Item 1. Financial Statements

REGENCY CENTERS CORPORATION

Consolidated Balance Sheets

September 30, 2022 and December 31, 2021

(in thousands, except share data)


	2022			2021
Assets	(unaudited)
Real estate assets, at cost	$	11,769,796			11,495,581
Less: accumulated depreciation		2,360,663			2,174,963
Real estate assets, net		9,409,133			9,320,618
Investments in real estate partnerships		332,248			372,591
Properties held for sale		2,354			25,574
Cash, cash equivalents, and restricted cash, including $3,752 and $1,930 of restricted cash at September 30, 2022 and December 31, 2021, respectively		154,984			95,027
Tenant and other receivables		173,572			153,091
Deferred leasing costs, less accumulated amortization of $122,690 and $117,878 at September 30, 2022 and December 31, 2021, respectively		69,091			65,741
Acquired lease intangible assets, less accumulated amortization of $332,866 and $312,186 at September 30, 2022 and December 31, 2021, respectively		204,097			212,707
Right of use assets, net		277,656			280,783
Other assets		275,702			266,431
Total assets	$	10,898,837			10,792,563
Liabilities and Equity
Liabilities:
Notes payable	$	3,729,404			3,718,944
Accounts payable and other liabilities		328,285			322,271
Acquired lease intangible liabilities, less accumulated amortization of $186,515 and $172,293 at September 30, 2022 and December 31, 2021, respectively		350,531			363,276
Lease liabilities		215,100			215,788
Tenants' security, escrow deposits and prepaid rent		76,777			62,352
Total liabilities		4,700,097			4,682,631
Commitments and contingencies		—			—
Equity:
Stockholders' equity:
Common stock, $0.01 par value per share, 220,000,000 shares authorized; 171,119,166 and 171,213,008 shares issued at September 30, 2022 and December 31, 2021, respectively		1,711			1,712
Treasury stock at cost, 458,325 and 427,901 shares held at September 30, 2022 and December 31, 2021, respectively		(24,061	)		(22,758	)
Additional paid-in-capital		7,878,993			7,883,458
Accumulated other comprehensive income (loss)		8,253			(10,227	)
Distributions in excess of net income		(1,749,013	)		(1,814,814	)
Total stockholders' equity		6,115,883			6,037,371
Noncontrolling interests:
Exchangeable operating partnership units, aggregate redemption value of $39,926 and $56,844 at September 30, 2022 and December 31, 2021, respectively		34,554			35,447
Limited partners' interests in consolidated partnerships		48,303			37,114
Total noncontrolling interests		82,857			72,561
Total equity		6,198,740			6,109,932
Total liabilities and equity	$	10,898,837			10,792,563

See accompanying notes to consolidated financial statements.

REGENCY CENTERS CORPORATION

Consolidated Statements of Operations

(in thousands, except per share data)

(unaudited)


	Three months ended September 30,						Nine months ended September 30,
	2022			2021			2022			2021
Revenues:
Lease income	$	295,756			283,303		$	882,265			826,390
Other property income		2,466			4,401			8,290			9,428
Management, transaction, and other fees		5,767			19,671			18,950			33,419
Total revenues		303,989			307,375			909,505			869,237
Operating expenses:
Depreciation and amortization		80,270			75,459			237,462			226,935
Operating and maintenance		49,577			43,468			143,788			135,616
General and administrative		20,273			17,789			56,710			58,263
Real estate taxes		37,926			35,779			111,495			107,392
Other operating expenses		949			812			3,739			2,687
Total operating expenses		188,995			173,307			553,194			530,893
Other expense (income):
Interest expense, net		36,361			35,993			109,798			108,741
Provision for impairment of real estate		—			(20	)		—			115
Gain on sale of real estate, net of tax		(220	)		(6,719	)		(106,459	)		(38,198	)
Net investment loss (income)		1,215			209			9,177			(3,275	)
Total other expense (income)		37,356			29,463			12,516			67,383
Income from operations before equity in income of investments in real estate partnerships		77,638			104,605			343,795			270,961
Equity in income of investments in real estate partnerships		11,209			14,243			47,855			26,344
Net income		88,847			118,848			391,650			297,305
Noncontrolling interests:
Exchangeable operating partnership units		(379	)		(519	)		(1,694	)		(1,315	)
Limited partners' interests in consolidated partnerships		(890	)		(923	)		(2,354	)		(2,438	)
Income attributable to noncontrolling interests		(1,269	)		(1,442	)		(4,048	)		(3,753	)
Net income attributable to common stockholders	$	87,578			117,406		$	387,602			293,552

Income per common share - basic	$	0.51			0.69		$	2.26			1.73
Income per common share - diluted	$	0.51			0.69		$	2.26			1.72

See accompanying notes to consolidated financial statements.

REGENCY CENTERS CORPORATION

Consolidated Statements of Comprehensive Income

(in thousands)

(unaudited)


	Three months ended September 30,						Nine months ended September 30,
	2022			2021			2022			2021
Net income	$	88,847			118,848		$	391,650			297,305
Other comprehensive income:
Effective portion of change in fair value of derivative instruments:
Effective portion of change in fair value of derivative instruments		7,069			138			20,473			3,646
Reclassification adjustment of derivative instruments included in net income		72			1,040			1,563			3,109
Unrealized loss on available-for-sale debt securities		(659	)		(49	)		(1,636	)		(263	)
Other comprehensive income		6,482			1,129			20,400			6,492
Comprehensive income		95,329			119,977			412,050			303,797
Less: comprehensive income attributable to noncontrolling interests:
Net income attributable to noncontrolling interests		1,269			1,442			4,048			3,753
Other comprehensive income attributable to noncontrolling interests		617			89			1,920			485
Comprehensive income attributable to noncontrolling interests		1,886			1,531			5,968			4,238
Comprehensive income attributable to the Company	$	93,443			118,446		$	406,082			299,559

See accompanying notes to consolidated financial statements.

REGENCY CENTERS CORPORATION

C****onsolidated Statements of Equity

For the three months ended September 30, 2022 and 2021

(in thousands, except per share data)

(unaudited)


																		Noncontrolling Interests
	Common Stock		Treasury Stock			Additional Paid In Capital			Accumulated Other Comprehensive Income (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 June 30, 2021	$	1,699		(25,887	)		7,796,699			(13,658	)		(1,791,773	)		5,967,080			35,544			37,407			72,951			6,040,031
Net income		—		—			—			—			117,406			117,406			519			923			1,442			118,848
Other comprehensive loss
Other comprehensive loss before reclassification		—		—			—			88			—			88			1			—			1			89
Amounts reclassified from accumulated other comprehensive income		—		—			—			952			—			952			4			84			88			1,040
Deferred compensation plan, net		—		569			(492	)		—			—			77			—			—			—			77
Restricted stock issued, net of amortization		—		—			3,425			—			—			3,425			—			—			—			3,425
Common stock issued for stock based compensation, net		—		—			80			—			—			80			—			—			—			80
Common stock issued under dividend reinvestment plan		—		—			404			—			—			404			—			—			—			404
Common stock issued, net of issuance costs		13		—			82,497			—			—			82,510			—			—			—			82,510
Distributions to partners		—		—			—			—			—			—			—			(1,283	)		(1,283	)		(1,283	)
Cash dividends declared:
Common stock/unit ($0.595 per share)		—		—			—			—			(101,301	)		(101,301	)		(456	)		—			(456	)		(101,757	)
Balance at September 30, 2021	$	1,712		(25,318	)		7,882,613			(12,618	)		(1,775,668	)		6,070,721			35,612			37,131			72,743			6,143,464

Balance at June 30, 2022	$	1,711		(23,882	)		7,874,461			2,388			(1,729,645	)		6,125,033			34,611			46,491			81,102			6,206,135
Net income		—		—			—			—			87,578			87,578			379			890			1,269			88,847
Other comprehensive income
Other comprehensive income before reclassification		—		—			—			5,787			—			5,787			27			596			623			6,410
Amounts reclassified from accumulated other comprehensive income		—		—			—			78			—			78			1			(7	)		(6	)		72
Deferred compensation plan, net		—		(179	)		179			—			—			—			—			—			—			—
Restricted stock issued, net of amortization		—		—			4,125			—			—			4,125			—			—			—			4,125
Common stock repurchased for taxes withheld for stock based compensation, net		—		—			92			—			—			92			—			—			—			92
Common stock issued under dividend reinvestment plan		—		—			136			—			—			136			—			—			—			136
Contributions from partners		—		—			—			—			—			—			—			1,457			1,457			1,457
Distributions to partners		—		—			—			—			—			—			—			(1,124	)		(1,124	)		(1,124	)
Cash dividends declared:
Common stock/unit ($0.625 per share)		—		—			—			—			(106,946	)		(106,946	)		(464	)		—			(464	)		(107,410	)
Balance at September 30, 2022	$	1,711		(24,061	)		7,878,993			8,253			(1,749,013	)		6,115,883			34,554			48,303			82,857			6,198,740

See accompanying notes to consolidated financial statements.

REGENCY CENTERS CORPORATION

Consolidated Statements of Equity

For the nine months ended September 30, 2022 and 2021

(in thousands, except per share data)

(unaudited)


																			Noncontrolling Interests
	Common Stock			Treasury Stock			Additional Paid In Capital			Accumulated Other Comprehensive Income (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, 2020	$	1,697			(24,436	)		7,792,082			(18,625	)		(1,765,806	)		5,984,912			35,727			37,508			73,235			6,058,147
Net income		—			—			—			—			293,552			293,552			1,315			2,438			3,753			297,305
Other comprehensive income
Other comprehensive income before reclassification		—			—			—			3,157			—			3,157			16			210			226			3,383
Amounts reclassified from accumulated other comprehensive income		—			—			—			2,850			—			2,850			12			247			259			3,109
Deferred compensation plan, net		—			(882	)		959			—			—			77			—			—			—			77
Restricted stock issued, net of amortization		2			—			9,466			—			—			9,468			—			—			—			9,468
Common stock repurchased for taxes withheld for stock based compensation, net		—			—			(3,662	)		—			—			(3,662	)		—			—			—			(3,662	)
Common stock issued under dividend reinvestment plan		—			—			1,172			—			—			1,172			—			—			—			1,172
Common stock issued, net of issuance costs		13			—			82,497			—			—			82,510			—			—			—			82,510
Common stock issued for partnership units exchanged		—			—			99			—			—			99			(99	)		—			(99	)		—
Distributions to partners		—			—			—			—			—			—			—			(3,272	)		(3,272	)		(3,272	)
Cash dividends declared:
Common stock/unit ($1.785 per share)		—			—			—			—			(303,414	)		(303,414	)		(1,359	)		—			(1,359	)		(304,773	)
Balance at September 30, 2021	$	1,712			(25,318	)		7,882,613			(12,618	)		(1,775,668	)		6,070,721			35,612			37,131			72,743			6,143,464

Balance at December 31, 2021	$	1,712			(22,758	)		7,883,458			(10,227	)		(1,814,814	)		6,037,371			35,447			37,114			72,561			6,109,932
Net income		—			—			—			—			387,602			387,602			1,694			2,354			4,048			391,650
Other comprehensive income
Other comprehensive income before reclassification		—			—			—			17,067			—			17,067			81			1,689			1,770			18,837
Amounts reclassified from accumulated other comprehensive income		—			—			—			1,413			—			1,413			8			142			150			1,563
Deferred compensation plan, net		—			(1,303	)		1,303			—			—			—			—			—			—			—
Restricted stock issued, net of amortization		2			—			12,697			—			—			12,699			—			—			—			12,699
Common stock repurchased for taxes withheld for stock based compensation, net		—			—			(5,996	)		—			—			(5,996	)		—			—			—			(5,996	)
Common stock repurchased and retired		(13	)		—			(75,406	)		—			—			(75,419	)		—			—			—			(75,419	)
Common stock issued under dividend reinvestment plan		—			—			388			—			—			388			—			—			—			388
Common stock issued for partnership units exchanged		—			—			1,275			—			—			1,275			(1,275	)		—			(1,275	)		—
Common stock issued, net of issuance costs		10			—			61,274			—			—			61,284			—			—			—			61,284
Contributions from partners		—			—			—			—			—			—			—			11,903			11,903			11,903
Distributions to partners		—			—			—			—			—			—			—			(4,899	)		(4,899	)		(4,899	)
Cash dividends declared:
Common stock/unit ($1.875 per share)		—			—			—			—			(321,801	)		(321,801	)		(1,401	)		—			(1,401	)		(323,202	)
Balance at September 30, 2022	$	1,711			(24,061	)		7,878,993			8,253			(1,749,013	)		6,115,883			34,554			48,303			82,857			6,198,740

See accompanying notes to consolidated financial statements.

REGENCY CENTERS CORPORATION

Consolidated Statements of Cash Flows

For the nine months ended September 30, 2022 and 2021

(in thousands)

(unaudited)


	2022			2021
Cash flows from operating activities:
Net income	$	391,650			297,305
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization		237,462			226,935
Amortization of deferred loan costs and debt premiums		4,297			4,608
(Accretion) and amortization of above and below market lease intangibles, net		(15,625	)		(17,244	)
Stock-based compensation, net of capitalization		12,592			9,272
Equity in income of investments in real estate partnerships		(47,855	)		(26,344	)
Gain on sale of real estate, net of tax		(106,459	)		(38,198	)
Provision for impairment of real estate, net of tax		—			115
Distribution of earnings from investments in real estate partnerships		45,238			54,310
Settlement of derivative instruments		—			(2,472	)
Deferred compensation expense		(8,016	)		2,707
Realized and unrealized loss (gain) on investments		9,253			(3,177	)
Changes in assets and liabilities:
Tenant and other receivables		(18,544	)		(8,659	)
Deferred leasing costs		(7,022	)		(7,103	)
Other assets		(4,312	)		(6,932	)
Accounts payable and other liabilities		21,656			25,879
Tenants' security, escrow deposits and prepaid rent		13,927			(2,524	)
Net cash provided by operating activities		528,242			508,478
Cash flows from investing activities:
Acquisition of operating real estate, net of cash acquired of $3,061 in 2022 and $2,991 in 2021		(141,275	)		(78,111	)
Real estate development and capital improvements		(143,724	)		(120,827	)
Proceeds from sale of real estate		137,280			131,861
Issuance of notes receivable		—			(20	)
Investments in real estate partnerships		(13,573	)		(21,788	)
Return of capital from investments in real estate partnerships		48,473			86,449
Dividends on investment securities		336			125
Acquisition of investment securities		(15,205	)		(22,422	)
Proceeds from sale of investment securities		15,821			23,162
Net cash used in investing activities		(111,867	)		(1,571	)
Cash flows from financing activities:
Net proceeds from common stock issuance		61,284			82,510
Repurchase of common shares in conjunction with equity award plans		(6,438	)		(4,066	)
Common shares repurchased through share repurchase program		(75,419	)		—
Proceeds from sale of treasury stock		64			96
Contributions from (distributions to) limited partners in consolidated partnerships, net		1,568			(3,272	)
Distributions to exchangeable operating partnership unit holders		(1,413	)		(1,363	)
Dividends paid to common stockholders		(321,484	)		(301,897	)
Proceeds from unsecured credit facilities		95,000			—
Repayment of unsecured credit facilities		(95,000	)		(265,000	)
Repayment of notes payable		(5,995	)		(13,764	)
Scheduled principal payments		(8,503	)		(8,448	)
Payment of loan costs		(82	)		(7,468	)
Net cash used in financing activities		(356,418	)		(522,672	)
Net increase (decrease) in cash and cash equivalents and restricted cash		59,957			(15,765	)
Cash and cash equivalents and restricted cash at beginning of the period		95,027			378,450
Cash and cash equivalents and restricted cash at end of the period	$	154,984			362,685

See accompanying notes to consolidated financial statements.

REGENCY CENTERS CORPORATION

Consolidated Statements of Cash Flows

For the nine months ended September 30, 2022 and 2021

(in thousands)

(unaudited)


	2022		2021
Supplemental disclosure of cash flow information:
Cash paid for interest (net of capitalized interest of $2,985 and $3,012 in 2022 and 2021, respectively)	$	115,011		113,647
Cash paid for income taxes, net of refunds	$	488		358
Supplemental disclosure of non-cash transactions:
Common stock and exchangeable operating partnership dividends declared but not paid	$	107,410		101,753
Acquisition of real estate previously held within investments in real estate partnerships	$	17,179		(4,609	)
Mortgage loans assumed by Company with the acquisition of real estate	$	22,779		111,090
Common stock issued for partnership units exchanged	$	1,275		99
Real estate received in lieu of promote interest	$	—		13,589
Change in accrued capital expenditures	$	10,230		5,830
Common stock issued under dividend reinvestment plan	$	388		1,172
Stock-based compensation capitalized	$	550		600
Contributions from limited partners in consolidated partnerships	$	5,434		—
Common stock issued for dividend reinvestment in trust	$	840		826
Contribution of stock awards into trust	$	2,136		1,416
Distribution of stock held in trust	$	786		966
Change in fair value of securities	$	1,896		334

See accompanying notes to consolidated financial statements.

REGENCY CENTERS, L.P.

Consolidated Balance Sheets

September 30, 2022 and December 31, 2021

(in thousands, except unit data)


	2022		2021
Assets	(unaudited)
Real estate assets, at cost	$	11,769,796		11,495,581
Less: accumulated depreciation		2,360,663		2,174,963
Real estate assets, net		9,409,133		9,320,618
Investments in real estate partnerships		332,248		372,591
Properties held for sale		2,354		25,574
Cash, cash equivalents, and restricted cash, including $3,752 and $1,930 of restricted cash at September 30, 2022 and December 31, 2021, respectively		154,984		95,027
Tenant and other receivables		173,572		153,091
Deferred leasing costs, less accumulated amortization of $122,690 and $117,878 at September 30, 2022 and December 31, 2021, respectively		69,091		65,741
Acquired lease intangible assets, less accumulated amortization of $332,866 and $312,186 at September 30, 2022 and December 31, 2021, respectively		204,097		212,707
Right of use assets, net		277,656		280,783
Other assets		275,702		266,431
Total assets	$	10,898,837		10,792,563
Liabilities and Capital
Liabilities:
Notes payable	$	3,729,404		3,718,944
Accounts payable and other liabilities		328,285		322,271
Acquired lease intangible liabilities, less accumulated amortization of $186,515 and $172,293 at September 30, 2022 and December 31, 2021, respectively		350,531		363,276
Lease liabilities		215,100		215,788
Tenants' security, escrow deposits and prepaid rent		76,777		62,352
Total liabilities		4,700,097		4,682,631
Commitments and contingencies		—		—
Capital:
Partners' capital:
General partner; 171,119,166 and 171,213,008 units outstanding at September 30, 2022 and December 31, 2021, respectively		6,107,630		6,047,598
Limited partners; 741,433 and 760,046 units outstanding at September 30, 2022 and December 31, 2021, respectively		34,554		35,447
Accumulated other comprehensive income (loss)		8,253		(10,227	)
Total partners' capital		6,150,437		6,072,818
Noncontrolling interest: Limited partners' interests in consolidated partnerships		48,303		37,114
Total capital		6,198,740		6,109,932
Total liabilities and capital	$	10,898,837		10,792,563

See accompanying notes to consolidated financial statements.

REGENCY CENTERS, L.P.

Consolidated Statements of Operations

(in thousands, except per unit data)

(unaudited)


	Three months ended September 30,						Nine months ended September 30,
	2022			2021			2022			2021
Revenues:
Lease income	$	295,756			283,303		$	882,265			826,390
Other property income		2,466			4,401			8,290			9,428
Management, transaction, and other fees		5,767			19,671			18,950			33,419
Total revenues		303,989			307,375			909,505			869,237
Operating expenses:
Depreciation and amortization		80,270			75,459			237,462			226,935
Operating and maintenance		49,577			43,468			143,788			135,616
General and administrative		20,273			17,789			56,710			58,263
Real estate taxes		37,926			35,779			111,495			107,392
Other operating expenses		949			812			3,739			2,687
Total operating expenses		188,995			173,307			553,194			530,893
Other expense (income):
Interest expense, net		36,361			35,993			109,798			108,741
Provision for impairment of real estate		—			(20	)		—			115
Gain on sale of real estate, net of tax		(220	)		(6,719	)		(106,459	)		(38,198	)
Net investment loss (income)		1,215			209			9,177			(3,275	)
Total other expense (income)		37,356			29,463			12,516			67,383
Income from operations before equity in income of investments in real estate partnerships		77,638			104,605			343,795			270,961
Equity in income of investments in real estate partnerships		11,209			14,243			47,855			26,344
Net income		88,847			118,848			391,650			297,305
Limited partners' interests in consolidated partnerships		(890	)		(923	)		(2,354	)		(2,438	)
Net income attributable to common unit holders	$	87,957			117,925		$	389,296			294,867

Income per common share - basic	$	0.51			0.69		$	2.26			1.73
Income per common share - diluted	$	0.51			0.69		$	2.26			1.72

See accompanying notes to consolidated financial statements.

REGENCY CENTERS, L.P.

Consolidated Statements of Comprehensive Income

(in thousands)

(unaudited)


	Three months ended September 30,						Nine months ended September 30,
	2022			2021			2022			2021
Net income	$	88,847			118,848		$	391,650			297,305
Other comprehensive income:
Effective portion of change in fair value of derivative instruments:
Effective portion of change in fair value of derivative instruments		7,069			138			20,473			3,646
Reclassification adjustment of derivative instruments included in net income		72			1,040			1,563			3,109
Unrealized loss on available-for-sale debt securities		(659	)		(49	)		(1,636	)		(263	)
Other comprehensive income		6,482			1,129			20,400			6,492
Comprehensive income		95,329			119,977			412,050			303,797
Less: comprehensive income attributable to noncontrolling interests:
Net income attributable to noncontrolling interests		890			923			2,354			2,438
Other comprehensive income attributable to noncontrolling interests		589			84			1,831			457
Comprehensive income attributable to noncontrolling interests		1,479			1,007			4,185			2,895
Comprehensive income attributable to the Partnership	$	93,850			118,970		$	407,865			300,902

See accompanying notes to consolidated financial statements.

REGENCY CENTERS, L.P.

C****onsolidated Statements of Capital

For the three months ended September 30, 2022 and 2021

(in thousands)

(unaudited)


	General Partner Preferred and Common Units			Limited Partners			Accumulated Other Comprehensive Income (Loss)			Total Partners’ Capital			Noncontrolling Interests in Limited Partners’ Interest in Consolidated Partnerships			Total Capital
Balance at June 30, 2021	$	5,980,738			35,544			(13,658	)		6,002,624			37,407			6,040,031
Net income		117,406			519			—			117,925			923			118,848
Other comprehensive loss
Other comprehensive loss before reclassification		—			1			88			89			—			89
Amounts reclassified from accumulated other comprehensive loss		—			4			952			956			84			1,040
Deferred compensation plan, net		77			—			—			77			—			77
Distributions to partners		(101,301	)		(456	)		—			(101,757	)		(1,283	)		(103,040	)
Restricted units issued as a result of restricted stock issued by Parent Company, net of amortization		3,425			—			—			3,425			—			3,425
Common units issued as a result of common stock issued by Parent Company, net of redemptions		82,510			—			—			82,510			—			82,510
Common units repurchased as a result of common stock repurchased by Parent Company, net of issuances		484			—			—			484			—			484
Balance at September 30, 2021	$	6,083,339			35,612			(12,618	)		6,106,333			37,131			6,143,464

Balance at June 30, 2022	$	6,122,645			34,611			2,388			6,159,644			46,491			6,206,135
Net income		87,578			379			—			87,957			890			88,847
Other comprehensive income
Other comprehensive income before reclassification		—			27			5,787			5,814			596			6,410
Amounts reclassified from accumulated other comprehensive loss		—			1			78			79			(7	)		72
Contributions from partners		—			—			—			—			1,457			1,457
Distributions to partners		(106,946	)		(464	)		—			(107,410	)		(1,124	)		(108,534	)
Restricted units issued as a result of restricted stock issued by Parent Company, net of amortization		4,125			—			—			4,125			—			4,125
Common units repurchased as a result of common stock repurchased by Parent Company, net of issuances		228			—			—			228			—			228
Balance at September 30, 2022	$	6,107,630			34,554			8,253			6,150,437			48,303			6,198,740

See accompanying notes to consolidated financial statements.

REGENCY CENTERS, L.P.

Consolidated Statements of Capital

For the nine months ended September 30, 2022 and 2021

(in thousands)

(unaudited)


	General Partner Preferred and Common Units			Limited Partners			Accumulated Other Comprehensive Income (Loss)			Total Partners’ Capital			Noncontrolling Interests in Limited Partners’ Interest in Consolidated Partnerships			Total Capital
Balance at December 31, 2020	$	6,003,537			35,727			(18,625	)		6,020,639			37,508			6,058,147
Net income		293,552			1,315			—			294,867			2,438			297,305
Other comprehensive income
Other comprehensive income before reclassification		—			16			3,157			3,173			210			3,383
Amounts reclassified from accumulated other comprehensive loss		—			12			2,850			2,862			247			3,109
Deferred compensation plan, net		77			—			—			77			—			77
Distributions to partners		(303,414	)		(1,359	)		—			(304,773	)		(3,272	)		(308,045	)
Restricted units issued as a result of restricted stock issued by Parent Company, net of amortization		9,468			—			—			9,468			—			9,468
Common units issued as a result of common stock issued by Parent Company, net of issuance costs		82,510			—			—			82,510			—			82,510
Common units repurchased as a result of common stock repurchased by Parent Company, net of issuances		(2,490	)		—			—			(2,490	)		—			(2,490	)
Common units exchanged for common stock of Parent Company		99			(99	)		—			—			—			—
Balance at September 30, 2021	$	6,083,339			35,612			(12,618	)		6,106,333			37,131			6,143,464

Balance at December 31, 2021	$	6,047,598			35,447			(10,227	)		6,072,818			37,114			6,109,932
Net income		387,602			1,694			—			389,296			2,354			391,650
Other comprehensive income
Other comprehensive income before reclassification		—			81			17,067			17,148			1,689			18,837
Amounts reclassified from accumulated other comprehensive income		—			8			1,413			1,421			142			1,563
Contributions from partners		—			—			—			—			11,903			11,903
Distributions to partners		(321,801	)		(1,401	)		—			(323,202	)		(4,899	)		(328,101	)
Restricted units issued as a result of restricted stock issued by Parent Company, net of amortization		12,699			—			—			12,699			—			12,699
Common units repurchased and retired as a result of common stock repurchased and retired by Parent Company		(75,419	)		—			—			(75,419	)		—			(75,419	)
Common units issued as a result of common stock issued by Parent Company, net of issuance costs		61,284			—			—			61,284			—			61,284
Common units repurchased as a result of common stock repurchased by Parent Company, net of issuances		(5,608	)		—			—			(5,608	)		—			(5,608	)
Common unit exchanged for common stock of Parent Company		1,275			(1,275	)		—			—			—			—
Balance at September 30, 2022	$	6,107,630			34,554			8,253			6,150,437			48,303			6,198,740

See accompanying notes to consolidated financial statements.

REGENCY CENTERS, L.P.

Consolidated Statem****ents of Cash Flows

For the nine months ended September 30, 2022 and 2021

(in thousands)

(unaudited)


	2022			2021
Cash flows from operating activities:
Net income	$	391,650			297,305
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization		237,462			226,935
Amortization of deferred loan costs and debt premiums		4,297			4,608
(Accretion) and amortization of above and below market lease intangibles, net		(15,625	)		(17,244	)
Stock-based compensation, net of capitalization		12,592			9,272
Equity in income of investments in real estate partnerships		(47,855	)		(26,344	)
Gain on sale of real estate, net of tax		(106,459	)		(38,198	)
Provision for impairment of real estate, net of tax		—			115
Distribution of earnings from investments in real estate partnerships		45,238			54,310
Settlement of derivative instruments		—			(2,472	)
Deferred compensation expense		(8,016	)		2,707
Realized and unrealized loss (gain) on investments		9,253			(3,177	)
Changes in assets and liabilities:
Tenant and other receivables		(18,544	)		(8,659	)
Deferred leasing costs		(7,022	)		(7,103	)
Other assets		(4,312	)		(6,932	)
Accounts payable and other liabilities		21,656			25,879
Tenants' security, escrow deposits and prepaid rent		13,927			(2,524	)
Net cash provided by operating activities		528,242			508,478
Cash flows from investing activities:
Acquisition of operating real estate, net of cash acquired of $3,061 in 2022 and $2,991 in 2021		(141,275	)		(78,111	)
Real estate development and capital improvements		(143,724	)		(120,827	)
Proceeds from sale of real estate		137,280			131,861
Issuance of notes receivable		—			(20	)
Investments in real estate partnerships		(13,573	)		(21,788	)
Return of capital from investments in real estate partnerships		48,473			86,449
Dividends on investment securities		336			125
Acquisition of investment securities		(15,205	)		(22,422	)
Proceeds from sale of investment securities		15,821			23,162
Net cash used in investing activities		(111,867	)		(1,571	)
Cash flows from financing activities:
Net proceeds from common stock issuance		61,284			82,510
Repurchase of common shares in conjunction with equity award plans		(6,438	)		(4,066	)
Common units repurchased through share repurchase program		(75,419	)		—
Proceeds from sale of treasury stock		64			96
Contributions from (distributions to) limited partners in consolidated partnerships, net		1,568			(3,272	)
Distributions to partners		(322,897	)		(303,260	)
Proceeds from unsecured credit facilities		95,000			—
Repayment of unsecured credit facilities		(95,000	)		(265,000	)
Repayment of notes payable		(5,995	)		(13,764	)
Scheduled principal payments		(8,503	)		(8,448	)
Payment of loan costs		(82	)		(7,468	)
Net cash used in financing activities		(356,418	)		(522,672	)
Net increase (decrease) in cash and cash equivalents and restricted cash		59,957			(15,765	)
Cash and cash equivalents and restricted cash at beginning of the period		95,027			378,450
Cash and cash equivalents and restricted cash at end of the period	$	154,984			362,685

See accompanying notes to consolidated financial statements.

REGENCY CENTERS, L.P.

Consolidated Statements of Cash Flows

For the nine months ended September 30, 2022 and 2021

(in thousands)

(unaudited)


	2022		2021
Supplemental disclosure of cash flow information:
Cash paid for interest (net of capitalized interest of $2,985 and $3,012 in 2022 and 2021, respectively)	$	115,011		113,647
Cash paid for income taxes, net of refunds	$	488		358
Supplemental disclosure of non-cash transactions:
Common stock and exchangeable operating partnership dividends declared but not paid	$	107,410		101,753
Acquisition of real estate previously held within investments in real estate partnerships	$	17,179		(4,609	)
Mortgage loans assumed by Company with the acquisition of real estate	$	22,779		111,090
Common stock issued by Parent Company for partnership units exchanged	$	1,275		99
Real estate received in lieu of promote interest	$	—		13,589
Change in accrued capital expenditures	$	10,230		5,830
Common stock issued by Parent Company for dividend reinvestment plan	$	388		1,172
Stock-based compensation capitalized	$	550		600
Contributions from limited partners in consolidated partnerships	$	5,434		—
Common stock issued for dividend reinvestment in trust	$	840		826
Contribution of stock awards into trust	$	2,136		1,416
Distribution of stock held in trust	$	786		966
Change in fair value of securities	$	1,896		334

See accompanying notes to consolidated financial statements.

REGENCY CENTERS CORPORATION AND REGENCY CENTERS, L.P.

Notes to Unaudited Consolidated Financial Statements

September 30, 2022


1.	Organization and Significant Accounting Policies

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 primarily engages in the ownership, management, leasing, acquisition, and development and redevelopment of shopping centers through the Operating Partnership, and has no other assets other than through its investment in the Operating Partnership, and its only liabilities are $200 million of unsecured private placement notes, which are co-issued and guaranteed by the Operating Partnership. The Parent Company guarantees all of the unsecured debt of the Operating Partnership.

As of September 30, 2022, the Parent Company, the Operating Partnership, and their controlled subsidiaries on a consolidated basis owned 308 properties and held partial interests in an additional 96 properties through unconsolidated Investments in real estate partnerships (also referred to as "joint ventures" or "investment partnerships").

The consolidated financial statements reflect all adjustments which are, in the opinion of management, necessary to fairly state the results for the interim periods presented. These adjustments are considered to be of a normal recurring nature.

Risks and Uncertainties

The success of the Company's tenants in operating their businesses and their corresponding ability to pay rent continue to be significantly influenced by many current economic challenges, which impact their cost of doing business, including but not limited to the impact of inflation, labor shortages, supply chain constraints, and increasing energy prices and interest rates. Additionally, macroeconomic and geopolitical risks create challenges that may exacerbate current market conditions in the United States. The policies implemented by the U.S. government to address these issues, including raising interest rates, could result in adverse impacts on the U.S. economy, including a slowing of growth and potentially a recession, thereby impacting consumer spending, tenants' businesses, and/or decreasing future demand for space in shopping centers. The potential impact of current economic challenges on the Company’s financial condition, results of operations, and cash flows is subject to change and continues to depend on the extent and duration of these risks and uncertainties.

Consolidation

The Company consolidates properties that are wholly-owned and properties where it owns less than 100%, but has control over the activities most important to the overall success of the partnership. Control is determined using an evaluation based on accounting standards related to the consolidation of Variable Interest Entities ("VIEs") and voting interest entities.

Ownership of the Operating Partnership

The Operating Partnership's capital includes general and limited common Partnership Units. As of September 30, 2022, the Parent Company owned approximately 99.6% of the outstanding common Partnership Units of the Operating Partnership, with the remaining limited common Partnership Units held by third parties ("Exchangeable operating partnership units" or "EOP units"). Each EOP unit is exchangeable for cash or one share of common stock of the Parent Company, at the discretion of the Parent Company, and the unit holder cannot require redemption in cash or other assets. The Parent Company has evaluated the conditions as specified under Accounting Standards Codification ("ASC") Topic 480, Distinguishing Liabilities from Equity 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 shares of unregistered common stock. Accordingly, the Parent Company classifies EOP units as permanent equity in the accompanying Consolidated Balance Sheets and Consolidated Statements of Equity and Comprehensive Income. The Parent Company serves as general partner of the Operating Partnership. The EOP unit holders have limited rights over the Operating Partnership such that they do not have the power to direct the activities of the Operating Partnership. As such, the Operating Partnership is considered a VIE, and the Parent Company, which consolidates it, is the primary beneficiary. The Parent Company's only investment is the Operating Partnership. Net income and distributions of the Operating Partnership are allocable to the general and limited common Partnership Units in accordance with their ownership percentages.

Real Estate Partnerships

REGENCY CENTERS CORPORATION AND REGENCY CENTERS, L.P.

Notes to Unaudited Consolidated Financial Statements

September 30, 2022

As of September 30, 2022, Regency had a partial ownership interest in 108 properties through partnerships, of which 12 are consolidated into the Company's financial statements. Regency's partners include institutional investors and other real estate developers and/or operators (the "Partners" or "limited partners"). Regency has a variable interest in these entities through its equity interests, with Regency the primary beneficiary in certain of these real estate partnerships. As such, Regency consolidates the partnerships into its financial statements for which it is the primary beneficiary and reports the limited partners’ interests as Noncontrolling interests. For those partnerships which Regency is not the primary beneficiary and does not control, but has significant influence, Regency recognizes its investment in them using the equity method of accounting.

The assets of these partnerships are restricted to the use of the partnerships and cannot be used by general creditors of the Company. Similarly, the obligations of the partnerships can only be settled by the assets of these partnerships or additional contributions by the partners.

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


(in thousands)	September 30, 2022		December 31, 2021
Assets
Net real estate investments	$	112,909		379,075
Cash, cash equivalents and restricted cash		2,928		5,202
Liabilities
Notes payable		4,931		5,000
Equity
Limited partners' interests in consolidated partnerships		27,339		27,950

Revenues and Other Receivables

Other property income includes parking fees and other incidental income from the properties and is generally recognized at the point in time that the performance obligation is met. All income from contracts with the Company's real estate partnerships is included within Management, transaction and other fees on the Consolidated Statements of Operations. The primary components of these revenue streams, the timing of satisfying the performance obligations, and amounts are as follows:


		Three months ended September 30,					Nine months ended September 30,
(in thousands)	Timing of satisfaction of performance obligations	2022		2021			2022		2021
Management, transaction and other fees:
Property management services	Over time	$	3,224		3,450		$	10,152		10,974
Asset management services	Over time		1,680		1,709			5,105		5,143
Leasing services	Point in time		729		879			2,895		3,066
Other transaction fees	Point in time		134		13,633	(1)		798		14,236	(1)
Total management, transaction, and other fees		$	5,767		19,671		$	18,950		33,419

(1)

Includes $13.6 million of promote income earned for exceeding partnership return thresholds resulting from the Company's performance as managing member. This consideration was paid in the form of a real estate asset.

The accounts receivable for management services, which are included within Tenant and other receivables in the accompanying Consolidated Balance Sheets, are $14.5 million and $13.2 million, as of September 30, 2022 and December 31, 2021, respectively.

REGENCY CENTERS CORPORATION AND REGENCY CENTERS, L.P.

Notes to Unaudited Consolidated Financial Statements

September 30, 2022

Recent Accounting Pronouncements

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


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

ASU 2021-05, Leases (Topic 842): Lessors - Certain Leases with Variable Lease Payments	The amendments in this update affect lessor lease classification. Lessors should classify and account for a lease as an operating lease if both of the following criteria are met: (1) have variable lease payments that do not depend on a reference index or a rate and (2) would have resulted in the recognition of a selling loss at lease commencement if classified as sales-type or direct financing. This update results in similar treatment under the current Topic 842 as under the previous Topic 840.	January 2022	The adoption of this standard did not have a material impact to the Company's financial condition, results of operations, cash flows or related footnote disclosures as the Company's customary lease terms do not result in sales-type or direct financing classification, although future leases may.

REGENCY CENTERS CORPORATION AND REGENCY CENTERS, L.P.

Notes to Unaudited Consolidated Financial Statements

September 30, 2022


2.	Real Estate Investments

The following tables detail the shopping centers acquired or land acquired for development during the periods set forth below:


(in thousands)		Nine months ended September 30, 2022
Date Purchased	Property Name	City/State	Property Type	Regency Ownership	Purchase Price (1)		Debt Assumed, Net of Discounts (1)		Intangible Assets (1)		Intangible Liabilities (1)
Consolidated
3/1/2022	Glenwood Green	Old Bridge, NJ	Development	70%	$	11,000		—		—		—
3/31/2022	Island Village	Bainbridge Island, WA	Operating	100%		30,650		—		2,900		6,839
4/1/2022	Apple Valley (2)	Apple Valley, MN	Operating	100%		34,070		—		4,773		490
4/1/2022	Cedar Commons (2)	Minneapolis, MN	Operating	100%		29,330		—		4,369		58
4/1/2022	Corral Hollow (2)	Tracy, CA	Operating	100%		40,600		—		3,410		74
4/1/2022	Shops at the Columbia (2)	Washington, DC	Operating	100%		14,000		—		889		181
5/6/2022	Baederwood Shoppes	Jenkintown, PA	Operating	80%		51,603		22,779		5,796		1,062
Total consolidated					$	211,253		22,779		22,137		8,704
Unconsolidated
3/25/2022	Naperville Plaza	Naperville, IL	Operating	20%		52,380		22,074		4,336		814
6/24/2022	Baybrook East 1B	Houston, TX	Development	50%		5,540		—		—		—
Total unconsolidated					$	57,920		22,074		4,336		814

Total property acquisitions					$	269,173		44,853		26,473		9,518

(1)

Amounts reflected for purchase price and allocation are reflected at 100%.

(2)

These properties were part of the four-property portfolio purchased from an existing unconsolidated real estate partnership, RegCal, LLC, in which the Company held a 25% ownership interest. The basis allocated to Real estate assets was $93.2 million on a combined basis, including the Company's carry over basis related to its 25% previously owned equity investment in the partnership.


(in thousands)		Nine months ended September 30, 2021
Date Purchased	Property Name	City/State	Property Type	Regency Ownership	Purchase Price (1)		Debt Assumed, Net of Discounts (1)		Intangible Assets (1)		Intangible Liabilities (1)
Consolidated
7/30/2021	Willa Springs (2)	Winter Springs, FL	Operating	100%	$	34,500		17,682		1,562		643
8/1/2021	Dunwoody Hall (2)	Dunwoody, GA	Operating	100%		32,000		14,612		2,255		973
8/1/2021	Alden Bridge (2)	Woodlands, TX	Operating	100%		43,000		27,529		3,198		2,308
8/1/2021	Hasley Canyon Village (2)	Castaic, CA	Operating	100%		31,000		16,941		2,037		—
8/1/2021	Shiloh Springs (2)	Garland, TX	Operating	100%		19,500		—		1,825		1,079
8/1/2021	Bethany Park Place (2)	Allen, TX	Operating	100%		18,000		10,800		996		1,732
8/1/2021	Blossom Valley (2)	Mountain View, CA	Operating	100%		44,000		23,611		2,895		732
Total consolidated					$	222,000		111,175		14,768		7,467

Total property acquisitions					$	222,000		111,175		14,768		7,467

(1)

Amounts reflected for purchase price and allocation are reflected at 100%.

(2)

These properties were part of the seven-property portfolio purchased from an existing unconsolidated real estate partnership, US Regency Retail I, LLC. The basis allocated to Real estate assets was $192.9 million, including the Company's carryover basis related to its 20% previously owned equity interest in the partnership.

REGENCY CENTERS CORPORATION AND REGENCY CENTERS, L.P.

Notes to Unaudited Consolidated Financial Statements

September 30, 2022


3.	Property Dispositions

The following table provides a summary of consolidated shopping centers and land parcels sold during the periods set forth below:


	Three months ended September 30,					Nine months ended September 30,
(in thousands, except number sold data)	2022		2021			2022		2021
Net proceeds from sale of real estate investments	$	859		24,284		$	137,280		131,861
Gain on sale of real estate, net of tax		220		6,719			106,459		38,198
Provision for impairment of real estate sold		—		(20	)		—		115
Number of operating properties sold		—		—			1		6
Number of land parcels and development project interests sold		1		3			4		4
Percent interest sold	100%		100%			100%		100%

At September 30, 2022, the Company also had one land parcel classified within Properties held for sale on the Consolidated Balance Sheets.


4.	Other Assets

The following table represents the components of Other assets in the accompanying Consolidated Balance Sheets as of the dates set forth below:


(in thousands)	September 30, 2022		December 31, 2021
Goodwill, net	$	167,095		167,095
Investments		52,977		65,112
Prepaid and other		37,023		21,332
Deferred financing costs, net		5,729		7,448
Furniture, fixtures, and equipment, net		5,732		5,444
Derivative assets		7,146		—
Total other assets	$	275,702		266,431


5.	Notes Payable and Unsecured Credit Facilities

The Company's outstanding debt, net of unamortized debt premium (discount) and debt issuance costs, consisted of the following as of the dates set forth below:


(in thousands)	Weighted Average Contractual Rate	Weighted Average Effective Rate	September 30, 2022		December 31, 2021
Notes payable:
Fixed rate mortgage loans	3.9%	3.5%	$	344,843		359,414
Variable rate mortgage loans (1)	3.3%	3.6%		137,284		115,539
Fixed rate unsecured debt	3.8%	4.0%		3,247,277		3,243,991
Total notes payable				3,729,404		3,718,944
Unsecured credit facilities:
$1.25 Billion Line of Credit (the "Line") (2)	3.4%	3.8%		—		—
Total debt outstanding			$	3,729,404		3,718,944

(1)

Five of these six variable rate loans, representing $132.4 million of debt in the aggregate, have interest rate swaps in place to mitigate interest rate fluctuation risk. Based on these swap agreements, the effective fixed rates of the five loans range from 2.5% to 4.1%.

(2)

Weighted average effective rate for the Line is calculated based on a fully drawn balance using the period end variable rate.

REGENCY CENTERS CORPORATION AND REGENCY CENTERS, L.P.

Notes to Unaudited Consolidated Financial Statements

September 30, 2022

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


(in thousands)	September 30, 2022
Scheduled Principal Payments and Maturities by Year:	Scheduled Principal Payments		Mortgage Loan Maturities		Unsecured Maturities (1)			Total
2022 (2)	$	2,738		—		—			2,738
2023		9,695		59,376		—			69,071
2024		4,849		90,742		250,000			345,591
2025		3,732		45,000		250,000			298,732
2026		3,922		112,365		200,000			316,287
Beyond 5 Years		6,661		138,234		2,575,000			2,719,895
Unamortized debt premium/(discount) and issuance costs		—		4,813		(27,723	)		(22,910	)
Total	$	31,597		450,530		3,247,277			3,729,404

(1)

Includes unsecured public and private debt and unsecured credit facilities.

(2)

Reflects scheduled principal payments for the remainder of the year.

The Company was in compliance as of September 30, 2022, with all financial and other covenants under its unsecured public and private placement debt and unsecured credit facilities and expects to remain in compliance thereafter.


6.	Derivative Financial Instruments

The Company may use derivative financial instruments, including interest rate swaps, caps, options, floors, and other interest rate derivative contracts, to hedge all or a portion of the interest rate risk associated with its borrowings. The principal objective of such arrangements is to minimize the risks and/or costs associated with the Company's operating and financial structure as well as to hedge specific anticipated transactions. The Company does not intend to utilize derivatives for speculative transactions or purposes other than mitigation of interest rate risk. The use of derivative financial instruments carries certain risks, including the risk that the counterparties to these contractual arrangements are not able to perform under the agreements. To mitigate this risk, the Company only enters into derivative financial instruments with counterparties with quality credit ratings. The Company does not anticipate that any of the counterparties will fail to meet their obligations.

The Company's objectives in using interest rate derivatives are to attempt to stabilize interest expense where possible and to mitigate its exposure to interest rate movements. To accomplish these objectives, the Company primarily uses interest rate swaps as part of its interest rate risk management strategy. 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 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
(in thousands)						Assets (Liabilities) (1)
Effective Date	Maturity Date	Notional Amount		Receive Variable Rate of	Pay Fixed Rate of	September 30, 2022		December 31, 2021
4/7/16	4/1/23	$	18,736	1 Month LIBOR	1.303%	$	261		(175	)
12/1/16	11/1/23		31,291	1 Month LIBOR (2)	1.490%		948		(412	)
9/17/19	3/17/25		24,000	1 Month LIBOR	1.542%		1,495		(364	)
6/2/17	6/2/27		35,589	1 Month LIBOR with Floor	2.366%		2,362		(1,907	)
12/20/19 (3)	12/19/26		24,365	1 Month LIBOR	1.750%		2,080		—
						$	7,146		(2,858	)

(1)

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.

(2)

In October 2022, the Company amended this LIBOR-based interest rate swap and related variable rate mortgage loan to transition to SOFR.

(3)

The Company assumed this interest rate swap which hedges debt also assumed with the purchase of Baederwood Shoppes in May 2022.

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, as of September 30, 2022, does not have any derivatives that are not designated as hedges.

REGENCY CENTERS CORPORATION AND REGENCY CENTERS, L.P.

Notes to Unaudited Consolidated Financial Statements

September 30, 2022

The changes in the fair value of derivatives designated and qualifying as cash flow hedges are recorded in Accumulated Other Comprehensive Income (Loss) ("AOCI") and subsequently reclassified into earnings in the period that the hedged forecasted transaction affects earnings.

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


Location and Amount of Gain (Loss) Recognized in OCI on Derivative					Location and Amount of Gain (Loss) Reclassified from AOCI into Income					Total amounts presented in the Consolidated Statements of Operations in which the effects of cash flow hedges are recorded
	Three months ended September 30,					Three months ended September 30,					Three months ended September 30,
(in thousands)	2022		2021			2022		2021			2022		2021
Interest rate swaps	$	7,069		138	Interest expense	$	72		1,040	Interest expense, net	$	36,361		35,993

	Nine months ended September 30,					Nine months ended September 30,					Nine months ended September 30,
(in thousands)	2022		2021			2022		2021			2022		2021
Interest rate swaps	$	20,473		3,646	Interest expense	$	1,563		3,109	Interest expense, net	$	109,798		108,741

As of September 30, 2022, the Company expects approximately $4.3 million of accumulated comprehensive income on derivative instruments in AOCI, including the Company's share from its Investments in real estate partnerships, to be reclassified into earnings during the next 12 months.


7.	Leases

All of the Company's leases are classified as operating leases. The Company's Lease income is comprised of both fixed and variable income. Fixed and in-substance fixed lease income includes stated amounts per the lease contract, which are primarily related to base rent, and in some cases stated amounts for common area maintenance ("CAM"), real estate taxes, and insurance ("Recoverable Costs"). Income for these amounts is recognized on a straight-line basis.

Variable lease income includes the following two main items in the lease contracts:

(i) Recoveries from tenants represents the tenants' contractual obligations to reimburse the Company for their portion of Recoverable Costs incurred. Generally the Company's leases provide for the tenants to reimburse the Company based on the tenants' share of the actual costs incurred in proportion to the tenants' share of leased space in the property.

(ii) Percentage rent represents amounts billable to tenants based on the tenants' actual sales volume in excess of levels specified in the lease contract.

The following table provides a disaggregation of lease income recognized as either fixed or variable lease income based on the criteria specified in ASC Topic 842:


(in thousands)	Three months ended September 30,				Nine months ended September 30,
	2022		2021		2022		2021
Operating lease income
Fixed and in-substance fixed lease income	$	215,077		201,183	$	634,416		594,471
Variable lease income		70,473		62,810		210,390		195,538
Other lease related income, net:
Above/below market rent and tenant rent inducement amortization, net		5,484		6,457		16,786		18,460
Uncollectible straight-line rent		3,612		3,655		8,517		(172	)
Uncollectible amounts billable in lease income		1,110		9,198		12,156		18,093
Total lease income	$	295,756		283,303	$	882,265		826,390

REGENCY CENTERS CORPORATION AND REGENCY CENTERS, L.P.

Notes to Unaudited Consolidated Financial Statements

September 30, 2022

Lease income for operating leases with fixed payment terms is recognized on a straight-line basis over the expected term of the lease for all leases in which collectibility is considered probable. At lease commencement, the Company generally expects that collectibility of substantially all payments due under the lease is probable due to the Company's credit checks on tenants and other credit analysis undertaken before entering into a new lease; therefore, income from most operating leases is initially recognized on a straight-line basis. For operating leases in which collectibility of Lease income is not considered probable, Lease income is recognized on a cash basis and all previously recognized straight-line rent receivables are reversed in the period in which the Lease income is determined no longer to be probable of collection. Should collectibility of Lease income become probable again, through evaluation of qualitative and quantitative measures on a tenant by tenant basis, accrual basis accounting resumes and all commencement-to-date straight-line rent is recognized in that period. In addition to the lease-specific collectibility assessment performed under Topic 842, the Company may also recognize a general reserve, as a reduction to Lease income, for its portfolio of operating lease receivables which are not expected to be fully collectible based on the Company's historical collection experience.

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


(in thousands)	September 30, 2022		December 31, 2021
Tenant receivables	$	25,802		27,354
Straight-line rent receivables		122,346		103,942
Other receivables (1)		25,424		21,795
Total tenant and other receivables	$	173,572		153,091

(1)

Other receivables include construction receivables, insurance receivables, and amounts due from real estate partnerships for Management, transaction and other fee income.


8.	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 approximate their fair values, except for the following:


	September 30, 2022				December 31, 2021
(in thousands)	Carrying Amount		Fair Value		Carrying Amount		Fair Value
Financial liabilities:
Notes payable	$	3,729,404		3,338,134		3,718,944		4,103,533

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 September 30, 2022, and December 31, 2021, respectively. These fair value measurements maximize the use of observable inputs which are classified within Level 2 of the fair value hierarchy. 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, appropriate 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 values presented above are not necessarily indicative of amounts that will be realized upon disposition of the financial instruments.

REGENCY CENTERS CORPORATION AND REGENCY CENTERS, L.P.

Notes to Unaudited Consolidated Financial Statements

September 30, 2022

(b) Fair Value Measurements

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

Securities

The Company has investments in marketable securities that are included within Other assets on the accompanying Consolidated Balance Sheets. The fair value of the securities was determined using quoted prices in active markets, which are considered Level 1 inputs of the fair value hierarchy. Changes in the value of securities are recorded within Net investment loss (income) in the accompanying Consolidated Statements of Operations, and include unrealized losses of $1.0 million and $1.5 million during the three months ended September 30, 2022 and 2021, respectively, and unrealized losses of $9.5 million and unrealized gains of $217,000 during the nine months ended September 30, 2022 and 2021, respectively, on equity securities.

Available-for-Sale Debt Securities

Available-for-sale debt securities consist of investments in certificates of deposit and corporate bonds, and are recorded at fair value using either recent trade prices for the identical debt instrument or comparable instruments by issuers of similar industry sector, issuer rating, and size, to estimate fair value, which are considered Level 2 inputs of the fair value hierarchy. Unrealized gains or losses on these debt 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.

The following tables present 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 September 30, 2022
			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:
Securities	$	38,848		38,848		—		—
Available-for-sale debt securities		14,129		—		14,129		—
Interest rate derivatives		7,146		—		7,146		—
Total	$	60,123		38,848		21,275		—

REGENCY CENTERS CORPORATION AND REGENCY CENTERS, L.P.

Notes to Unaudited Consolidated Financial Statements

September 30, 2022


	Fair Value Measurements as of December 31, 2021
				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:
Securities	$	49,513			49,513		—			—
Available-for-sale debt securities		15,599			—		15,599			—
Total	$	65,112			49,513		15,599			—
Liabilities:
Interest rate derivatives	$	(2,858	)		—		(2,858	)		—

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


	Fair Value Measurements as of December 31, 2021
			Quoted Prices in Active Markets for Identical Assets		Significant Other Observable Inputs		Significant Unobservable Inputs		Total Gains
(in thousands)	Balance		(Level 1)		(Level 2)		(Level 3)		(Losses)
Operating properties	$	140,500		—		—		140,500		(84,277	)

During the nine months ended September 30, 2022, there were no real estate assets remeasured to estimated fair value on a nonrecurring basis. During the year ended December 31, 2021, the Company revalued two shopping centers to estimated fair value due to a change in expected hold period using a discounted cash flow model with a discount rate of 7.2% and a terminal capitalization rate of 5.25%.


9.	Equity and Capital

Common Stock of the Parent Company

Dividends Declared

On November 2, 2022, our Board of Directors declared a common stock dividend of $0.65 per share, payable on January 4, 2023, to shareholders of record as of December 16, 2022.

At the Market ("ATM") Program

Under the Parent Company's ATM equity offering program, the Parent Company may sell up to $500 million of common stock at prices determined by the market at the time of sale.

During 2021, the Company entered into forward sale agreements under its ATM program to issue shares of its common stock at a weighted average offering price of $64.59 before any underwriting discount and offering expenses. In April 2022, the Company settled 984,618 shares subject to forward sales agreements and received proceeds of approximately $61.3 million, after approximately $3.3 million in underwriting discounts and offering expenses. The proceeds were used to fund acquisitions. All shares are now settled under the forward sales agreements. No sales occurred under the ATM program during 2022.

As of September 30, 2022, $350.4 million of common stock remained available for issuance under this ATM equity program.

Share Repurchase Program

On February 3, 2021, the Company's Board authorized a common share repurchase program under which the Company may purchase, from time to time, up to a maximum of $250 million of its outstanding common stock through open market purchases or in privately negotiated transactions (referred to as the "Authorized Repurchase Program"). Any shares purchased, if not retired, will be treated as treasury shares. Under the current authorization, the Authorized Repurchase Program is set to expire on February 3, 2023, but may be modified or terminated at any time at the discretion of the Board. The timing and actual number of shares purchased under the Authorized Repurchase Program depend upon marketplace conditions, liquidity needs, and other factors.

REGENCY CENTERS CORPORATION AND REGENCY CENTERS, L.P.

Notes to Unaudited Consolidated Financial Statements

September 30, 2022

During the nine months ended September 30, 2022, the Company executed multiple trades to repurchase 1,294,201 common shares under the Authorized Repurchase Program for a total of $75.4 million at a weighted average price of $58.25 per share. All repurchased shares were retired on the respective settlement dates. At September 30, 2022, the Company has $174.6 million remaining available under the authorized common share repurchase program.

Common Units of the Operating Partnership

Common units of the operating partnership are issued or redeemed and retired for each of the shares of Parent Company common stock issued or repurchased and retired, as described above. During the nine months ended September 30, 2022, 18,613 Partnership Units were converted to Parent Company common stock.


10.	Stock-Based Compensation

During the nine months ended September 30, 2022, the Company granted 272,003 shares of restricted stock with a weighted-average grant-date fair value of $72.88 per share. The Company records stock-based compensation expense within General and administrative expenses in the accompanying Consolidated Statements of Operations, and records forfeitures as they occur.


11.	Earnings per Share and Unit

Parent Company Earnings per Share

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


	Three months ended September 30,				Nine months ended September 30,
(in thousands, except per share data)	2022		2021		2022		2021
Numerator:
Income attributable to common stockholders - basic	$	87,578		117,406	$	387,602		293,552
Income attributable to common stockholders - diluted	$	87,578		117,406	$	387,602		293,552
Denominator:
Weighted average common shares outstanding for basic EPS		171,121		170,090		171,499		169,906
Weighted average common shares outstanding for diluted EPS		171,525		170,589		171,870		170,314
Income per common share – basic	$	0.51		0.69	$	2.26		1.73
Income per common share – diluted	$	0.51		0.69	$	2.26		1.72

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 be anti-dilutive. Weighted average exchangeable Operating Partnership units outstanding were 741,433 and 760,046 for the three months ended September 30, 2022 and 2021, respectively, and were 750,671 and 762,601 for the nine months ended September 30, 2022 and 2021, respectively.

Operating Partnership Earnings per Unit

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


	Three months ended September 30,				Nine months ended September 30,
(in thousands, except per share data)	2022		2021		2022		2021
Numerator:
Income attributable to common unit holders - basic	$	87,957		117,925	$	389,296		294,867
Income attributable to common unit holders - diluted	$	87,957		117,925	$	389,296		294,867
Denominator:
Weighted average common units outstanding for basic EPU		171,862		170,850		172,249		170,668
Weighted average common units outstanding for diluted EPU		172,267		171,349		172,620		171,076
Income per common unit – basic	$	0.51		0.69	$	2.26		1.73
Income per common unit – diluted	$	0.51		0.69	$	2.26		1.72

REGENCY CENTERS CORPORATION AND REGENCY CENTERS, L.P.

Notes to Unaudited Consolidated Financial Statements

September 30, 2022


12.	Commitments and Contingencies

Litigation

The Company is involved in litigation on a number of matters, and is subject to other disputes that arise in the ordinary course of business. While the outcome of any particular lawsuit or dispute cannot be predicted with certainty, in the opinion of management, the Company's currently pending litigation and disputes are not 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.

Environmental

The Company is subject to numerous environmental laws and regulations pertaining primarily to chemicals historically used by certain current and former dry cleaning tenants, the existence of asbestos in older shopping centers, older underground petroleum storage tanks and other historic land use. 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. The Company can give no assurance that existing environmental studies with respect to its shopping centers have revealed all potential environmental contaminants; that its estimate of liabilities will not change as more information becomes available; that any previous owner, occupant or tenant did not create any material environmental condition not known to the Company; 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; and that changes in applicable environmental laws and regulations or their interpretation will not result in additional environmental liability to the Company.

Letters of Credit

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. As of September 30, 2022 and December 31, 2021, the Company had $9.4 million in letters of credit outstanding. These letters of credit are primarily issued as collateral on behalf of its captive insurance program and to facilitate the construction of development projects.

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