Quarterly report pursuant to Section 13 or 15(d)

INVESTMENT PROPERTIES

v3.24.3
INVESTMENT PROPERTIES
 9 Months Ended
Sep. 30, 2024
Real Estate [Abstract]  
INVESTMENT PROPERTIES INVESTMENT PROPERTIES
As of September 30, 2024, the Trust's real estate portfolio consisted of 125 Retail Properties, two of which were classified as held for sale, across 35 U.S. states and Puerto Rico.

The following table presents the amortization during the next five years and thereafter related to the lease intangible assets and liabilities for properties owned as of September 30, 2024, excluding the two Retail Properties classified as held for sale:

Period from October 1 to December 31, 2024
 2025 2026 2027 2028 Thereafter Total
Amortization of:
Above market lease intangibles (a) $ 1,876  $ 7,507  $ 7,507  $ 7,507  $ 7,507  $ 90,078  $ 121,982 
In-place lease intangibles (a) 1,128  4,511  4,511  4,511  4,511  54,130  73,302 
Lease intangible assets, net (b) $ 3,004  $ 12,018  $ 12,018  $ 12,018  $ 12,018  $ 144,208  $ 195,284 
Below market lease intangibles (a) $ 1,214  $ 4,854  $ 4,854  $ 4,854  $ 4,854  $ 58,254  $ 78,884 
Lease intangible liabilities, net (b) $ 1,214  $ 4,854  $ 4,854  $ 4,854  $ 4,854  $ 58,254  $ 78,884 

(a)Represents the portion of the leases in which the Trust is the lessor. The amortization of above market lease intangibles is recorded as a reduction to lease income, and the amortization of below market lease intangibles is recorded as an increase to lease income. The amortization of in-place lease intangibles is recorded to depreciation and amortization expense.

(b)As of September 30, 2024, lease intangible assets, net and lease intangible liabilities, net are presented net of $44,443 and $18,953 of accumulated amortization, respectively. As of December 31, 2023, lease intangible assets, net and lease intangible liabilities, net are presented net of $36,373 and $15,969 of accumulated amortization, respectively.

As of September 30, 2024 and December 31, 2023, the weighted average amortization period for lease intangible assets and lease intangible liabilities was 16.3 years and 17.0 years, respectively.
Amortization for the three and nine months ended September 30, 2024 and 2023 were as follows:

Three Months Ended September 30, Nine Months Ended September 30,
2024 2023 2024 2023
Amortization of:
In-place lease intangibles $ 1,148  $ 1,204  $ 3,510  $ 3,627 
Above market lease intangibles $ 1,881  $ 1,933  $ 5,679  $ 5,847 
Below market lease intangibles $ 1,264  $ 1,387  $ 3,919  $ 4,180 

Dispositions

The following table summarizes the disposition activity for the nine months ended September 30, 2024:

Sale Date Location Property Type Ownership Square Footage Gross Sales Proceeds Aggregate Proceeds, Net
Gain (Loss)
3/15/24 Transnational Portfolio (1) Retail Fee Simple 302  $ 16,459  $ 16,096  $ 1,497 
6/10/24 Roseville, CA Retail Fee Simple 167  13,364  13,113  1,026 
9/30/24 Miami, FL Retail Fee Simple 150  12,249  12,107  1,869 
619  $ 42,072  41,316  $ 4,392 

(1) Portfolio comprised of three Retail Properties located in Newnan, Georgia; Aurora, Colorado; Kissimmee, Florida.

For the nine months ended September 30, 2024, gain on sales of investment properties, net was $4,316, which includes (i) a gain of $4,392 resulting from the dispositions of Retail Properties during the nine months ended September 30, 2024 (as summarized in the table above), (ii) a gain of $78 in proceeds released from escrow due to a disposition that occurred in December 2022 and (iii) $154 of selling expenses from prior period dispositions.
The following table summarizes the disposition activity during the nine months ended September 30, 2023:
Sale Date Location Property Type Ownership Square Footage Gross Sales Proceeds Aggregate Proceeds, Net Gain (Loss)
3/22/23 Temecula, CA Retail Fee Simple 125  $ 6,000  $ 5,869  $ (496)
8/9/23 Katy, TX Retail Fee Simple 100  11,282  11,029  2,687 
225  $ 17,282  16,898  $ 2,191 
During the nine months ended September 30, 2023, gain on sales of investment properties, net was $3,515, which includes (i) a gain of $1,326 less $2 of selling expenses released from escrow due to a disposition that occurred in December 2021 and (ii) a net gain of $2,191 from the dispositions of the Retail Properties in Temecula, California and Katy, Texas.

The dispositions completed during the nine months ended September 30, 2024 and 2023 did not qualify for discontinued operations treatment and are not considered individually significant.

Held for Sale

The following Retail Properties were classified as held for sale as of September 30, 2024:

Location Carrying Value Date of Sale
Gross Sales Price
Cherry Hill, NJ $ 4,627 
(1)
 October 25, 2024 $ 4,804 
Lynnwood, WA $ 11,934  October 25, 2024 $ 12,894 
(1) Prior to disposition, this Property was remeasured to fair value and a provision for impairment of $2,081 was recognized.

Real estate held for sale consisted of the following at September 30, 2024:
Land and improvements $ 9,750 
Building and other improvements 11,488 
Less: accumulated depreciation (1,437)
Net investment properties 19,801 
Accounts receivable 382 
Lease intangible assets, net 1,731 
Other assets 66 
Assets associated with investment properties held for sale $ 21,980 
Accounts payable and accrued expenses $ 31 
Lease intangible liabilities, net 5,276 
Other liabilities 112 
Liabilities associated with investment properties held for sale $ 5,419 

As of September 30, 2023, there were no properties classified as held for sale.

Impairment of Investment Properties

During the nine months ended September 30, 2024, the Trust recognized an impairment charge of $2,081 related to an adjustment to the carrying value of a Retail Property in Cherry Hill, New Jersey that was classified as held for sale as of September 30, 2024. There was no adjustment to the carrying value of the Retail Property in Lynnwood, Washington that was also classified as held for sale as of September 30, 2024. See Note 5 for fair value disclosure.