þ | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
☐ | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
Maryland (Brixmor Property Group Inc.) | 45-2433192 | |
Delaware (Brixmor Operating Partnership LP) | 80-0831163 | |
(State or Other Jurisdiction of Incorporation or Organization) | (I.R.S. Employer Identification No.) |
Brixmor Property Group Inc. | Brixmor Operating Partnership LP | ||||||||
Large accelerated filer | þ | Non-accelerated filer | ☐ | Large accelerated filer | ☐ | Non-accelerated filer | þ | ||
Smaller reporting company | ☐ | Accelerated filer | ☐ | Smaller reporting company | ☐ | Accelerated filer | ☐ | ||
Emerging growth company | ☐ | Emerging growth company | ☐ |
• | Enhances investors’ understanding of the Parent Company and the Operating Partnership by enabling investors to view the business as a whole in the same manner as management views and operates the business; |
• | Eliminates duplicative disclosure and provides a more streamlined and readable presentation; and |
• | Creates time and cost efficiencies through the preparation of one combined report instead of two separate reports. |
Item No. | Page | |
Part I - FINANCIAL INFORMATION | ||
1. | Financial Statements | |
Brixmor Property Group Inc. (unaudited) | ||
Condensed Consolidated Balance Sheets as of March 31, 2019 and December 31, 2018 | ||
Condensed Consolidated Statements of Operations for the Three Months Ended March 31, 2019 and 2018 | ||
Condensed Consolidated Statements of Comprehensive Income for the Three Months Ended March 31, 2019 and 2018 | ||
Condensed Consolidated Statements of Changes in Equity for the Three Months Ended March 31, 2019 and 2018 | ||
Condensed Consolidated Statements of Cash Flows for the Three Months Ended March 31, 2019 and 2018 | ||
Brixmor Operating Partnership LP (unaudited) | ||
Condensed Consolidated Balance Sheets as of March 31, 2019 and December 31, 2018 | ||
Condensed Consolidated Statements of Operations for the Three Months Ended March 31, 2019 and 2018 | ||
Condensed Consolidated Statements of Comprehensive Income for the Three Months Ended March 31, 2019 and 2018 | ||
Condensed Consolidated Statements of Changes in Capital for the Three Months Ended March 31, 2019 and 2018 | ||
Condensed Consolidated Statements of Cash Flows for the Three Months Ended March 31, 2019 and 2018 | ||
Brixmor Property Group Inc. and Brixmor Operating Partnership LP (unaudited) | ||
Notes to Condensed Consolidated Financial Statements | ||
2. | Management’s Discussion and Analysis of Financial Condition and Results of Operations | |
3. | Quantitative and Qualitative Disclosures about Market Risk | |
4. | Controls and Procedures | |
Part II - OTHER INFORMATION | ||
1. | Legal Proceedings | |
1A. | Risk Factors | |
2. | Unregistered Sales of Equity Securities and Use of Proceeds | |
3. | Defaults Upon Senior Securities | |
4. | Mine Safety Disclosures | |
5. | Other Information | |
6. | Exhibits |
BRIXMOR PROPERTY GROUP INC. AND SUBSIDIARIES | |||||||
CONDENSED CONSOLIDATED BALANCE SHEETS | |||||||
(Unaudited, in thousands, except share information) | |||||||
March 31, 2019 | December 31, 2018 | ||||||
Assets | |||||||
Real estate | |||||||
Land | $ | 1,794,709 | $ | 1,804,504 | |||
Buildings and improvements | 8,279,076 | 8,294,273 | |||||
10,073,785 | 10,098,777 | ||||||
Accumulated depreciation and amortization | (2,386,092 | ) | (2,349,127 | ) | |||
Real estate, net | 7,687,693 | 7,749,650 | |||||
Cash and cash equivalents | 349 | 41,745 | |||||
Restricted cash | 3,057 | 9,020 | |||||
Marketable securities | 29,634 | 30,243 | |||||
Receivables, net | 236,391 | 228,297 | |||||
Deferred charges and prepaid expenses, net | 143,535 | 145,662 | |||||
Real estate assets held for sale | 9,093 | 2,901 | |||||
Other assets | 74,178 | 34,903 | |||||
Total assets | $ | 8,183,930 | $ | 8,242,421 | |||
Liabilities | |||||||
Debt obligations, net | $ | 4,873,065 | $ | 4,885,863 | |||
Accounts payable, accrued expenses and other liabilities | 518,094 | 520,459 | |||||
Total liabilities | 5,391,159 | 5,406,322 | |||||
Commitments and contingencies (Note 15) | — | — | |||||
Equity | |||||||
Common stock, $0.01 par value; authorized 3,000,000,000 shares; 305,289,535 and 305,130,472 shares issued and 297,987,158 and 298,488,516 shares outstanding | 2,980 | 2,985 | |||||
Additional paid-in capital | 3,222,844 | 3,233,329 | |||||
Accumulated other comprehensive income | 6,048 | 15,973 | |||||
Distributions in excess of net income | (439,101 | ) | (416,188 | ) | |||
Total equity | 2,792,771 | 2,836,099 | |||||
Total liabilities and equity | $ | 8,183,930 | $ | 8,242,421 | |||
The accompanying notes are an integral part of these unaudited condensed consolidated financial statements. |
BRIXMOR PROPERTY GROUP INC. AND SUBSIDIARIES | |||||||
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS | |||||||
(Unaudited, in thousands, except per share data) | |||||||
Three Months Ended March 31, | |||||||
2019 | 2018 | ||||||
Revenues | |||||||
Rental income | $ | 289,955 | $ | 316,797 | |||
Other revenues | 1,184 | 378 | |||||
Total revenues | 291,139 | 317,175 | |||||
Operating expenses | |||||||
Operating costs | 31,258 | 35,490 | |||||
Real estate taxes | 43,326 | 45,725 | |||||
Depreciation and amortization | 85,395 | 90,383 | |||||
Provision for doubtful accounts | — | 2,415 | |||||
Impairment of real estate assets | 3,112 | 15,902 | |||||
General and administrative | 25,443 | 22,426 | |||||
Total operating expenses | 188,534 | 212,341 | |||||
Other income (expense) | |||||||
Dividends and interest | 147 | 96 | |||||
Interest expense | (46,666 | ) | (55,171 | ) | |||
Gain on sale of real estate assets | 7,602 | 11,448 | |||||
Gain (loss) on extinguishment of debt, net | 30 | (132 | ) | ||||
Other | (818 | ) | (53 | ) | |||
Total other expense | (39,705 | ) | (43,812 | ) | |||
Net income | $ | 62,900 | $ | 61,022 | |||
Per common share: | |||||||
Net income: | |||||||
Basic | $ | 0.21 | $ | 0.20 | |||
Diluted | $ | 0.21 | $ | 0.20 | |||
Weighted average shares: | |||||||
Basic | 298,599 | 304,158 | |||||
Diluted | 299,029 | 304,278 | |||||
The accompanying notes are an integral part of these unaudited condensed consolidated financial statements. |
BRIXMOR PROPERTY GROUP INC. AND SUBSIDIARIES | |||||||
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME | |||||||
(Unaudited, in thousands) | |||||||
Three Months Ended March 31, | |||||||
2019 | 2018 | ||||||
Net income | $ | 62,900 | $ | 61,022 | |||
Other comprehensive income (loss) | |||||||
Change in unrealized gain (loss) on interest rate swaps, net (Note 6) | (10,057 | ) | 4,773 | ||||
Change in unrealized gain (loss) on marketable securities | 132 | (86 | ) | ||||
Total other comprehensive income (loss) | (9,925 | ) | 4,687 | ||||
Comprehensive income | $ | 52,975 | $ | 65,709 | |||
The accompanying notes are an integral part of these unaudited condensed consolidated financial statements. |
BRIXMOR PROPERTY GROUP INC. AND SUBSIDIARIES | ||||||||||||||||||||||
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY | ||||||||||||||||||||||
(Unaudited, in thousands, except per share data) | ||||||||||||||||||||||
Common Stock | ||||||||||||||||||||||
Number | Amount | Additional Paid-in Capital | Accumulated Other Comprehensive Income | Distributions in Excess of Net Income | Total | |||||||||||||||||
Beginning balance, January 1, 2018 | 304,620 | $ | 3,046 | $ | 3,330,466 | $ | 24,211 | $ | (449,375 | ) | $ | 2,908,348 | ||||||||||
Common stock dividends ($0.275 per common share) | — | — | — | — | (83,479 | ) | (83,479 | ) | ||||||||||||||
Equity based compensation expense | — | — | 2,484 | — | — | 2,484 | ||||||||||||||||
Other comprehensive income | — | — | — | 4,687 | — | 4,687 | ||||||||||||||||
Issuance of common stock and OP Units | 128 | 1 | — | — | — | 1 | ||||||||||||||||
Repurchases of common stock | (1,922 | ) | (19 | ) | (29,746 | ) | — | — | (29,765 | ) | ||||||||||||
Share-based awards retained for taxes | — | — | (1,722 | ) | — | — | (1,722 | ) | ||||||||||||||
Net income | — | — | — | — | 61,022 | 61,022 | ||||||||||||||||
Ending balance, March 31, 2018 | 302,826 | $ | 3,028 | $ | 3,301,482 | $ | 28,898 | $ | (471,832 | ) | $ | 2,861,576 | ||||||||||
Beginning balance, January 1, 2019 | 298,489 | $ | 2,985 | $ | 3,233,329 | $ | 15,973 | $ | (416,188 | ) | $ | 2,836,099 | ||||||||||
ASC 842 cumulative adjustment | — | — | — | — | (1,974 | ) | (1,974 | ) | ||||||||||||||
Common stock dividends ($0.28 per common share) | — | — | — | — | (83,839 | ) | (83,839 | ) | ||||||||||||||
Equity based compensation expense | — | — | 2,641 | — | — | 2,641 | ||||||||||||||||
Other comprehensive loss | — | — | — | (9,925 | ) | — | (9,925 | ) | ||||||||||||||
Issuance of common stock and OP Units | 158 | 2 | — | — | — | 2 | ||||||||||||||||
Repurchases of common stock | (660 | ) | (7 | ) | (11,579 | ) | — | — | (11,586 | ) | ||||||||||||
Share-based awards retained for taxes | — | — | (1,547 | ) | — | — | (1,547 | ) | ||||||||||||||
Net income | — | — | — | — | 62,900 | 62,900 | ||||||||||||||||
Ending balance, March 31, 2019 | 297,987 | $ | 2,980 | $ | 3,222,844 | $ | 6,048 | $ | (439,101 | ) | $ | 2,792,771 | ||||||||||
The accompanying notes are an integral part of these unaudited condensed consolidated financial statements. |
BRIXMOR PROPERTY GROUP INC. AND SUBSIDIARIES | |||||||
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS | |||||||
(Unaudited, in thousands) | |||||||
Three Months Ended March 31, | |||||||
2019 | 2018 | ||||||
Operating activities: | |||||||
Net income | $ | 62,900 | $ | 61,022 | |||
Adjustments to reconcile net income to net cash provided by operating activities: | |||||||
Depreciation and amortization | 85,395 | 90,383 | |||||
Debt premium and discount amortization | 468 | (952 | ) | ||||
Deferred financing cost amortization | 1,787 | 1,682 | |||||
Accretion of above- and below-market leases, net | (4,898 | ) | (6,824 | ) | |||
Provisions for impairment | 3,112 | 15,902 | |||||
Gain on disposition of operating properties | (7,602 | ) | (11,448 | ) | |||
Equity based compensation | 2,641 | 2,484 | |||||
Other | 827 | 824 | |||||
(Gain) loss on extinguishment of debt, net | (30 | ) | 132 | ||||
Changes in operating assets and liabilities: | |||||||
Receivables | (816 | ) | 12,171 | ||||
Deferred charges and prepaid expenses | (6,829 | ) | (5,309 | ) | |||
Other assets | 82 | 40 | |||||
Accounts payable, accrued expenses and other liabilities | (40,199 | ) | (35,657 | ) | |||
Net cash provided by operating activities | 96,838 | 124,450 | |||||
Investing activities: | |||||||
Improvements to and investments in real estate assets | (77,725 | ) | (76,803 | ) | |||
Proceeds from sales of real estate assets | 45,160 | 104,198 | |||||
Purchase of marketable securities | (5,246 | ) | (3,655 | ) | |||
Proceeds from sale of marketable securities | 5,977 | 4,496 | |||||
Net cash provided by (used in) investing activities | (31,834 | ) | 28,236 | ||||
Financing activities: | |||||||
Repayment of secured debt obligations | — | (4,858 | ) | ||||
Repayment of borrowings under unsecured revolving credit facility | (65,000 | ) | — | ||||
Proceeds from borrowings under unsecured revolving credit facility | 50,000 | — | |||||
Repayment of borrowings under unsecured term loans | — | (50,000 | ) | ||||
Deferred financing and debt extinguishment costs | (133 | ) | (184 | ) | |||
Distributions to common stockholders | (84,097 | ) | (84,165 | ) | |||
Repurchases of common shares | (11,586 | ) | (29,765 | ) | |||
Repurchases of common shares in conjunction with equity award plans | (1,547 | ) | (1,722 | ) | |||
Net cash used in financing activities | (112,363 | ) | (170,694 | ) | |||
Net change in cash, cash equivalents and restricted cash | (47,359 | ) | (18,008 | ) | |||
Cash, cash equivalents and restricted cash at beginning of period | 50,765 | 110,777 | |||||
Cash, cash equivalents and restricted cash at end of period | $ | 3,406 | $ | 92,769 | |||
Reconciliation to consolidated balance sheets: | |||||||
Cash and cash equivalents | $ | 349 | $ | 27,332 | |||
Restricted cash | 3,057 | 65,437 | |||||
Cash, cash equivalents and restricted cash at end of period | $ | 3,406 | $ | 92,769 | |||
Supplemental disclosure of cash flow information: | |||||||
Cash paid for interest, net of amount capitalized of $626 and $654 | $ | 51,168 | $ | 63,646 | |||
The accompanying notes are an integral part of these unaudited condensed consolidated financial statements. |
BRIXMOR OPERATING PARTNERSHIP LP AND SUBSIDIARIES | |||||||
CONDENSED CONSOLIDATED BALANCE SHEETS | |||||||
(Unaudited, in thousands, except unit information) | |||||||
March 31, 2019 | December 31, 2018 | ||||||
Assets | |||||||
Real estate | |||||||
Land | $ | 1,794,709 | $ | 1,804,504 | |||
Buildings and improvements | 8,279,076 | 8,294,273 | |||||
10,073,785 | 10,098,777 | ||||||
Accumulated depreciation and amortization | (2,386,092 | ) | (2,349,127 | ) | |||
Real estate, net | 7,687,693 | 7,749,650 | |||||
Cash and cash equivalents | 99 | 41,619 | |||||
Restricted cash | 3,057 | 9,020 | |||||
Marketable securities | 29,413 | 30,023 | |||||
Receivables, net | 236,391 | 228,297 | |||||
Deferred charges and prepaid expenses, net | 143,535 | 145,662 | |||||
Real estate assets held for sale | 9,093 | 2,901 | |||||
Other assets | 74,178 | 34,903 | |||||
Total assets | $ | 8,183,459 | $ | 8,242,075 | |||
Liabilities | |||||||
Debt obligations, net | $ | 4,873,065 | $ | 4,885,863 | |||
Accounts payable, accrued expenses and other liabilities | 518,094 | 520,459 | |||||
Total liabilities | 5,391,159 | 5,406,322 | |||||
Commitments and contingencies (Note 15) | — | — | |||||
Capital | |||||||
Partnership common units; 305,289,535 and 305,130,472 units issued and 297,987,158 and 298,488,516 units outstanding | 2,786,242 | 2,819,770 | |||||
Accumulated other comprehensive income | 6,058 | 15,983 | |||||
Total capital | 2,792,300 | 2,835,753 | |||||
Total liabilities and capital | $ | 8,183,459 | $ | 8,242,075 | |||
The accompanying notes are an integral part of these unaudited condensed consolidated financial statements. |
BRIXMOR OPERATING PARTNERSHIP LP AND SUBSIDIARIES | |||||||
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS | |||||||
(Unaudited, in thousands, except per share data) | |||||||
Three Months Ended March 31, | |||||||
2019 | 2018 | ||||||
Revenues | |||||||
Rental income | $ | 289,955 | $ | 316,797 | |||
Other revenues | 1,184 | 378 | |||||
Total revenues | 291,139 | 317,175 | |||||
Operating expenses | |||||||
Operating costs | 31,258 | 35,490 | |||||
Real estate taxes | 43,326 | 45,725 | |||||
Depreciation and amortization | 85,395 | 90,383 | |||||
Provision for doubtful accounts | — | 2,415 | |||||
Impairment of real estate assets | 3,112 | 15,902 | |||||
General and administrative | 25,443 | 22,426 | |||||
Total operating expenses | 188,534 | 212,341 | |||||
Other income (expense) | |||||||
Dividends and interest | 147 | 96 | |||||
Interest expense | (46,666 | ) | (55,171 | ) | |||
Gain on sale of real estate assets | 7,602 | 11,448 | |||||
Gain (loss) on extinguishment of debt, net | 30 | (132 | ) | ||||
Other | (818 | ) | (53 | ) | |||
Total other expense | (39,705 | ) | (43,812 | ) | |||
Net income | $ | 62,900 | $ | 61,022 | |||
Per common unit: | |||||||
Net income: | |||||||
Basic | $ | 0.21 | $ | 0.20 | |||
Diluted | $ | 0.21 | $ | 0.20 | |||
Weighted average units: | |||||||
Basic | 298,599 | 304,158 | |||||
Diluted | 299,029 | 304,278 | |||||
The accompanying notes are an integral part of these unaudited condensed consolidated financial statements. |
BRIXMOR OPERATING PARTNERSHIP LP AND SUBSIDIARIES | |||||||
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME | |||||||
(Unaudited, in thousands) | |||||||
Three Months Ended March 31, | |||||||
2019 | 2018 | ||||||
Net income | $ | 62,900 | $ | 61,022 | |||
Other comprehensive income (loss) | |||||||
Change in unrealized gain (loss) on interest rate swaps, net (Note 6) | (10,057 | ) | 4,773 | ||||
Change in unrealized gain (loss) on marketable securities | 132 | (85 | ) | ||||
Total other comprehensive income (loss) | (9,925 | ) | 4,688 | ||||
Comprehensive income | $ | 52,975 | $ | 65,710 | |||
The accompanying notes are an integral part of these unaudited condensed consolidated financial statements. |
BRIXMOR OPERATING PARTNERSHIP LP AND SUBSIDIARIES | |||||||||||
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN CAPITAL | |||||||||||
(Unaudited, in thousands) | |||||||||||
Partnership Common Units | Accumulated Other Comprehensive Income (Loss) | Total | |||||||||
Beginning balance, January 1, 2018 | $ | 2,883,875 | $ | 24,224 | $ | 2,908,099 | |||||
Distributions to partners | (83,479 | ) | — | (83,479 | ) | ||||||
Equity based compensation expense | 2,484 | — | 2,484 | ||||||||
Other comprehensive income | — | 4,688 | 4,688 | ||||||||
Issuance of OP Units | 1 | — | 1 | ||||||||
Repurchases of OP Units | (29,765 | ) | — | (29,765 | ) | ||||||
Share-based awards retained for taxes | (1,722 | ) | — | (1,722 | ) | ||||||
Net income | 61,022 | — | 61,022 | ||||||||
Ending balance, March 31, 2018 | $ | 2,832,416 | $ | 28,912 | $ | 2,861,328 | |||||
Beginning balance, January 1, 2019 | $ | 2,819,770 | $ | 15,983 | $ | 2,835,753 | |||||
ASC 842 cumulative adjustment | (1,974 | ) | — | (1,974 | ) | ||||||
Distributions to partners | (83,964 | ) | — | (83,964 | ) | ||||||
Equity based compensation expense | 2,641 | — | 2,641 | ||||||||
Other comprehensive loss | — | (9,925 | ) | (9,925 | ) | ||||||
Issuance of OP Units | 2 | — | 2 | ||||||||
Repurchases of OP Units | (11,586 | ) | — | (11,586 | ) | ||||||
Share-based awards retained for taxes | (1,547 | ) | — | (1,547 | ) | ||||||
Net income | 62,900 | — | 62,900 | ||||||||
Ending balance, March 31, 2019 | $ | 2,786,242 | $ | 6,058 | $ | 2,792,300 | |||||
The accompanying notes are an integral part of these unaudited condensed consolidated financial statements. |
BRIXMOR OPERATING PARTNERSHIP LP AND SUBSIDIARIES | |||||||
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS | |||||||
(Unaudited, in thousands) | |||||||
Three Months Ended March 31, | |||||||
2019 | 2018 | ||||||
Operating activities: | |||||||
Net income | $ | 62,900 | $ | 61,022 | |||
Adjustments to reconcile net income to net cash provided by operating activities: | |||||||
Depreciation and amortization | 85,395 | 90,383 | |||||
Debt premium and discount amortization | 468 | (952 | ) | ||||
Deferred financing cost amortization | 1,787 | 1,682 | |||||
Accretion of above- and below-market leases, net | (4,898 | ) | (6,824 | ) | |||
Provisions for impairment | 3,112 | 15,902 | |||||
Gain on disposition of operating properties | (7,602 | ) | (11,448 | ) | |||
Equity based compensation | 2,641 | 2,484 | |||||
Other | 827 | 824 | |||||
(Gain) loss on extinguishment of debt, net | (30 | ) | 132 | ||||
Changes in operating assets and liabilities: | |||||||
Receivables | (816 | ) | 12,171 | ||||
Deferred charges and prepaid expenses | (6,829 | ) | (5,309 | ) | |||
Other assets | 82 | 40 | |||||
Accounts payable, accrued expenses and other liabilities | (40,199 | ) | (35,657 | ) | |||
Net cash provided by operating activities | 96,838 | 124,450 | |||||
Investing activities: | |||||||
Improvements to and investments in real estate assets | (77,725 | ) | (76,803 | ) | |||
Proceeds from sales of real estate assets | 45,160 | 104,198 | |||||
Purchase of marketable securities | (5,245 | ) | (3,654 | ) | |||
Proceeds from sale of marketable securities | 5,977 | 4,496 | |||||
Net cash provided by (used in) investing activities | (31,833 | ) | 28,237 | ||||
Financing activities: | |||||||
Repayment of secured debt obligations | — | (4,858 | ) | ||||
Repayment of borrowings under unsecured revolving credit facility | (65,000 | ) | — | ||||
Proceeds from borrowings under unsecured revolving credit facility | 50,000 | — | |||||
Repayment of borrowings under unsecured term loans | — | (50,000 | ) | ||||
Deferred financing and debt extinguishment costs | (133 | ) | (184 | ) | |||
Partner distributions | (97,355 | ) | (115,652 | ) | |||
Net cash used in financing activities | (112,488 | ) | (170,694 | ) | |||
Net change in cash, cash equivalents and restricted cash | (47,483 | ) | (18,007 | ) | |||
Cash, cash equivalents and restricted cash at beginning of period | 50,639 | 110,747 | |||||
Cash, cash equivalents and restricted cash at end of period | $ | 3,156 | $ | 92,740 | |||
Reconciliation to consolidated balance sheets: | |||||||
Cash and cash equivalents | $ | 99 | $ | 27,303 | |||
Restricted cash | 3,057 | 65,437 | |||||
Cash, cash equivalents and restricted cash at end of period | $ | 3,156 | $ | 92,740 | |||
Supplemental disclosure of cash flow information: | |||||||
Cash paid for interest, net of amount capitalized of $626 and $654 | $ | 51,168 | $ | 63,646 | |||
The accompanying notes are an integral part of these unaudited condensed consolidated financial statements. |
• | The Company did not reassess whether a current arrangement contains a lease. (ASU 2016-02) |
• | The Company did not reassess current lease classification. (ASU 2016-02) |
• | The Company did not reassess initial direct costs recognized under previous guidance. (ASU 2016-02) |
• | The Company did not reassess current land easements under ASC 842. (ASU 2018-01) |
• | The Company applied ASC 842 as of the effective date. Therefore, the Company’s reporting for the comparative periods presented in the unaudited Condensed Consolidated Financial Statements of the Company will continue to be in accordance with ASC 840, however certain prior period balances in the accompanying unaudited Condensed Consolidated Statements of Operations have been reclassified to conform to the current period presentation. The Company recognized a $2.0 million cumulative adjustment to decrease retained earnings for indirect leasing costs capitalized for executed leases that had not commenced as of the adoption date of ASC 842. (ASU 2018-11) |
• | The Company elected, by class of underlying asset, not to separate non-lease components from the associated lease components and instead account for them as a single component. This resulted in the consolidation of Rental income and Expense reimbursements on the Company’s unaudited Condensed Consolidated Statements of Operations. (ASU 2018-11) |
Assets | March 31, 2019 | December 31, 2018 | |||||||
Land | $ | 1,412 | $ | 1,220 | |||||
Buildings and improvements | 10,935 | 2,927 | |||||||
Accumulated depreciation and amortization | (3,356 | ) | (1,334 | ) | |||||
Real estate, net | 8,991 | 2,813 | |||||||
Other assets | 102 | 88 | |||||||
Assets associated with real estate assets held for sale | $ | 9,093 | $ | 2,901 | |||||
Liabilities | |||||||||
Below-market leases | $ | 444 | $ | — | |||||
Liabilities associated with real estate assets held for sale(1) | $ | 444 | $ | — |
(1) | These amounts are included in Accounts payable, accrued expenses and other liabilities on the Company’s unaudited Condensed Consolidated Balance Sheets. |
March 31, 2019 | December 31, 2018 | ||||||
Land | $ | 1,794,709 | $ | 1,804,504 | |||
Buildings and improvements: | |||||||
Buildings and tenant improvements(1) | 7,626,515 | 7,626,363 | |||||
Lease intangibles(2) | 652,561 | 667,910 | |||||
10,073,785 | 10,098,777 | ||||||
Accumulated depreciation and amortization(3) | (2,386,092 | ) | (2,349,127 | ) | |||
Total | $ | 7,687,693 | $ | 7,749,650 |
(1) | As of March 31, 2019 and December 31, 2018, Buildings and tenant improvements included accrued amounts, net of anticipated insurance proceeds, of $38.9 million and $41.7 million, respectively. |
(2) | As of March 31, 2019 and December 31, 2018, Lease intangibles consisted of $587.6 million and $601.0 million, respectively, of in-place leases and $65.0 million and $66.9 million, respectively, of above-market leases. These intangible assets are amortized over the term of each related lease. |
(3) | As of March 31, 2019 and December 31, 2018, Accumulated depreciation and amortization included $553.7 million and $560.3 million, respectively, of accumulated amortization related to Lease intangibles. |
Year ending December 31, | Below-market lease accretion (income), net of above-market lease amortization | In-place lease amortization expense | ||||||
2019 (remaining nine months) | $ | (13,278 | ) | $ | 17,382 | |||
2020 | (14,757 | ) | 17,615 | |||||
2021 | (11,982 | ) | 12,711 | |||||
2022 | (9,869 | ) | 9,353 | |||||
2023 | (8,473 | ) | 6,846 |
Three Months Ended March 31, 2019 | |||||||||
Property Name(1) | Location | GLA | Impairment Charge | ||||||
Brice Park | Reynoldsburg, OH | 158,565 | $ | 3,112 | |||||
158,565 | $ | 3,112 |
(1) | The Company recognized an impairment charge based upon a change in the estimated hold period of this property in connection with the Company’s capital recycling program. |
Three Months Ended March 31, 2018 | |||||||||
Property Name(1) | Location | GLA | Impairment Charge | ||||||
Southland Shopping Plaza(2) | Toledo, OH | 285,278 | $ | 6,942 | |||||
Roundtree Place(2) | Ypsilanti, MI | 246,620 | 3,772 | ||||||
Skyway Plaza | St. Petersburg, FL | 110,799 | 3,639 | ||||||
Pensacola Square(2) | Pensacola, FL | 142,767 | 1,345 | ||||||
Crossroads Centre(2) | Fairview Heights, IL | 242,752 | 204 | ||||||
1,028,216 | $ | 15,902 |
(1) | The Company recognized impairment charges based upon a change in the estimated hold period of these properties in connection with the Company’s capital recycling program. |
(2) | The Company disposed of this property during the year ended December 31, 2018. |
Number of Instruments | Notional Amount | |||||||||||
March 31, 2019 | December 31, 2018 | March 31, 2019 | December 31, 2018 | |||||||||
Interest Rate Swaps | 7 | 10 | $ | 800,000 | $ | 1,200,000 |
Fair Value of Derivative Instruments | ||||||||
Interest rate swaps classified as: | March 31, 2019 | December 31, 2018 | ||||||
Gross derivative assets | $ | 12,788 | $ | 18,630 | ||||
Gross derivative liabilities | (6,786 | ) | (2,571 | ) | ||||
Net derivative assets | $ | 6,002 | $ | 16,059 |
Derivatives in Cash Flow Hedging Relationships (Interest Rate Swaps) | Three Months Ended March 31, | |||||||
2019 | 2018 | |||||||
Change in unrealized gain (loss) on interest rate swaps | $ | (6,944 | ) | $ | 7,234 | |||
Accretion of interest rate swaps to interest expense | (3,113 | ) | (2,461 | ) | ||||
Change in unrealized gain (loss) on interest rate swaps, net | $ | (10,057 | ) | $ | 4,773 |
Carrying Value as of | ||||||||||||
March 31, 2019 | December 31, 2018 | Stated Interest Rate(1) | Scheduled Maturity Date | |||||||||
Secured loan | ||||||||||||
Secured loan(2) | $ | 7,000 | $ | 7,000 | 4.40% | 2024 | ||||||
Net unamortized premium | 250 | 262 | ||||||||||
Net unamortized debt issuance costs | (43 | ) | (45 | ) | ||||||||
Total secured loan, net | $ | 7,207 | $ | 7,217 | ||||||||
Notes payable | ||||||||||||
Unsecured notes(3) | $ | 3,468,453 | $ | 3,468,453 | 3.25% – 7.97% | 2022 – 2029 | ||||||
Net unamortized discount | (11,082 | ) | (11,562 | ) | ||||||||
Net unamortized debt issuance costs | (19,902 | ) | (20,877 | ) | ||||||||
Total notes payable, net | $ | 3,437,469 | $ | 3,436,014 | ||||||||
Unsecured Credit Facility and term loans | ||||||||||||
Unsecured Credit Facility - $500 Million Term Loan(4) | $ | 500,000 | $ | 500,000 | 3.74% | 2021 | ||||||
Unsecured Credit Facility - Revolving Facility | 291,000 | 306,000 | 3.59% | 2023 | ||||||||
Unsecured $350 Million Term Loan | 350,000 | 350,000 | 3.74% | 2023 | ||||||||
Unsecured $300 Million Term Loan(5) | 300,000 | 300,000 | 4.39% | 2024 | ||||||||
Net unamortized debt issuance costs | (12,611 | ) | (13,368 | ) | ||||||||
Total Unsecured Credit Facility and term loans | $ | 1,428,389 | $ | 1,442,632 | ||||||||
Total debt obligations, net | $ | 4,873,065 | $ | 4,885,863 |
(1) | The stated interest rates are as of March 31, 2019 and do not include the impact of the Company’s interest rate swap agreements (described below). |
(2) | The Company’s secured loan is collateralized by a property with a carrying value of approximately $16.3 million as of March 31, 2019. |
(3) | The weighted average stated interest rate on the Company’s unsecured notes was 3.81% as of March 31, 2019. |
(4) | Effective November 1, 2016, the Company has in place three interest rate swap agreements that convert the variable interest rate on a $500.0 million term loan (the “$500 Million Term Loan”) under the Company’s senior unsecured credit facility agreement, as amended December 12, 2018, (the “Unsecured Credit Facility”) to a fixed, combined interest rate of 1.11% (plus a spread of 125 basis points) through July 30, 2021. |
(5) | Effective January 2, 2019, the Company has in place four interest rate swap agreements that convert the variable interest rate on the Company’s $300.0 million term loan agreement, as amended December 12, 2018 (the “$300 Million Term Loan”) to a fixed, combined interest rate of 2.61% (plus a spread of 190 basis points until July 28, 2019, which decreases to 125 basis points thereafter) through July 26, 2024. |
Year ending December 31, | ||||
2019 (remaining nine months) | $ | — | ||
2020 | — | |||
2021 | 500,000 | |||
2022 | 750,000 | |||
2023 | 1,141,000 | |||
Thereafter | 2,525,453 | |||
Total debt maturities | 4,916,453 | |||
Net unamortized discount | (10,832 | ) | ||
Net unamortized debt issuance costs | (32,556 | ) | ||
Total debt obligations, net | $ | 4,873,065 |
March 31, 2019 | December 31, 2018 | |||||||||||||||
Carrying Amounts | Fair Value | Carrying Amounts | Fair Value | |||||||||||||
Secured loans | $ | 7,207 | $ | 7,172 | $ | 7,217 | $ | 7,072 | ||||||||
Notes payable | 3,437,469 | 3,462,929 | 3,436,014 | 3,372,418 | ||||||||||||
Unsecured Credit Facility and term loans | 1,428,389 | 1,436,953 | 1,442,632 | 1,452,382 | ||||||||||||
Total debt obligations, net | $ | 4,873,065 | $ | 4,907,054 | $ | 4,885,863 | $ | 4,831,872 | ||||||||
Fair Value Measurements as of March 31, 2019 | |||||||||||||||
Balance | Quoted Prices in Active Markets for Identical Assets (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | ||||||||||||
Assets: | |||||||||||||||
Marketable securities(1) | $ | 29,634 | $ | 1,535 | $ | 28,099 | $ | — | |||||||
Interest rate derivatives | $ | 12,788 | $ | — | $ | 12,788 | $ | — | |||||||
Liabilities: | |||||||||||||||
Interest rate derivatives | $ | (6,786 | ) | $ | — | $ | (6,786 | ) | $ | — | |||||
Fair Value Measurements as of December 31, 2018 | |||||||||||||||
Balance | Quoted Prices in Active Markets for Identical Assets (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | ||||||||||||
Assets: | |||||||||||||||
Marketable securities(1) | $ | 30,243 | $ | 1,756 | $ | 28,487 | $ | — | |||||||
Interest rate derivatives | $ | 18,630 | $ | — | $ | 18,630 | $ | — | |||||||
Liabilities: | |||||||||||||||
Interest rate derivatives | $ | (2,571 | ) | $ | — | $ | (2,571 | ) | $ | — |
(1) | As of March 31, 2019 and December 31, 2018, marketable securities included less than $0.1 million of net unrealized gains and $0.1 million of net unrealized losses, respectively. As of March 31, 2019, the contractual maturities of the Company’s marketable securities are within the next five years. |
Fair Value Measurements as of March 31, 2019 | |||||||||||||||||||
Balance | Quoted Prices in Active Markets for Identical Assets (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | Impairment of Real Estate Assets | |||||||||||||||
Assets: | |||||||||||||||||||
Properties(1) | $ | 9,700 | $ | — | $ | — | $ | 9,700 | $ | 3,112 | |||||||||
Fair Value Measurements as of December 31, 2018 | |||||||||||||||||||
Balance | Quoted Prices in Active Markets for Identical Assets (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | Impairment of Real Estate Assets | |||||||||||||||
Assets: | |||||||||||||||||||
Properties(2)(3)(4) | $ | 31,725 | $ | — | $ | — | $ | 31,725 | $ | 16,303 |
(1) | The carrying value of the property remeasured to fair value based upon offers from third-party buyers during the three months ended March 31, 2019 is $9.7 million related to Brice Park. |
(2) | Excludes properties disposed of prior to December 31, 2018. |
(3) | The carrying value of properties remeasured to fair value based upon offers from third-party buyers during the year ended December 31, 2018 includes $26.1 million related to Westview Center. |
(4) | The carrying value of properties remeasured to fair value based upon a discounted cash flow analysis during the year ended December 31, 2018 includes: (i) $2.9 million related to Skyway Plaza and (ii) $2.7 million related to Covington Gallery. The capitalization rates (ranging from 9.0% to 9.3%) and discount rates (ranging from 6.0% to 10.4%) which were utilized in the discounted cash flow analyses were based upon unobservable rates that the Company believes to be within a reasonable range of current market rates for each respective investment. |
Year ending December 31, | Operating Leases | |||
2019 (remaining nine months) | $ | 626,724 | ||
2020 | 751,081 | |||
2021 | 640,651 | |||
2022 | 529,569 | |||
2023 | 430,870 | |||
Thereafter | 1,501,400 |
Year ending December 31, | Operating Leases | |||
2019 | $ | 811,381 | ||
2020 | 709,230 | |||
2021 | 599,367 | |||
2022 | 490,087 | |||
2023 | 392,892 | |||
Thereafter | 1,368,278 |
Three Months Ended March 31, 2019 | ||||
Supplemental Statements of Operations Information | ||||
Operating lease costs | $ | 1,711 | ||
Short-term lease costs | 10 | |||
Variable lease costs | 142 | |||
Total lease costs | $ | 1,863 | ||
Three Months Ended March 31, 2019 | ||||
Supplemental Statements of Cash Flows Information | ||||
Operating cash outflows from operating leases | $ | 1,797 | ||
ROU assets obtained in exchange for operating lease liabilities | $ | 44,324 | ||
Operating Lease Liabilities | As of March 31, 2019 | |||
Future minimum operating lease payments: | ||||
2019 (remaining nine months) | $ | 5,180 | ||
2020 | 6,924 | |||
2021 | 6,964 | |||
2022 | 7,022 | |||
2023 | 5,635 | |||
Thereafter | 30,912 | |||
Total future minimum operating lease payments | 62,637 | |||
Less: imputed interest | (14,441 | ) | ||
Operating lease liabilities | $ | 48,196 | ||
Supplemental Balance Sheets Information | As of March 31, 2019 | |||
Operating lease liabilities(1)(2)(3) | $ | 48,196 | ||
ROU assets(1)(2)(4) | $ | 43,146 |
(1) | As of March 31, 2019, the weighted average remaining lease term was 11.3 years. |
(2) | As of March 31, 2019, the weighted average discount rate was 4.30%. |
(3) | These amounts are included in Accounts payable, accrued expenses and other liabilities on the Company’s unaudited Condensed Consolidated Balance Sheets. |
(4) | These amounts are included in Other assets on the Company’s unaudited Condensed Consolidated Balance Sheets. |
Year ending December 31, | ||||
2019 | $ | 6,929 | ||
2020 | 6,948 | |||
2021 | 7,157 | |||
2022 | 7,233 | |||
2023 | 5,827 | |||
Thereafter | 43,876 | |||
Total minimum annual rental commitments | $ | 77,970 |
Three Months Ended March 31, | |||||||
2019 | 2018 | ||||||
Computation of Basic Earnings Per Share: | |||||||
Net income | $ | 62,900 | $ | 61,022 | |||
Non-forfeitable dividends on unvested restricted shares | (144 | ) | (56 | ) | |||
Net income attributable to the Company’s common stockholders for basic earnings per share | $ | 62,756 | $ | 60,966 | |||
Weighted average number shares outstanding – basic | 298,599 | 304,158 | |||||
Basic earnings per share attributable to the Company’s common stockholders: | |||||||
Net income per share | $ | 0.21 | $ | 0.20 | |||
Computation of Diluted Earnings Per Share: | |||||||
Net income attributable to the Company’s common stockholders for diluted earnings per share | $ | 62,756 | $ | 60,966 | |||
Weighted average shares outstanding – basic | 298,599 | 304,158 | |||||
Effect of dilutive securities: | |||||||
Equity awards | 430 | 120 | |||||
Weighted average shares outstanding – diluted | 299,029 | 304,278 | |||||
Diluted earnings per share attributable to the Company’s common stockholders: | |||||||
Net income per share | $ | 0.21 | $ | 0.20 |
Three Months Ended March 31, | |||||||
2019 | 2018 | ||||||
Computation of Basic Earnings Per Unit: | |||||||
Net income | $ | 62,900 | $ | 61,022 | |||
Non-forfeitable dividends on unvested restricted units | (144 | ) | (56 | ) | |||
Net income attributable to the Operating Partnership’s common units for basic earnings per unit | $ | 62,756 | $ | 60,966 | |||
Weighted average number common units outstanding – basic | 298,599 | 304,158 | |||||
Basic earnings per unit attributable to the Operating Partnership’s common units: | |||||||
Net income per unit | $ | 0.21 | $ | 0.20 | |||
Computation of Diluted Earnings Per Unit: | |||||||
Net income attributable to the Operating Partnership’s common units for diluted earnings per unit | $ | 62,756 | $ | 60,966 | |||
Weighted average common units outstanding – basic | 298,599 | 304,158 | |||||
Effect of dilutive securities: | |||||||
Equity awards | 430 | 120 | |||||
Weighted average common units outstanding – diluted | 299,029 | 304,278 | |||||
Diluted earnings per unit attributable to the Operating Partnership’s common units: | |||||||
Net income per unit | $ | 0.21 | $ | 0.20 |
• | Expansive Retailer Relationships – We believe that the scale of our asset base and our nationwide footprint represent competitive advantages in supporting the growth objectives of the nation’s largest and most successful retailers. We believe that we are one of the largest landlords by GLA to TJX and Kroger, as well as a key landlord to most major grocers and retail category leaders. We believe that our strong relationships with leading retailers afford us unique insight into their strategies and priority access to their expansion plans. |
• | Fully-Integrated Operating Platform – We manage a fully-integrated operating platform, leveraging our national scope and demonstrating our commitment to operating with a strong regional and local presence. We provide our tenants with dedicated service through both our national accounts leasing team based in New York and our network of four regional offices in Atlanta, Chicago, Philadelphia and San Diego, as well as our 10 leasing and property management satellite offices throughout the country. We believe that this structure enables us to obtain critical national market intelligence, while also benefitting from the regional and local expertise of our leasing and operations team. |
• | Experienced Management – Senior members of our management team are seasoned real estate operators with extensive public company leadership experience. Our management team has deep industry knowledge and well-established relationships with retailers, brokers and vendors through many years of operational and transactional experience, as well as significant expertise in executing value-enhancing reinvestment opportunities. |
For the Three Months Ended March 31, 2019 | ||||||||||||||||||||
Leases | GLA | New ABR PSF | Tenant Improvements and Allowances PSF | Third Party Leasing Commissions PSF | Rent Spread(1) | |||||||||||||||
New, renewal and option leases | 395 | 3,184,376 | $ | 13.48 | $ | 4.79 | $ | 1.34 | 9.8 | % | ||||||||||
New and renewal leases | 325 | 1,722,634 | 16.33 | 8.85 | 2.47 | 12.3 | % | |||||||||||||
New leases | 147 | 694,443 | 18.79 | 19.21 | 6.12 | 32.7 | % | |||||||||||||
Renewal leases | 178 | 1,028,191 | 14.67 | 1.85 | 0.01 | 6.8 | % | |||||||||||||
Option leases | 70 | 1,461,742 | 10.13 | — | — | 6.7 | % | |||||||||||||
For the Three Months Ended March 31, 2018 | ||||||||||||||||||||
Leases | GLA | New ABR PSF | Tenant Improvements and Allowances PSF | Third Party Leasing Commissions PSF | Rent Spread(1) | |||||||||||||||
New, renewal and option leases | 440 | 2,745,080 | $ | 14.43 | $ | 8.90 | $ | 1.63 | 14.5 | % | ||||||||||
New and renewal leases | 395 | 2,046,088 | 15.19 | 11.94 | 2.19 | 16.7 | % | |||||||||||||
New leases | 151 | 1,042,526 | 14.47 | 21.11 | 4.29 | 36.7 | % | |||||||||||||
Renewal leases | 244 | 1,003,562 | 15.94 | 2.40 | — | 8.4 | % | |||||||||||||
Option leases | 45 | 698,992 | 12.19 | — | — | 8.5 | % |
(1) | Based on comparable leases only. |
• | During the three months ended March 31, 2019, we did not acquire any real estate assets. |
• | During the three months ended March 31, 2018, we did not acquire any real estate assets. |
• | During the three months ended March 31, 2019, we disposed of three shopping centers for aggregate net proceeds of $44.9 million resulting in aggregate gain of $7.3 million. In addition, during the three months ended March 31, 2019, the Company received aggregate net proceeds of $0.3 million from previously disposed assets resulting in a gain of $0.3 million. |
• | During the three months ended March 31, 2018, we disposed of six shopping centers and one outparcel for aggregate net proceeds of $104.2 million resulting in aggregate gain of $11.4 million and aggregate impairment of $0.2 million. |
Three Months Ended March 31, | |||||||||||
2019 | 2018 | $ Change | |||||||||
Revenues | |||||||||||
Rental income | $ | 289,955 | $ | 316,797 | $ | (26,842 | ) | ||||
Other revenues | 1,184 | 378 | 806 | ||||||||
Total revenues | $ | 291,139 | $ | 317,175 | $ | (26,036 | ) |
Three Months Ended March 31, | |||||||||||
2019 | 2018 | $ Change | |||||||||
Operating expenses | |||||||||||
Operating costs | $ | 31,258 | $ | 35,490 | $ | (4,232 | ) | ||||
Real estate taxes | 43,326 | 45,725 | (2,399 | ) | |||||||
Depreciation and amortization | 85,395 | 90,383 | (4,988 | ) | |||||||
Provision for doubtful accounts | — | 2,415 | (2,415 | ) | |||||||
Impairment of real estate assets | 3,112 | 15,902 | (12,790 | ) | |||||||
General and administrative | 25,443 | 22,426 | 3,017 | ||||||||
Total operating expenses | $ | 188,534 | $ | 212,341 | $ | (23,807 | ) |
Three Months Ended March 31, | |||||||||||
2019 | 2018 | $ Change | |||||||||
Other income (expense) | |||||||||||
Dividends and interest | $ | 147 | $ | 96 | $ | 51 | |||||
Interest expense | (46,666 | ) | (55,171 | ) | 8,505 | ||||||
Gain on sale of real estate assets | 7,602 | 11,448 | (3,846 | ) | |||||||
Gain (loss) on extinguishment of debt, net | 30 | (132 | ) | 162 | |||||||
Other | (818 | ) | (53 | ) | (765 | ) | |||||
Total other expense | $ | (39,705 | ) | $ | (43,812 | ) | $ | 4,107 |
• | cash and cash equivalent balances; |
• | operating cash flow; |
• | available borrowings under our existing Unsecured Credit Facility; |
• | dispositions; |
• | issuance of long-term debt; and |
• | issuance of equity securities. |
• | maintenance capital expenditures; |
• | leasing-related capital expenditures; |
• | debt repayments; |
• | anchor space repositioning, redevelopment, development and other value-enhancing capital expenditures; |
• | dividend/distribution payments |
• | acquisitions; and |
• | repurchases of equity securities. |
Three Months Ended March 31 | ||||||||
2019 | 2018 | |||||||
Cash flows provided by operating activities | $ | 96,838 | $ | 124,450 | ||||
Cash flows provided by (used in) investing activities | (31,834 | ) | 28,236 | |||||
Cash flows used in financing activities | (112,363 | ) | (170,694 | ) |
Three Months Ended March 31 | ||||||||
2019 | 2018 | |||||||
Cash flows provided by operating activities | $ | 96,838 | $ | 124,450 | ||||
Cash flows provided by (used in) investing activities | (31,833 | ) | 28,237 | |||||
Cash flows used in financing activities | (112,488 | ) | (170,694 | ) |
Contractual Obligations (in thousands) | Payment due by period | |||||||||||||||||||||||||||
2019 | 2020 | 2021 | 2022 | 2023 | Thereafter | Total | ||||||||||||||||||||||
Debt(1) | $ | — | $ | — | $ | 500,000 | $ | 750,000 | $ | 1,141,000 | $ | 2,525,453 | $ | 4,916,453 | ||||||||||||||
Interest payments(2) | 126,072 | 179,173 | 174,262 | 158,776 | 129,135 | 178,319 | 945,737 | |||||||||||||||||||||
Operating leases | 5,180 | 6,924 | 6,964 | 7,022 | 5,635 | 30,912 | 62,637 | |||||||||||||||||||||
Total | $ | 131,252 | $ | 186,097 | $ | 681,226 | $ | 915,798 | $ | 1,275,770 | $ | 2,734,684 | $ | 5,924,827 | ||||||||||||||
(1) | Debt includes scheduled maturities for unsecured notes payable, unsecured credit facilities and a secured loan. |
(2) | As of March 31, 2019, we incur variable rate interest on (i) a $500.0 million term loan outstanding under our Unsecured Credit Facility; (ii) a $350.0 million term loan outstanding; (iii) a $300 million term loan outstanding; (iv) $291.0 million outstanding under our Revolving Facility; and (v) $250.0 million outstanding under our Floating Rate Senior Notes due 2022. We have in place seven interest rate swap agreements with an aggregate notional value of $800.0 million, which effectively convert variable interest payments to fixed interest payments. For a further discussion of these and other factors that could impact interest payments please see Item 7A. “Quantitative and Qualitative Disclosures” in our annual report on Form 10-K for the fiscal year ended December 31, 2018. Interest payments for these variable rate loans are presented using rates (including the impact of interest rate swaps) as of March 31, 2019. |
Three Months Ended March 31, 2019 | |||||||
2019 | 2018 | ||||||
Net income | $ | 62,900 | $ | 61,022 | |||
Gain on disposition of operating properties | (7,602 | ) | (11,448 | ) | |||
Depreciation and amortization- real estate related | 84,397 | 89,352 | |||||
Impairment of operating properties | 3,112 | 15,902 | |||||
NAREIT FFO | $ | 142,807 | $ | 154,828 | |||
NAREIT FFO per diluted share | $ | 0.48 | $ | 0.51 | |||
Weighted average diluted shares outstanding | 299,029 | 304,278 |
Three Months Ended March 31, | ||||||||||||||
2019 | 2018 | Change | ||||||||||||
Number of properties | 420 | 420 | — | |||||||||||
Percent billed | 87.5 | % | 89.5 | % | (2.0 | %) | ||||||||
Percent leased | 91.1 | % | 92.0 | % | (0.9 | %) | ||||||||
Revenues | ||||||||||||||
Rental income | $ | 278,131 | $ | 276,929 | $ | 1,202 | ||||||||
Other revenues | 1,184 | 378 | 806 | |||||||||||
279,315 | 277,307 | 2,008 | ||||||||||||
Operating expenses | ||||||||||||||
Operating costs | (30,888 | ) | (31,930 | ) | 1,042 | |||||||||
Real estate taxes | (43,001 | ) | (41,900 | ) | (1,101 | ) | ||||||||
Provision for doubtful accounts | — | (2,153 | ) | 2,153 | ||||||||||
(73,889 | ) | (75,983 | ) | 2,094 | ||||||||||
Same property NOI | $ | 205,426 | $ | 201,324 | $ | 4,102 | ||||||||
Three Months Ended March 31, | |||||||
2019 | 2018 | ||||||
Net income | $ | 62,900 | $ | 61,022 | |||
Adjustments: | |||||||
Non-same property NOI | (1,239 | ) | (21,568 | ) | |||
Lease termination fees | (769 | ) | (1,531 | ) | |||
Straight-line rental income, net | (5,036 | ) | (3,097 | ) | |||
Accretion of above- and below-market leases and tenant inducements, net | (4,116 | ) | (6,055 | ) | |||
Straight-line ground rent expense | 31 | 30 | |||||
Depreciation and amortization | 85,395 | 90,383 | |||||
Impairment of real estate assets | 3,112 | 15,902 | |||||
General and administrative | 25,443 | 22,426 | |||||
Total other expense | 39,705 | 43,812 | |||||
Same property NOI | $ | 205,426 | $ | 201,324 |
Period | Total Number of Shares Repurchased | Average Price Paid Per Share | Total Number of Shares Repurchased as Part of Publicly Announced Plans or Programs | Approximate Dollar Value of Shares that May Yet Be Repurchased (in millions) | ||||||||||
January 1, 2019 to January 31, 2019 | — | $ | — | — | $ | 289.5 | ||||||||
February 1, 2019 to February 28, 2019 | 226,832 | 17.62 | 226,832 | 285.5 | ||||||||||
March 1, 2019 to March 31, 2019 | 433,589 | 17.48 | 433,589 | 278.0 | ||||||||||
Total | 660,421 | $ | 17.53 | 660,421 |
Incorporated by Reference | ||||||||||||
Exhibit Number | Exhibit Description | Form | File No. | Date of Filing | Exhibit Number | Filed Herewith | ||||||
First Amendment to Employment Agreement, dated March 7, 2019, by and between Brixmor Property Group Inc. and Angela Aman | 8-K | 001-36160 | 3/8/2019 | 10.1 | ||||||||
First Amendment to Employment Agreement, dated March 7, 2019, by and between Brixmor Property Group Inc. and Mark T. Horgan | 8-K | 001-36160 | 3/8/2019 | 10.2 | ||||||||
First Amendment to Employment Agreement, dated February 26, 2019, by and between Brixmor Property Group Inc. and Steven F. Siegel | — | — | — | — | x | |||||||
Second Amendment to Employment Agreement, dated April 26, 2019, by and between Brixmor Property Group Inc. and Steven F. Siegel | — | — | — | — | x | |||||||
Brixmor Property Group Inc. Certification of Chief Executive Officer pursuant to Rule 13a-14(a)/15d-14(a) of the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 | — | — | — | — | x | |||||||
Brixmor Property Group Inc. Certification of Chief Financial Officer pursuant to Rule 13a-14(a)/15d-14(a) of the Securities Exchange Act of 1934 as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 | — | — | — | — | x | |||||||
Brixmor Operating Partnership LP Certification of Chief Executive Officer pursuant to Rule 13a-14(a)/15d-14(a) of the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 | — | — | — | — | x | |||||||
Brixmor Operating Partnership LP Certification of Chief Financial Officer pursuant to Rule 13a-14(a)/15d-14(a) of the Securities Exchange Act of 1934 as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 | — | — | — | — | x | |||||||
Brixmor Property Group Inc. Certification of Chief Executive Officer and Chief Financial Officer Pursuant to 18 U.S.C. Section 1350 as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 | — | — | — | — | x | |||||||
Brixmor Operating Partnership LP Certification of Chief Executive Officer and Chief Financial Officer Pursuant to 18 U.S.C. Section 1350 as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 | — | — | — | — | x | |||||||
101.INS | XBRL Instance Document | — | — | — | — | x | ||||||
101.SCH | XBRL Taxonomy Extension Schema Document | — | — | — | — | x |
Incorporated by Reference | ||||||||||||
Exhibit Number | Exhibit Description | Form | File No. | Date of Filing | Exhibit Number | Filed Herewith | ||||||
101.CAL | XBRL Taxonomy Extension Calculation Linkbase Document | — | — | — | — | x | ||||||
101.DEF | XBRL Taxonomy Extension Definition Linkbase Document | — | — | — | — | x | ||||||
101.LAB | XBRL Taxonomy Extension Label Linkbase Document | — | — | — | — | x | ||||||
101.PRE | XBRL Taxonomy Extension Presentation Linkbase Document | — | — | — | — | x |
BRIXMOR PROPERTY GROUP INC. | ||
Date: April 29, 2019 | By: | /s/ James M. Taylor |
James M. Taylor | ||
Chief Executive Officer and President | ||
(Principal Executive Officer) | ||
Date: April 29, 2019 | By: | /s/ Angela Aman |
Angela Aman | ||
Chief Financial Officer | ||
(Principal Financial Officer) | ||
Date: April 29, 2019 | By: | /s/ Steven Gallagher |
Steven Gallagher | ||
Chief Accounting Officer | ||
(Principal Accounting Officer) | ||
BRIXMOR OPERATING PARTNERSHIP LP | ||
Date: April 29, 2019 | By: | /s/ James M. Taylor |
James M. Taylor | ||
Chief Executive Officer and President | ||
(Principal Executive Officer) | ||
Date: April 29, 2019 | By: | /s/ Angela Aman |
Angela Aman | ||
Chief Financial Officer | ||
(Principal Financial Officer) | ||
Date: April 29, 2019 | By: | /s/ Steven Gallagher |
Steven Gallagher | ||
Chief Accounting Officer | ||
(Principal Accounting Officer) | ||
1. | I have reviewed this quarterly report on Form 10-Q for the period ended March 31, 2019 of Brixmor Property Group Inc.; |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
4. | The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: |
a. | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
b. | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
c. | Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
d. | Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and |
5. | The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions): |
a. | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and |
b. | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting. |
Date: April 29, 2019 | |
/s/ James M. Taylor | |
Chief Executive Officer and President | |
(Principal Executive Officer) |
1. | I have reviewed this quarterly report on Form 10-Q for the period ended March 31, 2019 of Brixmor Property Group Inc.; |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
4. | The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: |
a. | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
b. | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
c. | Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
d. | Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and |
5. | The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions): |
a. | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and |
b. | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting. |
Date: April 29, 2019 | |
/s/ Angela Aman | |
Chief Financial Officer | |
(Principal Financial Officer) |
1. | I have reviewed this quarterly report on Form 10-Q for the period ended March 31, 2019 of Brixmor Operating Partnership LP; |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
4. | The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: |
a. | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
b. | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
c. | Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
d. | Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and |
5. | The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions): |
a. | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and |
b. | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting. |
Date: April 29, 2019 | |
/s/ James M. Taylor | |
Chief Executive Officer and President | |
(Principal Executive Officer) |
1. | I have reviewed this quarterly report on Form 10-Q for the period ended March 31, 2019 of Brixmor Operating Partnership LP; |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
4. | The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: |
a. | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
b. | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
c. | Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
d. | Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and |
5. | The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions): |
a. | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and |
b. | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting. |
Date: April 29, 2019 | |
/s/ Angela Aman | |
Chief Financial Officer | |
(Principal Financial Officer) |
• | The Report fully complies with the requirements of Section 13(a) or 15(d), as applicable of the Securities Exchange Act of 1934, as amended; and |
• | The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company for the periods presented therein. |
Date: April 29, 2019 | |
/s/ James M. Taylor | |
Chief Executive Officer and President | |
(Principal Executive Officer) | |
/s/ Angela Aman | |
Chief Financial Officer | |
(Principal Financial Officer) |
• | The Report fully complies with the requirements of Section 13(a) or 15(d), as applicable of the Securities Exchange Act of 1934, as amended; and |
• | The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Operating Partnership for the periods presented therein. |
Date: April 29, 2019 | |
/s/ James M. Taylor | |
Chief Executive Officer and President | |
(Principal Executive Officer) | |
/s/ Angela Aman | |
Chief Financial Officer | |
(Principal Financial Officer) |
Document and Entity Information - shares |
3 Months Ended | |
---|---|---|
Mar. 31, 2019 |
Apr. 01, 2019 |
|
Entity Registrant Name | Brixmor Property Group Inc. | |
Entity Central Index Key | 0001581068 | |
Document Type | 10-Q | |
Document Period End Date | Mar. 31, 2019 | |
Amendment Flag | false | |
Document Fiscal Year Focus | 2019 | |
Document Fiscal Period Focus | Q1 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Large Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 297,987,158 | |
Brixmor Operating Partnership LP | ||
Entity Registrant Name | Brixmor Operating Partnership LP | |
Entity Central Index Key | 0001630031 | |
Document Period End Date | Mar. 31, 2019 | |
Amendment Flag | false | |
Document Fiscal Year Focus | 2019 | |
Document Fiscal Period Focus | Q1 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Non-accelerated Filer |
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares |
Mar. 31, 2019 |
Dec. 31, 2018 |
---|---|---|
Common stock, par value | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 3,000,000,000 | 3,000,000,000 |
Common stock, shares issued | 305,289,535 | 305,130,472 |
Common stock, shares outstanding | 297,987,158 | 298,488,516 |
Brixmor Operating Partnership LP | ||
Common stock, shares issued | 305,289,535 | 305,130,472 |
Common stock, shares outstanding | 297,987,158 | 298,488,516 |
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Thousands |
3 Months Ended | |
---|---|---|
Mar. 31, 2019 |
Mar. 31, 2018 |
|
Net income | $ 62,900 | $ 61,022 |
Other comprehensive income (loss) | ||
Change in unrealized gain (loss) on interest rate swaps, net (Note 6) | (10,057) | 4,773 |
Change in unrealized gain (loss) on marketable securities | 132 | (86) |
Total other comprehensive income (loss) | (9,925) | 4,687 |
Comprehensive income | 52,975 | 65,709 |
Brixmor Operating Partnership LP | ||
Net income | 62,900 | 61,022 |
Other comprehensive income (loss) | ||
Change in unrealized gain (loss) on interest rate swaps, net (Note 6) | (10,057) | 4,773 |
Change in unrealized gain (loss) on marketable securities | 132 | (85) |
Total other comprehensive income (loss) | (9,925) | 4,688 |
Comprehensive income | $ 52,975 | $ 65,710 |
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY - USD ($) shares in Thousands, $ in Thousands |
Total |
Brixmor Operating Partnership LP |
Common Stock |
Common Stock
Brixmor Operating Partnership LP
|
Additional Paid-in Capital |
Additional Paid-in Capital
Brixmor Operating Partnership LP
|
Accumulated Other Comprehensive Income |
Distributions in Excess of Net Income |
---|---|---|---|---|---|---|---|---|
Beginning balance (in shares) at Dec. 31, 2017 | 304,620 | |||||||
Beginning balance at Dec. 31, 2017 | $ 2,908,348 | $ 2,908,099 | $ 3,046 | $ 2,883,875 | $ 3,330,466 | $ 24,224 | $ 24,211 | $ (449,375) |
Increase (Decrease) in Equity [Roll Forward] | ||||||||
Common stock dividends | (83,479) | (83,479) | (83,479) | (83,479) | ||||
Equity based compensation expense | 2,484 | 2,484 | 2,484 | 2,484 | ||||
Other comprehensive income | 4,687 | 4,688 | 4,688 | 4,687 | ||||
Issuance of common stock and OP Units (in shares) | 128 | |||||||
Issuance of common stock and OP Units | 1 | 1 | $ 1 | 1 | ||||
Repurchase of common stock, shares | (1,922) | |||||||
Repurchases of common stock | (29,765) | (29,765) | $ (19) | (29,765) | (29,746) | |||
Share-based awards retained for taxes | (1,722) | (1,722) | (1,722) | (1,722) | ||||
Net income | 61,022 | 61,022 | 61,022 | 61,022 | ||||
Ending balance (in shares) at Mar. 31, 2018 | 302,826 | |||||||
Ending balance at Mar. 31, 2018 | 2,861,576 | 2,861,328 | $ 3,028 | 2,832,416 | 3,301,482 | 28,912 | 28,898 | (471,832) |
Increase (Decrease) in Equity [Roll Forward] | ||||||||
ASC 842 cumulative adjustment | (1,974) | (1,974) | (1,974) | (1,974) | ||||
Beginning balance (in shares) at Dec. 31, 2018 | 298,489 | |||||||
Beginning balance at Dec. 31, 2018 | 2,836,099 | 2,835,753 | $ 2,985 | 2,819,770 | 3,233,329 | 15,983 | 15,973 | (416,188) |
Increase (Decrease) in Equity [Roll Forward] | ||||||||
Common stock dividends | (83,839) | (83,964) | (83,964) | (83,839) | ||||
Equity based compensation expense | 2,641 | 2,641 | 2,641 | 2,641 | ||||
Other comprehensive income | (9,925) | (9,925) | (9,925) | (9,925) | ||||
Issuance of common stock and OP Units (in shares) | 158 | |||||||
Issuance of common stock and OP Units | 2 | 2 | $ 2 | 2 | ||||
Repurchase of common stock, shares | (660) | |||||||
Repurchases of common stock | (11,586) | (11,586) | $ (7) | (11,586) | (11,579) | |||
Share-based awards retained for taxes | (1,547) | (1,547) | (1,547) | (1,547) | ||||
Net income | 62,900 | 62,900 | 62,900 | 62,900 | ||||
Ending balance (in shares) at Mar. 31, 2019 | 297,987 | |||||||
Ending balance at Mar. 31, 2019 | $ 2,792,771 | $ 2,792,300 | $ 2,980 | $ 2,786,242 | $ 3,222,844 | $ 6,058 | $ 6,048 | $ (439,101) |
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY (Parenthetical) - $ / shares |
3 Months Ended | |
---|---|---|
Mar. 31, 2019 |
Mar. 31, 2018 |
|
Statement of Stockholders' Equity [Abstract] | ||
Dividends, per common share | $ 0.28 | $ 0.275 |
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Parenthetical) - USD ($) $ in Thousands |
3 Months Ended | |
---|---|---|
Mar. 31, 2019 |
Mar. 31, 2018 |
|
Interest paid, capitalized | $ 626 | $ 654 |
Brixmor Operating Partnership LP | ||
Interest paid, capitalized | $ 626 | $ 654 |
Nature of Business and Financial Statement Presentation |
3 Months Ended | ||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Mar. 31, 2019 | |||||||||||||||||||||||||
Accounting Policies [Abstract] | |||||||||||||||||||||||||
Nature of Business and Financial Statement Presentation | Nature of Business and Financial Statement Presentation Description of Business Brixmor Property Group Inc. and subsidiaries (collectively, the “Parent Company”) is an internally-managed real estate investment trust (“REIT”). Brixmor Operating Partnership LP and subsidiaries (collectively, the “Operating Partnership”) is the entity through which the Parent Company conducts substantially all of its operations and owns substantially all of its assets. The Parent Company owns 100% of the common stock of BPG Subsidiary Inc. (“BPG Sub”), which, in turn, is the sole member of Brixmor OP GP LLC (the “General Partner”), the sole general partner of the Operating Partnership. The Parent Company engages in the ownership, management, leasing, acquisition, disposition and redevelopment of retail shopping centers through the Operating Partnership, and has no other substantial assets or liabilities other than through its investment in the Operating Partnership. The Parent Company, the Operating Partnership and their controlled subsidiaries on a consolidated basis (collectively, the “Company” or “Brixmor”) believes it owns and operates one of the largest open air retail portfolios by gross leasable area (“GLA”) in the United States (“U.S.”), comprised primarily of community and neighborhood shopping centers. As of March 31, 2019, the Company’s portfolio was comprised of 422 shopping centers (the “Portfolio”) totaling approximately 73 million square feet of GLA. The Company’s high-quality national Portfolio is primarily located within established trade areas in the top 50 Metropolitan Statistical Areas in the U.S., and its shopping centers are primarily anchored by non-discretionary and value-oriented retailers, as well as consumer-oriented service providers. The Company does not distinguish its principal business or group its operations on a geographical basis for purposes of measuring performance. Accordingly, the Company has a single reportable segment for disclosure purposes in accordance with U.S. generally accepted accounting principles (“GAAP”). Basis of Presentation The accompanying unaudited Condensed Consolidated Financial Statements have been prepared in accordance with GAAP for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and notes required by GAAP for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for the fair presentation of the unaudited Condensed Consolidated Financial Statements for the periods presented have been included. The operating results for the periods presented are not necessarily indicative of the results that may be expected for a full fiscal year. These financial statements should be read in conjunction with the financial statements for the year ended December 31, 2018 and accompanying notes included in the Company’s annual report on Form 10-K filed with the Securities and Exchange Commission (the “SEC”) on February 11, 2019. Certain prior period balances in the accompanying unaudited Condensed Consolidated Statements of Operations have been reclassified to conform to the current period presentation for the adoption of Accounting Standards Codification Topic 842 “Leases” (“ASC 842”) (described below), which supersedes Accounting Standards Codification Topic 840 “Leases” (“ASC 840”). Principles of Consolidation The accompanying unaudited Condensed Consolidated Financial Statements include the accounts of the Parent Company, the Operating Partnership, each of their wholly owned subsidiaries and all other entities in which they have a controlling financial interest. All intercompany transactions have been eliminated. Deferred Leasing and Financing Costs Costs incurred in executing tenant leases and long-term financings are capitalized and amortized using the straight-line method over the term of the related lease or debt agreement, which approximates the effective interest method. Capitalized costs incurred in executing tenant leases include tenant improvements and leasing commissions. In connection with the adoption of ASC 842, the Company no longer capitalizes partial salaries and/or legal fees incurred in executing tenant leases. These amounts were capitalized under previous guidance. For long-term financings, capitalized costs incurred include bank and legal fees. The amortization of deferred leasing and financing costs is included in Depreciation and amortization and Interest expense, respectively, in the Company’s unaudited Condensed Consolidated Statements of Operations and within Operating activities on the Company’s unaudited Condensed Consolidated Statements of Cash Flows. Revenue Recognition and Receivables The Company enters into agreements with tenants which convey the right to control the use of identified space at its shopping centers in exchange for rental revenue. These agreements meet the criteria for recognition as leases under ASC 842. Rental revenue is recognized on a straight-line basis over the terms of the related leases. The cumulative difference between rental revenue recognized in the Company’s unaudited Condensed Consolidated Statements of Operations and contractual payment terms is recognized as deferred rent and presented on the accompanying unaudited Condensed Consolidated Balance Sheets within Receivables. The Company commences recognizing rental revenue based on the date its makes the underlying asset available for use by the tenant. Leases also typically provide for the reimbursement of operating costs, including common area expenses, utilities, insurance and real estate taxes by the lessee and are recognized in the period the applicable expenditures are incurred. In connection with the adoption of ASC 842, the Company has evaluated the lease and non-lease components within its leases and has elected the practical expedient to present lease and non-lease components in its lease agreements as one component. As such, the Company accounts for rental revenue and common area expense reimbursements as one lease component under ASC 842. These amounts are included in Rental income in the Company’s unaudited Condensed Consolidated Statements of Operations. Additionally, the Company allocates the reimbursement of utilities, insurance and real estate taxes to the lease and non-lease components of its leases. These amounts are included in Rental income in the Company’s unaudited Condensed Consolidated Statements of Operations. Certain leases also provide for percentage rents based upon the level of sales achieved by a lessee. These percentage rents are recognized upon the achievement of certain pre-determined sales levels and are included in Rental income in the Company’s unaudited Condensed Consolidated Statements of Operations. Gains from the sale of depreciated operating properties are generally recognized under the full accrual method, provided that various criteria relating to the terms of the sale and subsequent involvement by the Company with the applicable property are met. The Company periodically evaluates the collectability of its receivables related to rental revenue, straight-line rent, expense reimbursements and those attributable to other revenue generating activities. The Company analyzes individual tenant receivables and considers tenant credit-worthiness, the length of time a receivable has been outstanding, and current economic trends when evaluating collectability. In addition, tenants in bankruptcy are analyzed and estimates are made in connection with the expected recovery of pre-petition and post-petition claims. Any receivables that are deemed to be uncollectible are recognized as a reduction to Rental income in the Company’s unaudited Condensed Consolidated Statements of Operations. Prior period Provision for doubtful accounts is presented on the Company's unaudited Condensed Consolidated Statements of Operations in accordance with the Company's previous presentation and has not been reclassified to Rental income. Leases The Company periodically enters into agreements in which it is the lessee, including ground leases for neighborhood and community shopping centers that it operates and office leases for administrative space. In connection with the adoption of ASC 842, the Company evaluated these agreements and determined that they meet the criteria for recognition as leases under ASC 842. For these agreements the Company recognizes an operating lease right-of-use (“ROU”) asset and operating lease liability based on the present value of the minimum lease payments over the non-cancellable lease term. As the rates implicit in the leases are not readily determinable the Company uses its incremental secured borrowing rate based on the information available at commencement date to determine the present value of the lease payments. The lease terms utilized by the Company may include options to extend or terminate the lease when it is reasonably certain that it will exercise that option. The Company evaluates many factors, including current and future tenant cash flows, when determining if an option to extend or terminate should be included in the non-cancellable period. Lease expense for minimum lease payments is recognized on a straight-line basis over the lease term. The Company has elected to apply the short-term lease exemption within ASC 842 and does not record an ROU asset or lease liability for leases with terms of less than 12 months. Additionally, leases also typically provide for the reimbursement of operating costs, including common area expenses, utilities, insurance and real estate taxes by the Company. In connection with the adoption of ASC 842, the Company has evaluated the lease and non-lease components within its leases and has elected the practical expedient to present lease and non-lease components in its lease agreements as one component. As such, the Company accounts for lease payments and common area expense reimbursements as one lease component under ASC 842. These amounts are included in Operating expenses in the Company’s unaudited Condensed Consolidated Statements of Operations. Additionally, the Company allocates the reimbursement of utilities, insurance and real estate taxes to the lease and non-lease components of its leases. These amounts are included in Operating expenses in the Company’s unaudited Condensed Consolidated Statements of Operations. Income Taxes The Parent Company has elected to qualify as a REIT in accordance with the Internal Revenue Code of 1986, as amended (the “Code”). To qualify as a REIT, the Parent Company must meet a number of organizational and operational requirements, including a requirement that it currently distribute to its stockholders at least 90% of its REIT taxable income, determined without regard to the deduction for dividends paid and excluding net capital gains. It is management’s intention to adhere to these requirements and maintain the Parent Company’s REIT status. As a REIT, the Parent Company generally will not be subject to U.S. federal income tax, provided that distributions to its stockholders equal at least the amount of its REIT taxable income as defined under the Code. The Parent Company conducts substantially all of its operations through the Operating Partnership which is organized as a limited partnership and treated as a pass-through entity for U.S. federal tax purposes. Therefore, U.S. federal income taxes on the Company’s taxable income do not materially impact the unaudited Condensed Consolidated Financial Statements of the Company. If the Parent Company fails to qualify as a REIT in any taxable year, it will be subject to U.S. federal taxes at regular corporate rates (including any applicable alternative minimum tax for tax years beginning before January 1, 2018) and may not be able to qualify as a REIT for four subsequent taxable years. Even if the Parent Company qualifies for taxation as a REIT, the Company is subject to certain state and local taxes on its income and property, and to U.S. federal income and excise taxes on its undistributed taxable income. The Parent Company has elected to treat certain of its subsidiaries as taxable REIT subsidiaries (“TRS”), and the Parent Company may in the future elect to treat newly formed and/or existing subsidiaries as TRSs. A TRS may participate in non-real estate related activities and/or perform non-customary services for tenants and is subject to certain limitations under the Code. A TRS is subject to U.S. federal and state income taxes. Income taxes related to the Parent Company’s TRSs do not materially impact the unaudited Condensed Consolidated Financial Statements of the Company. The Company has considered the tax positions taken for the open tax years and has concluded that no provision for income taxes related to uncertain tax positions is required in the Company’s unaudited Condensed Consolidated Financial Statements as of March 31, 2019 and December 31, 2018. Open tax years generally range from 2015 through 2018, but may vary by jurisdiction and issue. The Company recognizes penalties and interest accrued related to unrecognized tax benefits as income tax expense, which is included in Other on the Company’s unaudited Condensed Consolidated Statements of Operations. New Accounting Pronouncements In November 2018, the Financial Accounting Standards Board (“FASB”) issued ASU 2018-19, “Codification Improvements to Topic 326, Financial Instruments-Credit Losses.” ASU 2018-19 clarifies that receivables arising from operating leases are not within the scope of Subtopic 326-20. Instead, impairment of receivables arising from operating leases should be accounted for in accordance with ASC 842, Leases. The standard is effective on January 1, 2020, with early adoption permitted. The Company does not expect the adoption of ASU 2018-19 to have a material impact on the unaudited Condensed Consolidated Financial Statements of the Company. Information regarding the adoption of ASC 842 is described below. In October 2018, the FASB issued ASU 2018-16, “Derivatives and Hedging (Topic 815).” ASU 2018-16 amends guidance to permit the use of the Overnight Index Swap rate based on the Secured Overnight Financing Rate as a U.S. benchmark interest rate for hedge accounting purposes under Topic 815. The standard became effective for the Company on January 1, 2019. The Company determined that these changes did not have a material impact on the unaudited Condensed Consolidated Financial Statements of the Company. In August 2018, the FASB issued ASU 2018-13, “Fair Value Measurement (Topic 820).” ASU 2018-13 amends certain disclosure requirements regarding the fair value hierarchy of investments in accordance with GAAP, particularly the significant unobservable inputs used to value investments within Level 3 of the fair value hierarchy. The standard is effective on January 1, 2020, with early adoption permitted. The Company does not expect the adoption of ASU 2018-13 to have a material impact on the unaudited Condensed Consolidated Financial Statements of the Company. In February 2016, the FASB issued ASU 2016-02, “Leases (Topic 842).” ASU 2016-02 sets out the principles for the recognition, measurement, presentation and disclosure of leases for both parties to a contract (i.e., lessees and lessors). ASU 2016-02 was subsequently amended by ASU 2018-01, “Land Easement Practical Expedient for Transition to Topic 842”; ASU 2018-10, “Codification Improvements to Topic 842”; ASU 2018-11, “Targeted Improvements”; and ASU 2018-20, “Narrow-Scope Improvements for Lessors”. The new standard requires lessees to apply a dual approach, classifying leases as either finance or operating leases based on the principle of whether or not the lease is effectively a financed purchase by the lessee. This classification will determine whether lease expense is recognized based on an effective interest method or on a straight-line basis over the term of the lease. A lessee is also required to recognize an ROU asset and a lease liability for all leases with a term of greater than 12 months, regardless of their classification. Leases with a term of 12 months or less qualify for the short-term lease recognition exemption and may be accounted for similar to previous guidance for operating leases. The new standard requires lessors to account for leases using an approach that is substantially equivalent to previous guidance for sales-type leases, direct financing leases and operating leases. Adoption The standard became effective for the Company on January 1, 2019 and a modified retrospective transition approach was required. The Company determined that the adoption of ASC 842 had a material impact on the unaudited Condensed Consolidated Financial Statements of the Company. The Company elected the following optional practical expedients upon adoption:
Lessee For leases where the Company is the lessee, primarily for the Company’s ground leases and administrative office leases, the Company is required to record a right of use asset and a lease liability on its unaudited Condensed Consolidated Balance Sheets on the effective date. The Company has elected to apply the short-term lease recognition exemption for all leases that qualify. Lessor For leases where the Company is the lessor, the Company will continue to record revenues from rental properties for its operating leases on a straight-line basis. In addition, initial direct leasing costs continue to be capitalized, however, indirect leasing costs previously capitalized are being expensed under ASC 842. During the three months ended March 31, 2018, the Company capitalized $3.0 million of indirect leasing costs, including leasing payroll and legal costs. In addition, ASC 842 requires that additional lease disclosures be presented in the unaudited Condensed Consolidated Financial Statements of the Company for both lessor and lessee lease agreements. See Notes 9 and 10 for additional information. Any other recently issued accounting standards or pronouncements not disclosed above have been excluded as they either are not relevant to the Company, or they are not expected to have a material effect on the unaudited Condensed Consolidated Financial Statements of the Company. |
Acquisition of Real Estate |
3 Months Ended |
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Mar. 31, 2019 | |
Real Estate [Abstract] | |
Acquisition of Real Estate | Acquisition of Real Estate During the three months ended March 31, 2019 and 2018, the Company did not acquire any real estate assets. |
Dispositions and Assets Held for Sale |
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Discontinued Operations and Disposal Groups [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Dispositions and Assets Held for Sale | Dispositions and Assets Held for Sale During the three months ended March 31, 2019, the Company disposed of three shopping centers for aggregate net proceeds of $44.9 million resulting in aggregate gain of $7.3 million. In addition, during the three months ended March 31, 2019, the Company received net proceeds of $0.3 million from previously disposed assets resulting in a gain of $0.3 million. During the three months ended March 31, 2018, the Company disposed of six shopping centers and one outparcel for aggregate net proceeds of $104.2 million resulting in aggregate gain of $11.4 million and aggregate impairment of $0.2 million. As of March 31, 2019, the Company had one property and one partial property held for sale. As of December 31, 2018, the Company had one property held for sale. The following table presents the assets and liabilities associated with the properties classified as held for sale:
There were no discontinued operations for the three months ended March 31, 2019 and 2018 as none of the dispositions represented a strategic shift in the Company’s business that would qualify as discontinued operations. |
Real Estate |
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Real Estate [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Real Estate | Real Estate The Company’s components of Real estate, net consisted of the following:
In addition, as of March 31, 2019 and December 31, 2018, the Company had intangible liabilities relating to below-market leases of $385.3 million and $392.9 million, respectively, and accumulated accretion of $265.3 million and $266.1 million, respectively. These intangible liabilities are included in Accounts payable, accrued expenses and other liabilities in the Company’s unaudited Condensed Consolidated Balance Sheets. These intangible assets are accreted over the term of each related lease. Below-market lease accretion income, net of above-market lease amortization for the three months ended March 31, 2019 and 2018 was $4.9 million and $6.8 million, respectively. These amounts are included in Rental income in the Company’s unaudited Condensed Consolidated Statements of Operations. Amortization expense associated with in-place lease value for the three months ended March 31, 2019 and 2018 was $6.5 million and $9.3 million, respectively. These amounts are included in Depreciation and amortization in the Company’s unaudited Condensed Consolidated Statements of Operations. The Company’s estimated below-market lease accretion income, net of above-market lease amortization expense, and in-place lease amortization expense for the next five years are as follows:
Hurricane Michael Impact On October 7, 2018, Hurricane Michael struck Florida resulting in widespread damage and flooding. The Company has two properties, totaling 0.4 million square feet of GLA, which were impacted. The Company maintains comprehensive property insurance on these properties, including business interruption insurance. As of March 31, 2019, the Company’s assessment of the damages sustained to its properties from Hurricane Michael resulted in $13.7 million of accelerated depreciation, representing the estimated net book value of damaged assets. The Company also recognized a corresponding receivable for estimated property insurance recoveries related to the write-down. As such, there was no impact to net income during the three months ended March 31, 2019 and year ended December 31, 2018. As of March 31, 2019, the Company has received property insurance proceeds of $3.0 million and has a remaining receivable balance of $10.7 million, which is included in Receivables on the Company’s unaudited Condensed Consolidated Balance Sheets. |
Impairments |
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Impairment of Real Estate [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Impairments | Impairments On a periodic basis, management assesses whether there are any indicators, including property operating performance, changes in anticipated holding period and general market conditions, that the value of the Company’s real estate assets (including any related intangible assets or liabilities) may be impaired. If management determines that the carrying value of a real estate asset is impaired, a loss is recognized to reflect the estimated fair value. The Company recognized the following impairments during the three months ended March 31, 2019:
The Company recognized the following impairments during the three months ended March 31, 2018:
The Company can provide no assurance that material impairment charges with respect to its Portfolio will not occur in future periods. See Note 3 for additional information regarding impairment charges taken in connection with the Company’s dispositions. See Note 8 for additional information regarding the fair value of operating properties which have been impaired. |
Financial Instruments - Derivatives and Hedging |
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Derivative Instruments and Hedging Activities Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Financial Instruments - Derivatives and Hedging | Financial Instruments – Derivatives and Hedging The Company’s use of derivative instruments is intended to manage its exposure to interest rate movements and such instruments are not utilized for speculative purposes. In certain situations, the Company may enter into derivative financial instruments such as interest rate swap and interest rate cap agreements that result in the receipt and/or payment of future known and uncertain cash amounts, the value of which are determined by interest rates. Cash Flow Hedges of Interest Rate Risk 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 exchanging the underlying notional amount. The Company utilizes interest rate swaps to partially hedge the cash flows associated with variable LIBOR based debt. During the three months ended March 31, 2019, the Company did not enter into any new interest rate swap agreements. During the year ended December 31, 2018, the Company entered into four forward starting interest rate swap agreements with an effective date of January 2, 2019, an aggregate notional value of $300.0 million, a weighted average fixed rate of 2.61% and an expiration date of July 26, 2024. Detail on the Company’s interest rate derivatives designated as cash flow hedges outstanding as of March 31, 2019 and December 31, 2018 is as follows:
The Company has elected to present its interest rate derivatives on its unaudited Condensed Consolidated Balance Sheets on a gross basis as interest rate swap assets and interest rate swap liabilities. Detail on the Company’s fair value of interest rate derivatives on a gross and net basis as of March 31, 2019 and December 31, 2018, respectively, is as follows:
The gross derivative assets are included in Other assets and the gross derivative liabilities are included in Accounts payable, accrued expenses and other liabilities on the Company’s unaudited Condensed Consolidated Balance Sheets. All of the Company’s outstanding interest rate swap agreements for the periods presented were designated as cash flow hedges of interest rate risk. The fair value of the Company’s interest rate derivatives is determined using market standard valuation techniques including discounted cash flow analysis on the expected cash flows of each derivative. This analysis reflects the contractual terms of the derivative, including the period to maturity, and uses observable market-based inputs, including interest rate curves and implied volatilities. These inputs are classified as Level 2 of the fair value hierarchy. The effective portion of changes in the fair value of derivatives designated as cash flow hedges is recognized in other comprehensive income (“OCI”) and is reclassified into earnings as interest expense in the period that the hedged forecasted transaction affects earnings. The effective portion of the Company’s interest rate swaps that was recognized in the Company’s unaudited Condensed Consolidated Statements of Comprehensive Income for the three months ended March 31, 2019 and 2018 is as follows:
The Company estimates that $5.8 million will be reclassified from accumulated other comprehensive income as a decrease to interest expense over the next twelve months. No gain or loss was recognized related to hedge ineffectiveness or to amounts excluded from effectiveness testing on the Company’s cash flow hedges during the three months ended March 31, 2019 and 2018. Non-Designated (Mark-to-Market) Hedges of Interest Rate Risk The Company does not use derivatives for trading or speculative purposes. As of March 31, 2019 and December 31, 2018, the Company did not have any non-designated hedges. Credit-risk-related Contingent Features The Company has agreements with its derivative counterparties that contain provisions whereby if the Company defaults on certain of its indebtedness and the indebtedness has been accelerated by the lender, then the Company could also be declared in default on its derivative obligations. If the Company were to breach any of the contractual provisions of the derivative contracts, it would be required to settle its obligations under the agreements at their termination value including accrued interest. |
Debt Obligations |
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Debt Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Debt Obligations | Debt Obligations As of March 31, 2019 and December 31, 2018, the Company had the following indebtedness outstanding:
Pursuant to the terms of the Company’s unsecured debt agreements, the Company among other things is subject to the maintenance of various financial covenants. The Company was in compliance with these covenants as of March 31, 2019. Debt Maturities As of March 31, 2019 and December 31, 2018, the Company had accrued interest of $27.2 million and $34.0 million outstanding, respectively. As of March 31, 2019, scheduled amortization and maturities of the Company’s outstanding debt obligations were as follows:
As of the date the financial statements were issued, the Company did not have any scheduled debt maturities for the next 12 months. |
Fair Value Disclosures |
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Fair Value Disclosures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value Disclosures | Fair Value Disclosures All financial instruments of the Company are reflected in the accompanying unaudited Condensed Consolidated Balance Sheets at amounts which, in management’s judgment, reasonably approximate their fair values, except those instruments listed below:
As a basis for considering market participant assumptions in fair value measurements, a fair value hierarchy is included in GAAP that distinguishes between market participant assumptions based on market data obtained from sources independent of the reporting entity (observable inputs that are classified within Levels 1 and 2 of the hierarchy) and the reporting entity’s own assumptions about market participant assumptions (unobservable inputs that are classified within Level 3 of the hierarchy). In instances where the determination of the fair value measurement is based on inputs from different levels of the fair value hierarchy, the level in the fair value hierarchy within which the entire fair value measurement falls is based on the lowest level input that is significant to the fair value measurement in its entirety. The Company’s assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment, and considers factors specific to the asset or liability. The valuation methodology used to estimate the fair value of the Company’s debt obligations is based on a discounted cash flow analysis, with assumptions that include credit spreads, interest rate curves, estimated property values, loan amounts and maturity dates. Based on these inputs, the Company has determined that the valuations of its debt obligations are classified within Level 3 of the fair value hierarchy. Such fair value estimates are not necessarily indicative of the amounts that would be realized upon disposition. Recurring Fair Value The Company’s marketable securities and interest rate derivatives are measured and recognized at fair value on a recurring basis. The valuations of the Company’s marketable securities are based primarily on publicly traded market values in active markets and are classified within Level 1 or 2 of the fair value hierarchy. See Note 6 for fair value information regarding the Company’s interest rate derivatives. The following table presents the placement in the fair value hierarchy of assets and liabilities that are measured and recognized at fair value on a recurring basis:
Non-Recurring Fair Value On a non-recurring basis, the Company evaluates the carrying value of its properties when events or changes in circumstances indicate that the carrying value may not be recoverable. Fair value is determined by offers from third-party buyers, market comparable data, third party appraisals or by discounted cash flow analysis. The cash flows utilized in such analyses are comprised of unobservable inputs which include forecasted rental revenue and expenses based upon market conditions and future expectations. The capitalization rates and discount rates utilized in such analyses are based upon unobservable rates that we believe to be within a reasonable range of current market rates for the respective properties. Based on these inputs, the Company has determined that the valuations of these properties are classified within Level 3 of the fair value hierarchy. The following table presents the placement in the fair value hierarchy of assets and liabilities that are measured and recognized at fair value on a non-recurring basis. The table includes information related to properties that were remeasured to fair value as a result of impairment testing during the three months ended March 31, 2019 and during the year ended December 31, 2018, excluding the properties sold prior to March 31, 2019 and December 31, 2018, respectively:
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Revenue Recognition |
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Mar. 31, 2019 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Revenue Recognition [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Revenue Recognition | Revenue Recognition The Company engages in the ownership, management, leasing, acquisition, disposition and redevelopment of retail shopping centers. Revenue is primarily generated through lease agreements and classified as Rental income on the Company’s unaudited Condensed Consolidated Statements of Operations. These agreements include retail shopping center unit leases; ground leases; ancillary leases or agreements, such as agreements with tenants for cellular towers, ATMs, and short-term or seasonal retail (e.g. Halloween or Christmas-related retail); and reciprocal easement agreements. The agreements range in term from less than one year to 25 or more years, with certain agreements containing extension options. These extension options range from as little as one month to five or more years. The Company’s retail shopping center leases generally require tenants to pay their portion of reimbursable expenses such as common area expenses, utilities, insurance and real estate taxes. As of March 31, 2019, the fixed contractual lease payments to be received over the next five years pursuant to the terms of non-cancelable operating leases are included in the table below, assuming that no leases are renewed and no renewal options are exercised. Additionally, the table does not include variable lease payments which may be received under certain leases for percentage rents or the reimbursement of operating costs, such as common area expenses, utilities, insurance and real estate taxes. These variable lease payments are recognized in the period when the applicable expenditures are incurred or in the case of percentage rents when the sales data is made available.
Minimum Annual Base Rents As Presented Under ASC 840 Future minimum annual base rents as of and in-place at December 31, 2018 to be received over the next five years pursuant to the terms of non-cancelable operating leases are included in the table below, assuming that no leases are renewed and no renewal options are exercised. Future minimum annual base rents also do not include payments which may be received under certain leases for percentage rent or the reimbursement of operating costs, such as common area expenses, utilities, insurance and real estate taxes.
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Leases |
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Leases [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Leases | Leases The Company periodically enters into agreements in which it is the lessee, including ground leases for neighborhood and community shopping centers that it operates and office leases for administrative space. The agreements range in term from less than one year to 50 or more years, with certain agreements containing extension options for up to an additional 100 years. As of March 31, 2019 the Company is not including any options to extend or termination rights in its ROU asset. Upon lease execution, the Company measures a liability for the present value of future lease payments over the noncancellable period of the lease. Certain agreements require the Company to pay its portion of reimbursable expenses such as common area expenses, utilities, insurance and real estate taxes. These payments are not included in the calculation of the lease liability and are presented as variable lease costs. The following table presents additional information pertaining to the Company’s operating leases:
As of March 31, 2019, there were no material leases that have been executed but not yet commenced. Minimum Annual Rental Commitments As Presented Under ASC 840 Minimum annual rental commitments as of and in-place at December 31, 2018 for the Company's ground and office leases during the next five years and thereafter are as follows:
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Equity and Capital |
3 Months Ended |
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Mar. 31, 2019 | |
Equity [Abstract] | |
Equity and Capital | Equity and Capital Share Repurchase Program In December 2017, the Board of Directors authorized a share repurchase program (the “Program”) for up to $400.0 million of the Company’s common stock. The Program is scheduled to expire on December 5, 2019, unless extended by the Board of Directors. During the three months ended March 31, 2019, the Company repurchased 0.7 million shares of common stock under the Program at an average price per share of $17.53 for a total of $11.6 million, excluding commissions. The Company incurred commissions of less than $0.1 million in conjunction with the program for the three months ended March 31, 2019. During the three months ended March 31, 2018, the Company repurchased 1.9 million shares of common stock under the Program at an average price per share of $15.47 for a total of $29.7 million, excluding commissions. The Company incurred commissions of less than $0.1 million in conjunction with the program for the three months ended March 31, 2018. As of March 31, 2019, the Program had $278.0 million of available repurchase capacity. Common Stock In connection with the vesting of restricted stock units (“RSUs”) under the Company’s equity-based compensation plan, the Company withholds shares to satisfy tax withholding obligations. During the three months ended March 31, 2019 and 2018, the Company withheld 0.1 million shares. Dividends and Distributions During the three months ended March 31, 2019 and 2018, the Company declared common stock dividends and OP Unit distributions of $0.280 per share/unit and $0.275 per share/unit, respectively. As of March 31, 2019 and December 31, 2018, the Company had declared but unpaid common stock dividends and OP Unit distributions of $85.0 million and $85.3 million, respectively. These amounts are included in Accounts payable, accrued expenses and other liabilities on the Company’s unaudited Condensed Consolidated Balance Sheets. |
Stock Based Compensation |
3 Months Ended |
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Mar. 31, 2019 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Stock Based Compensation | Stock Based Compensation During the year ended December 31, 2013, the Board of Directors approved the 2013 Omnibus Incentive Plan (the “Plan”). The Plan provides for a maximum of 15.0 million shares of the Company’s common stock to be issued for qualified and non-qualified options, stock appreciation rights, restricted stock and RSUs, OP Units, performance awards and other stock-based awards. During the three months ended March 31, 2019 and the year ended December 31, 2018, the Company granted RSUs to certain employees. The RSUs are divided into multiple tranches, which are all subject to service-based vesting conditions. Certain tranches are also subject to performance-based or market-based vesting conditions, which contain a threshold, target, and maximum number of units which can be earned. The number of units actually earned for each tranche is determined based on performance during a specified performance period. Tranches that only have a service-based component can only earn a target number of units. The aggregate number of RSUs granted, assuming that the target level of performance is achieved, was 0.7 million and 0.8 million for the three months ended March 31, 2019 and the year ended December 31, 2018, respectively, with vesting periods ranging from one to five years. For the performance-based and service-based RSUs granted, fair value is based on the Company’s grant date stock price. For the market-based RSUs granted during the three months ended March 31, 2019 and the year ended December 31, 2018, the Company calculated the grant date fair values per unit using a Monte Carlo simulation based on the probability of satisfying the market performance hurdles over the remainder of the performance period based on the Company’s historical common stock performance relative to the other companies within the FTSE NAREIT Equity Shopping Centers Index as well as the following significant assumptions: (i) volatility of 20.0% to 21.0% and 29.0% to 32.0%, respectively; (ii) a weighted average risk-free interest rate of 2.55% and 2.43% to 2.53%, respectively; and (iii) the Company’s weighted average common stock dividend yield of 5.6% and 5.6%, respectively. During the three months ended March 31, 2019 and 2018, the Company recognized $2.6 million and $2.5 million of equity compensation expense, respectively. These amounts are included in General and administrative expense in the Company’s unaudited Condensed Consolidated Statements of Operations. As of March 31, 2019, the Company had $25.3 million of total unrecognized compensation expense related to unvested stock compensation, which is expected to be recognized over a weighted average period of approximately 2.5 years. |
Earnings Per Share |
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Earnings Per Share [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Earnings Per Share | Earnings per Share Basic earnings per share (“EPS”) is calculated by dividing net income attributable to the Company’s common stockholders, including any participating securities, by the weighted average number of shares outstanding for the period. Certain restricted shares issued pursuant to the Company’s share-based compensation program are considered participating securities, as such stockholders have rights to receive non-forfeitable dividends. Fully-diluted EPS reflects the potential dilution that could occur if securities or other contracts to issue common stock were exercised or converted into shares of common stock. Unvested RSUs are not allocated net losses and/or any excess of dividends declared over net income, as such amounts are allocated entirely to the Company’s common stock. The following table provides a reconciliation of the numerator and denominator of the EPS calculations for the three months ended March 31, 2019 and 2018 (dollars in thousands, except per share data):
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Earnings per Unit |
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Schedule of Earnings per Share [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Earnings per Unit | Earnings per Share Basic earnings per share (“EPS”) is calculated by dividing net income attributable to the Company’s common stockholders, including any participating securities, by the weighted average number of shares outstanding for the period. Certain restricted shares issued pursuant to the Company’s share-based compensation program are considered participating securities, as such stockholders have rights to receive non-forfeitable dividends. Fully-diluted EPS reflects the potential dilution that could occur if securities or other contracts to issue common stock were exercised or converted into shares of common stock. Unvested RSUs are not allocated net losses and/or any excess of dividends declared over net income, as such amounts are allocated entirely to the Company’s common stock. The following table provides a reconciliation of the numerator and denominator of the EPS calculations for the three months ended March 31, 2019 and 2018 (dollars in thousands, except per share data):
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Brixmor Operating Partnership LP | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Earnings per Share [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Earnings per Unit | Earnings per Unit Basic earnings per unit is calculated by dividing net income attributable to the Operating Partnership’s common unitholders, including any participating securities, by the weighted average number of partnership common units outstanding for the period. Certain restricted units issued pursuant to the Company’s share-based compensation program are considered participating securities, as such unitholders have rights to receive non-forfeitable dividends. Fully-diluted earnings per unit reflects the potential dilution that could occur if securities or other contracts to issue common units were exercised or converted into common units. Unvested RSUs are not allocated net losses and/or any excess of dividends declared over net income, as such amounts are allocated entirely to the Operating Partnership’s common units. The following table provides a reconciliation of the numerator and denominator of the earnings per unit calculations for the three months ended March 31, 2019 and 2018 (dollars in thousands, except per unit data):
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Commitments and Contingencies |
3 Months Ended |
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Mar. 31, 2019 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies Legal Matters Except as described below, the Company is not presently involved in any material litigation arising outside the ordinary course of business. However, the Company is involved in routine litigation arising in the ordinary course of business, none of which the Company believes, individually or in the aggregate, taking into account existing reserves, will have a material impact on the Company’s results of operations, cash flows, or financial position. On February 8, 2016, the Company issued a press release and filed a Form 8-K reporting the completion of a review by the Audit Committee of the Company’s Board of Directors that began after the Company received information in late December 2015 through its established compliance processes. The Audit Committee review led the Board of Directors to conclude that specific Company accounting and financial reporting personnel, in certain instances, were smoothing income items, both up and down, between reporting periods in an effort to achieve consistent quarterly same property net operating income growth. As a result of the Audit Committee review and the conclusions reached by the Board of Directors, the Company’s Chief Executive Officer, its President and Chief Financial Officer, its Chief Accounting Officer and Treasurer, and an accounting employee all resigned. Following these resignations the Company appointed a new Interim Chief Executive Officer and President, Interim Chief Financial Officer and Interim Chief Accounting Officer. A new Chief Executive Officer and Chief Financial Officer were appointed effective May 20, 2016. A new Chief Accounting Officer was appointed effective March 8, 2017. Prior to the Company’s February 8, 2016 announcement, the Company voluntarily reported these matters to the SEC. As a result, the SEC and the United States Attorney’s Office for the Southern District of New York (“SDNY”) have been conducting investigations of certain aspects of the Company’s financial reporting and accounting for prior periods and the Company has been cooperating fully. The Company and the Staff of the SEC Enforcement Division have been discussing a possible negotiated resolution with respect to the SEC investigation. Agreement has been reached on the material terms of such a resolution, which is still subject to finalizing the necessary documents and obtaining approval by the SEC, which cannot be assured. The agreement provides for, among other things, (i) the Company consenting to a cease and desist order, without admitting or denying the findings therein, with respect to violations of Sections 10(b) and 13(a) of the Securities Exchange Act of 1934, certain related rules and Rule 100(b) of Regulation G and (ii) the payment of a civil penalty of $7.0 million. As of March 31, 2019, the $7.0 million contingent liability is included in Accounts payable, accrued expenses and other liabilities in the Company’s unaudited Condensed Consolidated Balance Sheets. The Company believes that no additional government proceedings relating to these matters will be brought against the Company. The Company understands that the SEC and SDNY inquiries into these matters with respect to certain former employees are ongoing. As previously disclosed, on December 13, 2017, the United States District Court for the Southern District of New York granted final approval of the settlement of the previously disclosed putative securities class action complaint filed in March 2016 by the Westchester Putnam Counties Heavy & Highway Laborers Local 60 Benefit Funds related to the review conducted by the Audit Committee of the Board of Directors. Pursuant to the approved settlement, without any admission of liability, the Company will pay $28.0 million to settle the claims. This amount is within the coverage amount of the Company’s applicable insurance policies and has been funded into escrow by the insurance carriers. The settlement provides for the release of, among others, the Company, its subsidiaries, and their respective current and former officers, directors and employees from the claims that were or could have been asserted in the class action litigation. During the year ended December 31, 2018, $8.5 million of the settlement amount was released from escrow per the court approved settlement agreement for the payment of plaintiff’s legal fees. The remaining settlement balance of $19.5 million remains in escrow pending final class distribution. As of March 31, 2019, the $19.5 million amount is included in Accounts payable, accrued expenses and other liabilities in the Company’s unaudited Condensed Consolidated Balance Sheets. Because the settlement amount is within the coverage amount of the Company’s applicable insurance policies, the Company accrued a receivable of $19.5 million as of March 31, 2019. This amount is included in Accounts receivable, net in the Company’s unaudited Condensed Consolidated Balance Sheets. As previously disclosed, certain institutional investors elected to opt out of the class action settlement and accordingly were not bound by the release and will not receive any of the class action settlement proceeds. On October 10, 2018, the Company entered into an agreement to settle these claims for $8.0 million. This amount, which was paid in full during the year ended December 31, 2018, was within the coverage amount of the Company’s applicable insurance policies and was paid by the insurance carriers. The settlement provides for the release of, among others, the Company, its subsidiaries, and their respective current and former officers, directors and employees from the claims that were or could have been asserted in the opt out lawsuit. Environmental matters Under various federal, state and local laws, ordinances and regulations, the Company may be or become liable for the costs of removal or remediation of certain hazardous or toxic substances released on or in the Company’s property or disposed of by the Company or its tenants, as well as certain other potential costs which could relate to hazardous or toxic substances (including governmental fines and injuries to persons and property). The Company does not believe that any resulting liability from such matters will have a material impact on the Company’s results of operations, cash flows, or financial position. |
Related-Party Transactions |
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Mar. 31, 2019 | |
Related Party Transactions [Abstract] | |
Related-Party Transactions | Related-Party Transactions In the ordinary course of conducting its business, the Company enters into agreements with its affiliates in relation to the leasing and management of its real estate assets. As of March 31, 2019 and December 31, 2018, there were no material receivables from or payables to related parties. |
Subsequent Events |
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Mar. 31, 2019 | |
Subsequent Events [Abstract] | |
Subsequent Events | Subsequent Events In preparing the unaudited Condensed Consolidated Financial Statements, the Company has evaluated events and transactions occurring after March 31, 2019 for recognition and/or disclosure purposes. Based on this evaluation, there were no subsequent events from March 31, 2019 through the date the financial statements were issued. |
Nature of Business and Financial Statement Presentation Nature of Business and Financial Statement Presentation (Policies) |
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Accounting Policies [Abstract] | |||||||||||||||||||||||||
Description of Business | Description of Business Brixmor Property Group Inc. and subsidiaries (collectively, the “Parent Company”) is an internally-managed real estate investment trust (“REIT”). Brixmor Operating Partnership LP and subsidiaries (collectively, the “Operating Partnership”) is the entity through which the Parent Company conducts substantially all of its operations and owns substantially all of its assets. The Parent Company owns 100% of the common stock of BPG Subsidiary Inc. (“BPG Sub”), which, in turn, is the sole member of Brixmor OP GP LLC (the “General Partner”), the sole general partner of the Operating Partnership. The Parent Company engages in the ownership, management, leasing, acquisition, disposition and redevelopment of retail shopping centers through the Operating Partnership, and has no other substantial assets or liabilities other than through its investment in the Operating Partnership. The Parent Company, the Operating Partnership and their controlled subsidiaries on a consolidated basis (collectively, the “Company” or “Brixmor”) believes it owns and operates one of the largest open air retail portfolios by gross leasable area (“GLA”) in the United States (“U.S.”), comprised primarily of community and neighborhood shopping centers. As of March 31, 2019, the Company’s portfolio was comprised of 422 shopping centers (the “Portfolio”) totaling approximately 73 million square feet of GLA. The Company’s high-quality national Portfolio is primarily located within established trade areas in the top 50 Metropolitan Statistical Areas in the U.S., and its shopping centers are primarily anchored by non-discretionary and value-oriented retailers, as well as consumer-oriented service providers. The Company does not distinguish its principal business or group its operations on a geographical basis for purposes of measuring performance. Accordingly, the Company has a single reportable segment for disclosure purposes in accordance with U.S. generally accepted accounting principles (“GAAP”). |
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Basis of Presentation | Basis of Presentation The accompanying unaudited Condensed Consolidated Financial Statements have been prepared in accordance with GAAP for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and notes required by GAAP for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for the fair presentation of the unaudited Condensed Consolidated Financial Statements for the periods presented have been included. The operating results for the periods presented are not necessarily indicative of the results that may be expected for a full fiscal year. These financial statements should be read in conjunction with the financial statements for the year ended December 31, 2018 and accompanying notes included in the Company’s annual report on Form 10-K filed with the Securities and Exchange Commission (the “SEC”) on February 11, 2019. Certain prior period balances in the accompanying unaudited Condensed Consolidated Statements of Operations have been reclassified to conform to the current period presentation for the adoption of Accounting Standards Codification Topic 842 “Leases” (“ASC 842”) (described below), which supersedes Accounting Standards Codification Topic 840 “Leases” (“ASC 840”). |
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Principles of Consolidation | Principles of Consolidation The accompanying unaudited Condensed Consolidated Financial Statements include the accounts of the Parent Company, the Operating Partnership, each of their wholly owned subsidiaries and all other entities in which they have a controlling financial interest. All intercompany transactions have been eliminated. |
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Deferred Leasing and Financing Costs | Deferred Leasing and Financing Costs Costs incurred in executing tenant leases and long-term financings are capitalized and amortized using the straight-line method over the term of the related lease or debt agreement, which approximates the effective interest method. Capitalized costs incurred in executing tenant leases include tenant improvements and leasing commissions. In connection with the adoption of ASC 842, the Company no longer capitalizes partial salaries and/or legal fees incurred in executing tenant leases. These amounts were capitalized under previous guidance. For long-term financings, capitalized costs incurred include bank and legal fees. The amortization of deferred leasing and financing costs is included in Depreciation and amortization and Interest expense, respectively, in the Company’s unaudited Condensed Consolidated Statements of Operations and within Operating activities on the Company’s unaudited Condensed Consolidated Statements of Cash Flows. |
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Revenue Recognition | The Company enters into agreements with tenants which convey the right to control the use of identified space at its shopping centers in exchange for rental revenue. These agreements meet the criteria for recognition as leases under ASC 842. Rental revenue is recognized on a straight-line basis over the terms of the related leases. The cumulative difference between rental revenue recognized in the Company’s unaudited Condensed Consolidated Statements of Operations and contractual payment terms is recognized as deferred rent and presented on the accompanying unaudited Condensed Consolidated Balance Sheets within Receivables. The Company commences recognizing rental revenue based on the date its makes the underlying asset available for use by the tenant. Leases also typically provide for the reimbursement of operating costs, including common area expenses, utilities, insurance and real estate taxes by the lessee and are recognized in the period the applicable expenditures are incurred. In connection with the adoption of ASC 842, the Company has evaluated the lease and non-lease components within its leases and has elected the practical expedient to present lease and non-lease components in its lease agreements as one component. As such, the Company accounts for rental revenue and common area expense reimbursements as one lease component under ASC 842. These amounts are included in Rental income in the Company’s unaudited Condensed Consolidated Statements of Operations. Additionally, the Company allocates the reimbursement of utilities, insurance and real estate taxes to the lease and non-lease components of its leases. These amounts are included in Rental income in the Company’s unaudited Condensed Consolidated Statements of Operations. Certain leases also provide for percentage rents based upon the level of sales achieved by a lessee. These percentage rents are recognized upon the achievement of certain pre-determined sales levels and are included in Rental income in the Company’s unaudited Condensed Consolidated Statements of Operations. Gains from the sale of depreciated operating properties are generally recognized under the full accrual method, provided that various criteria relating to the terms of the sale and subsequent involvement by the Company with the applicable property are met. |
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Receivables | The Company periodically evaluates the collectability of its receivables related to rental revenue, straight-line rent, expense reimbursements and those attributable to other revenue generating activities. The Company analyzes individual tenant receivables and considers tenant credit-worthiness, the length of time a receivable has been outstanding, and current economic trends when evaluating collectability. In addition, tenants in bankruptcy are analyzed and estimates are made in connection with the expected recovery of pre-petition and post-petition claims. Any receivables that are deemed to be uncollectible are recognized as a reduction to Rental income in the Company’s unaudited Condensed Consolidated Statements of Operations. Prior period Provision for doubtful accounts is presented on the Company's unaudited Condensed Consolidated Statements of Operations in accordance with the Company's previous presentation and has not been reclassified to Rental income. |
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Leases | Leases The Company periodically enters into agreements in which it is the lessee, including ground leases for neighborhood and community shopping centers that it operates and office leases for administrative space. In connection with the adoption of ASC 842, the Company evaluated these agreements and determined that they meet the criteria for recognition as leases under ASC 842. For these agreements the Company recognizes an operating lease right-of-use (“ROU”) asset and operating lease liability based on the present value of the minimum lease payments over the non-cancellable lease term. As the rates implicit in the leases are not readily determinable the Company uses its incremental secured borrowing rate based on the information available at commencement date to determine the present value of the lease payments. The lease terms utilized by the Company may include options to extend or terminate the lease when it is reasonably certain that it will exercise that option. The Company evaluates many factors, including current and future tenant cash flows, when determining if an option to extend or terminate should be included in the non-cancellable period. Lease expense for minimum lease payments is recognized on a straight-line basis over the lease term. The Company has elected to apply the short-term lease exemption within ASC 842 and does not record an ROU asset or lease liability for leases with terms of less than 12 months. Additionally, leases also typically provide for the reimbursement of operating costs, including common area expenses, utilities, insurance and real estate taxes by the Company. In connection with the adoption of ASC 842, the Company has evaluated the lease and non-lease components within its leases and has elected the practical expedient to present lease and non-lease components in its lease agreements as one component. As such, the Company accounts for lease payments and common area expense reimbursements as one lease component under ASC 842. These amounts are included in Operating expenses in the Company’s unaudited Condensed Consolidated Statements of Operations. Additionally, the Company allocates the reimbursement of utilities, insurance and real estate taxes to the lease and non-lease components of its leases. These amounts are included in Operating expenses in the Company’s unaudited Condensed Consolidated Statements of Operations. |
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Income Taxes | Income Taxes The Parent Company has elected to qualify as a REIT in accordance with the Internal Revenue Code of 1986, as amended (the “Code”). To qualify as a REIT, the Parent Company must meet a number of organizational and operational requirements, including a requirement that it currently distribute to its stockholders at least 90% of its REIT taxable income, determined without regard to the deduction for dividends paid and excluding net capital gains. It is management’s intention to adhere to these requirements and maintain the Parent Company’s REIT status. As a REIT, the Parent Company generally will not be subject to U.S. federal income tax, provided that distributions to its stockholders equal at least the amount of its REIT taxable income as defined under the Code. The Parent Company conducts substantially all of its operations through the Operating Partnership which is organized as a limited partnership and treated as a pass-through entity for U.S. federal tax purposes. Therefore, U.S. federal income taxes on the Company’s taxable income do not materially impact the unaudited Condensed Consolidated Financial Statements of the Company. If the Parent Company fails to qualify as a REIT in any taxable year, it will be subject to U.S. federal taxes at regular corporate rates (including any applicable alternative minimum tax for tax years beginning before January 1, 2018) and may not be able to qualify as a REIT for four subsequent taxable years. Even if the Parent Company qualifies for taxation as a REIT, the Company is subject to certain state and local taxes on its income and property, and to U.S. federal income and excise taxes on its undistributed taxable income. The Parent Company has elected to treat certain of its subsidiaries as taxable REIT subsidiaries (“TRS”), and the Parent Company may in the future elect to treat newly formed and/or existing subsidiaries as TRSs. A TRS may participate in non-real estate related activities and/or perform non-customary services for tenants and is subject to certain limitations under the Code. A TRS is subject to U.S. federal and state income taxes. Income taxes related to the Parent Company’s TRSs do not materially impact the unaudited Condensed Consolidated Financial Statements of the Company. The Company has considered the tax positions taken for the open tax years and has concluded that no provision for income taxes related to uncertain tax positions is required in the Company’s unaudited Condensed Consolidated Financial Statements as of March 31, 2019 and December 31, 2018. Open tax years generally range from 2015 through 2018, but may vary by jurisdiction and issue. The Company recognizes penalties and interest accrued related to unrecognized tax benefits as income tax expense, which is included in Other on the Company’s unaudited Condensed Consolidated Statements of Operations. |
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New Accounting Pronouncements | New Accounting Pronouncements In November 2018, the Financial Accounting Standards Board (“FASB”) issued ASU 2018-19, “Codification Improvements to Topic 326, Financial Instruments-Credit Losses.” ASU 2018-19 clarifies that receivables arising from operating leases are not within the scope of Subtopic 326-20. Instead, impairment of receivables arising from operating leases should be accounted for in accordance with ASC 842, Leases. The standard is effective on January 1, 2020, with early adoption permitted. The Company does not expect the adoption of ASU 2018-19 to have a material impact on the unaudited Condensed Consolidated Financial Statements of the Company. Information regarding the adoption of ASC 842 is described below. In October 2018, the FASB issued ASU 2018-16, “Derivatives and Hedging (Topic 815).” ASU 2018-16 amends guidance to permit the use of the Overnight Index Swap rate based on the Secured Overnight Financing Rate as a U.S. benchmark interest rate for hedge accounting purposes under Topic 815. The standard became effective for the Company on January 1, 2019. The Company determined that these changes did not have a material impact on the unaudited Condensed Consolidated Financial Statements of the Company. In August 2018, the FASB issued ASU 2018-13, “Fair Value Measurement (Topic 820).” ASU 2018-13 amends certain disclosure requirements regarding the fair value hierarchy of investments in accordance with GAAP, particularly the significant unobservable inputs used to value investments within Level 3 of the fair value hierarchy. The standard is effective on January 1, 2020, with early adoption permitted. The Company does not expect the adoption of ASU 2018-13 to have a material impact on the unaudited Condensed Consolidated Financial Statements of the Company. In February 2016, the FASB issued ASU 2016-02, “Leases (Topic 842).” ASU 2016-02 sets out the principles for the recognition, measurement, presentation and disclosure of leases for both parties to a contract (i.e., lessees and lessors). ASU 2016-02 was subsequently amended by ASU 2018-01, “Land Easement Practical Expedient for Transition to Topic 842”; ASU 2018-10, “Codification Improvements to Topic 842”; ASU 2018-11, “Targeted Improvements”; and ASU 2018-20, “Narrow-Scope Improvements for Lessors”. The new standard requires lessees to apply a dual approach, classifying leases as either finance or operating leases based on the principle of whether or not the lease is effectively a financed purchase by the lessee. This classification will determine whether lease expense is recognized based on an effective interest method or on a straight-line basis over the term of the lease. A lessee is also required to recognize an ROU asset and a lease liability for all leases with a term of greater than 12 months, regardless of their classification. Leases with a term of 12 months or less qualify for the short-term lease recognition exemption and may be accounted for similar to previous guidance for operating leases. The new standard requires lessors to account for leases using an approach that is substantially equivalent to previous guidance for sales-type leases, direct financing leases and operating leases. Adoption The standard became effective for the Company on January 1, 2019 and a modified retrospective transition approach was required. The Company determined that the adoption of ASC 842 had a material impact on the unaudited Condensed Consolidated Financial Statements of the Company. The Company elected the following optional practical expedients upon adoption:
Lessee For leases where the Company is the lessee, primarily for the Company’s ground leases and administrative office leases, the Company is required to record a right of use asset and a lease liability on its unaudited Condensed Consolidated Balance Sheets on the effective date. The Company has elected to apply the short-term lease recognition exemption for all leases that qualify. Lessor For leases where the Company is the lessor, the Company will continue to record revenues from rental properties for its operating leases on a straight-line basis. In addition, initial direct leasing costs continue to be capitalized, however, indirect leasing costs previously capitalized are being expensed under ASC 842. During the three months ended March 31, 2018, the Company capitalized $3.0 million of indirect leasing costs, including leasing payroll and legal costs. In addition, ASC 842 requires that additional lease disclosures be presented in the unaudited Condensed Consolidated Financial Statements of the Company for both lessor and lessee lease agreements. See Notes 9 and 10 for additional information. Any other recently issued accounting standards or pronouncements not disclosed above have been excluded as they either are not relevant to the Company, or they are not expected to have a material effect on the unaudited Condensed Consolidated Financial Statements of the Company. |
Dispositions and Assets Held for Sale (Tables) |
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Discontinued Operations and Disposal Groups [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Reclassificationa of Disposal Groups, Including Discontinued Operations | The following table presents the assets and liabilities associated with the properties classified as held for sale:
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Real Estate (Tables) |
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Real Estate [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of real estate properties | The Company’s components of Real estate, net consisted of the following:
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Schedule of expected net amortization expense associated with intangible assets and liabilities | The Company’s estimated below-market lease accretion income, net of above-market lease amortization expense, and in-place lease amortization expense for the next five years are as follows:
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Impairments (Tables) |
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Impairment of Real Estate [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Impairments | The Company recognized the following impairments during the three months ended March 31, 2019:
The Company recognized the following impairments during the three months ended March 31, 2018:
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Financial Instruments - Derivatives and Hedging (Tables) |
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Derivative Instruments and Hedging Activities Disclosure [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of interest rate derivatives | Detail on the Company’s interest rate derivatives designated as cash flow hedges outstanding as of March 31, 2019 and December 31, 2018 is as follows:
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Schedule of derivative instruments in Statement of Financial Position, fair value | Detail on the Company’s fair value of interest rate derivatives on a gross and net basis as of March 31, 2019 and December 31, 2018, respectively, is as follows:
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Schedule of Derivatives in Cash Flow Hedging Relationships | The effective portion of the Company’s interest rate swaps that was recognized in the Company’s unaudited Condensed Consolidated Statements of Comprehensive Income for the three months ended March 31, 2019 and 2018 is as follows:
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Debt Obligations (Tables) |
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Debt obligations under various arrangements with financial institutions | As of March 31, 2019 and December 31, 2018, the Company had the following indebtedness outstanding:
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Future expected/scheduled maturities of outstanding debt and capital lease obligations | As of March 31, 2019 and December 31, 2018, the Company had accrued interest of $27.2 million and $34.0 million outstanding, respectively. As of March 31, 2019, scheduled amortization and maturities of the Company’s outstanding debt obligations were as follows:
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Fair Value Disclosures (Tables) |
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Mar. 31, 2019 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value Disclosures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule Of Fair Value Debt Obligation | All financial instruments of the Company are reflected in the accompanying unaudited Condensed Consolidated Balance Sheets at amounts which, in management’s judgment, reasonably approximate their fair values, except those instruments listed below:
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Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis | The following table presents the placement in the fair value hierarchy of assets and liabilities that are measured and recognized at fair value on a recurring basis:
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Fair Value Measurements, Nonrecurring | The following table presents the placement in the fair value hierarchy of assets and liabilities that are measured and recognized at fair value on a non-recurring basis. The table includes information related to properties that were remeasured to fair value as a result of impairment testing during the three months ended March 31, 2019 and during the year ended December 31, 2018, excluding the properties sold prior to March 31, 2019 and December 31, 2018, respectively:
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Revenue Recognition (Tables) |
3 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2019 | ||||||||||||||||||||||||||||||||||||||||||||||
Revenue Recognition [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||
Lessor, Operating Lease, Payments to be Received, Maturity | As of March 31, 2019, the fixed contractual lease payments to be received over the next five years pursuant to the terms of non-cancelable operating leases are included in the table below, assuming that no leases are renewed and no renewal options are exercised. Additionally, the table does not include variable lease payments which may be received under certain leases for percentage rents or the reimbursement of operating costs, such as common area expenses, utilities, insurance and real estate taxes. These variable lease payments are recognized in the period when the applicable expenditures are incurred or in the case of percentage rents when the sales data is made available.
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Operating Leases, Future Minimum Payments Receivable | Future minimum annual base rents as of and in-place at December 31, 2018 to be received over the next five years pursuant to the terms of non-cancelable operating leases are included in the table below, assuming that no leases are renewed and no renewal options are exercised. Future minimum annual base rents also do not include payments which may be received under certain leases for percentage rent or the reimbursement of operating costs, such as common area expenses, utilities, insurance and real estate taxes.
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Leases (Tables) |
3 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2019 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Leases [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Operating Leases | The following table presents additional information pertaining to the Company’s operating leases:
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Schedule of Future Minimum Rental Payments for Operating Leases | Minimum annual rental commitments as of and in-place at December 31, 2018 for the Company's ground and office leases during the next five years and thereafter are as follows:
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Earnings Per Share (Tables) |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2019 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Earnings Per Share [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of earnings per share, basic and diluted | The following table provides a reconciliation of the numerator and denominator of the EPS calculations for the three months ended March 31, 2019 and 2018 (dollars in thousands, except per share data):
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Earnings per Unit (Tables) |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2019 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Earnings per Share [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of earnings per unit, basic and diluted | The following table provides a reconciliation of the numerator and denominator of the EPS calculations for the three months ended March 31, 2019 and 2018 (dollars in thousands, except per share data):
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Brixmor Operating Partnership LP | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Earnings per Share [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of earnings per unit, basic and diluted | The following table provides a reconciliation of the numerator and denominator of the earnings per unit calculations for the three months ended March 31, 2019 and 2018 (dollars in thousands, except per unit data):
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Nature of Business and Financial Statement Presentation (Narrative) (Details) ft² in Millions, $ in Millions |
3 Months Ended | |
---|---|---|
Mar. 31, 2019
USD ($)
ft²
Property
|
Mar. 31, 2018
USD ($)
|
|
Nture of Oerations and Financial Statements Presentation [Line Items] | ||
Capitalized indirect internal leasing overhead costs | $ 2.0 | |
Accounting Standards Update 2016-02 | ||
Nture of Oerations and Financial Statements Presentation [Line Items] | ||
Capitalized indirect internal leasing overhead costs | $ 3.0 | |
Shopping Center | ||
Nture of Oerations and Financial Statements Presentation [Line Items] | ||
Number of real estate properties | Property | 422 | |
GLA | ft² | 73 | |
Parent Company | BPG Sub | ||
Nture of Oerations and Financial Statements Presentation [Line Items] | ||
Ownership percentage | 100.00% |
Dispositions and Assets Held for Sale (Narrative) (Details) $ in Thousands |
3 Months Ended | ||
---|---|---|---|
Mar. 31, 2019
USD ($)
property
shopping_center
|
Mar. 31, 2018
USD ($)
land_parcel
shopping_center
|
Dec. 31, 2018
property
|
|
Schedule of Acquisitions and Dispositions [Line Items] | |||
Gain on sale | $ 7,602 | $ 11,448 | |
Disposed of by Sale | |||
Schedule of Acquisitions and Dispositions [Line Items] | |||
Number of shopping centers sold | shopping_center | 3 | 6 | |
Proceeds from sale of property | $ 44,900 | $ 104,200 | |
Gain on sale | 7,300 | $ 11,400 | |
Number of outparcels sold | land_parcel | 1 | ||
Provisions of impairment | $ 200 | ||
Disposed of by Sale | Previously Disposed Assets | |||
Schedule of Acquisitions and Dispositions [Line Items] | |||
Proceeds from sale of property | $ 300 | ||
Held-for-sale | |||
Schedule of Acquisitions and Dispositions [Line Items] | |||
Number of real estate properties | property | 1 | 1 | |
Number of real estate partial properties | property | 1 |
Dispositions and Assets Held for Sale (Held for Sale) (Details) $ in Thousands |
Mar. 31, 2019
USD ($)
property
|
Dec. 31, 2018
USD ($)
property
|
---|---|---|
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||
Assets associated with real estate assets held for sale | $ 9,093 | $ 2,901 |
Held-for-sale | ||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||
Number of real estate properties | property | 1 | 1 |
Land | $ 1,412 | $ 1,220 |
Buildings and improvements | 10,935 | 2,927 |
Accumulated depreciation and amortization | (3,356) | (1,334) |
Real estate, net | 8,991 | 2,813 |
Other assets | 102 | 88 |
Assets associated with real estate assets held for sale | 9,093 | 2,901 |
Below-market leases | 444 | 0 |
Liabilities associated with real estate assets held for sale | $ 444 | $ 0 |
Real Estate (Damages) (Details) - Hurricane Michael ft² in Millions, $ in Millions |
3 Months Ended | |
---|---|---|
Mar. 31, 2019
USD ($)
|
Oct. 07, 2018
ft²
property
|
|
Causes of Increase (Decrease) in Liability for Unpaid Claims and Claims Adjustment Expense [Line Items] | ||
Number of properties effected in catastrophic event | property | 2 | |
GLA of properties effected | ft² | 0.4 | |
Properties effected, accelerated depreciation | $ 13.7 | |
Proceeds from property insurance | 3.0 | |
Receivables | ||
Causes of Increase (Decrease) in Liability for Unpaid Claims and Claims Adjustment Expense [Line Items] | ||
Property insurance receivable | $ 10.7 |
Impairments (Details) $ in Thousands |
3 Months Ended | |
---|---|---|
Mar. 31, 2019
USD ($)
ft²
|
Mar. 31, 2018
USD ($)
ft²
|
|
Real Estate Properties [Line Items] | ||
GLA | ft² | 158,565 | 1,028,216 |
Impairment Charge | $ | $ 3,112 | $ 15,902 |
Brice Park | ||
Real Estate Properties [Line Items] | ||
GLA | ft² | 158,565 | |
Impairment Charge | $ | $ 3,112 | |
Southland Shopping Plaza | ||
Real Estate Properties [Line Items] | ||
GLA | ft² | 285,278 | |
Impairment Charge | $ | $ 6,942 | |
Roundtree Place | ||
Real Estate Properties [Line Items] | ||
GLA | ft² | 246,620 | |
Impairment Charge | $ | $ 3,772 | |
Skyway Plaza | ||
Real Estate Properties [Line Items] | ||
GLA | ft² | 110,799 | |
Impairment Charge | $ | $ 3,639 | |
Pensacola Square | ||
Real Estate Properties [Line Items] | ||
GLA | ft² | 142,767 | |
Impairment Charge | $ | $ 1,345 | |
Crossroads Center | ||
Real Estate Properties [Line Items] | ||
GLA | ft² | 242,752 | |
Impairment Charge | $ | $ 204 |
Financial Instruments - Derivatives and Hedging (Notional Amount) (Details) |
3 Months Ended | |
---|---|---|
Mar. 31, 2019
USD ($)
derivative_instrument
|
Dec. 31, 2018
USD ($)
derivative_instrument
|
|
Derivative [Line Items] | ||
Amount expected to be reclassified from accumulated other comprehensive loss in the next twelve months | $ 5,800,000 | |
Interest Rate Swap | Designated as Hedging Instrument | ||
Derivative [Line Items] | ||
Number of Instruments | derivative_instrument | 7 | 10 |
Notional Amount | $ 800,000,000 | $ 1,200,000,000 |
Effective Date January 2, 2019 | Interest Rate Swap | Designated as Hedging Instrument | ||
Derivative [Line Items] | ||
Number of Instruments | derivative_instrument | 0 | 4 |
Notional Amount | $ 300,000,000 | |
Fixed interest rate | 2.61% |
Financial Instruments - Derivatives and Hedging (Fair Value) (Details) - Interest Rate Swap - USD ($) $ in Thousands |
Mar. 31, 2019 |
Dec. 31, 2018 |
---|---|---|
Derivatives, Fair Value [Line Items] | ||
Gross derivative assets | $ 12,788 | $ 18,630 |
Gross derivative liabilities | (6,786) | (2,571) |
Net derivative assets | $ 6,002 | $ 16,059 |
Financial Instruments - Derivatives and Hedging (Cash Flow Hedging Relationship) (Details) - USD ($) $ in Thousands |
3 Months Ended | |
---|---|---|
Mar. 31, 2019 |
Mar. 31, 2018 |
|
Derivative Instruments and Hedging Activities Disclosure [Abstract] | ||
Change in unrealized gain (loss) on interest rate swaps | $ (6,944) | $ 7,234 |
Accretion of interest rate swaps to interest expense | (3,113) | (2,461) |
Change in unrealized gain (loss) on interest rate swaps, net | $ (10,057) | $ 4,773 |
Debt Obligations (Maturities) (Details) - USD ($) $ in Thousands |
Mar. 31, 2019 |
Dec. 31, 2018 |
---|---|---|
Debt Disclosure [Abstract] | ||
Interest payable | $ 27,200 | $ 34,000 |
Future expected/scheduled maturities of outstanding debt and capital lease | ||
2019 (remaining nine months) | 0 | |
2020 | 0 | |
2021 | 500,000 | |
2022 | 750,000 | |
2023 | 1,141,000 | |
Thereafter | 2,525,453 | |
Total debt maturities | 4,916,453 | |
Net unamortized discount | (10,832) | |
Net unamortized debt issuance costs | (32,556) | |
Total debt obligations, net | $ 4,873,065 | $ 4,885,863 |
Fair Value Disclosures (Debt Obligations) (Details) - USD ($) $ in Thousands |
Mar. 31, 2019 |
Dec. 31, 2018 |
---|---|---|
Estimated fair value of the Company's debt obligations compared to their carrying amounts | ||
Mortgages and secured loans payable | $ 4,873,065 | $ 4,885,863 |
Total debt obligations, net | 4,873,065 | 4,885,863 |
Carrying Amount | ||
Estimated fair value of the Company's debt obligations compared to their carrying amounts | ||
Mortgages and secured loans payable | 7,207 | 7,217 |
Notes payable | 3,437,469 | 3,436,014 |
Unsecured credit facility and term loan | 1,428,389 | 1,442,632 |
Total debt obligations, net | 4,873,065 | 4,885,863 |
Fair Value | ||
Estimated fair value of the Company's debt obligations compared to their carrying amounts | ||
Mortgages and secured loans payable | 7,172 | 7,072 |
Notes payable | 3,462,929 | 3,372,418 |
Unsecured credit facility and term loan | 1,436,953 | 1,452,382 |
Total debt obligations | $ 4,907,054 | $ 4,831,872 |
Revenue Recognition (Details) - USD ($) $ in Thousands |
3 Months Ended | |
---|---|---|
Mar. 31, 2019 |
Dec. 31, 2018 |
|
Revenue Recognition [Abstract] | ||
Performance obligation, description of timing | The agreements range in term from less than one year to 25 or more years, with certain agreements containing extension options. These extension options range from as little as one month to five or more years. | |
Lessor, Operating Lease, Payments, Fiscal Year Maturity [Abstract] | ||
2019 (remaining nine months) | $ 626,724 | |
2020 | 751,081 | |
2021 | 640,651 | |
2022 | 529,569 | |
2023 | 430,870 | |
Thereafter | $ 1,501,400 | |
Operating Leases, Future Minimum Payments Receivable [Abstract] | ||
2019 | $ 811,381 | |
2020 | 709,230 | |
2021 | 599,367 | |
2022 | 490,087 | |
2023 | 392,892 | |
Thereafter | $ 1,368,278 |
Equity and Capital (Details) - USD ($) $ / shares in Units, $ in Millions |
3 Months Ended | ||
---|---|---|---|
Mar. 31, 2019 |
Mar. 31, 2018 |
Dec. 05, 2017 |
|
Schedule of Shareholders' Equity [Line Items] | |||
Compensation cost | $ 0.1 | $ 0.1 | |
Available repurchase amount | $ 278.0 | ||
Dividends, per common share | $ 0.28 | $ 0.275 | |
Accounts Payable and Accrued Liabilities | |||
Schedule of Shareholders' Equity [Line Items] | |||
Dividends payable | $ 85.0 | $ 85.3 | |
Common Stock | |||
Schedule of Shareholders' Equity [Line Items] | |||
Share repurchase program, number of shares authorized (in shares) | 700,000 | 1,900,000 | |
Share repurchase program, average cost per share | $ 17.53 | $ 15.47 | |
Share repurchase program, value | $ 11.6 | $ 29.7 | |
Stock repurchased during period, shares | 660,000 | 1,922,000 | |
Common Stock | RSUs | |||
Schedule of Shareholders' Equity [Line Items] | |||
Stock repurchased during period, shares | 100,000.0 | 100,000.0 | |
Common Stock | Maximum | |||
Schedule of Shareholders' Equity [Line Items] | |||
Share repurchase program, authorized amount | $ 400.0 |
Stock Based Compensation (Details) - USD ($) $ in Thousands, shares in Millions |
3 Months Ended | |
---|---|---|
Mar. 31, 2019 |
Mar. 31, 2018 |
|
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Number of shares authorized | 15.0 | |
Grants in period | 0.7 | 0.8 |
Risk free interest rate | 2.55% | |
Expected dividend rate | 5.60% | 5.60% |
Equity based compensation | $ 2,641 | $ 2,484 |
Compensation cost not yet recognized | $ 25,300 | |
Weighted average remaining contractual term | 2 years 6 months | |
Minimum | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Service period | 1 year | |
Expected volatility rate | 20.00% | 29.00% |
Risk free interest rate | 2.43% | |
Maximum | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Service period | 5 years | |
Expected volatility rate | 21.00% | 32.00% |
Risk free interest rate | 2.53% |
Earnings Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands |
3 Months Ended | |
---|---|---|
Mar. 31, 2019 |
Mar. 31, 2018 |
|
Earnings Per Share, Basic [Abstract] | ||
Net income | $ 62,900 | $ 61,022 |
Non-forfeitable dividends on unvested restricted shares | (144) | (56) |
Net income attributable to the Company’s common stockholders for basic earnings per share | $ 62,756 | $ 60,966 |
Weighted average number shares outstanding – basic | 298,599 | 304,158 |
Net income per share (usd per share) | $ 0.21 | $ 0.20 |
Computation of Diluted Earnings Per Share: | ||
Net income attributable to the Company’s common stockholders for diluted earnings per share | $ 62,756 | $ 60,966 |
Equity awards (in shares) | 430 | 120 |
Weighted average shares outstanding - diluted (in shares) | 299,029 | 304,278 |
Net income per share (usd per share) | $ 0.21 | $ 0.20 |
Commitments and Contingencies (Details) - USD ($) $ in Millions |
3 Months Ended | ||
---|---|---|---|
Mar. 31, 2019 |
Dec. 31, 2018 |
Oct. 10, 2018 |
|
Loss Contingencies [Line Items] | |||
Estimate of possible loss | $ 28.0 | ||
Litigation settlement | $ 8.5 | ||
Accrual | 19.5 | ||
Case No. 653091/2018 | |||
Loss Contingencies [Line Items] | |||
Estimate of possible loss | $ 8.0 | ||
Pending Litigation | |||
Loss Contingencies [Line Items] | |||
Estimate of possible loss | 7.0 | ||
Accounts Payable and Accrued Liabilities | |||
Loss Contingencies [Line Items] | |||
Accrual | 19.5 | ||
Accounts Receivable | |||
Loss Contingencies [Line Items] | |||
Receivable | 19.5 | ||
General and Administrative Expense | Pending Litigation | |||
Loss Contingencies [Line Items] | |||
Accrual | $ 7.0 |
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