchy. Unrealized gains or losses on these securities are recognized through Other comprehensive income.

Interest Rate Derivatives

The fair value of the Company's interest rate derivatives is determined using widely accepted valuation techniques including discounted cash flow analysis on the expected cash flows of each derivative. This analysis reflects the contractual terms of the derivatives, including the period to maturity, and uses observable market-based inputs, including interest rate curves and implied volatilities. The Company incorporates credit valuation adjustments to appropriately reflect both its own nonperformance risk and the respective counterparty's nonperformance risk in the fair value measurements.

Although the Company has determined that the majority of the inputs used to value its derivatives fall within Level 2 of the fair value hierarchy, the credit valuation adjustments associated with its derivatives utilize Level 3 inputs, such as estimates of current credit spreads, to evaluate the likelihood of default by the Company and its counterparties. The Company has assessed the significance of the impact of the credit valuation adjustments on the overall valuation of its derivative positions and has determined that the credit valuation adjustments are not significant to the overall valuation of its interest rate swaps. As a result, the Company determined that its interest rate swaps valuation in its entirety is classified in Level 2 of the fair value hierarchy.

REGENCY CENTERS CORPORATION AND REGENCY CENTERS, L.P.

Notes to Consolidated Financial Statements

December 31, 2016

The following table presents the placement in the fair value hierarchy of assets and liabilities that are measured at fair value on a recurring basis:



	Fair Value Measurements as of December 31, 2016
				Quoted Prices in Active Markets for Identical Assets	Significant Other Observable Inputs		Significant Unobservable Inputs
(in thousands)	Balance			(Level 1)	(Level 2)		(Level 3)
Assets:
Trading securities held in trust	$	28,588		28,588	—		—
Available-for-sale securities	7,420			—	7,420		—
Interest rate derivatives	11,622			—	11,622		—
Total	$	47,630		28,588	19,042		—
Liabilities:
Interest rate derivatives	$	(580	)	—	(580	)	—



	Fair Value Measurements as of December 31, 2015
				Quoted Prices in Active Markets for Identical Assets	Significant Other Observable Inputs		Significant Unobservable Inputs
(in thousands)	Balance			(Level 1)	(Level 2)		(Level 3)
Assets:
Trading securities held in trust	$	29,093		29,093	—		—
Available-for-sale securities	7,922			—	7,922		—
Total	$	37,015		29,093	7,922		—

Liabilities:
Interest rate derivatives	$	(20,539	)	—	(20,539	)	—

REGENCY CENTERS CORPORATION AND REGENCY CENTERS, L.P.

Notes to Consolidated Financial Statements

December 31, 2016

Equity and Capital

Preferred Stock of the Parent Company

Terms and conditions of the preferred stock outstanding are summarized as follows:



	Preferred Stock Outstanding as of December 31, 2016 and 2015
	Date of Issuance	Shares Issued and Outstanding	Liquidation Preference		Distribution Rate	Callable By Company
Series 6	2/16/2012	10,000,000	$	250,000,000	6.625%	2/16/2017
Series 7	8/23/2012	3,000,000	75,000,000		6.000%	8/23/2017
		13,000,000	$	325,000,000

The Series 6 and 7 preferred shares are perpetual, absent a change in control of the Parent Company, are not convertible into common stock of the Parent Company, and are redeemable at par upon the Company’s election beginning 5 years after the issuance date. None of the terms of the preferred stock contain any unconditional obligations that would require the Company to redeem the securities at any time or for any purpose.

Preferred Shares Redemption - Subsequent Event

Subsequent to December 31, 2016, on February 16, 2017, the Parent Company redeemed all of the issued and outstanding 6.625% Series 6 cumulative redeemable preferred shares. The redemption price of $25.21 per share includes accrued and unpaid dividends, resulting in an aggregate amount being paid of $252.0 million. The funds use to redeem the Series 6 preferred shares were provided by the senior unsecured debt offering done in January 2017, as discussed in note 6.

Common Stock of the Parent Company

Issuances:

At the Market ("ATM") Program

Under the Parent Company's March 2014 prospectus supplement filed with the Securities and Exchange Commission with respect to an ATM equity offering program, the Parent Company may sell up to $200.0 million of common stock at prices determined by the market at the time of sale. As of December 31, 2016, $70.8 million in common stock remained available for issuance under this ATM equity program.

The following table presents the shares that were issued under the ATM equity program, which was used to fund investment activities:



	Year ended December 31,
(dollar amounts are in thousands, except price per share data)	2016		2015
Shares issued (1)	182,787		189,266
Weighted average price per share	$	68.85	67.86
Gross proceeds	$	12,584	12,843
Commissions	$	157	161
Issuance costs	$	97	—
(1) Reflects shares traded in December and settled in January each year.

Forward Equity Offering

In March 2016, the Parent Company entered into a forward sale agreement (the "Forward Equity Offering") to issue 3.10 million shares of its common stock at an offering price of $75.25 per share, before any underwriting discount and offering expenses.

REGENCY CENTERS CORPORATION AND REGENCY CENTERS, L.P.

Notes to Consolidated Financial Statements

December 31, 2016

In June 2016, the Parent Company partially settled its forward equity offering by delivering 1.85 million shares of newly issued common stock, receiving $137.5 million of net proceeds, which were used to repay the Line.

The remaining 1.25 million shares must be settled under the forward sale agreement prior to June 23, 2017.

Equity Offering

In July 2016, the Parent Company issued 5.0 million shares of common stock at $79.78 per share resulting in net proceeds of $400.1 million, used to (i) redeem, in August, $300 million of notes, including a make-whole payment, (ii) settle forward interest rate swaps, and (iii) fund investment activities and general corporate purposes.

Tax Status of Dividends

The following table summarizes the tax status of dividends paid on our common shares:



	Year ended December 31,
	2016	2015	2014
Dividend per share	$2.00	1.94	1.88
Ordinary income	53%	71%	70%
Capital gain	8%	5%	16%
Return of capital	39%	19%	14%
Qualified dividend income	—%	5%	—%

Preferred Units of the Operating Partnership

Preferred units for the Parent Company are outstanding in relation to the Parent Company's preferred stock, as discussed above.

Common Units of the Operating Partnership

Issuances:

Common units were issued to the Parent Company in relation to the Parent Company's issuance of common stock, as discussed above.

General Partners

The Parent Company, as general partner, owned the following Partnership Units outstanding:



	December 31,
(in thousands)	2016	2015
Partnership units owned by the general partner	104,497	97,213
Partnership units owned by the limited partners	154	154
Total partnership units outstanding	104,651	97,367
Percentage of partnership units owned by the general partner	99.9%	99.8%

REGENCY CENTERS CORPORATION AND REGENCY CENTERS, L.P.

Notes to Consolidated Financial Statements

December 31, 2016

Accumulated Other Comprehensive Income (Loss)

The following table presents changes in the balances of each component of AOCI:



	Controlling Interest							Noncontrolling Interest						Total
(in thousands)	Cash Flow Hedges			Unrealized gain (loss) on Available-For-Sale Securities		AOCI		Cash Flow Hedges		Unrealized gain (loss) on Available-For-Sale Securities		AOCI		AOCI
Balance as of December 31, 2013	$	(17,404	)	—		(17,404	)	(479	)	—		(479	)	(17,883	)
Other comprehensive income before reclassifications	(49,524		)	7,752		(41,772	)	(444	)	13		(431	)	(42,203	)
Amounts reclassified from accumulated other comprehensive income	9,180			(7,752	)	1,428		173		(13	)	160		1,588
Current period other comprehensive income, net	(40,344		)	—		(40,344	)	(271	)	—		(271	)	(40,615	)
Balance as of December 31, 2014	$	(57,748	)	—		(57,748	)	(750	)	—		(750	)	(58,498	)
Other comprehensive income before reclassifications	(9,897		)	(43	)	(9,940	)	(192	)	—		(192	)	(10,132	)
Amounts reclassified from accumulated other comprehensive income	8,995			—		8,995		157		—		157		9,152
Current period other comprehensive income, net	(902		)	(43	)	(945	)	(35	)	—		(35	)	(980	)
Balance as of December 31, 2015	$	(58,650	)	(43	)	(58,693	)	(785	)	—		(785	)	(59,478	)
Other comprehensive income before reclassifications	(10,587		)	24		(10,563	)	255		—		255		(10,308	)
Amounts reclassified from accumulated other comprehensive income	50,910			—		50,910		229		—		229		51,139
Current period other comprehensive income, net	40,323			24		40,347		484		—		484		40,831
Balance as of December 31, 2016	$	(18,327	)	(19	)	(18,346	)	(301	)	—		(301	)	(18,647	)

The following represents amounts reclassified out of AOCI into income:



AOCI Component	Amount Reclassified from AOCI into Income					Affected Line Item (s) Where Net Income is Presented
	Year ended December 31,
(in thousands)	2016		2015	2014
Interest rate swaps	$	51,139	9,152	9,353		Interest expense and Loss on derivative instruments
Realized gains on sale of available-for-sale securities	—		—	(7,765	)	Net investment (income) loss

REGENCY CENTERS CORPORATION AND REGENCY CENTERS, L.P.

Notes to Consolidated Financial Statements

December 31, 2016

Stock-Based Compensation

The Company recorded stock-based compensation in general and administrative expenses in the accompanying Consolidated Statements of Operations, the components of which are further described below:



	Year ended December 31,
(in thousands)	2016			2015		2014
Restricted stock (1)	$	13,422		13,869		12,161
Directors' fees paid in common stock (1)	193			200		208
Capitalized stock-based compensation (2)	(2,963		)	(2,988	)	(2,707	)
Stock-based compensation, net of capitalization	$	10,652		11,081		9,662

(1) Includes amortization of the grant date fair value of restricted stock awards over the respective vesting periods.

(2) Includes compensation expense specifically identifiable to development and leasing activities.

The Company established its Long Term Omnibus Plan (the "Plan") under which the Board of Directors may grant stock options and other stock-based awards to officers, directors, and other key employees. The Plan allows the Company to issue up to 4.1 million shares in the form of the Parent Company's common stock or stock options. As of December 31, 2016, there were 2.3 million shares available for grant under the Plan either through stock options or restricted stock.

Stock Option Awards

Stock options are granted under the Plan with an exercise price equal to the Parent Company's stock's price at the date of grant. All stock options granted have ten-year lives, contain vesting terms of one to five years from the date of grant and some have dividend equivalent rights. The fair value of each option award is estimated on the date of grant using the Black-Scholes-Merton closed-form (“Black-Scholes”) option valuation model. The Company believes that the use of the Black-Scholes model meets the fair value measurement objectives of FASB ASC Topic 718 and reflects all substantive characteristics of the instruments being valued. There were no stock options granted during the years ended December 31, 2016, 2015 or 2014. There were no stock options exercised, forfeited or expired during the years ended December 31, 2016 or 2015.

The following table summarizes stock options outstanding:



	Year ended December 31, 2016
	Number of Options	Weighted Average Exercise Price		Weighted Average Remaining Contractual Term (in years)	Aggregate Intrinsic Value (in thousands)
Outstanding as of December 31, 2015	8,741	$	88.45	1.1	$	(178	)
Outstanding as of December 31, 2016	8,741	$	88.45	0.1	$	(170	)
Vested as of December 31, 2016	8,741	$	88.45	0.1	$	(170	)
Exercisable as of December 31, 2016 (1)	8,741	$	88.45	0.1	$	(170	)

(1) The Company issues new shares to fulfill option exercises from its authorized shares available. The total intrinsic value of options exercised during the year ended December 31, 2014 was approximately $1.3 million.

Restricted Stock Awards

The Company grants restricted stock under the Plan to its employees as a form of long-term compensation and retention. The terms of each restricted stock grant vary depending upon the participant's responsibilities and position within the Company. The Company's stock grants can be categorized as either time-based awards, performance-based awards, or market-based awards. All awards are valued at fair value, earn dividends throughout the vesting period, and have no voting rights. Fair value is measured using the grant date market price for all time-based or performance-based awards. Market based awards are valued using a Monte Carlo simulation to estimate the fair value based on the probability of satisfying the market conditions and the projected stock price at the time of payout, discounted to the

REGENCY CENTERS CORPORATION AND REGENCY CENTERS, L.P.

Notes to Consolidated Financial Statements

December 31, 2016

valuation date over a three year performance period. Assumptions include historic volatility over the previous three year period, risk-free interest rates, and Regency's historic daily return as compared to the market index. Since the award payout includes dividend equivalents and the total shareholder return includes the value of dividends, no dividend yield assumption is required for the valuation. Compensation expense is measured at the grant date and recognized on a straight-line basis over the requisite vesting period for the entire award.

The following table summarizes non-vested restricted stock activity:



	Year ended December 31, 2016
	Number of Shares	Intrinsic Value (in thousands)	Weighted Average Grant Price
Non-vested as of December 31, 2015	615,420
Add: Time-based awards granted (1) (4)	117,275		$73.22
Add: Performance-based awards granted (2) (4)	6,521		$73.22
Add: Market-based awards granted (3) (4)	67,332		$90.49
Less: Vested and Distributed (5)	222,915		$70.27
Less: Forfeited	22,372		$60.53
Non-vested as of December 31, 2016 (6)	561,261	$39,699

(1) Time-based awards vest beginning on the first anniversary following the grant date over a three or four year service period. These grants are subject only to continued employment and are not dependent on future performance measures. Accordingly, if such vesting criteria are not met, compensation cost previously recognized would be reversed.

(2) Performance-based awards are earned subject to future performance measurements. Once the performance criteria are achieved and the actual number of shares earned is determined, shares vest over a required service period. The Company considers the likelihood of meeting the performance criteria based upon management's estimates from which it determines the amounts recognized as expense on a periodic basis.

(3) Market-based awards are earned dependent upon the Company's total shareholder return in relation to the shareholder return of a NAREIT index over a three-year period. Once the performance criteria are met and the actual number of shares earned is determined, the shares are immediately vested and distributed. The probability of meeting the criteria is considered when calculating the estimated fair value on the date of grant using a Monte Carlo simulation. These awards are accounted for as awards with market criteria, with compensation cost recognized over the service period, regardless of whether the performance criteria are achieved and the awards are ultimately earned. The significant assumptions underlying determination of fair values for market-based awards granted were as follows:



	Year ended December 31,
	2016	2015	2014
Volatility	18.50%	17.10%	24.60%
Risk free interest rate	0.88%	0.78%	0.64%

(4) The weighted-average grant price for restricted stock granted during the years ended December 31, 2016, 2015, and 2014 was $79.40, $69.80, and $48.18, respectively.

(5) The total intrinsic value of restricted stock vested during the years ended December 31, 2016, 2015, and 2014 was $15.4 million, $18.6 million, and $12.4 million, respectively.

(6) As of December 31, 2016, there was $12.8 million of unrecognized compensation cost related to non-vested restricted stock granted under the Parent Company's Plan. When recognized, this compensation results in additional paid in capital in the accompanying Consolidated Statements of Equity of the Parent Company and in general partner preferred and common units in the accompanying Consolidated Statements of Capital of the Operating Partnership. This unrecognized compensation cost is expected to be recognized over the next three years. The Company issues new restricted stock from its authorized shares available at the date of grant.

REGENCY CENTERS CORPORATION AND REGENCY CENTERS, L.P.

Notes to Consolidated Financial Statements

December 31, 2016

Saving and Retirement Plans

401(k) Retirement Plan

The Company maintains a 401(k) retirement plan covering substantially all employees, which permits participants to defer up to the maximum allowable amount determined by the IRS of their eligible compensation. This deferred compensation, together with Company matching contributions equal to 100% of employee deferrals up to a maximum of $5,000 of their eligible compensation, is fully vested and funded as of December 31, 2016. Additionally, an annual profit sharing contribution is made, which vests over a three year period. Costs for Company contributions to the plan totaled $3.3 million, $3.1 million and $2.8 million for the years ended December 31, 2016, 2015, and 2014, respectively.

Non-Qualified Deferred Compensation Plan

The Company maintains a non-qualified deferred compensation plan (“NQDCP”), which allows select employees and directors to defer part or all of their cash bonus, director fees, and vested restricted stock awards. All contributions into the participants' accounts are fully vested upon contribution to the NQDCP and are deposited in a Rabbi trust.

The following table reflects the balances of the assets and deferred compensation liabilities of the Rabbi trust in the accompanying Consolidated Balance Sheets:



Non Qualified Deferred Compensation Plan Component (1)	Year ended December 31,
(in thousands)	2016		2015
Assets:
Trading securities held in trust	$	28,588	29,093
Liabilities:
Accounts payable and other liabilities	$	28,214	28,632

(1) Assets and liabilities of the Rabbi trust are exclusive of the shares of the Company's common stock.

Realized and unrealized gains and losses on trading securities are recognized within income from deferred compensation plan in the accompanying Consolidated Statements of Operations. Changes in participant obligations, which is based on changes in the value of their investment elections, is recognized within general and administrative expenses within the accompanying Consolidated Statements of Operations.

Investments in shares of the Company's common stock are included, at cost, as treasury stock in the accompanying Consolidated Balance Sheets of the Parent Company and as a reduction of general partner capital in the accompanying Consolidated Balance Sheets of the Operating Partnership. The participant's deferred compensation liability attributable to the participants' investments in shares of the Company's common stock are included, at cost, within additional paid in capital in the accompanying Consolidated Balance Sheets of the Parent Company and as a reduction of general partner capital in the accompanying Consolidated Balance Sheets of the Operating Partnership. Changes in participant account balances related to the Regency common stock fund are recorded directly within stockholders' equity.

REGENCY CENTERS CORPORATION AND REGENCY CENTERS, L.P.

Notes to Consolidated Financial Statements

December 31, 2016

Earnings per Share and Unit

Parent Company Earnings per Share

The following summarizes the calculation of basic and diluted earnings per share:



	Year ended December 31,
(in thousands, except per share data)	2016		2015	2014
Numerator:
Income from operations attributable to common stockholders - basic	$	143,860	128,994	165,875
Income from operations attributable to common stockholders - diluted	$	143,860	128,994	165,938
Denominator:
Weighted average common shares outstanding for basic EPS	100,863		94,391	92,370
Weighted average common shares outstanding for diluted EPS (1)	101,285		94,856	92,404

Income per common share – basic	$	1.43	1.37	1.80
Income per common share – diluted	$	1.42	1.36	1.80

(1) Includes the dilutive impact of unvested restricted stock and shares issuable under the forward equity offering using the treasury stock method.

Income allocated to noncontrolling interests of the Operating Partnership has been excluded from the numerator and exchangeable Operating Partnership units have been omitted from the denominator for the purpose of computing diluted earnings per share since the effect of including these amounts in the numerator and denominator would have no impact. Weighted average exchangeable Operating Partnership units outstanding for the years ended December 31, 2016 and 2015 were 154,170, and for the year ended December 31, 2014 was 157,950.

Operating Partnership Earnings per Unit

The following summarizes the calculation of basic and diluted earnings per unit:



	Year ended December 31,
(in thousands, except per share data)	2016		2015	2014
Numerator:
Income from operations attributable to common unit holders - basic	$	144,117	129,234	166,194
Income from operations attributable to common unit holders - diluted	$	144,117	129,234	166,257
Denominator:
Weighted average common units outstanding for basic EPU	101,017		94,546	92,528
Weighted average common units outstanding for diluted EPU (1)	101,439		95,011	92,562

Income per common unit – basic	$	1.43	1.37	1.80
Income per common unit – diluted	$	1.42	1.36	1.80

(1) Includes the dilutive impact of unvested restricted stock and forward equity offering using the treasury stock method.

REGENCY CENTERS CORPORATION AND REGENCY CENTERS, L.P.

Notes to Consolidated Financial Statements

December 31, 2016

Operating Leases

The Company's properties are leased to tenants under operating leases. Our leases for tenant space under 10,000 square feet generally have terms ranging from three to seven years. Leases greater than 10,000 square feet generally have lease terms in excess of five years, mostly comprised of anchor tenants. Many of the anchor leases contain provisions allowing the tenant the option of extending the term of the lease at expiration. Future minimum rents under non-cancelable operating leases as of December 31, 2016, excluding both tenant reimbursements of operating expenses and additional percentage rent based on tenants' sales, are as follows:



In Process Year Ending December 31,	Future Minimum Rents (in thousands)
2017	$	434,070
2018	390,872
2019	346,356
2020	295,289
2021	241,549
Thereafter	990,609
Total	$	2,698,745

The shopping centers' tenant base primarily includes national and regional supermarkets, drug stores, discount department stores, and other retailers and, consequently, the credit risk is concentrated in the retail industry. There were no tenants that individually represented more than 5% of the Company's annualized future minimum rents.

The Company has shopping centers that are subject to non-cancelable, long-term ground leases where a third party owns and has leased the underlying land to the Company to construct and/or operate a shopping center. Ground leases expire through the year 2101, and in most cases, provide for renewal options. Buildings and improvements constructed on the leased land are capitalized 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. Office leases expire through the year 2027, and in most cases, provide for renewal options. Leasehold improvements are capitalized, recorded as tenant improvements, and depreciated over the shorter of the useful life of the improvements or the lease term.

Operating lease expense was $13.1 million, $9.5 million, and $8.9 million for the years ended December 31, 2016, 2015, and 2014, respectively. The following table summarizes the future obligations under non-cancelable operating leases as of December 31, 2016:



In Process Year Ending December 31,	Future Obligations (in thousands)
2017	$	9,740
2018	11,464
2019	12,131
2020	11,706
2021	11,290
Thereafter	442,476
Total	$	498,807

14 Commitments and Contingencies

The Company is involved in litigation on a number of matters and is subject to certain claims, which arise in the normal course of business, none of which, in the opinion of management, is expected to have a material adverse effect on the Company's consolidated financial position, results of operations, or liquidity. Legal fees are expensed as incurred.

REGENCY CENTERS CORPORATION AND REGENCY CENTERS, L.P.

Notes to Consolidated Financial Statements

December 31, 2016

After the announcement of the merger agreement on November 14, 2016, a putative class action was filed on behalf of a purported stockholder in the Circuit Court for Duval County, Florida, under the following caption: Robert Garfield on Behalf of Himself and All Others Similarly Situated vs. Regency Centers Corporation, Martin E. Stein, Jr., John C. Schweitzer, Raymond L. Bank, Bryce Blair, C. Ronald Blankenship, J. Dix Druce, Jr., Mary Lou Fiala, David P. O'Connor, and Thomas G. Wattles, No. 16-2017-CA-000688-XXXX-MA, filed February 3, 2017.

The class action alleges, among other matters, that the definitive joint proxy statement/prospectus filed by Regency and Equity One with the Securities and Exchange Commission (the “SEC”) on January 24, 2017 (the “Joint Proxy Statement/Prospectus”) omitted certain material information in connection with the Merger. The complainant seeks various remedies, including injunctive relief to prevent the consummation of the Merger unless certain allegedly material information is disclosed and seeking compensatory and rescissory damages in the event the Merger is consummated without such disclosures.

On February 17, 2017, the defendants entered into a stipulation of settlement with respect to the class action, pursuant to which the parties have agreed, among other things, that Regency will make certain supplemental disclosures. The supplemental disclosures were made by Regency in the Current Report on Form 8-K filed by Regency with the SEC on February 17, 2017. The supplemental disclosures should be read in conjunction with the Joint Proxy Statement/Prospectus, which should be read in its entirety.

Regency believes that the class action is without merit and that no supplemental disclosure is required to the Joint Proxy Statement/Prospectus under any applicable rule, statute, regulation or law. However, to, among other things, eliminate the burden, inconvenience, expense, risk and disruption of further litigation, Regency has determined that it will provide supplemental disclosures. Additional information regarding the stipulation of settlement or additional disclosures may be found in the Current Report on Form 8-K as filed with the SEC on February 17, 2017.

The Company is also subject to numerous environmental laws and regulations as they apply to real estate pertaining to chemicals used by the dry cleaning industry, the existence of asbestos in older shopping centers, and underground petroleum storage tanks. The Company believes that the ultimate disposition of currently known environmental matters will not have a material effect on its financial position, liquidity, or operations; however, it can give no assurance that existing environmental studies with respect to the shopping centers have revealed all potential environmental liabilities; that any previous owner, occupant or tenant did not create any material environmental condition not known to it; that the current environmental condition of the shopping centers will not be affected by tenants and occupants, by the condition of nearby properties, or by unrelated third parties; or that changes in applicable environmental laws and regulations or their interpretation will not result in additional environmental liability to the Company.

The Company has the right to issue letters of credit under the Line up to an amount not to exceed $50.0 million, which reduces the credit availability under the Line. These letters of credit are primarily issued as collateral to facilitate the construction of development projects. As of December 31, 2016 and 2015, the Company had $5.8 million and $5.9 million in letters of credit outstanding, respectively.

REGENCY CENTERS CORPORATION AND REGENCY CENTERS, L.P.

Notes to Consolidated Financial Statements

December 31, 2016

Summary of Quarterly Financial Data (Unaudited)

The following table summarizes selected Quarterly Financial Data for the Company on a historical basis for the years ended December 31, 2016 and 2015:



(in thousands except per share and per unit data)	First Quarter		Second Quarter	Third Quarter	Fourth Quarter
Year ended December 31, 2016

Operating Data:
Revenue	$	149,628	152,413	152,769	159,561

Net income attributable to common stockholders	$	47,877	34,810	5,305	55,868
Net income attributable to exchangeable operating partnership units	85		64	16	92
Net income attributable to common unit holders	$	47,962	34,874	5,321	55,960

Net income attributable to common stock and unit holders per share and unit:
Basic	$	0.49	0.36	0.05	0.53
Diluted	$	0.49	0.35	0.05	0.53

Year ended December 31, 2015

Operating Data:
Revenue	$	140,399	141,129	142,068	146,167

Net income attributable to common stockholders	$	25,174	32,480	53,731	17,609
Net income attributable to exchangeable operating partnership units	49		61	94	36
Net income attributable to common unit holders	$	25,223	32,541	53,825	17,645

Net income attributable to common stock and unit holders per share and unit:
Basic	$	0.27	0.35	0.57	0.18
Diluted	$	0.27	0.34	0.57	0.18

REGENCY CENTERS CORPORATION AND REGENCY CENTERS, L.P.

Notes to Consolidated Financial Statements

December 31, 2016

Subsequent Events

Approval of Merger with Equity One, Inc.

On November 14, 2016, Regency entered into a Merger Agreement with Equity One, pursuant to which, subject to the satisfaction or waiver of certain conditions, Equity One will merge with and into the Company, with Regency being the surviving corporation (the “Merger”). The combined company will retain the Regency name and will continue to trade under the ticker symbol REG on the New York Stock Exchange ("NYSE"). The Company will expand its board of directors to 12 directors and will add three persons who served on Equity One's board of directors. The executive officers of Regency immediately prior to the effective date of the merger will continue to serve as executive officers of the combined company.

On the terms and subject to the conditions set forth in the Merger Agreement, which has been unanimously approved by the boards of directors of the Company and Equity One, at the effective time of the Merger, each share of the common stock, par value $0.01 per share, of Equity One issued and outstanding immediately prior to the effective time (other than shares of Equity One owned directly by Equity One or the Company and in each case not held on behalf of third parties) will be converted into the right to receive 0.45 of a newly issued share of the common stock of the Company.

The consummation of the Merger is subject to certain closing conditions, including (i) the approval of the Company’s and Equity One’s respective stockholders, (ii) the shares of Company Common Stock to be issued in the Merger will have been approved for listing on the New York Stock Exchange, subject to official notice of issuance, (iii) the absence of any temporary restraining order, preliminary or permanent injunction or other order issued by any court of competent jurisdiction or other legal restraint or prohibition preventing the consummation of the Merger, (iv) the receipt of certain tax opinions by the Company and Equity One, and (v) other customary conditions specified in the Merger Agreement.

At a special meeting of Regency stockholders, held on Friday, February 24, 2017, the stockholders approved all matters subject to stockholder vote, including

(i) the proposed Merger Agreement and the Merger,

(ii) the proposal to amend the Restated Articles of Incorporation of Regency to increase the number of authorized shares of Regency common stock, and

(iii) the proposal to increase the size of the Regency board of directors to 12 directors.

At a separate special meeting of Equity One stockholders, also held on Friday, February 24, 2017, their stockholders approved all matters subject to stockholder vote, including

(i) the proposed Merger Agreement and the Merger, and

(ii) the proposal to approve the compensation that may be paid or become payable to the named executive officers in connection with the Merger.

The Merger is expected to close effective March 1, 2017, at which time each share of Equity One common stock issued and outstanding will be converted into the right to receive 0.45 of a newly issued share of Regency common stock. The merger will be accounted for using the acquisition method of accounting. The purchase price will be computed using the closing price of Regency common stock on the closing date applied to the number of shares of common stock issued to consummate the merger. Under the acquisition method of accounting, the total purchase price is allocated to the acquired net tangible and identifiable intangible assets and liabilities assumed of Equity One based on their respective fair values, on the closing date. Since the purchase price will be based on the price of Regency's common stock on the effective date, the purchase price and resulting purchase price allocation is not yet known. Further information about preliminary estimated purchase price and unaudited pro forma financial statements of the combined company can be found in the Form S-4, as filed with the Securities and Exchange Commission on December 22, 2016 and subsequent amendments thereto.

REGENCY CENTERS CORPORATION AND REGENCY CENTERS, L.P.

Notes to Consolidated Financial Statements

December 31, 2016

Regency believes that the class action is without merit and that no supplemental disclosure is or was required to the Joint Proxy Statement/Prospectus under any applicable rule, statute, regulation or law. However, to, among other things, eliminate the burden, inconvenience, expense, risk and disruption of further litigation, Regency has determined to provide supplemental disclosures. Additional information regarding the stipulation of settlement may be found in the Current Report on Form 8-K as filed with the SEC on February 17, 2017.



REGENCY CENTERS CORPORATION AND REGENCY CENTERS, L.P. Schedule III - Consolidated Real Estate and Accumulated Depreciation December 31, 2016 (in thousands)

	Initial Cost					Total Cost				Net Cost
Shopping Centers (1)	Land		Building & Improvements	Cost Capitalized Subsequent to Acquisition (2)		Land	Building & Improvements	Total	Accumulated Depreciation	Net of Accumulated Depreciation	Mortgages
4S Commons Town Center	$	30,760	35,830	942		30,812	36,720	67,532	20,997	46,535	62,500
Amerige Heights Town Center	10,109		11,288	486		10,109	11,774	21,883	3,833	18,050	16,105
Anastasia Plaza	9,065		—	615		3,338	6,342	9,680	1,993	7,687	—
Ashburn Farm Market Center	9,835		4,812	244		9,835	5,056	14,891	4,084	10,807	—
Ashford Perimeter	2,584		9,865	1,062		2,584	10,927	13,511	6,829	6,682	—
Aventura Shopping Center	2,751		10,459	(10,367	)	2,751	92	2,843	52	2,791	—
Balboa Mesa Shopping Center	23,074		33,838	13,985		27,769	43,128	70,897	7,663	63,234	—
Belleview Square	8,132		9,756	2,649		8,323	12,214	20,537	6,709	13,828	—
Belmont Chase	13,881		15,407	—		13,881	15,407	29,288	1,415	27,873	—
Berkshire Commons	2,295		9,551	2,278		2,965	11,159	14,124	7,199	6,925	7,500
Black Rock	22,251		20,815	196		22,250	21,011	43,261	2,668	40,593	20,000
Bloomingdale Square	3,940		14,912	2,595		3,940	17,507	21,447	8,588	12,859	—
Boulevard Center	3,659		10,787	1,341		3,659	12,128	15,787	6,287	9,500	—
Boynton Lakes Plaza	2,628		11,236	4,699		3,606	14,957	18,563	6,246	12,317	—
Brentwood Plaza	2,788		3,473	286		2,788	3,759	6,547	1,042	5,505	—
Briarcliff La Vista	694		3,292	473		694	3,765	4,459	2,601	1,858	—
Briarcliff Village	4,597		24,836	1,380		4,597	26,216	30,813	16,579	14,234	—
Brick Walk	25,299		41,995	352		25,299	42,347	67,646	4,039	63,607	33,000
Bridgeton	3,033		8,137	415		3,067	8,518	11,585	1,863	9,722	—
Brighten Park	3,983		18,687	10,852		4,234	29,288	33,522	12,472	21,050	—
Brooklyn Station on Riverside	7,019		8,688	—		7,019	8,688	15,707	741	14,966	—
Buckhead Court	1,417		7,432	2,573		1,417	10,005	11,422	5,661	5,761	—
Buckley Square	2,970		5,978	1,131		2,970	7,109	10,079	3,773	6,306	—
Caligo Crossing	2,459		4,897	144		2,546	4,954	7,500	2,353	5,147	—
Cambridge Square	774		4,347	761		774	5,108	5,882	2,950	2,932	—
Carmel Commons	2,466		12,548	5,014		3,422	16,606	20,028	8,297	11,731	—
Carriage Gate	833		4,974	2,830		1,302	7,335	8,637	5,171	3,466	—
Centerplace of Greeley III	6,661		11,502	515		5,694	12,984	18,678	3,912	14,766	—
Chasewood Plaza	4,612		20,829	5,051		6,518	23,974	30,492	14,640	15,852	—
Cherry Grove	3,533		15,862	2,567		3,533	18,429	21,962	8,766	13,196	—
CityLine Market	12,208		15,839	—		12,208	15,839	28,047	563	27,484	—
CityLine Market Ph II	2,611		3,051	—		2,611	3,051	5,662	42	5,620	—



REGENCY CENTERS CORPORATION AND REGENCY CENTERS, L.P. Schedule III - Consolidated Real Estate and Accumulated Depreciation December 31, 2016 (in thousands)

	Initial Cost				Total Cost				Net Cost
Shopping Centers (1)	Land	Building & Improvements	Cost Capitalized Subsequent to Acquisition (2)		Land	Building & Improvements	Total	Accumulated Depreciation	Net of Accumulated Depreciation	Mortgages
Clayton Valley Shopping Center	24,189	35,422	2,535		24,538	37,608	62,146	20,655	41,491	—
Clybourn Commons	15,056	5,594	308		15,056	5,902	20,958	714	20,244	—
Cochran's Crossing	13,154	12,315	995		13,154	13,310	26,464	8,881	17,583	—
Corkscrew Village	8,407	8,004	567		8,407	8,571	16,978	2,998	13,980	7,343
Cornerstone Square	1,772	6,944	1,151		1,772	8,095	9,867	4,897	4,970	—
Corvallis Market Center	6,674	12,244	387		6,696	12,609	19,305	4,687	14,618	—
Costa Verde Center	12,740	26,868	1,555		12,798	28,365	41,163	14,597	26,566	—
Courtyard Landcom	5,867	4	3		5,867	7	5,874	2	5,872	—
Culpeper Colonnade	15,944	10,601	4,876		16,258	15,163	31,421	7,971	23,450	—
Dardenne Crossing	4,194	4,005	328		4,343	4,184	8,527	1,301	7,226	—
Delk Spectrum	2,985	12,001	2,711		3,271	14,426	17,697	6,935	10,762	—
Diablo Plaza	5,300	8,181	1,317		5,300	9,498	14,798	4,571	10,227	—
Dunwoody Village	3,342	15,934	3,541		3,342	19,475	22,817	12,283	10,534	—
East Pointe	1,730	7,189	1,993		1,944	8,968	10,912	4,744	6,168	—
East Washington Place	15,993	40,180	1,588		15,509	42,252	57,761	7,066	50,695	—
El Camino Shopping Center	7,600	11,538	1,248		7,600	12,786	20,386	5,790	14,596	—
El Cerrito Plaza	11,025	27,371	1,079		11,025	28,450	39,475	8,369	31,106	37,237
El Norte Parkway Plaza	2,834	7,370	3,266		3,263	10,207	13,470	4,539	8,931	—
Encina Grande	5,040	11,572	18,923		10,205	25,330	35,535	8,619	26,916	—
Fairfax Shopping Center	15,239	11,367	(8,763	)	10,826	7,017	17,843	2,942	14,901	—
Fairfield	6,731	29,420	456		6,731	29,876	36,607	2,759	33,848	—
Falcon	1,340	4,168	294		1,340	4,462	5,802	1,836	3,966	—
Fellsway Plaza	30,712	7,327	10,022		34,923	13,138	48,061	2,762	45,299	34,600
Fenton Marketplace	2,298	8,510	(8,305	)	512	1,991	2,503	558	1,945	—
Fleming Island	3,077	11,587	2,958		3,111	14,511	17,622	6,620	11,002	—
Fountain Square	29,650	28,393	2		29,290	28,755	58,045	3,205	54,840	—
French Valley Village Center	11,924	16,856	175		11,822	17,133	28,955	10,237	18,718	—
Friars Mission Center	6,660	28,021	1,418		6,660	29,439	36,099	13,281	22,818	—
Garden City	741	9,764	6		741	9,770	10,511	349	10,162	—
Gardens Square	2,136	8,273	502		2,136	8,775	10,911	4,488	6,423	—
Gateway 101	24,971	9,113	(1,435	)	24,971	7,678	32,649	2,539	30,110	—
Gateway Shopping Center	52,665	7,134	8,651		55,296	13,154	68,450	12,045	56,405	—



REGENCY CENTERS CORPORATION AND REGENCY CENTERS, L.P. Schedule III - Consolidated Real Estate and Accumulated Depreciation December 31, 2016 (in thousands)

	Initial Cost				Total Cost				Net Cost
Shopping Centers (1)	Land	Building & Improvements	Cost Capitalized Subsequent to Acquisition (2)		Land	Building & Improvements	Total	Accumulated Depreciation	Net of Accumulated Depreciation	Mortgages
Gelson's Westlake Market Plaza	3,157	11,153	5,462		4,648	15,124	19,772	5,358	14,414	—
Glen Oak Plaza	4,103	12,951	554		4,103	13,505	17,608	2,977	14,631	—
Glenwood Village	1,194	5,381	297		1,194	5,678	6,872	3,905	2,967	—
Golden Hills Plaza	12,699	18,482	2,160		11,397	21,944	33,341	6,792	26,549	—
Grand Ridge Plaza	24,208	61,033	2,872		24,879	63,234	88,113	10,786	77,327	10,931
Hancock	8,232	28,260	1,597		8,232	29,857	38,089	14,654	23,435	—
Harpeth Village Fieldstone	2,284	9,443	521		2,284	9,964	12,248	4,702	7,546	—
Harris Crossing	7,199	3,687	(720	)	6,443	3,723	10,166	2,011	8,155	—
Heritage Land	12,390	—	(453	)	11,937	—	11,937	—	11,937	—
Heritage Plaza	—	26,097	14,278		278	40,097	40,375	15,259	25,116	—
Hershey	7	808	8		7	816	823	361	462	—
Hibernia Pavilion	4,929	5,065	75		4,929	5,140	10,069	2,376	7,693	—
Hickory Creek Plaza	5,629	4,564	319		5,629	4,883	10,512	3,425	7,087	—
Hillcrest Village	1,600	1,909	51		1,600	1,960	3,560	897	2,663	—
Hilltop Village	2,995	4,581	2,124		3,097	6,603	9,700	1,278	8,422	—
Hinsdale	5,734	16,709	11,561		8,279	25,725	34,004	10,145	23,859	—
Holly Park	8,975	23,799	(211	)	8,828	23,735	32,563	2,688	29,875	—
Howell Mill Village	5,157	14,279	2,255		5,157	16,534	21,691	4,850	16,841	—
Hyde Park	9,809	39,905	2,661		9,809	42,566	52,375	22,453	29,922	—
Indian Springs	24,974	25,903	(43	)	25,034	25,800	50,834	2,010	48,824	—
Indio Towne Center	17,946	32,617	5,206		23,092	32,677	55,769	13,037	42,732	—
Inglewood Plaza	1,300	2,159	619		1,300	2,778	4,078	1,239	2,839	—
Jefferson Square	5,167	6,445	(7,220	)	1,894	2,498	4,392	508	3,884	—
Keller Town Center	2,294	12,841	685		2,404	13,416	15,820	6,073	9,747	—
Kent Place	4,855	3,586	785		5,269	3,957	9,226	620	8,606	8,250
Kirkwood Commons	6,772	16,224	478		6,802	16,672	23,474	3,410	20,064	9,978
Klahanie Shopping Center	14,451	20,089	40		14,451	20,129	34,580	358	34,222	—
Kroger New Albany Center	3,844	6,599	636		3,844	7,235	11,079	4,988	6,091	—
Lake Pine Plaza	2,008	7,632	594		2,029	8,205	10,234	3,986	6,248	—
Lebanon/Legacy Center	3,913	7,874	99		3,913	7,973	11,886	5,344	6,542	—
Littleton Square	2,030	8,859	(3,887	)	2,409	4,593	7,002	1,689	5,313	—
Lloyd King	1,779	10,060	1,168		1,779	11,228	13,007	5,551	7,456	—



REGENCY CENTERS CORPORATION AND REGENCY CENTERS, L.P. Schedule III - Consolidated Real Estate and Accumulated Depreciation December 31, 2016 (in thousands)

	Initial Cost				Total Cost				Net Cost
Shopping Centers (1)	Land	Building & Improvements	Cost Capitalized Subsequent to Acquisition (2)		Land	Building & Improvements	Total	Accumulated Depreciation	Net of Accumulated Depreciation	Mortgages
Loehmanns Plaza California	5,420	9,450	1,149		5,420	10,599	16,019	5,095	10,924	—
Lower Nazareth Commons	15,992	12,964	1,985		16,343	14,598	30,941	6,446	24,495	—
Market at Colonnade Center	6,455	9,839	69		6,160	10,203	16,363	2,853	13,510	—
Market at Preston Forest	4,400	11,445	1,179		4,400	12,624	17,024	6,044	10,980	—
Market at Round Rock	2,000	9,676	6,402		2,000	16,078	18,078	7,910	10,168	—
Market Common Clarendon	154,932	126,328	—		154,932	126,328	281,260	3,098	278,162	—
Marketplace Shopping Center	1,287	5,509	5,469		1,330	10,935	12,265	5,695	6,570	—
Marketplace at Briargate	1,706	4,885	62		1,727	4,926	6,653	2,303	4,350	—
Millhopper Shopping Center	1,073	5,358	5,136		1,796	9,771	11,567	6,302	5,265	—
Mockingbird Commons	3,000	10,728	972		3,000	11,700	14,700	5,643	9,057	10,300
Monument Jackson Creek	2,999	6,765	679		2,999	7,444	10,443	5,202	5,241	—
Morningside Plaza	4,300	13,951	725		4,300	14,676	18,976	7,004	11,972	—
Murryhill Marketplace	2,670	18,401	12,441		2,858	30,654	33,512	9,908	23,604	—
Naples Walk	18,173	13,554	696		18,173	14,250	32,423	5,059	27,364	—
Newberry Square	2,412	10,150	516		2,412	10,666	13,078	7,594	5,484	—
Newland Center	12,500	10,697	7,738		15,777	15,158	30,935	6,169	24,766	—
Nocatee Town Center	10,124	8,691	670		8,695	10,790	19,485	3,489	15,996	—
North Hills	4,900	19,774	1,146		4,900	20,920	25,820	10,006	15,814	—
Northgate Marketplace	5,668	13,727	(101	)	4,995	14,299	19,294	3,337	15,957	—
Northgate Plaza (Maxtown Road)	1,769	6,652	266		1,769	6,918	8,687	3,873	4,814	—
Northgate Square	5,011	8,692	908		5,011	9,600	14,611	3,278	11,333	—
Northlake Village	2,662	11,284	1,411		2,686	12,671	15,357	5,792	9,565	—
Oak Shade Town Center	6,591	28,966	554		6,591	29,520	36,111	5,798	30,313	8,695
Oakbrook Plaza	4,000	6,668	415		4,000	7,083	11,083	3,419	7,664	—
Oakleaf Commons	3,503	11,671	3,048		6,242	11,980	18,222	4,916	13,306	—
Ocala Corners	1,816	10,515	456		1,816	10,971	12,787	2,717	10,070	4,615
Old St Augustine Plaza	2,368	11,405	(529	)	2,368	10,876	13,244	5,853	7,391	—
Paces Ferry Plaza	2,812	12,639	1,316		2,812	13,955	16,767	8,469	8,298	—
Panther Creek	14,414	14,748	3,368		15,212	17,318	32,530	11,184	21,346	—
Peartree Village	5,197	19,746	863		5,197	20,609	25,806	11,052	14,754	6,153
Persimmons Place	25,975	37,965	—		26,619	37,321	63,940	3,234	60,706	—
Pike Creek	5,153	20,652	1,632		5,251	22,186	27,437	11,095	16,342	—



REGENCY CENTERS CORPORATION AND REGENCY CENTERS, L.P. Schedule III - Consolidated Real Estate and Accumulated Depreciation December 31, 2016 (in thousands)

	Initial Cost				Total Cost				Net Cost
Shopping Centers (1)	Land	Building & Improvements	Cost Capitalized Subsequent to Acquisition (2)		Land	Building & Improvements	Total	Accumulated Depreciation	Net of Accumulated Depreciation	Mortgages
Pine Lake Village	6,300	10,991	871		6,300	11,862	18,162	5,798	12,364	—
Pine Tree Plaza	668	6,220	590		668	6,810	7,478	3,247	4,231	—
Plaza Hermosa	4,200	10,109	3,159		4,202	13,266	17,468	5,516	11,952	13,800
Powell Street Plaza	8,248	30,716	2,532		8,248	33,248	41,496	13,533	27,963	—
Powers Ferry Square	3,687	17,965	6,503		5,345	22,810	28,155	13,538	14,617	—
Powers Ferry Village	1,191	4,672	518		1,191	5,190	6,381	3,407	2,974	—
Prairie City Crossing	4,164	13,032	493		4,164	13,525	17,689	5,518	12,171	—
Prestonbrook	7,069	8,622	568		7,069	9,190	16,259	6,247	10,012	6,800
Preston Oaks	763	30,438	443		763	30,881	31,644	3,404	28,240	—
Red Bank	10,336	9,505	(89	)	10,110	9,642	19,752	2,274	17,478	—
Regency Commons	3,917	3,616	236		3,917	3,852	7,769	2,173	5,596	—
Regency Square	4,770	25,191	5,200		5,060	30,101	35,161	21,946	13,215	—
Rona Plaza	1,500	4,917	225		1,500	5,142	6,642	2,731	3,911	—
Russell Ridge	2,234	6,903	1,396		2,234	8,299	10,533	4,534	5,999	—
Sammamish-Highlands	9,300	8,075	8,000		9,592	15,783	25,375	6,352	19,023	—
San Leandro Plaza	1,300	8,226	558		1,300	8,784	10,084	4,065	6,019	—
Sandy Springs	6,889	28,056	2,195		6,889	30,251	37,140	4,213	32,927	—
Saugus	19,201	17,984	(342	)	18,811	18,032	36,843	7,373	29,470	—
Sequoia Station	9,100	18,356	1,632		9,100	19,988	29,088	9,166	19,922	21,100
Sherwood II	2,731	6,360	646		2,731	7,006	9,737	2,668	7,069	—
Shoppes @ 104	11,193	—	850		6,652	5,391	12,043	1,888	10,155	—
Shoppes of Grande Oak	5,091	5,985	276		5,091	6,261	11,352	4,606	6,746	—
Shops at Arizona	3,063	3,243	(4,276	)	881	1,149	2,030	168	1,862	—
Shops at County Center	9,957	11,296	914		10,254	11,913	22,167	7,090	15,077	—
Shops at Erwin Mill	9,082	6,124	(7	)	9,082	6,117	15,199	1,250	13,949	10,000
Shops at Johns Creek	1,863	2,014	(342	)	1,501	2,034	3,535	1,141	2,394	—
Shops at Mira Vista	11,691	9,026	52		11,691	9,078	20,769	1,065	19,704	242
Shops at Quail Creek	1,487	7,717	449		1,458	8,195	9,653	2,821	6,832	—
Shops on Main	17,020	27,055	31		17,064	27,042	44,106	4,031	40,075	—
South Bay Village	11,714	15,580	1,382		11,776	16,900	28,676	2,750	25,926	—
Southcenter	1,300	12,750	1,427		1,300	14,177	15,477	6,503	8,974	—
Southpark at Cinco Ranch	18,395	11,306	5,867		21,146	14,422	35,568	3,045	32,523	—



REGENCY CENTERS CORPORATION AND REGENCY CENTERS, L.P. Schedule III - Consolidated Real Estate and Accumulated Depreciation December 31, 2016 (in thousands)

	Initial Cost				Total Cost				Net Cost
Shopping Centers (1)	Land	Building & Improvements	Cost Capitalized Subsequent to Acquisition (2)		Land	Building & Improvements	Total	Accumulated Depreciation	Net of Accumulated Depreciation	Mortgages
SouthPoint Crossing	4,412	12,235	720		4,382	12,985	17,367	5,910	11,457	—
Starke	71	1,683	5		71	1,688	1,759	685	1,074	—
Sterling Ridge	12,846	12,162	645		12,846	12,807	25,653	8,697	16,956	13,900
Stonewall	27,511	22,123	7,212		28,429	28,417	56,846	13,637	43,209	—
Strawflower Village	4,060	8,084	579		4,060	8,663	12,723	4,345	8,378	—
Stroh Ranch	4,280	8,189	451		4,280	8,640	12,920	5,732	7,188	—
Suncoast Crossing	9,030	10,764	4,449		13,374	10,869	24,243	4,960	19,283	—
Tanasbourne Market	3,269	10,861	(297	)	3,269	10,564	13,833	4,054	9,779	—
Tassajara Crossing	8,560	15,464	1,025		8,560	16,489	25,049	7,596	17,453	19,800
Tech Ridge Center	12,945	37,169	(690	)	12,945	36,479	49,424	8,320	41,104	7,784
The Hub Hillcrest Market	18,773	61,906	4,488		19,610	65,557	85,167	7,825	77,342	—
Town Square	883	8,132	389		883	8,521	9,404	4,563	4,841	—
Twin City Plaza	17,245	44,225	1,854		17,263	46,061	63,324	13,945	49,379	—
Twin Peaks	5,200	25,827	1,038		5,200	26,865	32,065	12,270	19,795	—
University Commons	4,070	30,785	(2	)	4,070	30,783	34,853	1,717	33,136	37,532
Valencia Crossroads	17,921	17,659	582		17,921	18,241	36,162	14,473	21,689	—
Village at La Floresta	13,140	20,258	—		13,140	20,258	33,398	1,014	32,384	—
Village at Lee Airpark	11,099	12,968	3,421		12,014	15,474	27,488	6,527	20,961	—
Village Center	3,885	14,131	8,348		5,434	20,930	26,364	7,875	18,489	—
Walker Center	3,840	7,232	3,272		3,878	10,466	14,344	5,233	9,111	—
Welleby Plaza	1,496	7,787	1,107		1,496	8,894	10,390	6,587	3,803	—
Wellington Town Square	2,041	12,131	342		2,041	12,473	14,514	6,559	7,955	12,800
West Park Plaza	5,840	5,759	1,288		5,840	7,047	12,887	3,626	9,261	—
Westchase	5,302	8,273	505		5,302	8,778	14,080	2,930	11,150	6,623
Westchester Commons	3,366	11,751	10,870		4,894	21,093	25,987	5,681	20,306	—
Westchester Plaza	1,857	7,572	361		1,857	7,933	9,790	4,988	4,802	—
Westlake Plaza and Center	7,043	27,195	29,198		17,561	45,875	63,436	17,158	46,278	—
Westwood Village	19,933	25,301	(1,284	)	19,553	24,397	43,950	10,971	32,979	—
Willow Festival	1,954	56,501	1,187		1,954	57,688	59,642	11,078	48,564	39,505
Woodcroft Shopping Center	1,419	6,284	806		1,421	7,088	8,509	3,988	4,521	—
Woodman Van Nuy	5,500	7,195	257		5,500	7,452	12,952	3,534	9,418	—
Woodmen and Rangewood	7,621	11,018	609		7,621	11,627	19,248	9,934	9,314	—



REGENCY CENTERS CORPORATION AND REGENCY CENTERS, L.P. Schedule III - Consolidated Real Estate and Accumulated Depreciation December 31, 2016 (in thousands)

	Initial Cost				Total Cost				Net Cost
Shopping Centers (1)	Land		Building & Improvements	Cost Capitalized Subsequent to Acquisition (2)	Land	Building & Improvements	Total	Accumulated Depreciation	Net of Accumulated Depreciation	Mortgages
Woodside Central	3,500		9,288	610	3,500	9,898	13,398	4,604	8,794	—

Total Corporate Assets	—		—	1,677	—	1,678	1,678	1,562	116	—
Land held for future development	23,202		—	—	23,202	—	23,202	54	23,148	—
Properties in Development	—		—	180,878	5,331	175,547	180,878	863	180,015	—
	$	1,620,365	2,790,644	522,490	1,665,755	3,267,744	4,933,499	1,124,391	3,809,108	467,093

(1) See Item 2, Properties for geographic location and year each operating property was acquired.

(2) The negative balance for costs capitalized subsequent to acquisition could include out-parcels sold, provision for loss recorded, and demolition of part of the property for redevelopment.

See accompanying report of independent registered public accounting firm.

REGENCY CENTERS CORPORATION AND REGENCY CENTERS, L.P.

Schedule III - Consolidated Real Estate and Accumulated Depreciation, continued

December 31, 2016

(in thousands)

Depreciation and amortization of the Company's investment in buildings and improvements reflected in the statements of operations is calculated over the estimated useful lives of the assets, which are up to 40 years. The aggregate cost for federal income tax purposes was approximately $5.1 billion at December 31, 2016.

The changes in total real estate assets for the years ended December 31, 2016, 2015, and 2014 are as follows (in thousands):



	2016			2015		2014
Beginning balance	$	4,545,900		4,409,886		4,026,531
Acquired properties	370,010			39,850		274,091
Developments and improvements	148,904			174,972		191,250
Sale of properties	(126,855		)	(78,808	)	(81,811	)
Provision for impairment	(4,460		)	—		(175	)
Ending balance	$	4,933,499		4,545,900		4,409,886

The changes in accumulated depreciation for the years ended December 31, 2016, 2015, and 2014 are as follows (in thousands):



	2016			2015		2014
Beginning balance	$	1,043,787		933,708		844,873
Depreciation expense	115,355			119,475		108,692
Sale of properties	(32,791		)	(9,396	)	(19,857	)
Provision for impairment	(1,960		)	—		—
Ending balance	$	1,124,391		1,043,787		933,708

See accompanying report of independent registered public accounting firm.

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