Management’s Discussion and Analysis of Financial Condition and Results of Operations
Quantitative and Qualitative Disclosures About Market Risk
Financial Statements and Supplementary Data
Changes in and Disagreements With Accountants on Accounting and Financial Disclosure
Controls and Procedures
Other Information
Disclosure Regarding Foreign Jurisdictions that Prevent Inspections
Part III
Directors, Executive Officers, and Corporate Governance
Executive Compensation
Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters
Certain Relationships and Related Transactions, and Director Independence
Principal Accountant Fees and Services
Part IV
Exhibit and Financial Statement Schedules
Form 10-K Summary
Forward-Looking Statements
This report may contain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934 (the "Exchange Act"). These statements include, but are not limited to, statements related to our expectations regarding the performance of our business, our financial results, our liquidity and capital resources, and other non-historical statements. You can identify these forward-looking statements by the use of words such as "outlook," "believes," "expects," "potential," "continues," "may," "will," "should," "seeks," "projects," "predicts," "intends," "plans," "estimates," "anticipates," or the negative version of these words or other comparable words. Such forward-looking statements are subject to various risks and uncertainties. Accordingly, there are or will be important factors that could cause actual outcomes or results to differ materially from those indicated in these statements. We believe these factors include but are not limited to those described under the section entitled "Risk Factors" in this report, as such factors may be updated from time to time in our periodic filings with the Securities and Exchange Commission (the "SEC"), which are accessible on the SEC’s website at https://www.sec.gov. These factors include (1) changes in national, regional, and local economies, due to global events such as international military conflicts, international trade disputes, a foreign debt crisis, foreign currency volatility, or due to domestic issues, such as government policies and regulations, tariffs, energy prices, market dynamics, general economic contractions, ongoing levels of inflation and interest rates, unemployment, or limited growth in consumer income or spending; (2) local real estate market conditions, including an oversupply of space in, or a reduction in demand for, properties similar to those in our Portfolio (defined hereafter); (3) competition from other available properties and e-commerce; (4) disruption and/or consolidation in the retail sector, the financial stability of our tenants, and the overall financial condition of large retailing companies, including their ability to pay rent and/or expense reimbursements that are due to us; (5) in the case of percentage rents, the sales volumes of our tenants; (6) increases in property operating expenses, including common area expenses, utilities, insurance, and real estate taxes, which are relatively inflexible and generally do not decrease if revenue or occupancy decrease; (7) increases in the costs to repair, renovate, and re-lease space; (8) earthquakes, wildfires, tornadoes, hurricanes, damage from rising sea levels due to climate change, other natural disasters, epidemics and/or pandemics, civil unrest, terrorist acts, or acts of war, any of which may result in uninsured or underinsured losses; (9) changes in laws and governmental regulations, including those governing usage, zoning, the environment, privacy, data security, intellectual property rights, and taxes; and (10) risks related to cybersecurity incidents or other disruptions to information technology ("IT") systems used by us, our tenants, or our vendors, which could compromise data or impair business operations. These factors should not be construed as exhaustive and should be read in conjunction with the other cautionary statements that are included in this report and in our other periodic filings. The forward-looking statements speak only as of the date of this report, and we expressly disclaim any obligation or undertaking to publicly update or review any forward-looking statement, whether as a result of new information, future developments, or otherwise, except to the extent otherwise required by law.
iii
PART I
Item 1. Business
Brixmor Property Group Inc. and subsidiaries (collectively, "BPG") is an internally-managed corporation that has elected to be taxed as a real estate investment trust ("REIT"). Brixmor Operating Partnership LP and subsidiaries (collectively, the "Operating Partnership") is the entity through which BPG conducts substantially all of its operations and owns substantially all of its assets. BPG owns 100% of the limited liability company interests of BPG Subsidiary LLC ("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. Unless stated otherwise or the context otherwise requires, "we," "our," and "us" mean BPG and the Operating Partnership, collectively. We own and operate one of the largest publicly traded open-air retail portfolios by gross leasable area ("GLA") in the United States ("U.S."), comprised primarily of grocery-anchored community and neighborhood shopping centers. As of December 31, 2025, our portfolio was comprised of 348 shopping centers (the "Portfolio") totaling approximately 63 million square feet of GLA. Our high-quality national Portfolio is primarily located within established trade areas in the top 50 Core-Based Statistical Areas ("CBSAs") in the U.S., and our shopping centers are primarily anchored by non-discretionary and value-oriented retailers, as well as consumer-oriented service providers. As of December 31, 2025, our three largest tenants by annualized base rent ("ABR") were The TJX Companies, Inc., The Kroger Co., and Burlington Stores, Inc. In the opinion of our management, no material part of our business is dependent upon a single tenant, the loss of which would have a material effect on us, and no single tenant or shopping center accounted for 5% or more of our consolidated revenues during 2025.
As of December 31, 2025, BPG beneficially owned, through its direct and indirect interest in BPG Sub and the General Partner, 100% of the outstanding partnership common units (the "OP Units") in the Operating Partnership. The number of OP Units in the Operating Partnership beneficially owned by BPG is equivalent to the number of outstanding shares of BPG’s common stock, and the entitlement of all OP Units to quarterly distributions and payments in liquidation is substantially the same as those of BPG’s common stockholders. BPG’s common stock is publicly traded on the New York Stock Exchange ("NYSE") under the ticker symbol "BRX."
Management operates BPG and the Operating Partnership as one business. Because the Operating Partnership is managed by BPG, and BPG conducts substantially all of its operations through the Operating Partnership, BPG’s executive officers are the Operating Partnership’s executive officers, and although, as a partnership, the Operating Partnership does not have a board of directors, we refer to BPG’s board of directors as the Operating Partnership’s board of directors.
Our Shopping Centers
The following table provides summary information regarding our Portfolio as of December 31, 2025:
Number of Shopping Centers
GLA (square feet) (1)
62.7 million
Percent Billed (2)
Percent Leased (3)
ABR Per Square Foot ("PSF") (4)
New Lease Volume (square feet) (5)
3.0 million
New and Renewal Lease Volume (square feet) (5)
6.0 million
New, Renewal and Option Lease Volume (square feet) (5)
9.5 million
New Rent Spread (5)(6)
New and Renewal Rent Spread (5)(6)
New, Renewal and Option Rent Spread (5)(6)
Percent of ABR Derived from Grocery-Anchored Shopping Centers
Percent of ABR in Top 50 U.S. CBSAs
(1) GLA represents the total amount of leasable property square footage.
(2) Billed GLA as a percentage of total GLA. Billed GLA represents the aggregate GLA of all commenced leases with an initial term of one year or greater, as of a specified date.
(3) Leased GLA as a percentage of total GLA. Leased GLA represents the aggregate GLA of all signed or commenced leases with an initial term of one year or greater, as of a specified date, excluding all signed leases on space that will be vacated by existing tenants in the near term.
(4) ABR PSF is calculated as ABR divided by leased GLA, excluding the GLA of lessee-owned leasehold improvements. For purposes of calculating ABR, all signed or commenced leases with an initial term of one year or greater are included and all signed leases on space that will be vacated by existing tenants in the near term are excluded. ABR represents contractual monthly base rent as of a specified date, under leases that have been signed or commenced as of the specified date, multiplied by 12.
(5) During the year ended December 31, 2025.
(6) Represents the percentage change in contractual ABR PSF in the first year of the new lease relative to contractual ABR PSF in the last year of the old lease. For purposes of calculating rent spreads, ABR PSF includes the GLA of lessee-owned leasehold improvements. Based on comparable leases only, which consist of new leases signed on units that were occupied within the prior 12 months, renewal leases signed with the same tenant in all or a portion of the same location or that include the expansion into space that was occupied within the prior 12 months, and contractual renewal options exercised by tenants in the same location to extend the term of an expiring lease. New leases signed on units that have been vacant for longer than 12 months, new leases signed on first generation space, and new leases that are ancillary in nature regardless of term are deemed non-comparable and excluded from rent spreads. Renewals that include the expansion of an existing tenant into space that has been vacant for longer than 12 months and renewals that are ancillary in nature regardless of term are deemed non-comparable and excluded from rent spreads.
Business Objectives and Strategies
Our primary objective is to maximize total returns to our stockholders through consistent, sustainable growth in cash flow. Our key strategies to achieve this objective include proactively managing our Portfolio to drive internal growth, pursuing value-enhancing reinvestment opportunities, and prudently executing on acquisition and disposition activity, while also maintaining a flexible capital structure positioned for growth. In addition, as we execute on our key strategies, we do so guided by our Corporate Responsibility ("CR") strategy.
Driving Internal Growth. Our primary drivers of internal growth include (i) embedded contractual rent escalations, (ii) below-market rents that may be reset to market as leases expire, (iii) occupancy growth, and (iv) prudent expense management, including proactively navigating inflationary pressure. Ongoing strong new leasing productivity, with a key focus on thoughtful merchandising and our rigorous underwriting processes, have also enabled us to consistently improve the credit of our tenancy and the vibrancy and relevancy of our Portfolio to retailers and consumers. During 2025, we executed 512 new leases representing approximately 3.0 million square feet and 1,453 total leases, including new leases, renewals, and options, representing approximately 9.5 million square feet.
We believe that rents across our Portfolio are below market, which provides us with a key competitive advantage in attracting and retaining tenants. During 2025, we achieved rent spreads on new leases of 38.7% and blended rent spreads on new and renewal leases of 21.7% excluding options or 16.4% including options. Looking forward, the weighted average expiring ABR PSF of anchor lease expirations through 2028, assuming no remaining renewal options are exercised, is $11.37 compared to a weighted average ABR PSF of $17.84 for new anchor leases signed during 2025.
Our high-quality, nationally diversified Portfolio of community and neighborhood shopping centers continues to benefit from robust, broad-based leasing demand for physical locations. We believe there is opportunity for
occupancy gains in our Portfolio, particularly for spaces less than 10,000 square feet, as such spaces will continue to benefit from our value-enhancing reinvestment initiatives. As of December 31, 2025, leased occupancy was 92.2% for spaces less than 10,000 square feet, while our total leased occupancy was 95.1%. The spread between our total leased occupancy and our total billed occupancy was 350 basis points and our total signed but not yet commenced lease population, which includes 90 basis points of GLA related to space that will be vacated by existing tenants in the near term, represented 2.7 million square feet and $62.3 million of ABR, providing strong visibility on our future growth.
Pursuing value-enhancing reinvestment opportunities. We believe that we have significant opportunities to realize attractive risk-adjusted returns by investing capital in the repositioning and/or redevelopment of certain assets in our Portfolio. Such initiatives are tenant driven and focus on upgrading our centers with strong, best-in-class retailers. During 2025, we stabilized 27 anchor space repositioning, outparcel development, and redevelopment projects, with a weighted average incremental net operating income ("NOI") yield of 10% and an aggregate cost of $183.3 million. As of December 31, 2025, we had 33 projects in process with an expected weighted average incremental NOI yield of 10% and an aggregate anticipated cost of $336.4 million. In addition, we have identified a pipeline of future reinvestment projects, which we expect to execute over the next several years at NOI yields that are generally consistent with those that we have recently realized.
Prudently executing on acquisition and disposition activity. We actively pursue acquisition and disposition opportunities in order to further concentrate our Portfolio in attractive retail submarkets and optimize the quality and long-term growth rate of our asset base. In general, our acquisition strategy focuses on buying assets with strong growth potential that are located in our existing markets and will allow us to leverage our operational platform and expertise to create value, while our disposition strategy focuses on selling assets when we believe value has been maximized, where there may be future downside risk, or where we have limited ability or desire to build critical mass in a particular submarket. Our acquisition activity may include acquisitions of open-air shopping centers and non-owned anchor spaces or outparcels at, or adjacent to, our shopping centers and the timing of acquisition and disposition activity is often dependent on the transactions and capital markets environments.
During 2025, we acquired $420.6 million of assets, including transaction costs and closing credits, and generated aggregate net proceeds of $289.2 million from property dispositions. Acquisitions were funded through a combination of net proceeds from property dispositions and available cash. Proceeds from dispositions were used primarily to fund acquisitions and our value-enhancing reinvestment opportunities and other corporate purposes.
Maintaining a Flexible Capital Structure Positioned for Growth. We believe our capital structure provides us with the financial and operational flexibility and capacity to fund our current capital needs, as well as future growth opportunities. We have access to multiple forms of capital, including secured property level debt, potential joint ventures, unsecured corporate level debt, preferred equity, and common equity, which will allow us to efficiently execute on our strategic and operational objectives. We have investment grade credit ratings from all three major credit rating agencies.
During 2025, we amended and restated our unsecured credit facility (the "Unsecured Credit Facility"), which is comprised of a $1.25 billion revolving credit facility (the "Revolving Facility") and a $500.0 million term loan (the "Term Loan Facility"). The Unsecured Credit Facility amendment extended the maturities of the Revolving Facility and Term Loan Facility to April 2029 and April 2030, respectively, while also improving pricing and adding the ability to obtain more favorable pricing in certain circumstances when our leverage ratio meets defined targets. We also renewed our $400.0 million share repurchase program and our $400.0 million at-the-market equity offering program, which together with well-staggered scheduled debt maturities, provide us with maximum flexibility to capitalize on a wide range of potential capital markets environments and support the long-term execution of our balanced business plan.
During 2025, we issued $400.0 million aggregate principal amount of 5.200% Senior Notes due 2032 and $400.0 million aggregate principal amount of 4.850% Senior Notes due 2033. We have used or intend to use the net proceeds for general corporate purposes, including the repayment of indebtedness. In addition, we repaid $632.3 million principal amount of our outstanding 3.850% Senior Notes due 2025 (the "2025 Notes"), representing all of the outstanding 2025 Notes. We funded the 2025 Notes repayment with available cash, proceeds from the Revolving Credit Facility, and net proceeds from dispositions. As of December 31, 2025, we had $1.61 billion of
available liquidity, including $1.25 billion under our Revolving Facility and $361.5 million of cash and cash equivalents and restricted cash. We have $607.5 million of debt maturities in 2026.
Operating in a Socially Responsible Manner. We believe that operating in a socially responsible manner is critical to delivering consistent, sustainable growth. As such, our CR strategy is integrated throughout our organization and is focused on creating partnerships that improve the social, economic, and environmental well-being of all our stakeholders including our communities, employees, tenants, suppliers and vendors, and investors. Our strong commitment to CR directly aligns with our core values and our vision to be the center of the communities we serve.
Our Board of Directors, through our Nominating and Corporate Governance Committee ("NCGC"), oversees our CR initiatives to ensure that our actions demonstrate our strong commitment to operating in an environmentally and socially responsible manner. To facilitate their oversight, the NCGC and our Board of Directors are provided with quarterly updates on our initiatives by our senior leadership team. Our internal steering committee, which is comprised of executive and senior leadership from a variety of functional areas, meets quarterly to set, implement, monitor, and communicate our CR strategy and related initiatives. CR objectives are included as part of our executive officers' goals and the progress toward achievement of such goals is a component of the individual performance portion of their compensation.
• Environmental Responsibility: We continue to make meaningful progress towards achieving our long-term sustainability goals, and we also execute our reinvestment projects with a focus on resource efficiency and resiliency. Integrating sustainable practices and initiatives into our business operations has reduced utility-related operational expenses and added ancillary income to our properties.
• Human Capital: As of December 31, 2025, we had 464 employees, including 462 full-time employees. Our talented and dedicated employees are the foundation of our success. Together, we strive to promote a culture that is supportive and inclusive and that provides opportunities for both personal and professional growth. We empower our employees to think and act like owners in order to create value for all stakeholders. We believe this approach enables us to attract and retain talented professionals while fostering collaborative, skilled, and motivated teams. The pillars of our human capital strategy are:
• Engagement : We believe that employees that are personally engaged in our vision to be the center of the communities we serve and are connected with similarly engaged colleagues will be more effective in their roles. We measure employee engagement through employee surveys and utilize the results from such surveys to continually improve our organization.
• Growth and Development : We encourage our employees to grow and develop their interests, skills, and passions by providing a variety of professional and personal training opportunities, including our annual talent development process in conjunction with professional development plans, innovative development programs, mentorship programs, Predictive Index Behavioral Assessments to enhance self-awareness and effective collaboration, educational assistance, and personal development accounts.
• Health and Well-being : Our commitment to the health and well-being of our employees is a crucial component of our culture. We provide a wide-range of employee benefits and encourage healthy lifestyles through initiatives such as annual wellness spending accounts; live wellness events; free access to online wellness applications, licensed counselors, financial advisors, legal specialists, and other professionals; and hybrid work schedules to maximize engagement, collaboration, and efficiency, while supporting a healthy work-life balance.
• Culture: We believe our performance is enhanced by an inclusive environment that reflects the diversity of the communities we serve. We believe a culture based on inclusion is critical to our ability to attract and retain talented employees and to deliver on our strategic goals and objectives.
In our 2024 Corporate Responsibility report, we provide comprehensive disclosure regarding our sustainability goals and initiatives. For more information on our CR strategy, goals, performance, and achievements, and to view our 2024 Corporate Responsibility report, please visit our CR page at https://www.brixmor.com/corporate-responsibility. Information on our website, including our 2024 Corporate Responsibility report, is not incorporated by reference herein and is not a part of this Annual Report on Form 10-K.
Tenants
Our Portfolio is thoughtfully merchandised with non-discretionary and value-oriented retailers, as well as consumer-oriented service providers, and is home to a broad mix of national and regional tenants and local entrepreneurs, including many vibrant new retailers added over the past several years, and approximately 81% of our ABR is derived from properties anchored by a grocer.
See Item 2. "Properties" for further information on our 20 largest tenants.
Compliance with Government Regulations
We are subject to federal, state, and local regulations, including environmental regulations that apply generally to the ownership of, and the operations conducted on, real property. As of December 31, 2025, we are not aware of any environmental conditions or material costs of complying with environmental or other government regulations that would have a material adverse effect on our overall business, financial condition, or results of operations. However, it is possible that we are not aware of, or may become subject to, potential environmental liabilities or material costs of complying with government regulations that could be material. See "Environmental conditions that exist at some of the properties in our Portfolio could result in significant unexpected costs" and "Compliance with the Americans with Disabilities Act, fire, safety, environmental, and other regulations may require us to make expenditures that would adversely affect our financial condition, operating results, and cash flows" in Item 1A. "Risk Factors" for further information regarding our risks related to government regulations.
Financial Information about Industry Segments
Our principal business is the ownership and operation of open-air retail shopping centers. We do not distinguish our principal business or group our operations on a geographical basis for purposes of measuring performance. Accordingly, we have a single reportable segment for disclosure purposes in accordance with U.S. generally accepted accounting principles ("GAAP").
REIT Qualification
We have been organized and operated in conformity with the requirements for qualification and taxation as a REIT under U.S. federal income tax laws commencing with our taxable year ended December 31, 2011, have maintained such requirements through our taxable year ended December 31, 2025, and intend to satisfy such requirements for subsequent taxable years. As a REIT, we generally will not be subject to U.S. federal income tax on net taxable income that we distribute annually to our stockholders. In order to qualify as a REIT for U.S. federal income tax purposes, we must continually satisfy tests concerning, among other things, the real estate qualification of sources of our income, the composition and value of our assets, the amounts we distribute to our stockholders, and the diversity of ownership of our stock. In order to comply with REIT requirements, we may need to forgo otherwise attractive opportunities or limit the manner in which we conduct our operations. See "Risks Related to our REIT Status and Certain Other Tax Items" in Item 1A. "Risk Factors" for further information.
Executive Officers
As of the date of filing this Form 10-K, our executive officers included the following:
Name
Position
Year Joined (1)
Age
Brian T. Finnegan
Chief Executive Officer ("CEO") and President
Steven T. Gallagher
Executive Vice President, Chief Financial Officer ("CFO") and Treasurer
Mark T. Horgan
Executive Vice President, Chief Investment Officer
Steven F. Siegel
Executive Vice President, General Counsel and Secretary
(1) Includes predecessors of Brixmor Property Group Inc.
Corporate Headquarters
Brixmor Property Group Inc., a Maryland corporation, was incorporated in 2011. The Operating Partnership, a Delaware limited partnership, was formed in 2011. Our principal executive offices are located at 100 Park Avenue, New York, New York 10017, and our telephone number is (212) 869-3000.
Our website address is https://www.brixmor.com. Information on our website is not incorporated by reference herein and is not a part of this Annual Report on Form 10-K. We make available free of charge on our website our Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K, and any amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Exchange Act, as soon as reasonably practicable after those reports are electronically filed with or furnished to the SEC. We also make available through our website other reports filed with or furnished to the SEC under the Exchange Act, including our proxy statements and reports filed by officers and directors under Section 16(a) of the Exchange Act. You may access these filings by visiting "SEC Filings" under the "Financial Info" section of the "Investors" portion of our website. In addition, the SEC maintains a website that contains reports, proxy and information statements, and other information for issuers, such as us, that file electronically with the SEC at https://www.sec.gov.
Financial and other material information regarding our company is routinely posted on and accessible at the "Investors" portion of our website at https://www.brixmor.com. Investors and others should note that we use our website as a channel of distribution of material information to our investors. Therefore, we encourage investors and others interested in our company to review the information we post on the "Investors" portion of our website. In addition, you may enroll to automatically receive e-mail alerts and other information about our company by visiting "Email Alerts" under the "Additional Info" section of the "Investors" portion of our website.
Dividend Reinvestment & Direct Stock Purchase Plan
Our registrar and stock transfer agent is Computershare Trust Company, N.A. We offer a Dividend Reinvestment and Direct Stock Purchase Plan, providing stockholders and new investors with a simple and convenient method of investing in additional shares of common stock without payment of transaction or processing fees, service charges, or other expenses. Plan inquiries may be directed to (877) 373-6374, or (781) 575-2879 if located outside the U.S. and Canada.
Item 1A. Risk Factors
Risks Related to Our Portfolio and Our Business
Adverse economic, market, and real estate conditions may adversely affect our financial condition, operating results, and cash flows.
Our Portfolio is predominantly comprised of community and neighborhood shopping centers. Our performance is, therefore, subject to risks associated with owning and operating these types of real estate assets. See "Forward-Looking Statements" included elsewhere in this Annual Report on Form 10-K for the factors that could affect our rental income and/or property operating expenses and therefore adversely affect our financial condition, operating results, and cash flows.
Elevated levels of inflation and/or interest rates could adversely affect us and our tenants.
Although recent inflationary pressures have begun to abate, certain price levels have remained high and inflation may increase in the future, and such increases could lead to the Federal Reserve increasing interest rates. Increases in interest rates could result in higher operating and incremental borrowing costs for us and our tenants. Although the terms of our leases, the duration of our indebtedness, and our relatively low exposure to floating rate debt have historically mitigated the direct impact of inflation and interest rate increases, the degree and pace of these changes have had and may continue to have impacts on our business, including as a result of increased financing costs when we refinance our indebtedness, and a potential economic recession, which may lead to higher levels of unemployment and decreases in consumer confidence and/or discretionary spending.
International trade disputes, including U.S. trade tariffs and retaliatory tariffs, could adversely impact our business.
International trade disputes, including threatened or implemented tariffs imposed by the U.S. and threatened or implemented tariffs imposed by foreign countries in retaliation, could adversely impact our business. Many of our tenants sell imported goods and tariffs or other trade restrictions could increase costs for these tenants. To the extent our tenants are unable to pass these costs on to their customers, our tenants could be adversely impacted. In addition, international trade disputes, including those related to tariffs, could result in inflationary pressures that directly impact our costs, such as costs for steel, lumber, and other materials applicable to our redevelopment projects. Trade disputes could also adversely impact global supply chains which could further increase costs for us and our tenants or delay delivery of key inventories and supplies.
We may be required to make rent or other concessions and/or incur significant capital expenditures to retain existing tenants or attract new tenants.
There are numerous shopping venues, including regional malls, outlet malls, other shopping centers, and e-commerce, which compete with our Portfolio in attracting and retaining retailers. As of December 31, 2025, leases are scheduled to expire in our Portfolio on a total of approximately 8.1% of leased GLA during 2026. We may not be able to renew or promptly re-lease expiring space and even if we do renew or re-lease such space, future rental rates may be lower than current rates and other terms may not be as favorable. In addition, we may be required to incur significant capital expenditures in order to retain existing tenants or attract new tenants. In these situations, our financial condition, operating results, and cash flows could be adversely impacted.
Our active value-enhancing reinvestment program subjects us to risks that could adversely affect our financial condition, operating results, and cash flows.
In order to enhance the attractiveness of our Portfolio to retailers and consumers, we actively reinvest in our assets in the form of repositioning and redevelopment projects. In addition to the risks associated with real estate investments in general, as described elsewhere, the risks associated with repositioning and redevelopment projects include: (1) delays or failures in obtaining necessary zoning, occupancy, land use, and other governmental permits; (2) abandonment of projects after expending resources to pursue such opportunities; (3) cost overruns; (4) construction delays; and (5) failure to achieve expected occupancy and/or rent levels within the projected time frame, if at all. If we fail to reinvest in our Portfolio or maintain its attractiveness to retailers and consumers, if our capital improvements are not , or if retailers and consumers perceive that shopping at other venues (including e-commerce) is more convenient, cost-, or otherwise more compelling, our financial condition, operating results, and cash flows could be impacted.
Significant retailer distress across our Portfolio could adversely affect our financial condition, operating results, and cash flows.
Our income is substantially comprised of rental income from tenants in our Portfolio. Our income would be adversely affected if a significant number of our tenants failed to make rental payments when due as a result of either operating challenges or disruptions in credit markets that adversely affect the ability of our tenants to obtain financing on favorable terms or at all. If our tenants are unable to meet their rental obligations, renew leases, or enter into new leases with us, our financial condition, operating results, and cash flows could be adversely impacted.
In certain circumstances, a tenant may have a right to terminate their lease. For example, a failure by an anchor tenant to occupy their leased premises could potentially trigger lease termination rights or reductions in rent due from certain other tenants in that shopping center. In the event of such lease terminations, we cannot be certain that we will be able to re-lease space on similar or economically advantageous terms. The loss of rental income from a significant number of tenants and difficulty in replacing such tenants could adversely affect our financial condition, operating results, and cash flows.
We may be unable to collect outstanding balances and/or future contractual rents due from tenants that file for bankruptcy protection.
When a tenant files for bankruptcy protection, we may not be able to collect amounts owed to us by that party prior to the bankruptcy filing. In addition, after filing for bankruptcy protection, a tenant may terminate any or all of its leases with us, which would result in a general unsecured claim against such tenant that would likely be worth less than the full amount owed to us over the remainder of the lease term. In these situations, we cannot be certain that we will be able to re-lease such space on similar or economically advantageous terms, which could adversely affect our financial condition, operating results, and cash flows.
Our expenses may remain constant or increase, even if income from our Portfolio decreases.
Costs associated with our business, such as common area expenses, utilities, insurance, real estate taxes, and corporate expenses, are relatively inflexible and generally do not decrease due to vacancy, decreasing rental rates, rent collection issues, or other circumstances that may cause our revenues to decrease. In addition, inflation has and could continue to result in higher operating costs. If we are unable to lower our operating costs when revenues decline and/or are unable to fully pass along cost increases to our tenants, our financial condition, operating results, and cash flows could be adversely impacted.
Our real estate investments are relatively illiquid, and we may not be able to dispose of assets in a timely manner, on favorable terms, or at all.
Our ability to dispose of properties on advantageous terms depends on factors beyond our control, including competition from other sellers and the availability of attractive financing for potential buyers, and we cannot predict the various market conditions affecting real estate investments that will exist at any particular time in the future. We may be required to expend funds to correct defects or to make capital improvements before a property can be sold and we cannot be certain that we will have the funds available to make such capital improvements; therefore, we may be unable to sell a property on favorable terms or at all. In addition, the ability to sell assets in our Portfolio may also be restricted by certain covenants in our debt agreements, such as the credit agreement governing our Unsecured Credit Facility. As a result, we may be unable to realize our investment objectives through dispositions, which could adversely affect our financial condition, operating results, and cash flows.
Our real estate assets may be subject to impairment charges.
We periodically assess whether there are any indicators, including property operating performance, changes in anticipated hold period, and general market conditions, that the carrying value of our real estate assets (including any related intangible assets or liabilities) may be impaired. A property’s value is considered to be impaired only if the estimated aggregate future undiscounted and unleveraged property operating cash flows, taking into account the anticipated probability-weighted hold period, are less than the carrying value of the property. Impairment charges have an immediate direct impact on our earnings. We have taken impairment charges on certain of our assets in the past and there can be no assurance that we will not take additional charges in the future. Any future impairment could have an adverse effect on our operating results in the period in which the charge is recognized.
We face competition in pursuing acquisition opportunities, which could increase the cost of such acquisitions and/or limit our ability to grow. To the extent that we are able to complete acquisitions, we may not be able to generate expected returns or successfully integrate such acquisitions into our existing operations.
We continue to evaluate the market for potential acquisitions and we may acquire properties when we believe strategic opportunities exist. Our ability to acquire properties on favorable terms and successfully integrate, operate, reposition, or redevelop such properties is subject to several risks. We may be unable to acquire desired properties because of competition from other real estate investors, including from other well-capitalized REITs and institutional investment funds. Even if we are able to acquire desired properties, competition from such investors may significantly increase the price we must pay. In certain circumstances, we may abandon acquisition activities after expending significant resources to pursue such opportunities. Once we acquire new properties, these properties may not yield expected returns for several reasons, including: (1) failure to achieve expected occupancy and/or rent levels within the projected time frame, if at all; (2) to integrate new properties into existing operations; and (3) fluctuations in the general economy, including due to the time between signing definitive documentation to acquire a new property and the of the acquisition. If any of these events occur, our financial condition, operating results, and cash flows could be impacted.
We utilize a significant amount of indebtedness in the operation of our business. Required debt service payments and other risks related to our debt financing could adversely affect our financial condition, operating results, and cash flows.
As of December 31, 2025, we had approximately $5.5 billion aggregate principal amount of indebtedness outstanding. Our indebtedness could have important consequences to us. For example, it could (1) require us to dedicate a substantial portion of our cash flow to principal and interest payments, reducing the cash flow available to fund our business, pay dividends, including those necessary to maintain our REIT qualification, or use for other purposes; (2) increase our vulnerability to an economic downturn or various competitive pressures, as debt payments are not reduced if the economic performance of any property, or the Portfolio as a whole, deteriorates; and (3) limit our flexibility to respond to changing business and economic conditions. We are also subject to risks related to refinancing our indebtedness, including the risk that interest rates on new indebtedness will be significantly higher than the indebtedness being refinanced. In addition, non-compliance with the terms of our debt agreements could result in the acceleration of a significant amount of indebtedness and could materially impair our ability to borrow unused amounts under existing financing arrangements or to obtain additional financing on favorable terms or at all. Any of these outcomes could adversely affect our financial condition, operating results, and cash flows.
We may be unable to obtain additional capital through the debt and equity markets on favorable terms or at all.
As a REIT, we must annually distribute at least 90% of our REIT taxable income to our stockholders. As a result, we depend on internally generated free cash flow, proceeds from asset sales, and capital raises in the debt and equity markets to fund our business. Our access to external capital depends upon several factors, including general market conditions, our current and potential future earnings, the market’s perception of our growth potential, our liquidity and leverage ratios, and our cash distributions. In recent years, interest rates have fluctuated significantly. Interest rate increases negatively affect our ability to efficiently refinance our outstanding debt. Consequently, we cannot provide assurance that we will be able to access the debt and equity capital markets on favorable terms or at all. Our inability to obtain debt or equity capital could result in the disruption of our ability to: (1) operate, maintain or reinvest in our Portfolio; (2) repay or refinance our indebtedness on or before maturity; (3) acquire new properties; or (4) dispose of some of our assets on favorable terms due to an immediate need for capital. As a result, our financial condition, operating results, and cash flows could be impacted.
Our variable rate indebtedness subjects us to interest rate risk, and an increase in our debt service obligations may adversely affect our financial condition, operating results, and cash flows.
Since 2022, interest rates have been significantly higher than in recent years. As of December 31, 2025, $500.0 million of borrowings under our Term Loan Facility bear interest at variable rates. In addition, we had $1.25 billion of available liquidity under our Revolving Facility which would bear interest at variable rates upon borrowing. When interest rates increase, our debt service obligations on the variable rate indebtedness increase even though the amount borrowed remains the same, and our net income and cash flows correspondingly decrease. If, in the future, we are not able to effectively mitigate these interest rate risks by utilizing interest rate swaps, that we have historically employed, our access to capital, as well as our financial condition, operating results, and cash flows could be adversely impacted.
Adverse changes in our credit rating could affect our borrowing ability and the terms of existing or new financing.
Our creditworthiness is rated by nationally recognized credit rating agencies. The credit ratings assigned are based on our operating performance, liquidity and leverage ratios, financial condition and prospects, and other factors viewed by the credit rating agencies as relevant to our industry. Our credit rating can affect our ability to access debt capital, as well as the terms of certain existing and potential future debt financings. Since we depend on debt financing to fund our business, an adverse change in our credit rating, including changes in our credit outlook, or even the initiation of a review of our credit rating that could result in an adverse change, could adversely affect our financial condition, operating results, and cash flows.
Covenants in our debt agreements could, under certain circumstances, result in an acceleration of our indebtedness.
Our debt agreements contain various financial and operating covenants, including, among other things, certain coverage ratios and limitations on our ability to incur secured and unsecured debt. A breach of any of these covenants, if not cured within any applicable cure period, could result in a default and acceleration of certain of our indebtedness. If any of our indebtedness is accelerated prior to maturity, we may not be able to repay or refinance such indebtedness on favorable terms, or at all, which could adversely affect our financial condition, operating results, and cash flows.
An uninsured property loss or a loss that exceeds the limits of our insurance policies could result in a loss of our investment or revenue associated with those properties.
We carry comprehensive liability, fire, extended coverage, business interruption, and acts of terrorism insurance with policy specifications and insured limits customarily carried for similar properties. There are, however, certain types of losses, such as from hurricanes, tornadoes, floods, earthquakes, terrorism, or wars, where coverages are limited or deductibles may be higher. In addition, tenants generally are required to indemnify and hold us harmless from liabilities resulting from injury to persons or damage to personal or real property on the premises due to activities conducted by tenants or their agents on the properties (including without limitation any environmental contamination), and to obtain liability and property damage insurance policies at the tenant’s expense, kept in full force during the term of the lease. However, tenants may not properly maintain their insurance policies or have the ability to pay the deductibles associated with such policies. Should a loss occur that is uninsured or in an amount exceeding the combined aggregate limits for the policies noted above, or in the event of an insured that is subject to a substantial deductible, we could all or part of the capital invested in, and anticipated revenue from, one or more properties, which could affect our financial condition, operating results, and cash flows.
Environmental conditions that exist at some of the properties in our Portfolio could result in significant unexpected costs.
We are subject to federal, state, and local environmental regulations that apply generally to the ownership of, and the operations conducted on, real property. Under various federal, state, and local laws, ordinances, and regulations, we may be or become liable for the costs of removal or remediation of certain hazardous or toxic substances released on or in our properties or disposed of by us or our tenants, as well as certain other potential costs that could relate to hazardous or toxic substances (including governmental fines and injuries to persons and property). Such liability may be imposed whether or not we knew of, or were responsible for, the presence of these hazardous or toxic substances. As is the case with many community and neighborhood shopping centers, many of our properties had or have on-site dry cleaners and/or on-site gas stations, the prior or current use of which could potentially increase our environmental liability exposure. The costs of investigation and removal or remediation of such substances may be substantial, and the presence of such substances, or the failure to properly remediate such substances, may adversely affect our ability to lease such property, to borrow funds using such property as collateral, or to of such property.
In addition, certain of our properties may contain asbestos-containing building materials ("ACBM"). Environmental laws require that ACBM be properly managed and maintained, and may impose fines and penalties on building owners or operators for failure to comply with these requirements. The laws also may allow third parties to seek recovery from owners or operators for personal injury associated with exposure to asbestos fibers.
Finally, we can provide no assurance that we are aware of all potential environmental liabilities or that the environmental studies performed by us have identified or will identify all material environmental conditions that
may exist with respect to any of the properties in our Portfolio; that any previous owner, occupant, or tenant did not create any material environmental condition unknown to us; that our properties will not be affected by tenants or nearby properties or other unrelated third parties; or that changes in environmental laws and regulations will not result in additional environmental liabilities to us.
Further information relating to recognition of remediation obligations in accordance with GAAP is discussed under the heading "Environmental matters" in Note 15 – Commitments and Contingencies to our Consolidated Financial Statements in this report.
Compliance with the Americans with Disabilities Act, fire, safety, environmental, and other regulations may require us to make expenditures that could adversely affect our financial condition, operating results, and cash flows.
All of the properties in our Portfolio are required to comply with the Americans with Disabilities Act ("ADA"). The ADA has separate compliance requirements for "public accommodations" and "commercial facilities," but generally requires that buildings be made accessible to people with disabilities. Compliance with the ADA requirements may necessitate the removal of access barriers and non-compliance could result in the imposition of fines by the U.S. government, awards of damages to private litigants, or both. We regularly assess our Portfolio to determine our compliance with the current requirements of the ADA. We are required to comply with the ADA within the common areas of our Portfolio and we may not be able to pass on to our tenants the costs necessary to remediate any common area ADA issues, which could adversely affect our financial condition, operating results, and cash flows. In addition, we are required to operate the properties in compliance with fire, safety, and environmental regulations, building codes, and other regulations, as they may be adopted by governmental bodies and become applicable to our Portfolio. As a result, we may be required to make substantial capital expenditures to comply with, and we may be restricted in our ability to renovate or redevelop properties subject to, those requirements. Further, compliance with new or more laws or regulations or stricter interpretations of existing laws may require us to make additional capital expenditures. For example, various federal, state, and local laws and regulations have been implemented or are under consideration to mitigate the effects of climate change caused by greenhouse gas emissions. Among other things, "green" building codes may seek to reduce emissions through the imposition of standards for design, construction materials, water and energy usage and , and waste management. These requirements could increase the costs of maintaining or the properties in our Portfolio and could also result in increased compliance costs or additional operating restrictions that could impact the businesses of our tenants and their ability to pay rent, which could affect our financial condition, operating results, and cash flows.
The direct and indirect impact on us and our tenants from severe weather events, including flooding, wildfires, and hurricanes, could adversely affect our financial condition, operating results, and cash flows.
Our properties have been and may in the future be adversely impacted by flooding, wildfires, high winds, and other effects of severe weather conditions that may be caused or exacerbated by climate change. These events have resulted in and may in the future result in property closures, property damage, and delays in value-enhancing reinvestment stabilizations, and may adversely impact the operations of our tenants. Even if these events do not directly impact our properties, they have impacted and may continue to impact us and our tenants through increases in insurance, energy, or other costs. In addition, changes in laws or regulations, including federal, state, or local laws, relating to reductions in greenhouse gas emissions could result in increased costs and capital expenditures.
Public health crises could materially and adversely affect our financial condition, operating results, and cash flows.
Public health crises can have repercussions across domestic and global economies and financial markets. Government responses to such crises, including quarantines, may force our tenants to temporarily close stores, reduce hours, or significantly limit service and may lead to reduced spending by the retail customer, which may result in significant economic contractions and increases in national unemployment. The direct and indirect impacts of these crises could adversely affect our financial condition, operating results, and cash flows.
We and our tenants face risks relating to cybersecurity incidents that could cause the loss of confidential information or other business disruptions.
We rely extensively on IT systems, including systems through vendors and third parties, to operate and manage our business and process transactions, and as a result, our business is at risk from, and may be impacted by,
cybersecurity incidents. These incidents or interruptions could include attempts to gain unauthorized access to our data and/or IT systems, computer viruses, cyberattacks (including ransomware, malware, unauthorized access attempts, and denial of service and other unintentional intrusions or malicious cyber-attacks), social engineering (including phishing), or other fraudulent schemes. Such activities may be undertaken by individuals or may be highly organized attempts by very sophisticated organizations.
We employ a variety of measures to prevent, detect, and mitigate these threats; however, there is no guarantee that such efforts will be successful in preventing or mitigating a cybersecurity incident. Further, new technologies such as AI may be more capable of evading these safeguard measures. We employ measures designed to detect such cybersecurity threats, but these threats could become more sophisticated and difficult to detect and counteract, which may present significant risks to the security of our IT systems and data. A cybersecurity incident could compromise the confidential information, including the personally identifiable information, of our employees, tenants, and vendors, disrupt the proper functioning of our networks and IT systems, result in misstated financial reports or covenants under various financing agreements, and/or missed reporting deadlines, prevent us from properly monitoring our REIT qualification, result in our to maintain the building systems relied upon by our tenants for the use of their leased space, or require significant management attention and resources to remedy any that result. Cybersecurity could also our reputation and result in significant remediation costs, regulatory or , and potential .
Similarly, our tenants rely extensively on IT systems to process transactions and manage their businesses and thus are also at risk from, and may be impacted by, cybersecurity incidents, which could impact their ability to pay rent timely or at all. Cybersecurity incidents experienced by us or one of our tenants that results in an interruption in business operations and/or a deterioration in reputation could adversely affect our financial condition, operating results, and cash flows. We continue to face ongoing and increasing cybersecurity risks which may materially affect us in the future and there can be no assurance that our cybersecurity efforts and measures will be effective or that attempted cybersecurity incidents or disruptions would not be successful or damaging. Increased regulation and enforcement activity of data collection, use, and retention practices, including self-regulation and industry standards, changes in or new laws and regulations, and changes in interpretation of laws, could increase our cost of compliance and operation, limit our ability to grow our business, or otherwise our business.
Although we maintain insurance that is designed to cover cybersecurity incidents, our coverage may not sufficiently cover all types of losses or claims that may arise or be subject to exclusions. Furthermore, as cybersecurity incidents increase in frequency and magnitude, we may be unable to obtain insurance in amounts and on terms we view as adequate.
The use of, or inability to use, artificial intelligence by us, our tenants, and/or our vendors presents risks that may adversely impact our business and operating results, the business and operating results of our tenants, or demand for properties in our Portfolio.
We may use artificial intelligence ("AI"), including generative or agentic AI, and/or machine learning tools in our operations. Our use of AI tools will subject us to risks, including inaccurate or otherwise flawed results that are not easily detectable, misappropriation of intellectual property which may expose us to legal liability, and confidentiality, data privacy, and cybersecurity risks. Although we implement measures designed to help mitigate these risks, such measures may not always be successful.
Our vendors may use AI tools in their products or services without our knowledge, and the providers of these tools may not meet the evolving regulatory or industry standards for privacy and data protection. Consequently, this may inhibit our vendors' ability to uphold an appropriate level of service, security, or data privacy. If we, our vendors, or other third parties with which we conduct business experience an actual or perceived cybersecurity incident due to the use of AI, we may be adversely impacted, lose valuable intellectual property or confidential information, and incur harm to our reputation and the public perception of the effectiveness of our cybersecurity measures.
Risks Related to Our Organization and Structure
BPG’s board of directors may change significant corporate policies without stockholder approval.
BPG’s investment, financing, and dividend policies and our policies with respect to all other business activities, including strategy and operations, will be determined by BPG’s board of directors. These policies may be amended or revised at any time and from time to time at the discretion of BPG’s board of directors without a vote of our
stockholders. BPG’s charter also provides that BPG’s board of directors may revoke or otherwise terminate our REIT election without the approval of BPG’s stockholders if it determines that it is no longer in BPG’s best interests to continue to qualify as a REIT. In addition, BPG’s board of directors may change BPG’s policies with respect to conflicts of interest, provided that such changes are consistent with applicable legal requirements. A change in any of these policies could have an adverse effect on our financial condition, operating results, and cash flows.
BPG’s board of directors may approve the issuance of stock, including preferred stock, with terms that may discourage a third party from acquiring us.
BPG’s charter permits its board of directors to authorize the issuance of stock in one or more classes or series. Our board of directors may also classify or reclassify any unissued stock and establish the preferences, conversion and other rights, voting powers, restrictions, limitations as to dividends and other distributions, qualifications, and terms and conditions of redemption of any such stock, which rights may be superior to those of our common stock. Thus, BPG’s board of directors could authorize the issuance of shares of a class or series of stock with terms and conditions that could have the effect of discouraging an unsolicited acquisition of us or a change of our control in which holders of some or a majority of BPG’s outstanding common stock may receive a premium for their shares over the then-current market price of our common stock.
The rights of BPG and BPG's stockholders to take action against BPG’s directors and officers are limited.
BPG’s charter eliminates the liability of BPG’s directors and officers to us and BPG’s stockholders for money damages to the maximum extent permitted under Maryland law. Under Maryland law and BPG’s charter, BPG’s directors and officers do not have any liability to BPG or BPG’s stockholders for money damages other than liability resulting from:
• the actual receipt of an improper benefit or profit in money, property, or services; or
• active and deliberate dishonesty by the director or officer that was established by a final judgment and is material to the cause of action adjudicated.
BPG’s charter authorizes, and BPG’s bylaws require, BPG to indemnify each of BPG’s directors and officers who is made a party to or witness in a proceeding by reason of his or her service in those capacities (or in a similar capacity at another entity at the request of BPG), to the maximum extent permitted under Maryland law, from and against any claim or liability to which such person may become subject by reason of his or her status as a present or former director or officer of BPG. In addition, BPG may be obligated to pay or reimburse the expenses incurred by BPG’s present and former directors and officers without requiring a preliminary determination of their ultimate entitlement to indemnification. As a result, BPG and BPG’s stockholders may have more limited rights to recover money damages from BPG’s directors and officers than might otherwise exist absent these provisions in BPG’s charter and bylaws or that might exist with other companies, which could limit the recourse of stockholders.
BPG’s charter contains a provision that expressly permits BPG’s non-employee directors to compete with us.
BPG’s charter provides that, to the maximum extent permitted under Maryland law, BPG renounces any interest or expectancy that BPG has in, or any right to be offered an opportunity to participate in, any business opportunities that are from time to time presented to or developed by BPG’s directors or their affiliates, other than to those directors who are employed by BPG or BPG’s subsidiaries, unless the business opportunity is expressly offered or made known to such person in his or her capacity as a director. Non-employee directors or any of their affiliates will not have any duty to communicate or offer such transaction or business opportunity to us or to refrain from engaging, directly or indirectly, in the same or similar business activities or lines of business in which we or our affiliates engage or propose to engage. These provisions may deprive us of opportunities which we may have otherwise wanted to pursue.
BPG’s charter provides that, to the maximum extent permitted under Maryland law, each of BPG’s non-employee directors, and any of their affiliates, may:
• acquire, hold, and dispose of shares of BPG’s stock or OP Units for his or her own account or for the account of others, and exercise all of the rights of a stockholder of Brixmor Property Group Inc. or a limited partner of our Operating Partnership, to the same extent and in the same manner as if he, she, or they were not BPG’s director or stockholder; and
• in his, her, or their personal capacity or in his, her, or their capacity as a director, officer, trustee, stockholder, partner, member, equity owner, manager, advisor, or employee of any other person, have business interests and engage, directly or indirectly, in business activities that are similar to ours or compete with us, that involve a business opportunity that we could seize and develop or that include the acquisition, syndication, holding, management, development, operation, or disposition of interests in mortgages, real property, or persons engaged in the real estate business.
Risks Related to our REIT Status and Certain Other Tax Items
If BPG does not maintain its qualification as a REIT, it will be subject to tax as a regular corporation and could face a substantial tax liability.
BPG intends to continue to operate so as to qualify as a REIT under the Internal Revenue Code of 1986, as amended (the "Code"). However, qualification as a REIT involves the application of highly technical and complex Code provisions for which only a limited number of judicial or administrative interpretations exist. Notwithstanding the availability of cure provisions in the Code, BPG could fail to meet various compliance requirements, which could jeopardize its REIT status.
If BPG fails to qualify as a REIT in any taxable year and BPG is not entitled to relief under applicable statutory provisions:
• BPG would be taxed as a non-REIT "C" corporation, which under current laws, among other things, means being unable to deduct dividends paid to stockholders in computing taxable income and being subject to U.S. federal income tax on its taxable income at regular corporate income tax rates, which would reduce BPG’s cash flows and funds available for distribution to stockholders; and
• BPG would be disqualified from taxation as a REIT for the four taxable years following the year in which it failed to qualify as a REIT.
Changes to the U.S. federal income tax laws, including the enactment of certain tax reform measures, could have a material and adverse effect on us.
The Internal Revenue Service ("IRS"), the U.S. Treasury Department, and Congress frequently review U.S. federal income tax legislation, regulations, and other guidance. BPG cannot predict whether, when, or to what extent new U.S. federal tax laws, regulations, interpretations, or rulings will be adopted. Any legislative action, including the possibility of major tax legislation, may prospectively or retroactively modify BPG’s tax treatment and, therefore, may adversely affect taxation of BPG or BPG’s stockholders. Stockholders should consult with their tax advisors with respect to the status of legislative, regulatory, or administrative developments and proposals and their potential effect on an investment in BPG’s stock.
Complying with REIT requirements may force BPG to liquidate or restructure investments or forgo otherwise attractive investment opportunities, and/or may discourage BPG from disposing of certain assets.
In order to qualify as a REIT, BPG must satisfy various requirements relating to the types of assets it holds and the nature of its income. In order to satisfy these technical requirements, BPG may be required to liquidate from its portfolio, or contribute to a taxable REIT subsidiary, otherwise attractive investments in order to maintain its qualification as a REIT. These actions could reduce BPG’s income and amounts available for distribution to its stockholders.
In addition, the REIT provisions of the Code impose a 100% tax on income from "prohibited transactions." Prohibited transactions generally include sales of assets, other than foreclosure property, which constitute inventory or other property held for sale to customers in the ordinary course of business. Although BPG does not intend to hold any properties that would be characterized as held for sale to customers in the ordinary course of business, unless a sale or disposition qualifies under certain statutory safe harbors, such characterization is a factual determination and no guarantee can be given that the IRS would agree with BPG’s characterization of its properties or that BPG will be able to make use of the otherwise available safe harbors. The resulting 100% tax could affect BPG’s decisions to sell certain properties if it believes such sales could be treated as prohibited transactions. However, BPG would not be subject to this tax if it were to sell such assets through a taxable REIT subsidiary, instead incurring tax on the asset sale at regular corporate tax rates.
BPG’s charter does not permit any person to own more than 9.8% of BPG’s outstanding common stock or of BPG’s outstanding stock of all classes or series, and attempts to acquire BPG’s common stock or BPG’s stock of all classes or series in excess of these limits would not be effective without an exemption from these limits by BPG’s board of directors.
For BPG to qualify as a REIT under the Code, not more than 50% of the value of BPG’s outstanding stock may be owned directly or indirectly by five or fewer individuals (including certain entities treated as individuals for this purpose) during the last half of a taxable year. For the purpose of assisting BPG’s qualification as a REIT for U.S. federal income tax purposes, among other purposes, BPG’s charter prohibits beneficial or constructive ownership by any individual of more than a certain percentage, currently 9.8%, in value or by number of shares, whichever is more restrictive, of the outstanding shares of BPG’s common stock or 9.8% in value of the outstanding shares of BPG’s capital stock, which BPG refers to as the “ownership limit.” The constructive ownership rules under the Code and BPG’s charter are complex and may cause shares of the outstanding common stock owned by a group of related individuals to be deemed to be constructively owned by one individual. As a result, the acquisition of less than 9.8% of BPG’s outstanding common stock or BPG’s capital stock by an individual could cause the individual to own constructively in excess of 9.8% of BPG’s outstanding common stock or BPG’s capital stock, respectively, and thus violate the ownership limit. Any attempt to own or transfer shares of BPG’s stock in excess of the ownership limit without an exemption from BPG’s board of directors will result either in the shares in excess of the limit being transferred by operation of the charter to a trust or the original transfer being void, and the individual who attempted to acquire such excess shares will not have any rights in such excess shares. In addition, there can be no assurance that BPG’s board of directors, as permitted in the charter, will not decrease this ownership limit in the future.
The ownership limit may have the effect of precluding a change in control of BPG by a third party, even if such change in control would be in the best interests of BPG’s stockholders or would result in BPG’s stockholders receiving a premium for their shares over the then-current market price of BPG’s common stock, and even if such change in control would not reasonably jeopardize BPG’s REIT status.
BPG may choose to make distributions in BPG’s own stock, in which case stockholders may be required to pay income taxes without receiving any cash dividends.
In connection with BPG’s qualification as a REIT, BPG is required to annually 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. Although it does not currently intend to do so, in order to satisfy this requirement, BPG is permitted, subject to certain conditions and limitations, to make distributions that are in whole or in part payable in shares of BPG’s stock. Taxable stockholders receiving such distributions will be required to include a portion, if not all, of such distributions as ordinary dividend income. As a result, stockholders may be required to pay income taxes with respect to such distributions in excess of the cash portion of the distribution received and may be required to sell shares received in such distribution or may be required to sell other stock or assets owned by them, at a time that may be disadvantageous, in order to satisfy any tax imposed on such distribution. In addition, if a significant number of BPG’s stockholders elect to sell shares of BPG’s stock in order to pay taxes owed on dividend income, such sales may put downward pressure on the market price of BPG’s stock.
Item 1B . Unresolved Staff Comments
None.
Item 1C . Cybersecurity
Given the critical importance of cybersecurity, including data privacy, we have developed a cybersecurity program, supported by risk management and oversight procedures. The cybersecurity program includes written policies and standards that take into account the guidance of well-recognized industry cybersecurity frameworks.
Management and Board Oversight
We have dedicated cybersecurity resources, including our incident response team ("IRT"), led by our Chief Information Officer ("CIO") , who regularly provides reports on cybersecurity to our executive officers, including the CEO and CFO. Our IRT members, which are subject to change from time to time, have a diverse range of education and expertise significant experience in fields such as IT, change and incident management, public company governance, accounting, financial controls, risk management, communications, human capital, and legal matters.
We have developed a cybersecurity incident response plan ("CSIRP") for cybersecurity incidents that may jeopardize the confidentiality, integrity, or availability of our IT systems. Our CSIRP guides the internal response to cybersecurity incidents, following a process consistent with well-recognized industry cybersecurity frameworks. Pursuant to the CSIRP and its escalation protocols, we engage the IRT, which includes designated personnel responsible for: (1) analyzing the severity of the incident and associated threat; (2) notifying management of the threat; (3) containing the threat; (4) eradicating the threat; (5) restoring data and access to systems; (6) working with management to determine the reporting and disclosure obligations associated with the incident; and (7) performing post-incident analysis and improvements. The IRT is led by an response coordinator, which in the event of a cybersecurity would generally be the CIO, and includes members of our IT resources, risk management, legal, communications, finance, and accounting teams, in addition to other personnel depending on the particular facts and circumstances of the cybersecurity .
We consider cybersecurity as part of our broader consideration of business strategy and enterprise risk management. Our board of directors has delegated to the Audit Committee the responsibility of overseeing our risk management program, including for the cybersecurity program. The Audit Committee receives quarterly updates from our CIO with respect to the cybersecurity program. As part of its oversight, the Audit Committee may, for example, receive updates regarding assessments of our alignment with certain industry cybersecurity frameworks, our cybersecurity insurance coverage, cybersecurity-related internal controls, results of penetration testing, revisions to the CSIRP, business continuity plans, and threat assessments.
Processes for Assessing, Identifying, and Managing Material Risks from Cybersecurity Threats
Our cybersecurity program has four components: (1) preparation and prevention; (2) detection and analysis; (3) incident response including containment, eradication, recovery, and reporting; and (4) post-incident analysis and program enhancements.
Preparation and Prevention
We utilize a variety of tools, processes, software, and hardware that are managed and monitored by our IT resources including third-party vendors, as applicable, to prevent and prepare for cybersecurity threats. We conduct regular internal and external security audits and vulnerability assessments to reduce the risk of a cybersecurity incident, and we implement business continuity, contingency, and recovery plans to mitigate the impact of an incident. As part of these efforts, we engage a third party to conduct periodic penetration testing and an external review of our vulnerabilities. To support our preparedness, we perform tabletop exercises at least once a year to test our CSIRP.
A key element of our prevention efforts is training employees to recognize and respond to cybersecurity threats. New hires receive mandatory privacy and information security training. Employees must also complete mandatory ongoing annual cybersecurity and data trainings, which are supplemented throughout the year by regular phishing and other cyber-related awareness activities.
To mitigate third-party risk, vendor access to our network resources is reviewed, authorized, and monitored for appropriateness. Third-party IT vendors that are determined to present a higher risk are also subject to additional diligence such as questionnaires, inquiries, and relevant certifications.
Detection and Analysis
Cybersecurity incidents may be detected through a variety of means and indicators, which may include, but are not limited to, alerts from customers, employees, vendors, service providers, other third parties, and/or automated event-detection notifications. Once a potential cybersecurity incident is identified, including a third-party cybersecurity event, the IRT follow the procedures pursuant to the CSIRP to investigate the potential incident.
Containment, Eradication, Recovery, and Reporting
The IRT is responsible for deciding on a containment strategy to respond to the cybersecurity incident, coordinating resources, and communicating to management with subsequent notification to the Audit Committee, if warranted. The IRT also directs and coordinates eradication and recovery efforts. Containment, eradication, and recovery may be aided by third-party vendors or investigators.
Our CSIRP provides clear communication protocols, including with respect to members of management, which may include, depending on the incident's classification and other circumstances, members of the IRT, CEO, CFO, CIO,
General Counsel, Audit Committee, and external counsel. In addition, the CSIRP considers communications and reporting to tenants, regulators, and law enforcement.
Post-Incident Activity
After recovery, the IRT conducts a post-incident analysis for significant cybersecurity incidents to identify potential enhancements to the cybersecurity program that can mitigate the risk and/or severity of future incidents. The results of these reviews are shared with management and the Audit Committee as appropriate.
Cybersecurity Risks
As of December 31, 2025, we have not had any known instances of material cybersecurity incidents, including third-party incidents, during any of the prior three fiscal years. However, there can be no assurance that our cybersecurity efforts and measures will be effective or that attempted cybersecurity incidents or disruptions would not be successful or damaging. See "We and our tenants face risks relating to cybersecurity attacks that could cause the loss of confidential information or other business disruptions" in Item 1A. "Risk Factors" for further information relating to cybersecurity risks.
Item 2 . Properties
As of December 31, 2025, our Portfolio was comprised of 348 shopping centers totaling approximately 63 million square feet of GLA. Our high-quality national Portfolio is primarily located within established trade areas in the top 50 CBSAs in the U.S., and our shopping centers are primarily anchored by non-discretionary and value-oriented retailers, as well as consumer-oriented service providers. As of December 31, 2025, our three largest tenants by ABR were The TJX Companies, Inc., The Kroger Co., and Burlington Stores, Inc.
The following table summarizes our top 20 tenants, ranked by ABR, as of December 31, 2025 (dollars in thousands, except for PSF amounts):
Retailer
Owned Leases (1)
Leased GLA (1)
Percent of GLA (1)
ABR (1)
Percent of ABR (1)
ABR PSF (1)
The TJX Companies, Inc.
The Kroger Co.
Burlington Stores, Inc.
Publix Super Markets, Inc.
Ross Stores, Inc
Dollar Tree Stores, Inc.
Five Below, Inc.
Amazon.com, Inc. / Whole Foods Market Services, Inc.
L.A Fitness International, LLC
Ulta Beauty, Inc.
PetSmart, Inc.
Albertson's Companies, Inc
PETCO Animal Supplies, Inc.
Ahold Delhaize
Kohl's Corporation
The Michaels Companies, Inc.
Barnes & Noble, Inc.
Sprouts Farmers Market, Inc.
Best Buy Co., Inc.
DICK's Sporting Goods, Inc.
TOP 20 RETAILERS
(1) Includes only locations which are owned or guaranteed by the parent company. Excludes all franchise locations.
The following table summarizes the geographic diversity of our Portfolio by state, ranked by ABR, as of December 31, 2025 (dollars in thousands, expect for PSF amounts):
State
Number of Properties
GLA
Percent Billed
Percent Leased
ABR
ABR PSF
Percent of Number of Properties
Percent of GLA
Percent of ABR
Florida
Texas
California
New York
Pennsylvania
Illinois
New Jersey
Georgia
North Carolina
Michigan
Ohio
Colorado
Connecticut
Massachusetts
Tennessee
South Carolina
Kentucky
Minnesota
Indiana
Virginia
New Hampshire
Wisconsin
Maryland
Missouri
Arizona
Maine
Vermont
Kansas
West Virginia
TOTAL
The following table summarizes certain information for our Portfolio by unit size, as of December 31, 2025 (dollars in thousands, expect for PSF amounts):
Number of
Units
GLA
Percent of GLA
Percent Billed
Percent Leased
ABR
Percent of ABR
ABR PSF
TOTAL
TOTAL ≥ 10,000 SF
TOTAL < 10,000 SF
The following table summarizes lease expirations for leases in place within our Portfolio for each of the next 10 calendar years and thereafter, assuming no exercise of renewal options and including the GLA of lessee-owned leasehold improvements, as of December 31, 2025:
Number of Leases
Leased GLA
% of Leased GLA
% of In-Place ABR
In-Place ABR PSF
ABR PSF at Expiration
More specific information with respect to each of our properties is set forth in Exhibit 99.1, which is incorporated herein by reference.
Leases
Our anchor tenants generally have leases with original terms ranging from 10 to 20 years and may or may not have renewal options for one or more additional periods. Smaller tenants typically have leases with original terms ranging from five to 10 years and may or may not have renewal options for one or more additional periods. Leases in our Portfolio generally provide for the payment of fixed monthly base rent. Certain leases also provide for the payment of additional rent based upon a percentage of the tenant’s gross sales above a predetermined threshold. Leases also generally provide for contractual increases in base rent over both the original lease term and any renewal option periods and the reimbursement of property operating expenses such as common area expenses, utilities, insurance, and real estate taxes, and certain capital expenditures related to the maintenance of our properties.
The foregoing general description of the characteristics of the leases of our Portfolio is not intended to describe all leases, and material variations in lease terms may exist.
Insurance
We maintain commercial liability, fire, extended coverage, earthquake, business interruption, and rental loss insurance covering all of the properties in our Portfolio. We select coverage specifications and insured limits which we believe to be appropriate given the relative risk of loss, the cost of coverage, industry practice, and the nature of the shopping centers in our Portfolio. In addition, tenants are generally required to indemnify and hold us harmless from liabilities resulting from injury to persons or damage to personal or real property on the premises due to activities conducted by tenants or their agents at the properties (including without limitation any environmental contamination), and to obtain liability and property damage insurance policies at the tenant’s expense, kept in full force during the term of the lease. In the opinion of our management, all of the properties in our Portfolio are currently adequately insured. We do not carry insurance for generally uninsured , such as from war. See "Risk Factors – Risks Related to Our Portfolio and Our Business – An property or a that exceeds the limits of our insurance policies could result in a of our investment or related revenue in those properties."
Additionally, we have a wholly owned captive insurance company, Brixmor Incap, LLC ("Incap"). Incap underwrites the first layer of general liability insurance for the properties in our Portfolio. We formed Incap as part of our overall risk management program to stabilize insurance costs, manage exposures, and recoup expenses through the function of the captive program. Incap is capitalized in accordance with the applicable regulatory requirements.
Item 3 . Legal Proceedings
The information contained under the heading "Legal Matters" in Note 15 – Commitments and Contingencies to our Consolidated Financial Statements in this report is incorporated by reference into this Item 3.
Item 4. Mine Safety Disclosures
Not applicable.
PART II
Item 5 . Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities
BPG’s common stock trades on the New York Stock Exchange under the trading symbol "BRX." As of February 2, 2026, the number of holders of record of BPG’s common stock was 463. This figure does not represent the actual number of beneficial owners of BPG’s common stock because shares of BPG’s common stock are frequently held in "street name" by securities dealers and others for the benefit of beneficial owners who may vote the shares.
BPG 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, BPG must meet several organizational and operational requirements, including a requirement that it annually 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. Management intends to continue to satisfy these requirements and maintain BPG’s REIT status. As a REIT, BPG 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.
BPG’s future distributions will be at the sole discretion of BPG’s board of directors. When determining the amount of future distributions, we expect that BPG’s board of directors will consider, among other factors; (1) the amount of cash generated from our operating activities; (2) the amount of cash required for leasing and maintenance capital expenditures; (3) the amount of cash required for debt repayments, reinvestment activity, net acquisitions, and share repurchases; (4) the amount of cash required to be distributed to maintain BPG’s status as a REIT and to reduce any income and excise taxes that BPG otherwise would be required to pay; (5) any limitations on our distributions contained in our financing agreements, including, without limitation, in our Unsecured Credit Facility; (6) the sufficiency of legally-available assets; and (7) our ability to continue to access external sources of capital.
To the extent BPG is prevented, by provisions in our financing agreements or otherwise, from distributing 100% of BPG’s REIT taxable income, or otherwise does not distribute 100% of BPG’s REIT taxable income, BPG will be subject to income tax, and potentially excise tax, on the retained amounts. If our operations do not generate sufficient cash flow to allow BPG to satisfy the REIT distribution requirements, we may be required to fund distributions with working capital, additional indebtedness, or asset sales, or we may be required to reduce such distributions or make such distributions, in whole or in part, payable in shares of BPG’s stock. See Item 1A. "Risk Factors" for information regarding risk factors that could adversely affect our financial condition, operating results, and cash flows.
Distributions to the extent of the Company’s current and accumulated earnings and profits for federal income tax purposes will be taxable to stockholders as ordinary dividend income or capital gain income. Distributions in excess of taxable earnings and profits generally will be treated as non-taxable return of capital. Non-taxable return of capital distributions, to the extent that they do not exceed the stockholder’s adjusted tax basis in its common shares, have the effect of deferring taxation until the sale of the stockholder’s common shares. To the extent that distributions are both in excess of taxable earnings and profits and in excess of the stockholder’s adjusted tax basis in its common shares, the distributions will be treated as capital gains from the sale of common shares. For the taxable year ended December 31, 2025, 97.5% of the Company’s distributions to stockholders constituted taxable ordinary income and 2.5% constituted taxable capital gain income. For the taxable year ended December 31, 2024, 100.0% of the Company’s distributions to stockholders constituted taxable ordinary income.
BPG’s Total Stockholder Return Performance
The following performance chart compares, for the period from December 31, 2020 through December 31, 2025, the cumulative total return of BPG’s common stock with the cumulative total return of the S&P 500 Index and the FTSE Nareit Equity Shopping Centers Index. All stockholder return performance assumes the reinvestment of dividends. The information in this paragraph and the following performance chart are deemed to be furnished, not filed.
Sales of Unregistered Equity Securities
There were no sales of unregistered equity securities during the year ended December 31, 2025.
Issuer Purchases of Equity Securities
On October 28, 2025, we renewed our share repurchase program (the "Repurchase Program") for up to $400.0 million of our common stock. The Repurchase Program is scheduled to expire on October 28, 2028, unless suspended or extended by our board of directors. The Repurchase Program replaced our prior share repurchase program, which was scheduled to expire on November 1, 2025. During the three months and year ended December 31, 2025, we did not repurchase any shares of common stock. As of December 31, 2025, the Repurchase Program had $400.0 million of available repurchase capacity.
Item 6 . [Reserved]
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations
The following discussion should be read in conjunction with the Consolidated Financial Statements and the accompanying notes thereto. Historical results and percentage relationships set forth in the Consolidated Financial Statements and accompanying notes, including trends which might appear, should not be taken as indicative of future operations.
Executive Summary
Our Company
Brixmor Property Group Inc. and subsidiaries (collectively, "BPG") is an internally-managed corporation that has elected to be taxed as a real estate investment trust ("REIT"). Brixmor Operating Partnership LP and subsidiaries (collectively, the "Operating Partnership") is the entity through which BPG conducts substantially all of its operations and owns substantially all of its assets. BPG owns 100% of the limited liability company interests of BPG Subsidiary LLC ("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. Unless stated otherwise or the context otherwise requires, "we," "our," and "us" mean BPG and the Operating Partnership, collectively. We own and operate one of the largest publicly traded open-air retail portfolios by gross leasable area ("GLA") in the United States ("U.S."), comprised primarily of grocery-anchored community and neighborhood shopping centers. As of December 31, 2025, our portfolio was comprised of 348 shopping centers (the "Portfolio") totaling approximately 63 million square feet of GLA. Our high-quality national Portfolio is primarily located within established trade areas in the top 50 Core-Based Statistical Areas in the U.S., and our shopping centers are primarily anchored by non-discretionary and value-oriented retailers, as well as consumer-oriented service providers. As of December 31, 2025, our three largest tenants by annualized base rent ("ABR") were The TJX Companies, Inc. ("TJX"), The Kroger Co. ("Kroger"), and Burlington Stores, Inc. ("Burlington"). BPG has been organized and operated in conformity with the requirements for qualification and taxation as a REIT under U.S. federal income tax laws commencing with our taxable year ended December 31, 2011, has maintained such requirements through our taxable year ended December 31, 2025, and intends to such requirements for subsequent taxable years.
Our primary objective is to maximize total returns to our stockholders through consistent, sustainable growth in cash flow. Our key strategies to achieve this objective include proactively managing our Portfolio to drive internal growth, pursuing value-enhancing reinvestment opportunities, and prudently executing on acquisition and disposition activity, while also maintaining a flexible capital structure positioned for growth. In addition, as we execute on our key strategies, we do so guided by our Corporate Responsibility strategy.
We believe the following set of competitive advantages positions us to successfully execute on our key strategies:
• 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, Kroger, and Burlington, 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 three regional offices in Atlanta, 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 benefiting from the regional and local expertise of our leasing and operations teams.
• 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 capital markets capabilities and expertise in executing value-enhancing reinvestment opportunities.
Factors That May Influence Our Future Results
We derive our rental income primarily from base rent and expense reimbursements paid by tenants to us under existing leases at each of our properties. Expense reimbursements primarily consist of payments made by tenants to us for a portion of property operating expenses, such as common area expenses, utilities, insurance, and real estate taxes, and certain capital expenditures related to the maintenance of our properties.
Our ability to maintain or increase rental income is primarily dependent on our ability to maintain or increase rental rates, renew expiring leases, and/or lease available space. Increases in our property operating expenses, including repairs and maintenance, landscaping, snow removal, security, ground rent related to properties for which we are the lessee, utilities, insurance, real estate taxes, and various other costs, to the extent they are not reimbursed by tenants or offset by increases in rental income, will adversely impact our overall performance. See "Forward-Looking Statements" included elsewhere in this Annual Report on Form 10-K for additional information regarding risk factors that could affect our financial condition, operating results, and cash flows.
Leasing Highlights
As of December 31, 2025, billed and leased occupancy were 91.6% and 95.1%, respectively, compared to 91.4% and 95.2%, respectively, as of December 31, 2024.
The following table summarizes our executed leasing activity for the years ended December 31, 2025 and 2024 (dollars in thousands, except for per square foot ("PSF") amounts):
For the Year Ended December 31, 2025
Leases
GLA
New ABR PSF
Tenant Improvements and Allowances PSF
Third-Party Leasing Commissions PSF
Rent Spread (1)
New, renewal and option leases
New and renewal leases
New leases
Renewal leases
Option leases
For the Year Ended December 31, 2024
Leases
GLA
New ABR PSF
Tenant Improvements and Allowances PSF
Third-Party Leasing Commissions PSF
Rent Spread (1)
New, renewal and option leases
New and renewal leases
New leases
Renewal leases
Option leases
(1) Based on comparable leases only, which consist of new leases signed on units that were occupied within the prior 12 months and renewal or option leases signed with the same tenant in all or a portion of the same location or that include the expansion into space that was occupied within the prior 12 months.
Excludes leases executed for terms of less than one year.
ABR PSF includes the GLA of lessee-owned leasehold improvements.
Acquisition Activity
• During the year ended December 31, 2025, we acquired three shopping centers, two land parcels, and acquired a lease and associated subleases at an existing shopping center for an aggregate purchase price of $420.6 million, including transaction costs and closing credits.
• During the year ended December 31, 2024, we acquired seven shopping centers and two land parcels for an aggregate purchase price of $293.8 million, including transaction costs and closing credits.
Disposition Activity
• During the year ended December 31, 2025, we disposed of 18 shopping centers, five partial shopping centers, and one land parcel for aggregate net proceeds of $289.2 million, resulting in aggregate gain of $123.3 million and aggregate impairment of $18.8 million.
• During the year ended December 31, 2024, we disposed of six shopping centers, six partial shopping centers, and two land parcels for aggregate net proceeds of $208.2 million, resulting in aggregate gain of $76.2 million and aggregate impairment of $0.5 million. In addition, during the year ended December 31, 2024, we received aggregate net proceeds of $1.9 million related to land at one shopping center previously seized through eminent domain and resolved contingencies related to previously disposed assets, resulting in aggregate gain of $1.9 million.
Results of Operations
The results of operations discussion is combined for BPG and the Operating Partnership because there are no material differences in the results of operations between the two reporting entities.
Comparison of the Year Ended December 31, 2025 to the Year Ended December 31, 2024
Revenues (in thousands)
Year Ended December 31,
$ Change
Revenues
Rental income
Other revenues
Total revenues
Rental income
The increase in rental income for the year ended December 31, 2025 of $86.0 million, compared to the corresponding period in 2024, was due to a $60.2 million increase for assets owned for the full period, in addition to a $25.8 million increase due to net transaction activity. The increase for assets owned for the full period was due to (i) a $26.9 million increase in base rent; (ii) a $15.7 million increase in expense reimbursements; (iii) a $10.4 million increase in lease termination fees; (iv) a $9.1 million increase in ancillary and other rental income; and (v) a $1.2 million increase in straight-line rental income, net; partially offset by (vi) a $2.4 million decrease in rental income associated with revenues deemed uncollectible; (vii) a $0.6 million decrease in percentage rents; and (viii) a $0.1 million decrease in accretion of below-market leases, net of amortization of above-market leases and tenant inducements. The $26.9 million increase in base rent for assets owned for the full period was primarily due to contractual rent increases, positive rent spreads for new and renewal leases and option exercises of 16.4% during the year ended December 31, 2025 and 16.5% during the year ended December 31, 2024.
Other revenues
The increase in other revenues for the year ended December 31, 2025 of $0.5 million, compared to the corresponding period in 2024, was primarily due to an increase in tax increment financing income.
Operating Expenses (in thousands)
Year Ended December 31,
$ Change
Operating expenses
Operating costs
Real estate taxes
Depreciation and amortization
Impairment of real estate assets
General and administrative
Total operating expenses
Operating costs
The increase in operating costs for the year ended December 31, 2025 of $9.5 million, compared to the corresponding period in 2024, was due to a $5.9 million increase in operating costs for assets owned for the full period, primarily due to an increase in repairs and maintenance, utilities, and insurance, in addition to a $3.6 million increase due to net transaction activity.
Real estate taxes
The increase in real estate taxes for the year ended December 31, 2025 of $13.9 million, compared to the corresponding period in 2024, was due to a $10.4 million increase in real estate taxes for assets owned for the full period and a $3.5 million increase due to net transaction activity. The $10.4 million increase for assets owned for the full period is primarily due to a decrease in favorable adjustments related to prior year assessments recognized in 2024 and an increase in current year assessments, partially offset by an increase in real estate tax refunds.
Depreciation and amortization
The increase in depreciation and amortization for the year ended December 31, 2025 of $33.5 million, compared to the corresponding period in 2024, was due to a $25.2 million increase due to net transaction activity, in addition to an $8.3 million increase for assets owned for the full period. The $8.3 million increase for assets owned for the full period is primarily due to an increase in capital expenditures and an increase in accelerated depreciation and amortization related to tenant move-outs.
Impairment of real estate assets
During the year ended December 31, 2025, aggregate impairment of $20.5 million was recognized on one shopping center as a result of disposition activity, and one operating property. During the year ended December 31, 2024, aggregate impairment of $11.1 million was recognized on one partial shopping center and one land parcel as a result of disposition activity, and two operating properties.
General and administrative
The decrease in general and administrative costs of $3.7 million for the year ended December 31, 2025, compared to the corresponding period in 2024, was primarily due to a decrease in net compensation costs, partially offset by an increase in office rent expense.
During the years ended December 31, 2025 and 2024, construction compensation costs of $16.3 million and $18.9 million, respectively, were capitalized to building and improvements and leasing legal costs of $2.2 million and $3.2 million, respectively, and leasing commission costs of $7.5 million and $7.6 million, respectively, were capitalized to deferred charges and prepaid expenses, net.
Other Income and Expenses (in thousands)
Year Ended December 31,
$ Change
Other income (expense)
Dividends and interest
Interest expense
Gain on sale of real estate assets
Gain (loss) on extinguishment of debt, net
Other
Total other expense
Dividends and interest
The decrease in dividends and interest for the year ended December 31, 2025 of $13.0 million, compared to the corresponding period in 2024, was primarily due to a decrease in interest income associated with lower average cash and cash equivalent balances and a lower weighted average interest rate return.
Interest expense
The increase in interest expense for the year ended December 31, 2025 of $8.7 million, compared to the corresponding period in 2024, was primarily due to a higher weighted average interest rate, partially offset by lower weighted average debt obligations.
Gain on sale of real estate assets
During the year ended December 31, 2025, 17 shopping centers, five partial shopping centers, and one land parcel were disposed of resulting in aggregate gain of $123.3 million. During the year ended December 31, 2024, six shopping centers, five partial shopping centers, and one land parcel were disposed of resulting in aggregate gain of $76.2 million. In addition, during the year ended December 31, 2024, we received aggregate net proceeds of $1.9 million related to land at one shopping center previously seized through eminent domain and resolved contingencies relating to previously disposed assets, resulting in aggregate gain of $1.9 million.
Gain (loss) on extinguishment of debt, net
During the year ended December 31, 2025, we amended and restated our unsecured credit facility agreements (the "Unsecured Credit Facility"), resulting in a $0.3 million loss on extinguishment of debt due to the acceleration of unamortized debt issuance costs. During the year ended December 31, 2024, we repurchased $67.7 million of the $700.0 million 2025 Notes then outstanding, resulting in a $0.6 million gain on extinguishment of debt.
Other
The decrease in other expense for the year ended December 31, 2025 of $0.3 million, as compared to the corresponding period in 2024, was primarily due to a decrease in transaction expenses, net.
Comparison of the Year Ended December 31, 2024 to the Year Ended December 31, 2023
See Item 7. "Management’s Discussion and Analysis of Financial Condition and Results of Operations" in our Form 10-K for the year ended December 31, 2024, filed with the SEC on February 10, 2025, for a discussion of the comparison of the year ended December 31, 2024 to the year ended December 31, 2023.
Liquidity and Capital Resources
We anticipate that our cash flows from the sources listed below will provide adequate capital for the next 12 months and beyond for all anticipated uses, including all scheduled payments on our outstanding debt, current and anticipated tenant and other capital improvements, stockholder distributions to maintain our qualification as a REIT, and other obligations associated with conducting our business.
Our primary expected sources and uses of capital are as follows:
Sources
• cash and cash equivalent balances;
• operating cash flow;
• available borrowings under the Unsecured Credit Facility;
• issuance of long-term debt;
• dispositions; and
• issuance of equity securities.
Uses
• debt repayments;
• maintenance capital expenditures;
• leasing capital expenditures;
• dividend/distribution payments;
• value-enhancing reinvestment capital expenditures;
• acquisitions; and
• repurchases of equity securities.
We believe our capital structure provides us with the financial flexibility and capacity to fund our current capital needs as well as future growth opportunities. We generate significant operating cash flow and have access to multiple forms of external capital, including secured property level debt, unsecured corporate level debt, preferred equity, and common equity, which will allow us to efficiently execute on our strategic and operational objectives. We have investment grade credit ratings from all three major credit rating agencies. As of December 31, 2025, we had $1.61 billion of available liquidity, including $1.25 billion available under our Revolving Facility and $361.5 million of cash and cash equivalents and restricted cash. We intend to continue to enhance our financial and operational flexibility through periodic extensions of the duration of our debt.
Material Cash Requirements
Our expected material cash requirements for the twelve months ended December 31, 2026 and thereafter are comprised of (i) contractually obligated expenditures; (ii) other essential expenditures; and (iii) opportunistic expenditures.
Contractually Obligated Expenditures
The following table summarizes our debt maturities (excluding extension options), interest payment obligations, and obligations under non-cancelable operating leases (excluding renewal options), as of December 31, 2025 (dollars in millions):
Contractually Obligated Expenditures
Twelve
Months Ended
December 31, 2026
Thereafter
Debt maturities (1)
Interest payments (1)(2)
Operating leases
Total
(1) Amounts presented do not assume the issuance of new debt upon maturity of existing debt.
(2) Scheduled interest payments for variable rate loans are presented using rates (including the impact of interest rate swaps), as of December 31, 2025. See Item 7A. "Quantitative and Qualitative Disclosures about Market Risk" for a further discussion of these and other factors that could impact interest payments.
Other Essential Expenditures
We incur certain essential expenditures in the ordinary course of business, such as common area expenses, utilities, insurance, real estate taxes, capital expenditures related to the maintenance of our properties, leasing capital expenditures, and corporate level expenses. The amount of common area expenses, utilities, and capital expenditures related to the maintenance of our properties that we incur depends on the scope of services that we provide, prevailing market rates, and the size and composition of our Portfolio. We carry comprehensive insurance to protect our Portfolio against various losses. The amount of insurance expense that we incur depends on the assessed values of our properties, prevailing market rates, and the size and composition of our Portfolio. We incur real estate taxes in the various jurisdictions in which we operate. The amount of real estate taxes that we incur depends on the assessed values of our properties, the tax rates assessed by various jurisdictions, and the size and composition of our Portfolio. Leasing capital expenditures represent tenant specific costs incurred to lease or renew space, including tenant improvements, tenant allowances, and external leasing commissions. The amount of leasing capital expenditures that we incur depends on the volume and nature of leasing activity. We incur corporate level expenses such as employee compensation costs, professional fees, corporate office rents, and other platform expenses. The amount of corporate level expenses that we incur depends on the size and composition of our Portfolio and platform and prevailing market wages and rates. Leases typically provide for the reimbursement of property operating expenses such as common area expenses, utilities, insurance, and real estate taxes, and certain capital expenditures related to the maintenance of our properties. However, costs that we incur generally do not decrease if revenue or occupancy decrease, and certain costs that we incur, such as corporate level expenses, are not typically reimbursed.
In order to continue to qualify as a REIT for federal income tax purposes, we must meet several organizational and operational requirements, including a requirement that we annually distribute to our stockholders at least 90% of our REIT taxable income, determined without regard to the deduction for dividends paid and excluding net capital gains. We intend to continue to satisfy these requirements and maintain our REIT status. Our board of directors evaluates our dividend on a quarterly basis, taking into account a variety of relevant factors, including REIT taxable income.
The following table summarizes our dividend activity for the fourth quarter of 2025 and the first quarter of 2026:
Fourth
Quarter 2025
First
Quarter 2026
Dividend declared per common share
Dividend declaration date
October 22, 2025
February 4, 2026
Dividend record date
January 5, 2026
April 2, 2026
Dividend payable date
January 15, 2026
April 15, 2026
Opportunistic Expenditures
We also utilize cash for opportunistic expenditures such as value-enhancing reinvestment and acquisition activity.
The amount of value-enhancing reinvestment capital expenditures that we incur depends on a variety of factors that may change from period to period, such as the number, total expected cost, and nature of value-enhancing reinvestment projects that are underway. See “Improvements to and investments in real estate assets” below for further information regarding our in-process reinvestment projects and our pipeline of future redevelopment projects.
The amount of future acquisition expenditures depends on the availability of opportunities that further concentrate our Portfolio in attractive retail submarkets and optimize the quality and long-term growth rate of our asset base. Our acquisition strategy focuses on buying assets with strong growth potential that are located in our existing markets and will allow us to leverage our operational platform and expertise to create value. Our acquisition activity may include acquisitions of open-air shopping centers or non-owned anchor spaces, retail buildings, and/or outparcels at, or adjacent to, our existing shopping centers.
Our cash flow activities are summarized as follows (dollars in thousands):
Brixmor Property Group Inc .
Year Ended December 31,
$ Change
Net cash provided by operating activities
Net cash used in investing activities
Net cash provided by (used in) financing activities
Net change in cash, cash equivalents and restricted cash
Cash, cash equivalents and restricted cash at beginning of period
Cash, cash equivalents and restricted cash at end of period
Brixmor Operating Partnership LP
Year Ended December 31,
$ Change
Net cash provided by operating activities
Net cash used in investing activities
Net cash provided by (used in) financing activities
Net change in cash, cash equivalents and restricted cash
Cash, cash equivalents and restricted cash at beginning of period
Cash, cash equivalents and restricted cash at end of period
Operating Activities
Net cash provided by operating activities primarily consists of cash inflows from tenant rental payments and expense reimbursements and cash outflows for property operating costs, real estate taxes, general and administrative expenses, and interest expense.
During the year ended December 31, 2025, our net cash provided by operating activities increased $27.3 million, compared to the corresponding period in 2024. The increase was primarily due to (i) an increase in same property
net operating income; (ii) an increase in cash from net working capital; (iii) an increase in lease termination fees; (iv) an increase in net operating income due to net transaction activity and other non-same property net operating income; and (v) a decrease in cash outflows for general and administrative expense; partially offset by (vi) an increase in cash outflows for interest expense; and (vii) a decrease in cash inflows for dividends and interest income.
Investing Activities
Net cash used in investing activities is primarily impacted by the nature, timing, and magnitude of acquisition and disposition activity and improvements to and investments in our shopping centers, including capital expenditures associated with our value-enhancing reinvestment activity.
During the year ended December 31, 2025, our net cash used in investing activities increased $15.2 million, compared to the corresponding period in 2024. The increase was primarily due to (i) an increase of $126.8 million in acquisitions of real estate assets; and (ii) a decrease of $0.7 million in sales of marketable securities, net of purchases; partially offset by (iii) an increase of $79.0 million in net proceeds from sales of real estate assets; and (iii) a decrease of $33.3 million in improvements to and investments in real estate assets.
Improvements to and investments in real estate assets
During the years ended December 31, 2025 and 2024, we expended $320.1 million and $353.4 million, respectively, on improvements to and investments in real estate assets. Included in these amounts are insurance proceeds of $7.7 million and $4.8 million, respectively, which were received during the year ended December 31, 2025 and 2024.
Maintenance capital expenditures represent costs to fund major replacements and betterments to our properties. Leasing related capital expenditures represent tenant specific costs incurred to lease or renew space, including tenant improvements, tenant allowances, and external leasing commissions. In addition, we evaluate our Portfolio on an ongoing basis to identify value-enhancing reinvestment opportunities. Such initiatives are tenant driven and focus on upgrading our centers with strong, best-in-class retailers. As of December 31, 2025, we had 33 in-process anchor space repositioning, redevelopment, and outparcel development projects with an aggregate anticipated cost of $336.4 million, of which $153.0 million had been incurred as of December 31, 2025. In addition, we have identified a pipeline of future redevelopment projects, which we expect to execute over the coming years. We expect to fund these projects with cash and cash equivalents, net cash provided by operating activities, proceeds from sales of real estate assets, and/or proceeds from capital markets transactions.
Acquisitions of and proceeds from sales of real estate assets
We continue to evaluate the market for acquisition opportunities and we may acquire individual shopping centers or portfolios of shopping centers when we believe strategic opportunities exist, to further concentrate our Portfolio in attractive retail submarkets and optimize the quality and long-term growth rate of our asset base. During the year ended December 31, 2025, we acquired three shopping centers, two land parcels, and acquired a lease and associated subleases at an existing shopping center for an aggregate purchase price of $420.6 million, including transaction costs and closing credits. During the year ended December 31, 2024, we acquired seven shopping centers and two land parcels for an aggregate purchase price of $293.8 million, including transaction costs and closing credits.
We may also dispose of properties when we believe value has been maximized, where there is downside risk, or where we have limited ability or desire to build critical mass in a particular submarket. During the year ended December 31, 2025, we disposed of 18 shopping centers, five partial shopping centers, and one land parcel for aggregate net proceeds of $289.2 million. During the year ended December 31, 2024, we disposed of six shopping centers, six partial shopping centers, and two land parcels for aggregate net proceeds of $208.2 million. In addition, during the year ended December 31, 2024, we received aggregate net proceeds of $1.9 million related to land at one shopping center previously seized through eminent domain and resolved contingencies related to previously disposed assets.
Financing Activities
Net cash provided by (used in) financing activities is primarily impacted by the nature, timing, and magnitude of issuances and repurchases of debt and equity securities, as well as borrowings or principal payments associated with our outstanding indebtedness, including our Unsecured Credit Facility, and distributions made to our common stockholders.
During the year ended December 31, 2025, our net cash provided by (used in) financing activities decreased $389.1 million, compared to the corresponding period in 2024. The decrease was primarily due to (i) a $243.8 million increase in debt repayments, net of borrowings; (ii) a $115.1 million decrease in issuances of common stock; (iii) a $23.0 million increase in distributions to our common stockholders; (iv) an $8.6 million increase in deferred financing costs; (v) a $0.2 million decrease in contributions from non-controlling interests; and (vi) a $0.1 million increase in distributions to non-controlling interests; partially offset by (vii) a $1.7 million decrease in repurchases of common stock.
Non-GAAP Performance Measures
We present the non-GAAP performance measures set forth below. These measures should not be considered as alternatives to, or more meaningful than, net income (calculated in accordance with GAAP) or other GAAP financial measures, as an indicator of financial performance and are not alternatives to, or more meaningful than, cash flow from operating activities (calculated in accordance with GAAP) as a measure of liquidity. Non-GAAP performance measures have limitations as they do not include all items of income and expense that affect operations, and accordingly, should always be considered as supplemental financial results to those calculated in accordance with GAAP. Our computation of these non-GAAP performance measures may differ in certain respects from the methodology utilized by other REITs and, therefore, may not be comparable to similarly titled measures presented by such other REITs. Investors are cautioned that items excluded from these non-GAAP performance measures are relevant to understanding and addressing financial performance.
Funds From Operations
Nareit FFO (defined hereafter) is a supplemental, non-GAAP performance measure utilized to evaluate the operating and financial performance of real estate companies. Nareit defines funds from operations ("FFO") as net income (calculated in accordance with GAAP) excluding (i) depreciation and amortization related to real estate, (ii) gains and losses from the sale of certain real estate assets, (iii) gains and losses from change in control, (iv) impairment write-downs of certain real estate assets and investments in entities when the impairment is directly attributable to decreases in the value of depreciable real estate held by the entity and (v) after adjustments for unconsolidated joint ventures calculated to reflect FFO on the same basis.
Considering the nature of our business as a real estate owner and operator, we believe that Nareit FFO is useful to investors in measuring our operating and financial performance because the definition excludes items included in net income that do not relate to or are not indicative of our operating and financial performance, such as depreciation and amortization related to real estate, and items which can make periodic and peer analyses of operating and financial performance more difficult, such as gains and losses from the sale of certain real estate assets and impairment write-downs of certain real estate assets.
Our reconciliation of net income (calculated in accordance with GAAP) to Nareit FFO for the years ended December 31, 2025 and 2024 is as follows (in thousands, except per share amounts):
Year Ended December 31,
Net income attributable to Brixmor Property Group Inc.
Depreciation and amortization related to real estate
Gain on sale of real estate assets
Impairment of real estate assets
Nareit FFO
Nareit FFO per diluted share
Weighted average diluted shares outstanding
Same Property Net Operating Income
Same property net operating income ("NOI") is a supplemental, non-GAAP performance measure utilized to evaluate the operating performance of real estate companies. Same property NOI is calculated (using properties owned for the entirety of both periods and excluding properties under development and completed new development properties that have been stabilized for less than one year) as total property revenues (base rent, expense reimbursements, adjustments for revenues deemed uncollectible, ancillary and other rental income, percentage rents, and other revenues) less direct property operating expenses (operating costs and real estate taxes). Same property
NOI excludes (i) lease termination fees, (ii) straight-line rental income, net, (iii) accretion of below-market leases, net of amortization of above-market leases and tenant inducements, (iv) straight-line ground rent expense, net, (v) income or expense associated with our captive insurance company, (vi) depreciation and amortization, (vii) impairment of real estate assets, (viii) general and administrative expense, and (ix) other income and expense (including interest expense and gain on sale of real estate assets).
Considering the nature of our business as a real estate owner and operator, we believe that NOI is useful to investors in measuring the operating performance of our portfolio because the definition excludes various items included in net income that do not relate to, or are not indicative of, the operating performance of our properties, such as lease termination fees, straight-line rental income, net, accretion of below-market leases, net of amortization of above-market leases and tenant inducements, straight-line ground rent expense, net, income or expense associated with our captive insurance company, depreciation and amortization, impairment of real estate assets, general and administrative expense, and other income and expense (including interest expense and gain on sale of real estate assets). We believe that same property NOI is also useful to investors because it further eliminates disparities in NOI by only including NOI of properties owned for the entirety of both periods presented and excluding properties under development and completed new development properties that have been stabilized for less than one year and therefore provides a more consistent metric for comparing the operating performance of our real estate between periods.
Comparison of the Year Ended December 31, 2025 to the Year Ended December 31, 2024
Year Ended December 31,
Change
Number of properties
Percent billed
Percent leased
Revenues
Rental income
Other revenues
Operating expenses
Operating costs
Real estate taxes
Same property NOI
The following table provides a reconciliation of net income (calculated in accordance with GAAP) to same property NOI for the periods presented (in thousands):
Year Ended December 31,
Net income attributable to Brixmor Property Group Inc.
Adjustments:
Non-same property NOI
Lease termination fees
Straight-line rental income, net
Accretion of below-market leases, net of amortization of above-market leases and tenant inducements
Straight-line ground rent expense
Depreciation and amortization
Impairment of real estate assets
General and administrative
Total other expense
Net income attributable to non-controlling interests
Same property NOI
Our Critical Accounting Estimates
Our discussion and analysis of our historical financial condition and operating results is based upon our Consolidated Financial Statements, which have been prepared in accordance with GAAP. The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported in the Consolidated Financial Statements and accompanying notes. Actual results could ultimately differ from those estimates. The following accounting estimates are considered critical because they are particularly dependent on management’s judgment about matters that have a significant level of uncertainty at the time the accounting estimates are made, and changes to those estimates could have a material impact on our financial condition or operating results.
Revenue Recognition and Receivables - Estimating Collectability
We enter into agreements with tenants that convey the right to control the use of identified space at our shopping centers in exchange for rental revenue. These agreements meet the criteria for recognition as leases under Accounting Standards Codification ("ASC") 842, Leases . Rental revenue is recognized on a straight-line basis over the terms of the related leases. The cumulative difference between rental revenue recognized on our Consolidated Statements of Operations and contractual payment terms is recognized as deferred rent and included in Receivables, net on our Consolidated Balance Sheets. We commence recognizing rental revenue based on the date we make the underlying asset available for use by the tenant. Leases also typically provide for the reimbursement of property operating expenses, including common area expenses, utilities, insurance, and real estate taxes, and certain capital expenditures related to the maintenance of our properties, by the lessee and are recognized in the period the applicable expenditures are incurred and/or contractually required to be reimbursed.
We periodically evaluate the collectability of our receivables related to rental revenue, straight-line rent, expense reimbursements, and those attributable to other revenue generating activities. We analyze individual tenant receivables and consider tenant credit-worthiness, the length of time a receivable has been outstanding, and current economic trends when evaluating collectability. Any receivables that are deemed to be uncollectible are recognized as a reduction to Rental income on our Consolidated Statements of Operations.
Real Estate - Estimates Related to Valuing Acquired Assets and Liabilities
Real estate assets are recognized on our Consolidated Balance Sheets at historical cost, less accumulated depreciation and amortization. Upon acquisition of real estate operating properties, we estimate the fair value of acquired tangible assets (consisting of land, buildings, and tenant improvements) and identifiable intangible assets and liabilities (consisting of above- and below-market leases and in-place leases) based on an evaluation of available information. Transaction costs incurred during the acquisition process are capitalized as a component of the asset’s value.
The fair value of tangible assets is determined as if the acquired property is vacant. Fair value is determined using an exit price approach, which contemplates the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date.
In allocating fair value to identifiable intangible assets and liabilities, the value of above-market and below-market leases is estimated based on the present value (using a discount rate reflecting the risks associated with the leases acquired) of the difference between: (i) the contractual amounts to be paid pursuant to the leases negotiated and in-place at the time of acquisition and (ii) management’s estimate of fair market lease rates for the property or an equivalent property, measured over a period equal to the lesser of 30 years or the remaining non-cancelable term of the leases, which includes renewal periods with fixed rental terms that are considered to be below-market. The capitalized above-market or below-market intangibles are amortized as a reduction of, or increase to, rental income over the remaining non-cancelable term of the leases.
The value of in-place leases is estimated based on management’s evaluation of the specific characteristics of each tenant lease, including: (i) fair market rent and the reimbursement of property operating expenses, including common area expenses, utilities, insurance, real estate taxes, and certain capital expenditures related to the maintenance of our properties, that would be forgone during a hypothetical expected lease-up period and (ii) costs that would be incurred, including leasing commissions, legal and marketing costs, and tenant improvements and allowances, to execute similar leases. The value assigned to in-place leases is amortized to depreciation and amortization expense over the remaining term of each lease.
Real Estate - Estimates Related to Impairments
We periodically assess whether there are any indicators, including property operating performance, changes in anticipated hold period, and general market conditions, that the carrying value of our real estate assets (including any related intangible assets or liabilities) may be impaired. If an indicator is identified, a real estate asset is considered impaired only if our estimate of aggregate future undiscounted and unleveraged property operating cash flows, taking into account the anticipated probability-weighted hold period, is less than the carrying value of the property. Various factors are considered in the estimation process that are subject to significant management judgment, including the anticipated hold period, current and/or future reinvestment projects, and the effects of demand and competition on future operating income and/or property values. Changes in any estimates and/or assumptions, particularly the anticipated hold period, could have a material impact on the projected operating cash flows. If management determines that the carrying value of a real estate asset is impaired, an impairment charge is recognized to reflect the estimated fair value of the asset.
When we identify a real estate asset as held for sale, we discontinue depreciating the asset and estimate its sales price, net of estimated selling costs. If the estimated net sales price of an asset is less than its net carrying value, an impairment charge is recognized to reflect the estimated fair value of the asset.
Inflation
We continue to monitor the impacts of inflation and tariffs on our operating and financial performance. With respect to our shopping centers, our long-term leases generally contain provisions designed to mitigate the adverse impact of inflation, including contractual rent escalations and requirements for tenants to pay a portion of property operating expenses, including common area expenses, utilities, insurance, and real estate taxes, and certain capital expenditures related to the maintenance of our properties, thereby reducing our exposure to increases in property operating expenses resulting from inflation. However, we have exposure to increases in certain non-reimbursable property operating expenses, including expenses incurred on vacant units. In addition, tariffs may contribute to rising construction and redevelopment costs and tariffs on imported goods may impact many of our tenants, particularly those who rely on international supply chains, by increasing their cost of goods sold or delaying inventory deliveries. If tenants are unable to pass these increased costs on to customers, it could adversely affect their financial performance and ability to meet lease obligations. We believe that many of our existing rental rates are below current market rates for comparable space and that upon renewal or re-leasing, such rates may be increased to be consistent with, or closer to, current market rates, which may also offset certain non-reimbursed inflationary and trade-related expense pressures. With respect to our outstanding indebtedness, we periodically evaluate our exposure to interest rate fluctuations and have entered, and may continue to, enter into interest rate protection agreements that mitigate, but do not eliminate, the impact of changes in interest rates on our variable rate loans. With respect to general and administrative costs, we continually seek to offset inflationary cost pressures through routine evaluations of our spending levels and through ongoing efforts to utilize technology to our operational .
Recent Tax Legislation
Effective July 4, 2025, certain changes to U.S. tax law were approved that impact us and our stockholders. Among other changes, this legislation (i) permanently extended the 20% deduction for "qualified REIT dividends" for individuals and other non-corporate taxpayers under Section 199A of the Internal Revenue Code (the "Code"), (ii) increased the percentage limit under the REIT asset test applicable to taxable REIT subsidiaries ("TRSs") from 20% to 25% for taxable years beginning after December 31, 2025, and (iii) increases the base on which the 30% interest deduction limit under Section 163(j) of the Code applies by excluding depreciation, amortization and depletion from the definition of "adjusted taxable income" (i.e. based on EBITDA rather than EBIT) for taxable years beginning after December 31, 2024.
Item 7A . Quantitative and Qualitative Disclosures About Market Risk
We may be exposed to interest rate changes primarily as a result of long-term debt used to fund operations and capital expenditures. Our use of derivative instruments is intended to manage our exposure to interest rate movements.
With regard to variable-rate financing, we assess interest rate risk by continually identifying and monitoring changes in interest rate exposures that may adversely impact expected future cash flows and by evaluating hedging opportunities. We maintain risk management control systems to monitor interest rate cash flow risk attributable to both our outstanding and forecasted debt obligations, as well as our potential offsetting hedge positions. Our risk management control systems involve the use of analytical techniques, including cash flow sensitivity analysis, to estimate the expected impact of changes in interest rates on our future cash flows.
We may use derivative financial instruments to hedge exposures to changes in interest rates. To the extent we do, we are exposed to market and credit risk. Market risk is the adverse effect on the value of the financial instrument that results from a change in interest rates. Market risk associated with derivative instruments is managed by establishing and monitoring parameters that limit the types and degree of market risk that may be undertaken. Credit risk is the failure of the counterparty to perform under the terms of the derivative contract. When the fair value of the derivative instrument is positive, the counterparty owes us, which creates credit risk to us. The credit risk associated with derivative instruments is managed by entering into transactions with a variety of highly-rated counterparties.
As of December 31, 2025, we had $500.0 million outstanding variable-rate indebtedness which bears interest at a rate equal to the Secured Overnight Financing Rate ("SOFR") plus credit spreads ranging from 77.5 basis points to 85 basis points. We have entered into interest rate swap agreements on $500.0 million of our variable-rate indebtedness, which involve the exchange of variable for fixed rate interest payments, effectively converting the base rate on the indebtedness from variable to fixed. Taking into account our current $500.0 million of interest rate swap agreements, a 100 basis point increase or decrease in interest rates our variable-rate debt would not increase or decrease earnings and cash flows.
The table below presents the maturity profile, weighted average interest rates and fair value of total debt as of December 31, 2025. The table has limited predictive value as average interest rates for variable-rate debt included in the table represent rates that existed as of December 31, 2025 and are subject to change. Furthermore, the table below incorporates only those exposures that existed as of December 31, 2025 and does not consider exposures or positions that may have arisen or expired after that date. As a result, our ultimate realized gain or loss with respect to interest rate fluctuations will depend on the exposures that arise during future periods, our hedging strategies at that time, and actual interest rates.
(dollars in thousands)
Unsecured Debt
Thereafter
Total
Fair Value
Fixed rate
Weighted average interest rate (1)
Variable rate
Weighted average interest rate (1)(2)(3)
(1) Weighted average interest rates for all years presented include the impact of our interest rate swap agreements in place as of December 31, 2025 and are calculated based on the total debt balances as of the end of each year, assuming the repayment of debt on its scheduled maturity date.
(2) The interest rates on our variable rate Unsecured Credit Facility are based on credit rating grids. The credit rating grids and all-in-rates on outstanding variable rate debt as of December 31, 2025 are as follows:
Credit Spread Grid
As of December 31, 2025
SOFR Rate Loans
Base Rate Loans
Variable Rate Debt
SOFR Rate
Credit Spread
All-in-Rate
Credit Spread
Credit Spread
Revolving Facility (1)(2)
Term Loan Facility (2)
(1) Our Revolving Facility is further subject to a facility fee ranging from 0.13% to 0.30%, which is excluded from the all-in-rate presented above.
(2) The Company's Revolving Facility and Term Loan Facility include incentives based on the achievement of certain leverage ratio metric targets, which can reduce the applicable credit spread by up to 7.5 basis points and 10 basis points, respectively. As of December 31, 2025, the Term Loan Facility and Revolving Credit Facility qualify for reductions of 7.5 basis points and 10 basis points, respectively, in the applicable credit spreads.
(3) We have in place seven interest rate swap agreements that convert the variable interest rate on one variable rate debt instrument to a fixed rate. The balance subject to interest rates swaps as of December 31, 2025 is as follows (dollars in thousands):
As of December 31, 2025
Variable Rate Debt
Amount
Weighted Average Fixed SOFR Rate
Credit Spread
Swapped All-in-Rate
Term Loan Facility
