Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations

Forward-Looking Statements

Certain statements in this document regarding anticipated financial, business, legal or other outcomes including business and market conditions, outlook and other similar statements relating to Regency's future events, developments, or financial or operational performance or results, are "forward-looking statements" made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995 and other federal securities laws. These forward-looking statements are identified by the use of words such as "may," "will," "could," "should," "would," "expect," "estimate," "believe," "intend," "forecast," "project," "plan," "anticipate," "guidance," and other similar language. However, the absence of these or similar words or expressions does not mean a statement is not forward-looking. While we believe these forward-looking statements are reasonable when made, forward-looking statements are not guarantees of future performance or events and undue reliance should not be placed on these statements. Although we believe the expectations reflected in any forward-looking statements are based on reasonable assumptions, we can give no assurance these expectations will be attained, and it is possible actual results may differ materially from those indicated by these forward-looking statements due to a variety of risks and uncertainties.

Our operations are subject to a number of risks and uncertainties including, but not limited to, risk factors described in our Securities and Exchange Commission ("SEC") filings, our Annual Report on Form 10-K for the year ended December 31, 2023 ("2023 Form 10-K") under Item 1A. "Risk Factors" and in Part II, Item 1A. "Risk Factors" in this Report. When considering an investment in our securities, you should carefully read and consider these risks, together with all other information in our most recent 2023 Form 10-K, subsequent Quarterly Reports on Form 10-Q, and our other filings with and submissions to the SEC. If any of the events described in the risk factors actually occur, our business, financial condition or operating results, as well as the market price of our securities, could be materially adversely affected. Forward-looking statements are only as of the date they are made, and Regency undertakes no duty to update its forward-looking statements, whether as a result of new information, future events or developments or otherwise, except as and to the extent required by law.

Non-GAAP Measures

In addition to the required Generally Accepted Accounting Principles ("GAAP") presentations, we use and report certain non-GAAP measures as we believe these measures improve the understanding of our operational results. We believe these non-GAAP measures provide useful information to our Board of Directors, management and investors regarding certain trends relating to our financial condition and results of operations. Our management uses these non-GAAP measures to compare our performance to that of prior periods for trend analyses, purposes of determining management incentive compensation and budgeting, forecasting and planning purposes. We continually evaluate the usefulness, relevance, limitations, and calculation of our reported non-GAAP measures to determine how best to provide relevant information to the public, and thus such reported measures could change.

We do not consider non-GAAP measures an alternative to financial measures determined in accordance with GAAP, rather they supplement GAAP measures by providing additional information we believe to be useful to our shareholders. The principal limitation of these non-GAAP measures is that they may exclude significant expense and income items that are required by GAAP to be recognized in our Consolidated Financial Statements. In addition, they reflect the exercise of management's judgment about which expense and income items are excluded or included in determining these non-GAAP measures. In order to compensate for these limitations, reconciliations of the non-GAAP measures we use to their most directly comparable GAAP measures are provided. Non-GAAP measures should not be relied upon in evaluating the financial condition, results of operations, or future prospects of the Company.

Defined Terms

The following terms, as defined, are commonly used by management and the investing public to understand and evaluate our operational results, and are included in this document:

Adjusted Funds From Operations ("AFFO") is an additional performance measure used by Regency that reflects cash available to fund the Company’s business needs and distribution to shareholders. AFFO is calculated by adjusting Core Operating Earnings ("COE") for (i) capital expenditures necessary to maintain and lease the Company’s portfolio of properties, (ii) debt cost and derivative adjustments and (iii) stock-based compensation.

Core Operating Earnings is an additional performance measure we use because the computation of Nareit Funds from Operations ("Nareit FFO") includes certain non-comparable items that affect our period-over-period performance. Core Operating Earnings excludes from Nareit FFO: (i) transaction related income or expenses, (ii) gains or losses from the early extinguishment of debt, (iii) certain non-cash components of earnings derived from straight-line rents, above and below market rent amortization, and debt and derivative mark-to-market amortization, and (iv) other amounts as they occur. We provide reconciliations of both Net Income Attributable to Common Shareholders to Nareit FFO and Nareit FFO to Core Operating Earnings.

Development Completion is a Property in Development that is deemed complete upon the earlier of: (i) 90% of total estimated net development costs have been incurred and percent leased equals or exceeds 95%, or (ii) the property features at least two years of anchor operations. Once deemed complete, the property is termed a Retail Operating Property.

Fixed Charge Coverage Ratio is defined as Operating EBITDAre divided by the sum of the gross interest and scheduled mortgage principal paid to our lenders.

Nareit EBITDAre is a measure of REIT performance, which the National Association of Real Estate Investment Trusts ("Nareit") defines as net income, computed in accordance with GAAP, excluding (i) interest expense, (ii) income tax expense, (iii) depreciation and amortization, (iv) gains on sales of real estate, (v) impairments of real estate, and (vi) adjustments to reflect the Company's share of unconsolidated partnerships and joint ventures.

Nareit Funds from Operations ("Nareit FFO") is a commonly used measure of REIT performance, which Nareit defines as net income, computed in accordance with GAAP, excluding gains on sales and impairments of real estate, net of tax, plus depreciation and amortization, and after adjustments for unconsolidated partnerships and joint ventures. We compute Nareit FFO for all periods presented in accordance with Nareit's definition.

Companies use different depreciable lives and methods, and real estate values historically fluctuate with market conditions. Since Nareit FFO excludes depreciation and amortization and gains on sale and impairments of real estate, it provides a performance measure that, when compared year over year, reflects the impact on operations from trends in percent leased, rental rates, operating costs, acquisition and development activities, and financing costs. This provides a perspective of our financial performance not immediately apparent from net income determined in accordance with GAAP. Thus, Nareit FFO is a supplemental non-GAAP financial measure of our operating performance, which does not represent cash generated from operating activities in accordance with GAAP; and, therefore, should not be considered a substitute measure of cash flows from operations. We provide a reconciliation of Net Income Attributable to Common Shareholders to Nareit FFO.

Net Operating Income ("NOI") is the sum of base rent, percentage rent, recoveries from tenants, other lease income, and other property income, less operating and maintenance expenses, real estate taxes, ground rent, and uncollectible lease income. NOI excludes straight-line rental income and expense, above and below market rent and ground rent amortization, tenant lease inducement amortization, and other fees. We also provide disclosure of NOI excluding termination fees, which excludes both termination fee income and expenses.

A Non-Same Property is any property, during either calendar year period being compared, that was acquired, sold, a Property in Development, a Development Completion, or a property under, or being positioned for, significant redevelopment that distorts comparability between periods. Non-retail properties and corporate activities, including the captive insurance program, are part of Non-Same Property.

Operating EBITDAre begins with Nareit EBITDAre and excludes certain non-cash components of earnings derived from straight-line rents and above and below market rent amortization. We provide a reconciliation of Net income to Nareit EBITDAre to Operating EBITDAre.

Pro-rata information includes 100% of our consolidated properties plus our economic share (based on our ownership interest) in our unconsolidated real estate investment partnerships.

We provide Pro-rata financial information because we believe it assists investors and analysts in estimating our economic interest in our consolidated and unconsolidated partnerships, when read in conjunction with our reported results under GAAP. We believe presenting our Pro-rata share of assets, liabilities, operating results, and other metrics, along with certain other non-GAAP measures, makes comparisons of our operating results to those of other REITs more meaningful. The Pro-rata information provided is not, nor is it intended to be, presented in accordance with GAAP. The Pro-rata supplemental details of assets and liabilities and supplemental details of operations reflect our proportionate economic ownership of the assets, liabilities, and operating results of the properties in our portfolio.

The Pro-rata information is prepared on a basis consistent with the comparable consolidated amounts and is intended to more accurately reflect our proportionate economic interest in the assets, liabilities, and operating results of properties in our portfolio. We do not control the unconsolidated investment partnerships, and the Pro-rata presentations of the assets and liabilities, and revenues and expenses do not represent our legal claim to such items. The partners are entitled to profit or loss allocations and distributions of cash flows according to the operating agreements, which generally provide for such allocations according to their invested capital. Our share of invested capital establishes the ownership interests we use to prepare our Pro-rata share.

The presentation of Pro-rata information has limitations which include, but are not limited to, the following:

o

The amounts shown on the individual line items were derived by applying our overall economic ownership interest percentage determined when applying the equity method of accounting and do not necessarily represent our legal claim to the assets and liabilities, or the revenues and expenses; and

o

Other companies in our industry may calculate their Pro-rata interest differently, limiting the comparability of Pro-rata information.

Because of these limitations, the Pro-rata financial information should not be considered independently or as a substitute for our financial statements as reported under GAAP. We compensate for these limitations by relying primarily on our GAAP financial statements, using the Pro-rata information as a supplement.

Property In Development includes properties in various stages of ground-up development.

Property In Redevelopment includes Retail Operating Properties under redevelopment or being positioned for redevelopment. Unless otherwise indicated, a Property in Redevelopment is included in the Same Property pool.

Redevelopment Completion is a Property in Redevelopment that is deemed complete upon the earlier of: (i) 90% of total estimated project costs have been incurred and percent leased equals or exceeds 95% for the Company owned GLA related to the project, or (ii) the property features at least two years of anchor operations, if applicable.

Retail Operating Property is any retail property not termed a Property in Development. A retail property is any property where the majority of the income is generated from retail uses.

Same Property is a Retail Operating Property that was owned and operated for the entirety of both calendar year periods being compared. This term excludes Properties in Development, prior year Development Completions, and Non-Same Properties. Properties in Redevelopment are included unless otherwise indicated.

Overview of Our Strategy

Regency Centers Corporation began operations as a publicly-traded REIT in 1993. All of our operating, investing, and financing activities are performed through our Operating Partnership, Regency Centers, L.P. and its wholly-owned subsidiaries, and through our real estate partnerships. As of March 31, 2024, the Parent Company owned approximately 99.4% of the outstanding Common Units and 100% of the Preferred Units of the Operating Partnership.

We are a preeminent national owner, operator, and developer of neighborhood and community shopping centers predominantly located in suburban trade areas with compelling demographics. As of March 31, 2024, we had full or partial ownership interests in 482 retail properties. Our properties are high-quality neighborhood and community shopping centers primarily anchored by market leading grocers and principally located in suburban markets within the country's most desirable metro areas and contain approximately 57.0 million square feet ("SF") of gross leasable area ("GLA"). Our mission is to create thriving environments for retailers and service providers to connect with surrounding neighborhoods and communities. Our vision is to elevate quality of life as an integral thread in the fabric of our communities. Our portfolio includes thriving properties merchandised with highly productive grocers, restaurants, service providers, and best-in-class retailers that connect with their neighborhoods, communities, and customers.

Our values:

We are our people: Our people are our greatest asset, and we believe that a talented team from diverse backgrounds and experiences makes us better.

We do what is right: We act with unwavering standards of honesty and integrity.

We connect with our communities: We promote philanthropic ideas and strive for the betterment of our neighborhoods by giving our time and financial support.

We are responsible: Our duty is to balance purpose and profit, being good stewards of capital and the environment for the benefit of all our stakeholders.

We strive for excellence: When we are passionate about what we do, it is reflected in our performance.

We are better together: When we listen to each other and our customers, we will succeed together.

Our goals are to:

Own and manage a portfolio of high-quality neighborhood and community shopping centers anchored primarily by market leading grocers and principally located in suburban trade areas in the most desirable metro areas in the United States. We believe that this strategy will result in highly desirable and attractive centers with best-in-class retailers. These centers should command higher rental and occupancy rates resulting in excellent prospects to grow NOI;

Create shareholder value by increasing earnings and dividends per share that generate total returns at or near the top of our shopping center peers;

Maintain an industry leading, disciplined development and redevelopment platform to create exceptional retail centers that deliver favorable returns;

Support our business activities with a conservative capital structure, including a strong balance sheet with sufficient liquidity to meet our capital needs together with a carefully constructed debt maturity profile;

Implement leading environmental, social, and governance ("ESG") practices through our Corporate Responsibility program to support and enhance our business goals and objectives; and

Engage and retain an exceptional and diverse team that is guided by our strong values, while fostering an environment of innovation and continuous improvement.

Risks and Uncertainties

Refer to Item 1, Note 1 to Unaudited Consolidated Financial Statements.

Please also refer to the Risk Factors discussed in Item 1A of Part I of our Annual Report on Form 10-K for the year ended December 31, 2023, and the Risk Factors described in Part II, Item 1A of this Form 10-Q.

Executing on our Strategy

During the three months ended March 31, 2024, we had Net income attributable to common shareholders of $106.4 million as compared to $97.3 million during the three months ended March 31, 2023.

During the three months ended March 31, 2024:

Our Pro-rata same property NOI, excluding termination fees, grew 1.4%, as compared to the three months ended March 31, 2023, primarily attributable to improvements in base rent from increases in year over year occupancy rates, contractual rent steps in existing leases, and positive rent spreads on comparable new and renewal leases.

We executed 461 new and renewal leasing transactions representing 2.0 million Pro-rata SF with positive rent spreads of 8.5% during the three months ended March 31, 2024, compared to 405 leasing transactions representing 1.1 million Pro-rata SF with positive rent spreads of 5.5% during the three months ended March 31, 2023. Rent spreads are calculated on all executed leasing transactions for comparable Retail Operating Property spaces, including spaces vacant greater than 12 months.

At March 31, 2024, December 31, 2023, and March 31, 2023 our total property portfolio was 95.0%, 95.1%, and 94.9% leased, respectively. At March 31, 2024, December 31, 2023, and March 31, 2023 our same property portfolio was 95.8%, 95.7%, and 95.1% leased, respectively.

We continued our development and redevelopment of high quality shopping centers:

Estimated Pro-rata project costs of our current in process development and redevelopment projects totaled $547.1 million at March 31, 2024, compared to $468.1 million at December 31, 2023.

Development and redevelopment projects completed during 2024 represented $3.1 million of estimated net project costs, with an average stabilized yield of 9.8%.

We maintained liquidity and financial flexibility to cost effectively fund investment opportunities and debt maturities:

At both March 31, 2024 and December 31, 2023, our Pro-rata net debt and Preferred Stock-to-operating EBITDAre ratio on a trailing 12 month basis was 5.4x.

On January 8, 2024, Regency priced a public offering of $400 million of senior unsecured debt due in 2034, with a coupon of 5.250% . The Company intends to use the net proceeds of the offering to reduce the outstanding balance on its line of credit and for general corporate purposes, including, but not limited to, the future repayment of outstanding debt. We invested a portion of the net proceeds in certificates of deposit and within short-term U.S. Treasury funds until such time as the proceeds are required.

We have $250 million of unsecured debt maturing in June 2024, which we intend to pay off by utilizing the proceeds available from the January 2024 offering noted above.

In February, Regency received a credit rating upgrade to A3 with a stable outlook by Moody's Investors Service.

We have $196.1 million of secured loan maturities during the next 12 months, including maturities within our unconsolidated real estate partnerships, which we intend to refinance or pay-off as they mature.

At March 31, 2024, we had $1.46 billion available on the Line, which expires March 23, 2028 with the option to extend the maturity for two additional six-month periods.

Property Portfolio

The following table summarizes general information related to the consolidated properties in our portfolio:

(GLA in thousands)	March 31, 2024				December 31, 2023
Number of Properties	381				381
GLA		43,947				43,758
% Leased – Operating and Development		95.0	%			94.9	%
% Leased – Operating		95.4	%			95.3	%
Weighted average annual effective rent per square foot ("PSF"), net of tenant concessions.	$24.74				$24.67

The following table summarizes general information related to the unconsolidated properties owned in real estate investment partnerships in our portfolio:

(GLA in thousands)	March 31, 2024				December 31, 2023
Number of Properties	101				101
GLA		13,066				13,067
% Leased – Operating and Development		96.0	%			96.6	%
% Leased –Operating		96.0	%			96.6	%
Weighted average annual effective rent PSF, net of tenant concessions	$24.88				$24.04

The following table summarizes Pro-rata occupancy rates of our combined consolidated and unconsolidated shopping center portfolio:

	March 31, 2024				December 31, 2023
Percent Leased – All Properties		95.0	%			95.1	%
Anchor Space (spaces ≥ 10,000 SF)		96.8	%			96.7	%
Shop Space (spaces < 10,000 SF)		92.1	%			92.4	%

The following table summarizes leasing activity, including our Pro-rata share of activity within the portfolio of our real estate partnerships (totals as a weighted average PSF):

		Three months ended March 31, 2024
		Leasing Transactions				SF (in thousands)				Base Rent PSF				Tenant Allowance and Landlord Work PSF				Leasing Commissions PSF
Anchor Space Leases
New			11				241			$	21.59			$	52.82			$	8.10
Renewal			29				851				21.00				0.29				0.05
Total Anchor Space Leases			40				1,092			$	21.13			$	11.91			$	1.83
Shop Space Leases
New			136				286			$	37.65			$	38.66			$	13.10
Renewal			285				573				37.27				3.66				0.61
Total Shop Space Leases			421				859			$	37.40			$	15.33			$	4.77
Total Leases			461				1,951			$	28.29			$	13.41			$	3.13

		Three months ended March 31, 2023
		Leasing Transactions				SF (in thousands)				Base Rent PSF				Tenant Allowance and Landlord Work PSF				Leasing Commissions PSF
Anchor Space Leases
New			6				67			$	14.24			$	41.74			$	7.69
Renewal			18				399				15.01				0.40				0.19
Total Anchor Space Leases			24				466			$	14.90			$	6.37			$	1.27
Shop Space Leases
New			121				217			$	36.88			$	33.10			$	12.21
Renewal			260				447				35.20				0.75				0.54
Total Shop Space Leases			381				664			$	35.75			$	11.33			$	4.36
Total Leases			405				1,130			$	27.14			$	9.28			$	3.08

The weighted-average base rent PSF on signed Shop Space leases during 2024 was $37.40 PSF, which is higher than the weighted average annual base rent PSF of all Shop Space leases due to expire during the next 12 months of $33.81 PSF. New and renewal rent spreads, compared to prior rents on these same spaces leased, were positive at 8.5% for the three months ended March 31, 2024, compared to 5.5% for the three months ended March 31, 2023.

Significant Tenants and Concentrations of Credit Risk

We seek to reduce our operating and leasing risks through geographic diversification of our properties and by avoiding dependence on any single property, market, or tenant. Based on percentage of annualized base rent, the following table summarizes our most significant tenants, of which four of the top five are grocers:

		March 31, 2024
Tenant		Number of Stores				Percentage of Company- owned GLA (1)		Percentage of Annual Base Rent (1)
Publix			68			6.4%		3.0%
Albertsons Companies, Inc.			53			4.7%		2.9%
TJX Companies, Inc.			73			3.8%		2.8%
Amazon/Whole Foods			39			2.8%		2.7%
Kroger Co.			52			6.3%		2.6%

(1)

Includes Regency's Pro-rata share of unconsolidated properties and excludes those owned by anchors.

Bankruptcies and Credit Concerns

Our management team devotes significant time to researching and monitoring consumer preferences and trends, customer shopping behaviors, changes in delivery methods, shifts to e-commerce, and changing demographics in order to anticipate the challenges and opportunities impacting our industry. We seek to mitigate these potential impacts through maintaining a high quality portfolio, diversifying our tenant mix, replacing less successful tenants with stronger operators, anchoring our centers with market leading grocery stores that drive customer traffic, and investing in suburban trade areas with compelling demographic populations benefiting from high levels of disposal income. The potential for a recession and the severity and duration of any economic downturn could negatively impact our existing tenants and their ability to continue to meet their lease obligations.

Although base rent is derived from long-term lease contracts, tenants that file for bankruptcy generally have the legal right to reject any or all of their leases and close related stores. Any unsecured claim we hold against a bankrupt tenant for unpaid rent might be paid only to the extent that funds are available and only in the same percentage as is paid to all other holders of unsecured claims. As a result, it is likely that we would recover substantially less than the full value of any unsecured claims we hold. Additionally, we may incur significant expense to adjudicate our claim and significant downtime to re-lease the vacated space. In the event that a tenant with a significant number of leases in our shopping centers files for bankruptcy and rejects its leases, we could experience a significant reduction in our revenues. Tenants who are currently in bankruptcy and continue to occupy space in our shopping centers represent an aggregate of 0.6% of our Pro-rata annual base rent, which is primarily related to Rite Aid who filed in October 2023.

Results from Operations

Comparison of the three months ended March 31, 2024 and 2023:

Revenues changed as summarized in the following table:

		Three months ended March 31,
(in thousands)		2024				2023				Change
Lease income
Base rent		$	244,135				212,930				31,205
Recoveries from tenants			85,023				71,226				13,797
Percentage rent			7,807				7,030				777
Uncollectible lease income			(1,233	)			1,937				(3,170	)
Other lease income			5,957				7,216				(1,259	)
Straight-line rent			5,594				2,597				2,997
Above / below market rent and tenant rent inducement amortization, net			5,823				5,865				(42	)
Total lease income		$	353,106				308,801				44,305
Other property income			4,350				3,138				1,212
Management, transaction, and other fees			6,396				6,038				358
Total revenues		$	363,852				317,977				45,875

Total lease income increased $44.3 million primarily driven by the following contractually billable components of rent to the tenants per the lease agreements:

$31.2 million increase from billable Base rent, mainly from the following:

o

$24.8 million increase from acquisition of UBP;

o

$5.6 million net increase from same properties, including:

▪

$3.8 million net increase due to increases from occupancy, rent steps in existing leases, and positive rental spreads on new and renewal leases; and

▪

$1.8 million increase due to redevelopment projects completing and operating; and

o

$1.1 million increase from acquisitions of other operating properties.

$13.8 million increase from contractual Recoveries from tenants, which represents the tenants' proportionate share of the operating, maintenance, insurance, and real estate tax expenses that we incur to operate our shopping centers. Recoveries from tenants increased, on a net basis, mainly from the following:

o

$9.8 million increase from acquisition of UBP;

o

$3.7 million net increase from same properties primarily due to higher operating costs in the current year; and

o

$0.4 million increase from rents commencing at development properties and the acquisition of other operating properties.

$3.2 million change in Uncollectible lease income primarily driven by the 2023 collections of previously reserved amounts, which have continued in 2024 but to a lesser degree.

$1.3 million decrease in Other lease income primarily due to:

o

$3.1 million decrease in lease termination fees, partially offset by

o

$1.8 million increase driven by acquisition of UBP.

$3.0 million increase in Straight-line rent mainly due to:

o

$2.1 million increase related to developments;

o

$1.2 million increase driven by acquisition of UBP; partially offset by

o

$0.3 million decrease in same properties.

Other property income increased $1.2 million primarily due to an increase in settlements in 2024.

There were no significant changes in Management, transaction, and other fees.

Changes in our operating expenses are summarized in the following table:

		Three months ended March 31,
(in thousands)		2024				2023				Change
Depreciation and amortization		$	97,585				82,707				14,878
Property operating expense			63,274				51,022				12,252
Real estate taxes			44,307				38,477				5,830
General and administrative			26,132				25,280				852
Other operating expenses (income)			2,643				(497	)			3,140
Total operating expenses		$	233,941				196,989				36,952

Depreciation and amortization costs increased $14.9 million, mainly due to the following:

$15.9 million increase from acquisition of UBP;

$0.8 million increase from acquisitions of operating properties;

$0.6 million increase from properties under development becoming available for occupancy in the current quarter; partially offset by

$2.4 million decrease from same properties, primarily driven by redevelopment projects.

Property operating expense increased $12.3 million, as follows:

$7.0 million increase from acquisition of UBP;

$3.6 million increase from same properties primarily attributable to an increase in recoverable common area and tenant related costs.

$1.0 million increase from higher claims expense in our captive insurance company; and

$0.7 million related to acquisitions of other operating properties.

Real estate taxes increased $5.8 million, mainly due to acquisition of UBP.

There were no significant changes in General and administrative expenses.

Other operating expenses (income) increased $3.1 million, mainly due to the following:

$1.7 million increase from acquisition of UBP; and

$1.4 million increase driven by fee income received in 2023 for the cancelation of a land contract related to a development pursuit.

The following table presents the components of other expense, net:

		Three months ended March 31,
(in thousands)		2024				2023				Change
Interest expense, net
Interest on notes payable		$	45,601				36,909				8,692
Interest on unsecured credit facilities			1,439				987				452
Capitalized interest			(1,656	)			(1,250	)			(406	)
Hedge expense			109				109				—
Interest income			(2,625	)			(362	)			(2,263	)
Interest expense, net		$	42,868				36,393				6,475
Gain on sale of real estate, net of tax			(11,403	)			(250	)			(11,153	)
Loss on early extinguishment of debt			180				—				180
Net investment income			(2,431	)			(1,727	)			(704	)
Total other expense, net		$	29,214				34,416				(5,202	)

Interest expense, net increased $6.5 million primarily due to the following:

$4.6 million increase related to increased outstanding balance of Notes Payable mainly due to the issued public debt in January 2024;

$4.1 million increase primarily related to loans assumed with the UBP acquisition; partially offset by

$2.3 million increase in interest income due to the short term investments of excess cash.

During the three months ended March 31, 2024, we recognized gains on sale of $11.4 million mainly from sale of one operating property and recognition of one sales type lease. During the three months ended March 31, 2023, we recognized gains on sale of $0.3 million from one land parcel.

There were no significant changes in Net investment income.

Total equity in income of investments in real estate partnerships changed as follows:

				Three months ended March 31,
(in thousands)		Regency's Ownership		2024				2023				Change
GRI - Regency, LLC ("GRIR")		40.00%		$	9,126				9,130				(4	)
Columbia Regency Retail Partners, LLC ("Columbia I")		20.00%			428				458				(30	)
Columbia Regency Partners II, LLC ("Columbia II")		20.00%			589				528				61
Columbia Village District, LLC		30.00%			511				453				58
Other investments in real estate partnerships		11.80% - 66.67%			1,307				1,347				(40	)
Total equity in income of investments in real estate partnerships				$	11,961				11,916				45

The following represents the remaining components that comprise Net income attributable to common shareholders and unit holders:

		Three months ended March 31,
(in thousands)		2024				2023				Change
Net income		$	112,658				98,488				14,170
Income attributable to noncontrolling interests			(2,884	)			(1,207	)			(1,677	)
Net income attributable to the Company			109,774				97,281				12,493
Preferred stock dividends			(3,413	)			—				(3,413	)
Net income attributable to common shareholders		$	106,361			$	97,281			$	9,080
Net income attributable to exchangeable operating partnership units			(642	)			(420	)			(222	)
Net income attributable to common unit holders		$	107,003				97,701				9,302

Income attributable to noncontrolling interests increased $1.7 million, mainly due to acquisition of UBP.

The $3.4 million increase in Preferred stock dividends is related to the preferred stock issued in connection with UBP acquisition.

Supplemental Earnings Information

We use certain non-GAAP measures, in addition to certain performance metrics determined under GAAP, as we believe these measures improve the understanding of the operating results. We believe these non-GAAP measures provide useful information to our Board of Directors, management and investors regarding certain trends relating to our financial condition and results of operations. Our management uses these non-GAAP measures to compare our performance to that of prior periods for trend analyses, purposes of determining management incentive compensation and budgeting, forecasting and planning purposes. We provide Pro-rata financial information because we believe it assists investors and analysts in estimating our economic interest in our consolidated and unconsolidated real estate partnerships, when read in conjunction with our reported results under GAAP. We believe presenting our Pro-rata share of operating results, along with other non-GAAP measures, may assist in comparing our operating results to other REITs. We continually evaluate the usefulness, relevance, limitations, and calculation of our reported non-GAAP measures to determine how best to provide relevant information to the public, and thus such reported non-GAAP measures could change. See "Non-GAAP Measures" at the beginning of this Management's Discussion and Analysis.

We do not consider non-GAAP measures as an alternative to financial measures determined in accordance with GAAP, rather they supplement GAAP measures by providing additional information we believe to be useful to our shareholders. The principal limitation of these non-GAAP measures is they may exclude significant expense and income items that are required by GAAP to be recognized in our Consolidated Financial Statements. In addition, they reflect the exercise of management's judgment about which expense and income items are excluded or included in determining these non-GAAP measures. In order to compensate for these limitations, reconciliations of the non-GAAP measures we use to their most directly comparable GAAP measures are provided, including as set forth below. Non-GAAP measures should not be relied upon in evaluating the financial condition, results of operations, or future prospects.

Pro-rata Same Property NOI:

Pro-rata same property NOI, excluding termination fees/expenses, changed from the following major components:

		Three months ended March 31,
(in thousands)		2024				2023				Change
Base rent		$	242,684				236,363				6,321
Recoveries from tenants			83,192				79,069				4,123
Percentage rent			7,982				7,671				311
Termination fees			1,443				4,717				(3,274	)
Uncollectible lease income			(1,036	)			1,879				(2,915	)
Other lease income			3,136				2,872				264
Other property income			2,575				2,663				(88	)
Total real estate revenue			339,976				335,234				4,742
Operating and maintenance			56,734				52,744				3,990
Termination expense			70				—				70
Real estate taxes			42,789				42,606				183
Ground rent			3,949				3,436				513
Total real estate operating expenses			103,542				98,786				4,756
Pro-rata same property NOI		$	236,434				236,448				(14	)
Less: Termination fees			1,373				4,717				(3,344	)
Pro-rata same property NOI, excluding termination fees		$	235,061				231,731				3,330
Pro-rata same property NOI growth, excluding termination fees											1.4	%

Real estate revenue increased $4.7 million during the three months ended March 31, 2024, as follows:

Base rent increased $6.3 million due to rent steps in existing leases, positive rental spreads on new and renewal leases, and increases in occupancy, as well as redevelopment projects completing and operating.

Recoveries from tenants increased $4.1 million due to increases in recoverable expenses.

Termination fees decreased $3.3 million driven by terminations that were recognized in 2023.

Uncollectible lease income changed by $2.9 million primarily driven by higher collections in 2023 of previously reserved amounts which have continued in 2024, but to a lesser degree.

Total real estate operating expense increased $4.8 million as follows:

Operating and maintenance increased $4.0 million primarily due to increases in property insurance, common area maintenance and other tenant-recoverable costs.

Same Property Roll-forward:

Our same property pool includes the following property count, Pro-rata GLA, and changes therein:

		Three months ended March 31,
		2024								2023
(GLA in thousands)		Property Count				GLA				Property Count				GLA
Beginning same property count			394				42,135				389				41,383
Acquired properties owned for entirety of comparable periods			4				441				5				771
Developments that reached completion by beginning of earliest comparable period presented			2				175				—				—
Disposed properties			(1	)			(93	)			—				—
SF adjustments (1)			—				123				—				(6	)
Change in intended property use			—				—				1				—
Properties under or being repositioned for redevelopment			1				103				—				—
Ending same property count			400				42,884				395				42,148

(1)

SF adjustments arising from re-measurements or redevelopments.

Nareit FFO, Core Operating Earnings and AFFO:

Our reconciliation of net income attributable to common stock and unit holders to Nareit FFO, to Core Operating Earnings, and to AFFO is as follows:

		Three months ended March 31,
(in thousands, except share information)		2024				2023
Reconciliation of Net income attributable to common shareholders to Nareit FFO
Net income attributable to common shareholders		$	106,361				97,281
Adjustments to reconcile to Nareit FFO: (1)
Depreciation and amortization (excluding FF&E)			104,372				89,035
Gain on sale of real estate, net of tax			(11,408	)			(241	)
Exchangeable operating partnership units			642				420
Nareit FFO attributable to common stock and unit holders		$	199,967				186,495
Reconciliation of Nareit FFO to Core Operating Earnings
Nareit Funds From Operations		$	199,967				186,495
Adjustments to reconcile to Core Operating Earnings: (1)
Not Comparable Items
Merger transition costs			2,561				—
Loss on early extinguishment of debt			180				—
Certain Non Cash Items
Straight-line rent			(5,738	)			(2,389	)
Uncollectible straight-line rent			656				(635	)
Above/below market rent amortization, net			(5,467	)			(5,665	)
Debt and derivative mark-to-market amortization			909				(8	)
Core Operating Earnings		$	193,068				177,798
Reconciliation of Core Operating Earnings to AFFO:
Core Operating Earnings		$	193,068				177,798
Adjustments to reconcile to AFFO (1):
Operating capital expenditures			(20,852	)			(17,459	)
Debt cost and derivative adjustments			2,140				1,672
Stock-based compensation			4,640				4,819
AFFO		$	178,996				166,830

(1)

Includes Regency's Pro-rata share of unconsolidated investment partnerships, net of Pro-rata share attributable to noncontrolling interests.

Reconciliation of Same Property NOI to Most Directly Comparable GAAP Measure:

Our reconciliation of Net income attributable to common shareholders to Same Property NOI, on a Pro-rata basis, is as follows:

		Three months ended March 31,
(in thousands)		2024				2023
Net income attributable to common shareholders		$	106,361				97,281
Less:
Management, transaction, and other fees			6,396				6,038
Other (1)			12,587				9,502
Plus:
Depreciation and amortization			97,585				82,707
General and administrative			26,132				25,280
Other operating expense			2,643				(497	)
Other expense, net			29,214				34,416
Equity in income of investments in real estate excluded from NOI (2)			13,689				11,785
Net income attributable to noncontrolling interests			2,884				1,207
Preferred stock dividends and issuance costs			3,413				—
Pro-rata NOI		$	262,938				236,639
Less non-same property NOI			26,504				191
Pro-rata same property NOI		$	236,434				236,448

(1)

Includes straight-line rental income and expense, net of reserves, above and below market rent amortization, other fees, and noncontrolling interests.

(2)

Includes non-NOI income earned and expenses incurred at our unconsolidated real estate partnerships, including those separated out above for our consolidated properties.

Liquidity and Capital Resources

General

We use cash flows generated from operating, investing, and financing activities to strengthen our balance sheet, finance our development and redevelopment projects, fund our investment activities, and maintain financial flexibility. A significant portion of our cash from operations is distributed to our common shareholders in the form of dividends in order to maintain our status as a REIT.

Except for $200 million of private placement debt, our Parent Company has no capital commitments other than its guarantees of the commitments of our Operating Partnership. All remaining debt is held by our Operating Partnership, its subsidiaries, or by our real estate partnerships. The Operating Partnership is a co-issuer and a guarantor of the $200 million of outstanding debt of our Parent Company. The Parent Company will from time to time access the capital markets for the purpose of issuing new equity, and will simultaneously contribute all of the offering proceeds to the Operating Partnership in exchange for additional partnership units.

We continually assess our available liquidity and our expected cash requirements, including monitoring our tenant rent collections. We have access to and draw on multiple financing sources to fund our operations and our long-term capital needs, including the requirements of our in process and planned developments, redevelopments, other capital expenditures, and the repayment of debt. We expect to meet these needs by using a combination of the following: cash flow from operations after funding our common stock and preferred stock dividends, borrowings from our Line, proceeds from the sale of real estate, mortgage loan and unsecured bank financing, distributions received from our real estate partnerships, and when the capital markets are favorable, proceeds from the sale of equity securities or the issuance of new unsecured debt. We continually evaluate alternative financing options, and we believe we can obtain new financing on reasonable terms, although likely at higher interest rates than that of our debt currently outstanding, due to the current interest rate environment.

On January 8, 2024, Regency priced a public offering of $400 million of senior unsecured notes due in 2034 (the “2024 Notes”) under our existing shelf registration filed with the SEC. The Notes mature on January 15, 2034, and were issued at 99.617% of par value with a coupon of 5.25%. We have $250 million of unsecured debt maturing in June 2024, which we intend to pay off by utilizing the proceeds available from the 2024 Notes. In addition, we have $196.1 million of secured loan maturities during the next 12 months, including maturities within our unconsolidated real estate partnerships, which we intend to refinance or pay-off as they mature. Based upon our available cash balance, sources of capital, our current credit ratings, and the number of high quality, unencumbered properties we own, we believe our available capital resources are sufficient to meet our expected capital needs for the next year, although, in the longer term, we can provide no assurances.

In addition to our $224.7 million of unrestricted cash, we have the following additional sources of capital available:

(in thousands)	March 31, 2024
ATM program
Original offering amount	$	500,000
Available capacity	$	500,000
Line of credit
Total commitment amount	$	1,500,000
Available capacity (1)	$	1,462,285
Maturity (2)	March 23, 2028

(1)

Net of letters of credit issued against our Line.

(2)

The Company has the option to extend the maturity for two additional six-month periods.

The declaration of dividends is determined quarterly by our Board of Directors. On May 1, 2024, our Board of Directors:

Declared a common stock dividend of $0.67 per share, payable on July 3, 2024, to shareholders of record as of June 12, 2024;

Declared a dividend on the Series A Preferred Stock, which will be paid at a rate of $0.390625 per share on July 31, 2024. The dividend will be payable to holders of record of the Series A Preferred Stock as of the close of business on July 16, 2024; and

Declared a dividend on the Series B Preferred Stock, which will be paid at a rate of $0.367200 per share on July 31, 2024. The dividend will be payable to holders of record of the Series B Preferred Stock as of the close of business on July 16, 2024.

While future dividends will be determined at the discretion of our Board of Directors, we plan to continue paying an aggregate amount of distributions to our stock and unit holders that, at a minimum, meet the requirements to continue qualifying as a REIT for federal income tax purposes. We have historically generated sufficient cash flow from operations to fund our dividend distributions. During the three months ended March 31, 2024 and 2023, we generated cash flow from operations of $167.8 million and $162.1 million, respectively, and paid $127.7 million in dividends to our common and preferred stock and unit holders, and $111.6 million in dividends to our common stock and unit holders, in the same respective periods.

We currently have development and redevelopment projects in various stages of construction, along with a pipeline of potential projects for future development or redevelopment. After funding our common and preferred stock dividend payments in April of 2024, we estimate that we will require capital during the next 12 months of approximately $715.5 million related to leasing commissions, tenant improvements, in-process developments and redevelopments, capital contributions to our real estate partnerships, and repaying maturing debt. These capital requirements are being impacted by inflation resulting in increased costs of construction materials, labor, and services from third party contractors and suppliers. In response, we have implemented mitigation strategies such as entering into fixed cost construction contracts, pre-ordering materials, and other planning efforts. Further, continued challenges from permitting delays and labor shortages may extend the time to completion of these projects.

If we start new developments or redevelopments, commit to property acquisitions, repay debt prior to maturity, declare future dividends, or repurchase shares of our common stock, our cash requirements will increase. If we refinance maturing debt, our cash requirements will decrease.

We endeavor to maintain a high percentage of unencumbered assets. As of March 31, 2024, 87.6% of our wholly-owned real estate assets were unencumbered. Our low level of encumbered assets allows us to more readily access the secured and unsecured debt markets and to maintain borrowing capacity on the Line. Our trailing 12 month fixed charge coverage ratio, including our Pro-rata share of our partnerships, was 4.5x and 4.7x for the periods ended March 31, 2024, and December 31, 2023, respectively, and our Pro-rata net debt and Preferred Stock-to-operating EBITDAre ratio on a trailing 12 month basis was 5.4x during the same periods.

Our Line and unsecured debt require that we remain in compliance with various covenants, which are described in the Notes to Consolidated Financial Statements included in our 2023 Form 10-K. The debt assumed in conjunction with the UBP acquisition contain covenants that are consistent with our existing debt covenants. We were in compliance with these covenants at March 31, 2024, and expect to remain in compliance.

Summary of Cash Flow Activity

The following table summarizes net cash flows related to operating, investing, and financing activities of the Company:

		Three months ended March 31,
(in thousands)		2024				2023				Change
Net cash provided by operating activities		$	167,758				162,099				5,659
Net cash used in investing activities			(142,336	)			(39,050	)			(103,286	)
Net cash provided by (used in) financing activities			113,325				(123,682	)			237,007
Net change in cash, cash equivalents, and restricted cash		$	138,747				(633	)			139,380
Total cash, cash equivalents, and restricted cash		$	230,101				68,143				161,958

Net cash provided by operating activities:

Net cash provided by operating activities increased $5.7 million due to:

$3.2 million increase in cash from operations due to timing of receipts and payments, and

$2.4 million increase in operating cash flow distributions from Investments in real estate partnerships.

Net cash used in investing activities:

Net cash used in investing activities changed by $103.3 million as follows:

		Three months ended March 31,
(in thousands)		2024				2023				Change
Cash flows from investing activities:
Real estate development and capital improvements		$	(60,850	)			(44,569	)			(16,281	)
Proceeds from sale of real estate			30,033				3,603				26,430
Proceeds from property insurance casualty claims			4,110				—				4,110
Issuance of notes receivable			(29,830	)			—				(29,830	)
Collection of notes receivable			1,561				—				1,561
Investments in real estate partnerships			(4,156	)			(604	)			(3,552	)
Return of capital from investments in real estate partnerships			3,152				—				3,152
Dividends on investment securities			122				187				(65	)
Acquisition of investment securities			(92,527	)			(2,171	)			(90,356	)
Proceeds from sale of investment securities			6,049				4,504				1,545
Net cash used in investing activities		$	(142,336	)			(39,050	)			(103,286	)

Significant changes in investing activities include:

We invested $16.3 million more on real estate development, redevelopment, and capital improvements, as further detailed in a table below.

We sold one operating property in 2024 for proceeds of $30.0 million compared to one land parcel in 2023 for proceeds of $3.6 million.

We received additional property insurance claim proceeds of $4.1 million in 2024 attributable to a single property that was impacted by a weather event in 2019.

We issued a note receivable in the amount of $29.8 million at an interest rate of 6.9% maturing in January 2027, secured by a grocery-anchored shopping center.

Investments in real estate partnerships:

o

In 2024, we invested $4.2 million to fund our share of development and redevelopment activities.

o

In 2023, we invested $0.6 million to fund our share of development and redevelopment activities.

Return of capital from our unconsolidated investments in real estate partnerships includes sales or financing proceeds.

o

During the three months ended March 31, 2024 we received $3.2 million from our share of proceeds from debt refinancing activities.

o

During the same period in 2023, we had no such activity.

Acquisition of securities and proceeds from sale of securities pertain to investment activities held in our captive insurance company and our deferred compensation plan. Additionally, the Company invested approximately $90 million in commercial deposits from the proceeds received from the January public offering of senior unsecured notes.

We plan to continue developing and redeveloping shopping centers for long-term investment. During the three months ended March 31, 2024, we deployed capital of $60.9 million for the development, redevelopment, and improvement of our real estate properties, comprised of the following:

		Three months ended March 31,
(in thousands)		2024				2023				Change
Capital expenditures:
Land acquisitions		$	7,836				—				7,836
Building and tenant improvements			17,914				14,998				2,916
Redevelopment costs			19,938				20,610				(672	)
Development costs			9,113				5,847				3,266
Capitalized interest			1,622				1,224				398
Capitalized direct compensation			4,427				1,890				2,537
Real estate development and capital improvements		$	60,850				44,569				16,281

We acquired one land parcel for development in 2024.

Building and tenant improvements increased $2.9 million in 2024, primarily related to the timing of capital projects.

Redevelopment costs are in line with prior year. We intend to continuously improve our portfolio of shopping centers through redevelopment which can include adjacent land acquisition, existing building expansion, facade renovation, new out-parcel building construction, and redevelopment related tenant improvement costs. The size and magnitude of each redevelopment project varies with each redevelopment plan. The timing and duration of these projects could also result in volatility in NOI. See the tables below for more details about our redevelopment projects.

Development costs are higher in 2024 due to the progress towards completion of our development projects in process. See the tables below for more details about our development projects.

Interest is capitalized on our development and redevelopment projects and is based on cumulative actual costs expended. We cease interest capitalization when the property is no longer being developed or is available for occupancy upon substantial completion of tenant improvements, but in no event would we capitalize interest on the project beyond 12 months after the anchor tenant opens for business. If we reduce our development and redevelopment activity, the amount of interest that we capitalize may be lower than historical averages.

We have a staff of employees who directly support our development program, which includes redevelopment of our existing properties. Internal compensation costs directly attributable to these activities are capitalized as part of each project.

The following table summarizes our development projects in-process and completed:

(in thousands, except cost PSF)										March 31, 2024
Property Name		Market		Ownership (3)		Start Date		Estimated Stabilization Year (1)		Estimated / Actual Net Development Costs (2) (3)				GLA (3)				Cost PSF of GLA (2) (3)				% of Costs Incurred
Developments In-Process
Glenwood Green		Metro NYC		70%		Q1-22		2025			46,172				247				187				85	%
Baybrook East - Phase 1B		Houston, TX		50%		Q2-22		2026			10,384				77				135				79	%
Sienna - Phase 1		Houston, TX		75%		Q2-23		2027			9,409				23				409				33	%
The Shops at SunVet		Long Island, NY		100%		Q2-23		2027			86,872				167				520				40	%
The Shops at Stone Bridge		Cheshire, CT		100%		Q1-24		2027			67,387				155				435				13	%
Total Developments In-Process										$	220,224				669				329				43	%

(1)

Estimated Stabilization Year represents the estimated first full calendar year that the project will reach our expected stabilized yield.

(2)

Includes leasing costs and is net of tenant reimbursements.

(3)

Estimated Net Development Costs and GLA are reported based on Regency’s ownership interest in the real estate partnership at completion.

The following table summarizes our redevelopment projects in process and completed:

(in thousands, except cost PSF)										March 31, 2024
Property Name		Market		Ownership (3)		Start Date		Estimated Stabilization Year (1)		Estimated Net Project Costs (2) (3)				GLA (3)				% of Costs Incurred
Redevelopments In-Process
The Abbot		Boston, MA		100%		Q2-19		2026		$	59,854				64				93	%
Westbard Square Phase I		Bethesda, MD		100%		Q2-21		2025			39,499				126				77	%
Buckhead Landing		Atlanta, GA		100%		Q2-22		2025			30,859				152				48	%
Bloom on Third (fka Town and Country Center)		Los Angeles, CA		35%		Q4-22		2027			24,525				51				32	%
Mandarin Landing		Jacksonville, FL		100%		Q2-23		2025			16,422				140				32	%
Serramonte Center - Phase 3		San Francisco, CA		100%		Q2-23		2025			36,989				1,072				13	%
Circle Marina Center		Los Angeles, CA		100%		Q3-23		2025			14,986				118				21	%
Avenida Biscayne		Miami, FL		100%		Q4-23		2026			22,743				29				14	%
Cambridge Square		Atlanta, GA		100%		Q4-23		2026			15,002				70				4	%
Various Redevelopments		Various		20% - 100%		Various		Various			66,020				1,969				47	%
Total Redevelopments In-Process										$	326,899				3,791				47	%
Redevelopments Completed
Various Properties		Various		100%		Various		Various			3,055				63				90	%
Total Redevelopments Completed										$	3,055				63				90	%

(1)

Estimated Stabilization Year represents the estimated first full calendar year that the project will reach our expected stabilized yield.

(2)

Includes leasing costs and is net of tenant reimbursements.

(3)

Estimated Net Development Costs and GLA are reported based on Regency’s ownership interest in the real estate partnership at completion.

Net cash used in financing activities

Net cash flows from financing activities changed by $237.0 million during 2024, as follows:

		Three months ended March 31,
(in thousands)		2024				2023				Change
Cash flows from financing activities:
Repurchase of common shares in conjunction with equity award plans		$	(8,730	)			(7,066	)			(1,664	)
Common shares repurchased through share repurchase program			—				(20,006	)			20,006
Contributions from limited partners in consolidated partnerships			1,472				738				734
Distributions to limited partners in consolidated partnerships			(4,364	)			—				(4,364	)
Dividend payments and operating partnership distributions			(127,662	)			(111,567	)			(16,095	)
(Repayment of) Proceeds from unsecured credit facilities, net			(122,000	)			30,000				(152,000	)
Proceeds from issuance of fixed rate unsecured notes, net of debt discount			398,468				15,500				382,968
Debt repayment, including early redemption costs			(10,780	)			(31,142	)			20,362
Payment of loan costs			(13,289	)			(141	)			(13,148	)
Proceeds from sale of treasury stock, net			210				2				208
Net cash provided by (used in) financing activities		$	113,325				(123,682	)			237,007

Significant financing activities during the three months ended March 31, 2024 and 2023, include the following:

We repurchased a portion of the common stock granted to employees for stock based compensation to satisfy employee tax withholding requirements, which totaled $8.7 million and $7.1 million during 2024 and 2023, respectively.

During 2023, we paid $20.0 million to repurchase 349,519 shares of our common stock through our Repurchase Program.

During 2024, we distributed $4.4 million to limited partners and received $1.5 million in contributions for their share of development funding. During 2023, received $0.7 million net from limited partners, including $1.7 million of contributions from limited partners for their share of debt repayments and development funding, partially offset by $1.0 million in distributions to limited partners.

We paid $16.1 million more in dividends as a result of an increase in our dividend rate per share and the number of shares of our common stock outstanding, as well as preferred dividends which commenced in late 2023 as a result of the UBP acquisition.

We had the following debt related activity during 2024:

o

We had $122.0 million in net repayments on our Line,

o

We received $398.5 million in proceeds from issuing unsecured public debt,

o

We paid $10.8 million for debt repayments, including:

▪

$3.2 million in principal mortgage payments, and

▪

$7.6 million for repaying one mortgage loan ahead of maturity,

o

We paid $13.3 million in loan costs relating to the recast of the Line as well as the unsecured public debt offering.

We had the following debt related activity during 2023:

o

$30.0 million in borrowings from our Line to manage working capital needs,

o

$15.5 million in proceeds from a mortgage refinancing,

o

We paid $31.1 million for debt repayments, including:

▪

$2.8 million in principal mortgage payments, and

▪

$28.3 million to repay three mortgage loans at maturity.

Investments in Real Estate Partnerships

The following table is a summary of the unconsolidated combined assets and liabilities of our real estate partnerships and our Pro-rata share:

		Combined								Regency's Share (1)
(dollars in thousands)		March 31, 2024				December 31, 2023				March 31, 2024				December 31, 2023
Number of real estate partnerships			18				18
Regency's ownership		12% - 67%				12% - 67%
Number of properties			101				101
Assets		$	2,697,962				2,689,993			$	987,364				984,027
Liabilities			1,609,140				1,595,271				571,632				565,822
Equity			1,088,822				1,094,722				415,732				418,205
Basis difference											(47,023	)			(47,600	)
Investments in real estate partnerships										$	368,709				370,605

(1)

Pro-rata financial information is not, and is not intended to be, a presentation in accordance with GAAP. However, management believes that providing such information is useful to investors in assessing the impact of its investments in real estate partnership activities on our operations, which includes such items on a single line presentation under the equity method in our Consolidated Financial Statements.

Our equity method investments in real estate partnerships consist of the following:

(in thousands)		Regency's Ownership		March 31, 2024				December 31, 2023
GRI - Regency, LLC (GRIR)		40.00%		$	142,238				144,371
Columbia Regency Retail Partners, LLC (Columbia I)		20.00%			6,946				7,045
Columbia Regency Partners II, LLC (Columbia II)		20.00%			43,103				42,994
Columbia Village District, LLC		30.00%			6,155				6,123
Individual Investors
Ballard Blocks		49.90%			61,718				62,140
Bloom on Third		35.00%			43,099				42,074
Others (1)		11.80% - 66.67%			65,450				65,858
Total Investment in real estate partnerships				$	368,709				370,605

(1)

Includes investments in real estate partnerships acquired as part of the UBP acquisition, which was effective on August 18, 2023.

Notes Payable - Investments in Real Estate Partnerships

Scheduled principal repayments on notes payable held by our investments in real estate partnerships were as follows:

(in thousands)		March 31, 2024
Scheduled Principal Payments and Maturities by Year:		Scheduled Principal Payments				Mortgage Loan Maturities				Unsecured Maturities				Total				Regency’s Pro-Rata Share
2024 (1)		$	2,775				7,008				—				9,783				4,312
2025			6,094				147,064				—				153,158				48,443
2026			7,393				239,397				44,800				291,590				92,308
2027			7,576				32,800				—				40,376				13,669
2028			4,267				246,605				—				250,872				92,027
Beyond 5 Years			6,688				771,324				—				778,012				293,128
Net unamortized loan costs, debt premium / (discount)			—				(10,355	)			—				(10,355	)			(3,780	)
Total		$	34,793				1,433,843				44,800				1,513,436				540,107

(1)

Reflects scheduled principal payments and maturities for the remainder of the year.

At March 31, 2024, our investments in real estate partnerships had notes payable of $1.5 billion maturing through 2034, of which 94.8% had a weighted average fixed interest rate of 3.8%. The remaining notes payable float with SOFR and had a weighted average variable interest rate of 7.3%, based on rates as of March 31, 2024. These fixed and variable rate notes payable are all non-recourse, and our Pro-rata share was $540.1 million as of March 31, 2024. As notes payable mature, they are expected to be repaid from proceeds from new borrowings and/or partner capital contributions. Refinancing debt at maturity in the current interest rate environment could result in higher interest expense in future periods if rates remain elevated.

We believe that our partners are financially sound and have sufficient capital or access thereto to fund future capital requirements. In the event that a real estate investment partner is unable to fund its share of the capital requirements of the real estate partnership, we would have the right, but not the obligation, to loan the defaulting partner the amount of its capital call which would be secured by the partner's membership interest.

Management fee income

In addition to earning our Pro-rata share of net income or loss in each of these real estate partnerships, we receive fees as shown below:

		Three months ended March 31,
(in thousands)		2024				2023
Asset management, property management, leasing, and other transaction fees		$	6,396				6,038

Critical Accounting Estimates

There have been no material changes in our Critical Accounting Estimates from the information provided in the "Critical Accounting Estimates" section of "Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations" in our Form 10-K.

Environmental Matters

We are subject to numerous environmental laws and regulations, which primarily pertain to chemicals historically used by certain current and former dry cleaning and gas station tenants and the existence of asbestos in older shopping centers. We believe that the relatively few tenants who currently operate dry cleaning plants or gas stations do so in accordance with current laws and regulations. Generally, we endeavor to require tenants to remove dry cleaning plants from our shopping centers or convert them to more environmentally friendly systems, in accordance with the terms of our leases. We carry an environmental insurance policy for certain third-party liabilities and, in certain circumstances, remediation costs on shopping centers for currently unknown contamination. We have also secured environmental insurance policies, where appropriate, on a relatively small number of specific properties with known contamination, in order to mitigate our environmental risk. We monitor the shopping centers containing environmental issues and in certain cases voluntarily remediate the sites. We also have legal obligations to remediate certain sites and we are in the process of doing so.

As of March 31, 2024, we had accrued liabilities of $15.9 million for our consolidated environmental remediation, including our Investments in real estate partnerships. We believe that the ultimate remediation of currently known environmental matters will not have a material effect on our financial position, cash flows, or results of operations. We can give no assurance that existing environmental studies on our shopping centers have revealed all potential environmental contamination; that our 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 us; 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 us.