[10-Q] Acadia Realty Trust Quarterly Earnings Report
Q2-25 turnaround: Antero Resources (AR) generated $1.30 B revenue (+32% YoY) and swung to $204.9 M operating income from an $80.1 M loss. Net income attributable to common shareholders was $156.6 M (diluted EPS 0.50) versus a –0.26 loss per share in Q2-24. YTD revenue reached $2.65 B (+26%) and net income $364.6 M after a prior-year loss.
Drivers: Natural-gas sales nearly doubled to $689 M; NGL revenue remained flat and oil fell 47%. A $53.4 M derivative gain versus a $5.6 M loss last year boosted results. Total operating expenses grew 3% to $1.09 B; gathering, compression & transportation remain the largest cost line at $702 M.
Balance sheet & cash flow: Long-term debt declined $390 M to $1.10 B, cutting leverage. Stockholders’ equity rose to $7.31 B. Operating cash flow surged to $950 M six-month YTD (+135%), funding $405 M of capex and $85 M share repurchases. Liquidity includes a $1.5 B unused unsecured credit facility now extended to 2030.
Key metrics (Q2-25):
- Adj. revenue from customers: $1.24 B
- Depletion, DD&A: $187.6 M (flat YoY)
- Shares out. 6/30/25: 309.9 M (-0.4 M QoQ)
Outlook signals: Higher gas sales, reduced debt and strong cash generation indicate improved financial flexibility, though oil pricing and high midstream costs remain pressure points.
Risultati Q2-25: Antero Resources (AR) ha registrato un fatturato di 1,30 miliardi di dollari (+32% su base annua) e ha raggiunto un utile operativo di 204,9 milioni di dollari passando da una perdita di 80,1 milioni. L'utile netto attribuibile agli azionisti ordinari è stato di 156,6 milioni di dollari (EPS diluito 0,50) rispetto a una perdita per azione di –0,26 nel Q2-24. Il fatturato da inizio anno ha raggiunto 2,65 miliardi di dollari (+26%) e l'utile netto 364,6 milioni di dollari dopo una perdita nell'anno precedente.
Fattori trainanti: Le vendite di gas naturale sono quasi raddoppiate a 689 milioni di dollari; i ricavi da NGL sono rimasti stabili mentre il petrolio è calato del 47%. Un guadagno da derivati di 53,4 milioni di dollari rispetto a una perdita di 5,6 milioni dell’anno scorso ha migliorato i risultati. Le spese operative totali sono cresciute del 3% a 1,09 miliardi; raccolta, compressione e trasporto restano la voce di costo più rilevante con 702 milioni di dollari.
Bilancio e flusso di cassa: Il debito a lungo termine è diminuito di 390 milioni di dollari a 1,10 miliardi, riducendo la leva finanziaria. Il patrimonio netto degli azionisti è salito a 7,31 miliardi di dollari. Il flusso di cassa operativo da inizio anno è aumentato a 950 milioni di dollari (+135%), finanziando 405 milioni di investimenti e 85 milioni di riacquisto azioni. La liquidità comprende una linea di credito non utilizzata da 1,5 miliardi di dollari, ora estesa fino al 2030.
Indicatori chiave (Q2-25):
- Ricavi rettificati da clienti: 1,24 miliardi di dollari
- Deplezione, DD&A: 187,6 milioni di dollari (stabili su base annua)
- Azioni in circolazione al 30/6/25: 309,9 milioni (-0,4 milioni rispetto al trimestre precedente)
Prospettive: L’aumento delle vendite di gas, la riduzione del debito e la forte generazione di cassa indicano una maggiore flessibilità finanziaria, sebbene il prezzo del petrolio e i costi elevati del midstream restino fattori di pressione.
Resultados Q2-25: Antero Resources (AR) generó ingresos de 1,30 mil millones de dólares (+32% interanual) y pasó a un ingreso operativo de 204,9 millones de dólares desde una pérdida de 80,1 millones. El ingreso neto atribuible a los accionistas comunes fue de 156,6 millones de dólares (EPS diluido 0,50) frente a una pérdida de –0,26 por acción en el Q2-24. Los ingresos acumulados alcanzaron 2,65 mil millones de dólares (+26%) y el ingreso neto 364,6 millones de dólares tras una pérdida el año anterior.
Factores clave: Las ventas de gas natural casi se duplicaron a 689 millones; los ingresos por NGL se mantuvieron estables y el petróleo cayó un 47%. Una ganancia por derivados de 53,4 millones frente a una pérdida de 5,6 millones el año pasado impulsó los resultados. Los gastos operativos totales crecieron un 3% hasta 1,09 mil millones; recolección, compresión y transporte siguen siendo el mayor gasto con 702 millones.
Balance y flujo de caja: La deuda a largo plazo disminuyó 390 millones hasta 1,10 mil millones, reduciendo el apalancamiento. El patrimonio neto aumentó a 7,31 mil millones. El flujo de caja operativo acumulado subió a 950 millones (+135%), financiando 405 millones en capex y 85 millones en recompra de acciones. La liquidez incluye una línea de crédito no utilizada de 1,5 mil millones, ahora extendida hasta 2030.
Métricas clave (Q2-25):
- Ingresos ajustados de clientes: 1,24 mil millones
- Depreciación, DD&A: 187,6 millones (estable interanual)
- Acciones en circulación al 30/6/25: 309,9 millones (-0,4 millones trimestral)
Perspectivas: El aumento en ventas de gas, la reducción de deuda y la fuerte generación de efectivo indican mayor flexibilidad financiera, aunque los precios del petróleo y los altos costos de midstream siguen siendo desafíos.
2025년 2분기 실적: Antero Resources(AR)는 13억 달러 매출(전년 대비 32% 증가)을 기록했으며, 2억 490만 달러 영업이익으로 8010만 달러 적자에서 흑자로 전환했습니다. 보통주주 귀속 순이익은 1억 5660만 달러(희석 주당순이익 0.50)로, 2024년 2분기 주당 –0.26 달러 손실에서 개선되었습니다. 연초부터 매출은 26억 5000만 달러(26% 증가), 순이익은 전년 적자 대비 3억 6460만 달러를 기록했습니다.
주요 동인: 천연가스 판매가 거의 두 배 증가하여 6억 8900만 달러에 달했으며, NGL 매출은 유지되었고 원유 매출은 47% 감소했습니다. 5,340만 달러 파생상품 이익은 작년 560만 달러 손실 대비 실적을 견인했습니다. 총 영업비용은 3% 증가한 10억 9000만 달러이며, 집하, 압축 및 운송 비용이 7억 200만 달러로 가장 큰 비중을 차지합니다.
재무 상태 및 현금 흐름: 장기 부채는 3억 9천만 달러 감소해 11억 달러가 되었고, 레버리지가 줄었습니다. 주주 지분은 73억 1000만 달러로 증가했습니다. 영업 현금 흐름은 연초부터 9억 5천만 달러(135% 증가)로 급증해, 4억 500만 달러의 자본 지출과 8500만 달러의 자사주 매입을 지원했습니다. 유동성에는 2030년까지 연장된 15억 달러 미사용 무담보 신용 한도가 포함됩니다.
주요 지표 (2025년 2분기):
- 고객으로부터 조정 매출: 12억 4000만 달러
- 감가상각 및 DD&A: 1억 8760만 달러(전년 대비 변동 없음)
- 2025년 6월 30일 기준 발행 주식 수: 3억 999만 주(전분기 대비 40만 주 감소)
전망 신호: 가스 판매 증가, 부채 감소 및 강력한 현금 창출은 재무 유연성 향상을 시사하지만, 유가와 높은 미드스트림 비용은 여전히 부담 요인입니다.
Résultats T2-25 : Antero Resources (AR) a généré un chiffre d'affaires de 1,30 milliard de dollars (+32 % en glissement annuel) et est passé à un résultat opérationnel de 204,9 millions de dollars contre une perte de 80,1 millions. Le résultat net attribuable aux actionnaires ordinaires s’est élevé à 156,6 millions de dollars (BPA dilué de 0,50) contre une perte de –0,26 par action au T2-24. Le chiffre d’affaires cumulé atteint 2,65 milliards de dollars (+26 %) et le résultat net 364,6 millions de dollars après une perte l’année précédente.
Facteurs clés : Les ventes de gaz naturel ont presque doublé à 689 millions de dollars ; les revenus de NGL sont restés stables tandis que le pétrole a chuté de 47 %. Un gain sur dérivés de 53,4 millions de dollars contre une perte de 5,6 millions l’an dernier a soutenu les résultats. Les dépenses opérationnelles totales ont augmenté de 3 % à 1,09 milliard ; la collecte, la compression et le transport restent la principale ligne de coûts avec 702 millions.
Bilan et flux de trésorerie : La dette à long terme a diminué de 390 millions pour s’établir à 1,10 milliard, réduisant l’effet de levier. Les capitaux propres sont passés à 7,31 milliards. Le flux de trésorerie opérationnel cumulé a bondi à 950 millions (+135 %), finançant 405 millions d’investissements et 85 millions de rachats d’actions. La liquidité comprend une facilité de crédit non utilisée de 1,5 milliard, désormais prolongée jusqu’en 2030.
Indicateurs clés (T2-25) :
- Revenus ajustés des clients : 1,24 milliard
- Amortissements, DD&A : 187,6 millions (stable en glissement annuel)
- Actions en circulation au 30/06/25 : 309,9 millions (-0,4 million par rapport au trimestre précédent)
Perspectives : La hausse des ventes de gaz, la réduction de la dette et la forte génération de trésorerie indiquent une meilleure flexibilité financière, bien que les prix du pétrole et les coûts élevés du midstream restent des points de pression.
Q2-25 Ergebnis: Antero Resources (AR) erzielte einen Umsatz von 1,30 Mrd. USD (+32 % im Jahresvergleich) und drehte zu einem operativen Gewinn von 204,9 Mio. USD von einem Verlust von 80,1 Mio. USD. Der auf Stammaktionäre entfallende Nettogewinn betrug 156,6 Mio. USD (verwässertes EPS 0,50) gegenüber einem Verlust von –0,26 je Aktie im Q2-24. Der Umsatz seit Jahresbeginn erreichte 2,65 Mrd. USD (+26 %) und der Nettogewinn 364,6 Mio. USD nach einem Vorjahresverlust.
Treiber: Der Verkauf von Erdgas verdoppelte sich nahezu auf 689 Mio. USD; die Erlöse aus NGL blieben stabil, während Öl um 47 % fiel. Ein Derivategewinn von 53,4 Mio. USD gegenüber einem Verlust von 5,6 Mio. USD im Vorjahr steigerte die Ergebnisse. Die gesamten Betriebskosten stiegen um 3 % auf 1,09 Mrd. USD; Sammel-, Kompressions- und Transportkosten bleiben mit 702 Mio. USD die größte Kostenposition.
Bilanz & Cashflow: Die langfristigen Schulden sanken um 390 Mio. USD auf 1,10 Mrd. USD, was die Verschuldung reduzierte. Das Eigenkapital stieg auf 7,31 Mrd. USD. Der operative Cashflow stieg im laufenden Jahr auf 950 Mio. USD (+135 %) und finanzierte 405 Mio. USD Investitionen sowie 85 Mio. USD Aktienrückkäufe. Die Liquidität umfasst eine ungenutzte, unbesicherte Kreditlinie von 1,5 Mrd. USD, die bis 2030 verlängert wurde.
Wichtige Kennzahlen (Q2-25):
- Bereinigte Umsatzerlöse von Kunden: 1,24 Mrd. USD
- Abschreibungen, DD&A: 187,6 Mio. USD (stabil im Jahresvergleich)
- Ausstehende Aktien am 30.06.25: 309,9 Mio. (-0,4 Mio. gegenüber Vorquartal)
Ausblick: Höhere Gasverkäufe, geringere Verschuldung und starke Cash-Generierung deuten auf verbesserte finanzielle Flexibilität hin, obwohl Ölpreise und hohe Midstream-Kosten weiterhin Druck ausüben.
- Revenue up 32% YoY and company returned to profitability with $156.6 M net income.
- $390 M long-term debt reduction lowers leverage and interest expense.
- $950 M operating cash flow YTD covers capex and buybacks, generating free cash.
- Unsecured revolver extended to 2030, providing $1.5 B available liquidity.
- Oil revenue declined 47% YoY, exposing earnings to commodity-mix swings.
- Gathering, compression & transportation costs remain elevated at $702 M in Q2.
- Derivative portfolio shows $18.3 M YTD loss, indicating earnings volatility.
- No cash on balance sheet; reliance on credit facility continues.
Insights
TL;DR: Materially better earnings and lower leverage bode well; cost discipline and derivative gains key tailwinds.
Revenue growth of 32% and a move to positive EPS highlight a clear earnings inflection. Debt trimmed by 26% year-to-date, significantly delevering the balance sheet and lowering interest expense (-39% YoY). Operating cash flow exceeds capex by >$540 M, enabling buybacks and debt pay-downs without drawing on cash. The unsecured credit facility extension to 2030 de-risks near-term refinancing. Risks include persistent high gathering/transport costs (54% of revenue) and a 47% drop in oil sales, underscoring commodity-mix sensitivity. Overall impact positive.
TL;DR: Credit metrics improve; volatility remains around derivatives and midstream fees.
Net debt/total cap falls to roughly 13%, enhancing covenant headroom (<65% limit). Interest coverage (EBIT/interest) improves from negative to 11×. However, zero cash balance and book overdrafts require continuous revolver access. Derivative book swung to a YTD loss despite Q2 gains, signalling potential future earnings volatility. Impairments and restatement note show modest accounting risk but appear immaterial. On balance, leverage trajectory and extended maturity profile outweigh residual cost and hedge risks.
Risultati Q2-25: Antero Resources (AR) ha registrato un fatturato di 1,30 miliardi di dollari (+32% su base annua) e ha raggiunto un utile operativo di 204,9 milioni di dollari passando da una perdita di 80,1 milioni. L'utile netto attribuibile agli azionisti ordinari è stato di 156,6 milioni di dollari (EPS diluito 0,50) rispetto a una perdita per azione di –0,26 nel Q2-24. Il fatturato da inizio anno ha raggiunto 2,65 miliardi di dollari (+26%) e l'utile netto 364,6 milioni di dollari dopo una perdita nell'anno precedente.
Fattori trainanti: Le vendite di gas naturale sono quasi raddoppiate a 689 milioni di dollari; i ricavi da NGL sono rimasti stabili mentre il petrolio è calato del 47%. Un guadagno da derivati di 53,4 milioni di dollari rispetto a una perdita di 5,6 milioni dell’anno scorso ha migliorato i risultati. Le spese operative totali sono cresciute del 3% a 1,09 miliardi; raccolta, compressione e trasporto restano la voce di costo più rilevante con 702 milioni di dollari.
Bilancio e flusso di cassa: Il debito a lungo termine è diminuito di 390 milioni di dollari a 1,10 miliardi, riducendo la leva finanziaria. Il patrimonio netto degli azionisti è salito a 7,31 miliardi di dollari. Il flusso di cassa operativo da inizio anno è aumentato a 950 milioni di dollari (+135%), finanziando 405 milioni di investimenti e 85 milioni di riacquisto azioni. La liquidità comprende una linea di credito non utilizzata da 1,5 miliardi di dollari, ora estesa fino al 2030.
Indicatori chiave (Q2-25):
- Ricavi rettificati da clienti: 1,24 miliardi di dollari
- Deplezione, DD&A: 187,6 milioni di dollari (stabili su base annua)
- Azioni in circolazione al 30/6/25: 309,9 milioni (-0,4 milioni rispetto al trimestre precedente)
Prospettive: L’aumento delle vendite di gas, la riduzione del debito e la forte generazione di cassa indicano una maggiore flessibilità finanziaria, sebbene il prezzo del petrolio e i costi elevati del midstream restino fattori di pressione.
Resultados Q2-25: Antero Resources (AR) generó ingresos de 1,30 mil millones de dólares (+32% interanual) y pasó a un ingreso operativo de 204,9 millones de dólares desde una pérdida de 80,1 millones. El ingreso neto atribuible a los accionistas comunes fue de 156,6 millones de dólares (EPS diluido 0,50) frente a una pérdida de –0,26 por acción en el Q2-24. Los ingresos acumulados alcanzaron 2,65 mil millones de dólares (+26%) y el ingreso neto 364,6 millones de dólares tras una pérdida el año anterior.
Factores clave: Las ventas de gas natural casi se duplicaron a 689 millones; los ingresos por NGL se mantuvieron estables y el petróleo cayó un 47%. Una ganancia por derivados de 53,4 millones frente a una pérdida de 5,6 millones el año pasado impulsó los resultados. Los gastos operativos totales crecieron un 3% hasta 1,09 mil millones; recolección, compresión y transporte siguen siendo el mayor gasto con 702 millones.
Balance y flujo de caja: La deuda a largo plazo disminuyó 390 millones hasta 1,10 mil millones, reduciendo el apalancamiento. El patrimonio neto aumentó a 7,31 mil millones. El flujo de caja operativo acumulado subió a 950 millones (+135%), financiando 405 millones en capex y 85 millones en recompra de acciones. La liquidez incluye una línea de crédito no utilizada de 1,5 mil millones, ahora extendida hasta 2030.
Métricas clave (Q2-25):
- Ingresos ajustados de clientes: 1,24 mil millones
- Depreciación, DD&A: 187,6 millones (estable interanual)
- Acciones en circulación al 30/6/25: 309,9 millones (-0,4 millones trimestral)
Perspectivas: El aumento en ventas de gas, la reducción de deuda y la fuerte generación de efectivo indican mayor flexibilidad financiera, aunque los precios del petróleo y los altos costos de midstream siguen siendo desafíos.
2025년 2분기 실적: Antero Resources(AR)는 13억 달러 매출(전년 대비 32% 증가)을 기록했으며, 2억 490만 달러 영업이익으로 8010만 달러 적자에서 흑자로 전환했습니다. 보통주주 귀속 순이익은 1억 5660만 달러(희석 주당순이익 0.50)로, 2024년 2분기 주당 –0.26 달러 손실에서 개선되었습니다. 연초부터 매출은 26억 5000만 달러(26% 증가), 순이익은 전년 적자 대비 3억 6460만 달러를 기록했습니다.
주요 동인: 천연가스 판매가 거의 두 배 증가하여 6억 8900만 달러에 달했으며, NGL 매출은 유지되었고 원유 매출은 47% 감소했습니다. 5,340만 달러 파생상품 이익은 작년 560만 달러 손실 대비 실적을 견인했습니다. 총 영업비용은 3% 증가한 10억 9000만 달러이며, 집하, 압축 및 운송 비용이 7억 200만 달러로 가장 큰 비중을 차지합니다.
재무 상태 및 현금 흐름: 장기 부채는 3억 9천만 달러 감소해 11억 달러가 되었고, 레버리지가 줄었습니다. 주주 지분은 73억 1000만 달러로 증가했습니다. 영업 현금 흐름은 연초부터 9억 5천만 달러(135% 증가)로 급증해, 4억 500만 달러의 자본 지출과 8500만 달러의 자사주 매입을 지원했습니다. 유동성에는 2030년까지 연장된 15억 달러 미사용 무담보 신용 한도가 포함됩니다.
주요 지표 (2025년 2분기):
- 고객으로부터 조정 매출: 12억 4000만 달러
- 감가상각 및 DD&A: 1억 8760만 달러(전년 대비 변동 없음)
- 2025년 6월 30일 기준 발행 주식 수: 3억 999만 주(전분기 대비 40만 주 감소)
전망 신호: 가스 판매 증가, 부채 감소 및 강력한 현금 창출은 재무 유연성 향상을 시사하지만, 유가와 높은 미드스트림 비용은 여전히 부담 요인입니다.
Résultats T2-25 : Antero Resources (AR) a généré un chiffre d'affaires de 1,30 milliard de dollars (+32 % en glissement annuel) et est passé à un résultat opérationnel de 204,9 millions de dollars contre une perte de 80,1 millions. Le résultat net attribuable aux actionnaires ordinaires s’est élevé à 156,6 millions de dollars (BPA dilué de 0,50) contre une perte de –0,26 par action au T2-24. Le chiffre d’affaires cumulé atteint 2,65 milliards de dollars (+26 %) et le résultat net 364,6 millions de dollars après une perte l’année précédente.
Facteurs clés : Les ventes de gaz naturel ont presque doublé à 689 millions de dollars ; les revenus de NGL sont restés stables tandis que le pétrole a chuté de 47 %. Un gain sur dérivés de 53,4 millions de dollars contre une perte de 5,6 millions l’an dernier a soutenu les résultats. Les dépenses opérationnelles totales ont augmenté de 3 % à 1,09 milliard ; la collecte, la compression et le transport restent la principale ligne de coûts avec 702 millions.
Bilan et flux de trésorerie : La dette à long terme a diminué de 390 millions pour s’établir à 1,10 milliard, réduisant l’effet de levier. Les capitaux propres sont passés à 7,31 milliards. Le flux de trésorerie opérationnel cumulé a bondi à 950 millions (+135 %), finançant 405 millions d’investissements et 85 millions de rachats d’actions. La liquidité comprend une facilité de crédit non utilisée de 1,5 milliard, désormais prolongée jusqu’en 2030.
Indicateurs clés (T2-25) :
- Revenus ajustés des clients : 1,24 milliard
- Amortissements, DD&A : 187,6 millions (stable en glissement annuel)
- Actions en circulation au 30/06/25 : 309,9 millions (-0,4 million par rapport au trimestre précédent)
Perspectives : La hausse des ventes de gaz, la réduction de la dette et la forte génération de trésorerie indiquent une meilleure flexibilité financière, bien que les prix du pétrole et les coûts élevés du midstream restent des points de pression.
Q2-25 Ergebnis: Antero Resources (AR) erzielte einen Umsatz von 1,30 Mrd. USD (+32 % im Jahresvergleich) und drehte zu einem operativen Gewinn von 204,9 Mio. USD von einem Verlust von 80,1 Mio. USD. Der auf Stammaktionäre entfallende Nettogewinn betrug 156,6 Mio. USD (verwässertes EPS 0,50) gegenüber einem Verlust von –0,26 je Aktie im Q2-24. Der Umsatz seit Jahresbeginn erreichte 2,65 Mrd. USD (+26 %) und der Nettogewinn 364,6 Mio. USD nach einem Vorjahresverlust.
Treiber: Der Verkauf von Erdgas verdoppelte sich nahezu auf 689 Mio. USD; die Erlöse aus NGL blieben stabil, während Öl um 47 % fiel. Ein Derivategewinn von 53,4 Mio. USD gegenüber einem Verlust von 5,6 Mio. USD im Vorjahr steigerte die Ergebnisse. Die gesamten Betriebskosten stiegen um 3 % auf 1,09 Mrd. USD; Sammel-, Kompressions- und Transportkosten bleiben mit 702 Mio. USD die größte Kostenposition.
Bilanz & Cashflow: Die langfristigen Schulden sanken um 390 Mio. USD auf 1,10 Mrd. USD, was die Verschuldung reduzierte. Das Eigenkapital stieg auf 7,31 Mrd. USD. Der operative Cashflow stieg im laufenden Jahr auf 950 Mio. USD (+135 %) und finanzierte 405 Mio. USD Investitionen sowie 85 Mio. USD Aktienrückkäufe. Die Liquidität umfasst eine ungenutzte, unbesicherte Kreditlinie von 1,5 Mrd. USD, die bis 2030 verlängert wurde.
Wichtige Kennzahlen (Q2-25):
- Bereinigte Umsatzerlöse von Kunden: 1,24 Mrd. USD
- Abschreibungen, DD&A: 187,6 Mio. USD (stabil im Jahresvergleich)
- Ausstehende Aktien am 30.06.25: 309,9 Mio. (-0,4 Mio. gegenüber Vorquartal)
Ausblick: Höhere Gasverkäufe, geringere Verschuldung und starke Cash-Generierung deuten auf verbesserte finanzielle Flexibilität hin, obwohl Ölpreise und hohe Midstream-Kosten weiterhin Druck ausüben.
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the quarterly period ended
or
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the transition period from to
Commission File Number
(Exact name of registrant as specified in its charter)
|
||
|
|
|
(State or other jurisdiction of incorporation or organization) |
|
(I.R.S. Employer Identification No.) |
|
|
|
(Address of principal executive offices) |
(Zip Code) |
|
(
(Registrant’s telephone number, including area code)
Securities registered pursuant to Section 12(b) of the Act:
Title of class of registered securities |
Trading symbol |
Name of exchange on which registered |
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
|
||
|
|
|
|
No ☐ |
|
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).
|
||
|
|
|
|
No ☐ |
|
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
☒ |
Accelerated Filer |
☐ |
Emerging Growth Company |
||
|
|
|
|
|
|
Non-accelerated Filer |
☐ |
Smaller Reporting Company |
|
|
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate by checkmark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act) Yes ☐ No
As of July 25, 2025, there were
ACADIA REALTY TRUST AND SUBSIDIARIES
FORM 10-Q
INDEX
|
|
|||
|
|
|
|
|
Item No. |
|
Description |
|
Page |
|
|
PART I - FINANCIAL INFORMATION |
|
|
1. |
|
Financial Statements |
|
4 |
|
|
Condensed Consolidated Balance Sheets (Unaudited) as of June 30, 2025 and December 31, 2024 |
|
4 |
|
|
Condensed Consolidated Statements of Operations (Unaudited) for the Three and Six Months Ended June 30, 2025 and 2024 |
|
5 |
|
|
Condensed Consolidated Statements of Comprehensive (Loss) Income (Unaudited) for the Three and Six Months Ended June 30, 2025 and 2024 |
|
6 |
|
|
Condensed Consolidated Statements of Changes in Equity (Unaudited) for the Three and Six Months Ended June 30, 2025 and 2024 |
|
7 |
|
|
Condensed Consolidated Statements of Cash Flows (Unaudited) for the Six Months Ended June 30, 2025 and 2024 |
|
9 |
|
|
Notes to Condensed Consolidated Financial Statements (Unaudited) |
|
11 |
|
|
|
|
|
2. |
|
Management’s Discussion and Analysis of Financial Condition and Results of Operations |
|
44 |
3. |
|
Quantitative and Qualitative Disclosures about Market Risk |
|
58 |
4. |
|
Controls and Procedures |
|
60 |
|
|
|
|
|
|
|
PART II - OTHER INFORMATION |
|
|
1. |
|
Legal Proceedings |
|
61 |
1A. |
|
Risk Factors |
|
61 |
2. |
|
Unregistered Sales of Equity Securities and Use of Proceeds |
|
61 |
3. |
|
Defaults Upon Senior Securities |
|
61 |
4. |
|
Mine Safety Disclosures |
|
61 |
5. |
|
Other Information |
|
61 |
6. |
|
Exhibits |
|
62 |
|
|
Signatures |
|
63 |
SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS
Certain statements contained in this Quarterly Report on Form 10-Q (this “Report”) of Acadia Realty Trust, a Maryland real estate investment trust, (the “Company”), may contain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). We intend these forward-looking statements to be covered by the safe harbor provisions for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995, and we are including this statement for the purposes of complying with those safe harbor provisions, in each case, to the extent applicable. Forward-looking statements, which are based on certain assumptions and describe our future plans, strategies and expectations are generally identifiable by the use of the words such as “may,” “will,” “should,” “expect,” “anticipate,” “estimate,” “believe,” “intend” or “project,” or the negative thereof, or other variations thereon or comparable terminology. Forward-looking statements involve known and unknown risks, uncertainties and other factors that could cause our actual results and financial performance to be materially different from future results and financial performance expressed or implied by such forward-looking statements, including, but not limited to: (i) macroeconomic conditions, including due to geopolitical conditions and instability and global trade disruptions, which may lead to a disruption of, or lack of access to, the capital markets and other sources of funding, disruptions and instability in the banking and financial services industries and rising inflation; (ii) our ability to successfully implement our business strategy and to identify, underwrite, finance, consummate and integrate diversifying acquisitions and investments; (iii) changes in general economic conditions or economic conditions in the markets in which we may, from time to time, compete, including the impact of recently announced tariffs on our tenants and their customers, and their effect on our and our tenants’ revenues, earnings and funding sources; (iv) increases in our borrowing costs as a result of elevated inflation, changes in interest rates and other factors; (v) our ability to pay down, refinance, restructure or extend our indebtedness as it becomes due; (vi) our investments in joint ventures and unconsolidated entities, including our lack of sole decision-making authority and our reliance on our joint venture partners’ financial condition; (vii) our ability to obtain the financial results expected from our development and redevelopment projects; (viii) our tenants’ ability and willingness to renew their leases with us upon expiration, our ability to re-lease our properties on the same or better terms in the event of nonrenewal or in the event we exercise our right to replace an existing tenant, and obligations we may incur in connection with the replacement of an existing tenant; (ix) our potential liability for environmental matters; (x) damage to our properties from catastrophic weather and other natural events, and the physical effects of climate change; (xi) the economic, political and social impact of, and uncertainty surrounding, any public health crisis, which adversely affected the Company and its tenants’ business, financial condition, results of operations and liquidity; (xii) uninsured losses; (xiii) our ability and willingness to maintain our qualification as a real estate investment trust in light of economic, market, legal, tax and other considerations; (xiv) information technology security breaches, including increased cybersecurity risks relating to the use of remote technology; (xv) the loss of key executives; and (xvi) the accuracy of our methodologies and estimates regarding corporate responsibility metrics, goals and targets, tenant willingness and ability to collaborate towards reporting such metrics and meeting such goals and targets, and the impact of governmental regulation on our corporate responsibility efforts.
The factors described above are not exhaustive and additional factors could adversely affect the Company’s future results and financial performance, including the risk factors discussed under the section captioned “Risk Factors” in the Company’s Annual Report on Form 10-K for the year ended December 31, 2024 and other periodic or current reports the Company files with the Securities and Exchange Commission (the “SEC”), including those set forth under the headings “Item 1A. Risk Factors” and “Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations” in this Report. These risks and uncertainties should be considered in evaluating any forward-looking statements contained or incorporated by reference herein. Any forward-looking statements speak only as of the date hereof. The Company expressly disclaims any obligation or undertaking to release publicly any updates or revisions to any forward-looking statements to reflect any changes in the Company’s expectations with regard thereto or changes in the events, conditions or circumstances on which such forward-looking statements are based.
SPECIAL NOTE REGARDING CERTAIN REFERENCES
All references to “Notes” throughout the document refer to the Notes to the Condensed Consolidated Financial Statements of the registrant referenced in Part I, Item 1. Financial Statements.
3
PART I – FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS.
ACADIA REALTY TRUST AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
|
|
June 30, |
|
|
December 31, |
|
||
(in thousands, except share and per share data) |
|
2025 |
|
|
2024 |
|
||
ASSETS |
|
(Unaudited) |
|
|
|
|
||
Investments in real estate |
|
|
|
|
|
|
||
Operating real estate, net |
|
$ |
|
|
$ |
|
||
Real estate under development |
|
|
|
|
|
|
||
Net investments in real estate |
|
|
|
|
|
|
||
Notes receivable, net ($ |
|
|
|
|
|
|
||
Investments in and advances to unconsolidated affiliates |
|
|
|
|
|
|
||
Other assets, net |
|
|
|
|
|
|
||
Right-of-use assets - operating leases, net |
|
|
|
|
|
|
||
Cash and cash equivalents |
|
|
|
|
|
|
||
Restricted cash |
|
|
|
|
|
|
||
Marketable securities |
|
|
|
|
|
|
||
Rents receivable, net |
|
|
|
|
|
|
||
Assets of properties held for sale |
|
|
|
|
|
|
||
Total assets (b) |
|
$ |
|
|
$ |
|
||
|
|
|
|
|
|
|
||
LIABILITIES, REDEEMABLE NONCONTROLLING INTERESTS AND EQUITY |
|
|
|
|
|
|
||
Liabilities: |
|
|
|
|
|
|
||
Mortgage and other notes payable, net |
|
$ |
|
|
$ |
|
||
Unsecured notes payable, net |
|
|
|
|
|
|
||
Unsecured line of credit |
|
|
|
|
|
|
||
Accounts payable and other liabilities |
|
|
|
|
|
|
||
Lease liabilities - operating leases |
|
|
|
|
|
|
||
Dividends and distributions payable |
|
|
|
|
|
|
||
Distributions in excess of income from, and investments in, unconsolidated affiliates |
|
|
|
|
|
|
||
Liabilities of properties held for sale |
|
|
|
|
|
|
||
Total liabilities (b) |
|
|
|
|
|
|
||
Commitments and contingencies (Note 9) |
|
|
|
|
|
|
||
Redeemable noncontrolling interests (Note 10) |
|
|
|
|
|
|
||
Equity: |
|
|
|
|
|
|
||
Acadia Shareholders' Equity |
|
|
|
|
|
|
||
Common shares, $ |
|
|
|
|
|
|
||
Additional paid-in capital |
|
|
|
|
|
|
||
Accumulated other comprehensive income |
|
|
|
|
|
|
||
Distributions in excess of accumulated earnings |
|
|
( |
) |
|
|
( |
) |
Total Acadia shareholders’ equity |
|
|
|
|
|
|
||
Noncontrolling interests |
|
|
|
|
|
|
||
Total equity |
|
|
|
|
|
|
||
Total liabilities, redeemable noncontrolling interests, and equity |
|
$ |
|
|
$ |
|
||
The accompanying notes are an integral part of these Condensed Consolidated Financial Statements (unaudited).
4
ACADIA REALTY TRUST AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
|
|
Three Months Ended June 30, |
|
|
Six Months Ended June 30, |
|
||||||||||
(in thousands, except per share amounts) |
|
2025 |
|
|
2024 |
|
|
2025 |
|
|
2024 |
|
||||
Revenues |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Rental |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
Other |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Total revenues |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Expenses |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Depreciation and amortization |
|
|
|
|
|
|
|
|
|
|
|
|
||||
General and administrative |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Real estate taxes |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Property operating |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Impairment charges |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Total expenses |
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Gain (loss) on disposition of properties |
|
|
|
|
|
|
|
|
|
|
|
( |
) |
|||
Operating income |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Equity in (losses) earnings of unconsolidated affiliates |
|
|
( |
) |
|
|
|
|
|
( |
) |
|
|
|
||
Interest income (a) |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Realized and unrealized holding (losses) gains on investments and other |
|
|
( |
) |
|
|
( |
) |
|
|
|
|
|
( |
) |
|
Interest expense |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
Loss on change in control |
|
|
|
|
|
|
|
|
( |
) |
|
|
|
|||
(Loss) income from continuing operations before income taxes |
|
|
( |
) |
|
|
|
|
|
( |
) |
|
|
( |
) |
|
Income tax provision |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
Net (loss) income |
|
|
( |
) |
|
|
|
|
|
( |
) |
|
|
( |
) |
|
Net loss attributable to redeemable noncontrolling interests |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Net loss (income) attributable to noncontrolling interests |
|
|
|
|
|
( |
) |
|
|
|
|
|
|
|||
Net income attributable to Acadia shareholders |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Basic income per share |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
Diluted income per share |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Weighted average shares for basic income per share |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Weighted average shares for diluted income per share |
|
|
|
|
|
|
|
|
|
|
|
|
||||
The accompanying notes are an integral part of these Condensed Consolidated Financial Statements (unaudited).
5
ACADIA REALTY TRUST AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE (LOSS) INCOME (UNAUDITED)
|
|
Three Months Ended June 30, |
|
|
Six Months Ended June 30, |
|
||||||||||
(in thousands) |
|
2025 |
|
|
2024 |
|
|
2025 |
|
|
2024 |
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Net (loss) income |
|
$ |
( |
) |
|
$ |
|
|
$ |
( |
) |
|
$ |
( |
) |
|
Other comprehensive (loss) income: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Unrealized (loss) gain on valuation of swap agreements |
|
|
( |
) |
|
|
|
|
|
( |
) |
|
|
|
||
Reclassification of realized interest on swap agreements |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
Other comprehensive (loss) income |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|
|
|
|
Comprehensive (loss) income |
|
|
( |
) |
|
|
|
|
|
( |
) |
|
|
|
||
Comprehensive loss attributable to redeemable noncontrolling interests |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Comprehensive loss (income) attributable to noncontrolling interests |
|
|
|
|
|
( |
) |
|
|
|
|
|
|
|||
Comprehensive (loss) income attributable to Acadia shareholders |
|
$ |
( |
) |
|
$ |
|
|
$ |
( |
) |
|
$ |
|
||
The accompanying notes are an integral part of these Condensed Consolidated Financial Statements (unaudited).
6
ACADIA REALTY TRUST AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY (UNAUDITED)
Three Months Ended June 30, 2025 and 2024
|
|
Acadia Shareholders |
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
(in thousands, except per share amounts) |
|
Common |
|
|
Share |
|
|
Additional |
|
|
Accumulated |
|
|
Distributions |
|
|
Total |
|
|
Noncontrolling |
|
|
Total |
|
|
Redeemable Noncontrolling |
|
|||||||||
Balance as of April 1, 2025 |
|
|
|
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
( |
) |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||||||
Conversion of OP Units to Common Shares by limited partners of the Operating Partnership |
|
|
|
|
|
— |
|
|
|
|
|
|
— |
|
|
|
— |
|
|
|
|
|
|
( |
) |
|
|
— |
|
|
|
— |
|
|||
Dividends/distributions declared ($ |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|
|
— |
|
City Point Loan accrued interest |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
( |
) |
Employee and trustee stock compensation, net |
|
|
|
|
|
— |
|
|
|
|
|
|
— |
|
|
|
— |
|
|
|
|
|
|
|
|
|
|
|
|
— |
|
|||||
Noncontrolling interest distributions |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
( |
) |
|
|
( |
) |
|
|
— |
|
Noncontrolling interest contributions |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
|
|
|
|
|
|
|
|||
Comprehensive (loss) income |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
( |
) |
|
|
|
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|
Reallocation of noncontrolling interests |
|
|
— |
|
|
|
— |
|
|
|
|
|
|
— |
|
|
|
— |
|
|
|
|
|
|
( |
) |
|
|
— |
|
|
|
— |
|
||
Balance as of June 30, 2025 |
|
|
|
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
( |
) |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Balance as of April 1, 2024 |
|
|
|
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
( |
) |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||||||
Conversion of OP Units to Common Shares by limited partners of the Operating Partnership |
|
|
|
|
|
|
|
|
|
|
|
— |
|
|
|
— |
|
|
|
|
|
|
( |
) |
|
|
— |
|
|
|
— |
|
||||
Issuance of Common Shares, net |
|
|
|
|
|
|
|
|
|
|
|
— |
|
|
|
— |
|
|
|
|
|
|
— |
|
|
|
|
|
|
— |
|
|||||
Dividends/distributions declared ($ |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|
|
— |
|
City Point Loan accrued interest |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
( |
) |
Employee and trustee stock compensation, net |
|
|
|
|
|
— |
|
|
|
|
|
|
— |
|
|
|
— |
|
|
|
|
|
|
|
|
|
|
|
|
— |
|
|||||
Capital call receivable |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
|
|
|
|
|
|
— |
|
||
Noncontrolling interest distributions |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
Comprehensive income (loss) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
( |
) |
|||||
Reallocation of noncontrolling interests |
|
|
— |
|
|
|
— |
|
|
|
|
|
|
— |
|
|
|
— |
|
|
|
|
|
|
( |
) |
|
|
— |
|
|
|
— |
|
||
Balance as of June 30, 2024 |
|
|
|
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
( |
) |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||||||
The accompanying notes are an integral part of these Condensed Consolidated Financial Statements (unaudited).
7
ACADIA REALTY TRUST AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY (UNAUDITED)
Six Months Ended June 30, 2025 and 2024
|
|
Acadia Shareholders |
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
(in thousands, except per share amounts) |
|
Common |
|
|
Share |
|
|
Additional |
|
|
Accumulated |
|
|
Distributions |
|
|
Total |
|
|
Noncontrolling |
|
|
Total |
|
|
Redeemable Noncontrolling Interest |
|
|||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Balance at January 1, 2025 |
|
|
|
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
( |
) |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||||||
Issuance of Common Shares, net |
|
|
|
|
|
|
|
|
|
|
|
— |
|
|
|
— |
|
|
|
|
|
|
— |
|
|
|
|
|
|
— |
|
|||||
Conversion of OP Units to Common Shares by limited partners of the Operating Partnership |
|
|
|
|
|
— |
|
|
|
|
|
|
— |
|
|
|
— |
|
|
|
|
|
|
( |
) |
|
|
— |
|
|
|
— |
|
|||
Dividends/distributions declared ($ |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|
|
— |
|
Consolidation of previously unconsolidated investment |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
|
|
|
|
|
|
— |
|
||
City Point Loan accrued interest |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
( |
) |
Employee and trustee stock compensation, net |
|
|
|
|
|
— |
|
|
|
|
|
|
— |
|
|
|
— |
|
|
|
|
|
|
|
|
|
|
|
|
— |
|
|||||
Noncontrolling interest distributions |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
( |
) |
|
|
( |
) |
|
|
— |
|
Noncontrolling interest contributions |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
|
|
|
|
|
|
|
|||
Comprehensive (loss) income |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
( |
) |
|
|
|
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|
Reallocation of noncontrolling interests |
|
|
— |
|
|
|
— |
|
|
|
( |
) |
|
|
— |
|
|
|
— |
|
|
|
( |
) |
|
|
|
|
|
— |
|
|
|
— |
|
|
Balance at June 30, 2025 |
|
|
|
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
( |
) |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Balance at January 1, 2024 |
|
|
|
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
( |
) |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||||||
Issuance of Common Shares, net |
|
|
|
|
|
|
|
|
|
|
|
— |
|
|
|
— |
|
|
|
|
|
|
— |
|
|
|
|
|
|
— |
|
|||||
Conversion of OP Units to Common Shares by limited partners of the Operating Partnership |
|
|
|
|
|
|
|
|
|
|
|
— |
|
|
|
— |
|
|
|
|
|
|
( |
) |
|
|
— |
|
|
|
— |
|
||||
Dividends/distributions declared ($ |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|
|
— |
|
City Point Loan accrued interest |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
( |
) |
Employee and trustee stock compensation, net |
|
|
|
|
|
— |
|
|
|
|
|
|
— |
|
|
|
— |
|
|
|
|
|
|
|
|
|
|
|
|
— |
|
|||||
Noncontrolling interest distributions |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
Noncontrolling interest contributions |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
|
|
|
|
|
|
— |
|
||
Comprehensive income (loss) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
|
|
|
|
|
|
|
|
|
( |
) |
|
|
|
|
|
( |
) |
||||
Reallocation of noncontrolling interests |
|
|
— |
|
|
|
— |
|
|
|
( |
) |
|
|
— |
|
|
|
— |
|
|
|
( |
) |
|
|
|
|
|
— |
|
|
|
— |
|
|
Balance at June 30, 2024 |
|
|
|
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
( |
) |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||||||
The accompanying notes are an integral part of these Condensed Consolidated Financial Statements (unaudited).
8
ACADIA REALTY TRUST AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
|
|
Six Months Ended June 30, |
|
|||||
(in thousands) |
|
2025 |
|
|
2024 |
|
||
CASH FLOWS FROM OPERATING ACTIVITIES |
|
|
|
|
|
|
||
Net loss |
|
$ |
( |
) |
|
$ |
( |
) |
Adjustments to reconcile net loss to net cash provided by operating activities: |
|
|
|
|
|
|
||
Depreciation and amortization |
|
|
|
|
|
|
||
Loss on disposition of properties and other investments |
|
|
|
|
|
|
||
Net unrealized holding (gains) losses on investments |
|
|
( |
) |
|
|
|
|
Stock compensation expense |
|
|
|
|
|
|
||
Straight-line rents |
|
|
( |
) |
|
|
( |
) |
Equity in losses (earnings) of unconsolidated affiliates |
|
|
|
|
|
( |
) |
|
Distributions of operating income from unconsolidated affiliates |
|
|
|
|
|
|
||
Amortization of financing costs |
|
|
|
|
|
|
||
Non-cash lease expense |
|
|
|
|
|
|
||
Loss on change in control |
|
|
|
|
|
|
||
Impairment charges |
|
|
|
|
|
|
||
Other, net |
|
|
( |
) |
|
|
( |
) |
Changes in assets and liabilities: |
|
|
|
|
|
|
||
Rents receivable |
|
|
( |
) |
|
|
( |
) |
Other liabilities |
|
|
( |
) |
|
|
( |
) |
Accounts payable and accrued expenses |
|
|
( |
) |
|
|
( |
) |
Prepaid expenses and other assets |
|
|
|
|
|
( |
) |
|
Lease liabilities - operating leases |
|
|
( |
) |
|
|
( |
) |
Net cash provided by operating activities |
|
|
|
|
|
|
||
CASH FLOWS FROM INVESTING ACTIVITIES |
|
|
|
|
|
|
||
Acquisitions of real estate |
|
|
( |
) |
|
|
|
|
Proceeds from the disposition of properties and other investments, net |
|
|
|
|
|
|
||
Investments in unconsolidated affiliates |
|
|
( |
) |
|
|
( |
) |
Development, construction and property improvement costs |
|
|
( |
) |
|
|
( |
) |
Refund for properties under purchase contract |
|
|
|
|
|
|
||
Deposits for properties under purchase contract |
|
|
|
|
|
( |
) |
|
Increase in cash and restricted cash upon change of control |
|
|
|
|
|
|
||
Return of capital from unconsolidated affiliates |
|
|
|
|
|
|
||
Payment of deferred leasing costs |
|
|
( |
) |
|
|
( |
) |
Proceeds from sale of marketable securities |
|
|
|
|
|
|
||
Proceeds from repayment of note receivable |
|
|
|
|
|
|
||
Issuance of note receivable |
|
|
( |
) |
|
|
( |
) |
Net cash (used in) provided by investing activities |
|
|
( |
) |
|
|
|
|
CASH FLOWS FROM FINANCING ACTIVITIES |
|
|
|
|
|
|
||
Proceeds from unsecured debt |
|
|
|
|
|
|
||
Principal payments on unsecured debt |
|
|
( |
) |
|
|
( |
) |
Proceeds from issuances of Common Shares |
|
|
|
|
|
|
||
Capital contributions from noncontrolling interests |
|
|
|
|
|
|
||
Principal payments on mortgage and other notes |
|
|
( |
) |
|
|
( |
) |
Proceeds received from mortgage and other notes |
|
|
|
|
|
|
||
Distributions to noncontrolling interests |
|
|
( |
) |
|
|
( |
) |
Dividends paid to Common Shareholders |
|
|
( |
) |
|
|
( |
) |
Payment of deferred financing and other costs |
|
|
( |
) |
|
|
( |
) |
Payments of finance lease obligations |
|
|
|
|
|
( |
) |
|
Net cash provided by (used in) financing activities |
|
|
|
|
|
( |
) |
|
Increase in cash and cash equivalents and restricted cash |
|
|
|
|
|
|
||
Cash and cash equivalents of $ |
|
|
|
|
|
|
||
Cash and cash equivalents of $ |
|
$ |
|
|
$ |
|
||
The accompanying notes are an integral part of these Condensed Consolidated Financial Statements (unaudited).
9
ACADIA REALTY TRUST AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) (Continued)
|
|
Six Months Ended June 30, |
|
|||||
(in thousands) |
|
2025 |
|
|
2024 |
|
||
Supplemental disclosure of cash flow information |
|
|
|
|
|
|
||
Cash paid during the period for interest, net of capitalized interest of $ |
|
$ |
|
|
$ |
|
||
Cash paid for income taxes, net of refunds |
|
$ |
|
|
$ |
|
||
|
|
|
|
|
|
|
||
Supplemental disclosure of non-cash investing and financing activities |
|
|
|
|
|
|
||
Dividends/Distributions declared and payable |
|
$ |
|
|
$ |
|
||
Conversion of Common and Preferred OP Units to Common Shares |
|
$ |
|
|
$ |
|
||
Accrued interest on note receivable recorded to redeemable noncontrolling interest |
|
$ |
|
|
$ |
|
||
Retained investment in an unconsolidated affiliate |
|
$ |
|
|
$ |
|
||
Recognition of non-refundable deposit upon expiration of sale agreement |
|
$ |
|
|
$ |
|
||
|
|
|
|
|
|
|
||
Increase (decrease) in assets and liabilities resulting from the consolidation of previously unconsolidated investment: |
|
|
|
|
|
|
||
Operating real estate |
|
$ |
|
|
$ |
|
||
Mortgage and other notes payable |
|
|
|
|
|
|
||
Investments in and advances to unconsolidated affiliates |
|
|
( |
) |
|
|
|
|
Rents receivable and other assets |
|
|
|
|
|
|
||
Accounts payable and other liabilities |
|
|
|
|
|
|
||
Noncontrolling interests |
|
|
|
|
|
|
||
The accompanying notes are an integral part of these Condensed Consolidated Financial Statements (unaudited).
10
ACADIA REALTY TRUST AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
1. Organization, Basis of Presentation and Summary of Significant Accounting Policies
Organization
Acadia Realty Trust, (the “Trust”, collectively with its consolidated subsidiaries, the “Company”), a Maryland real estate investment trust (“REIT”), is a fully-integrated equity REIT focused on the ownership, acquisition, development, and management of retail properties located primarily in high-barrier-to-entry, supply-constrained, densely populated metropolitan areas in the United States.
All of the Company’s assets are held by, and its operations are conducted through, Acadia Realty Limited Partnership (the “Operating Partnership”) and entities in which the Operating Partnership owns an interest. At June 30, 2025 and December 31, 2024, the Trust controlled approximately
The limited partners primarily consist of entities or individuals that contributed interests in certain properties or entities to the Operating Partnership in exchange for common or preferred units of limited partnership interest (“Common OP Units” or “Preferred OP Units”), as well as employees who have been granted restricted Common OP Units (“LTIP Units”) as long-term incentive compensation (Note 13). Limited partners holding Common OP and LTIP Units generally have the right to exchange their units on a
As of June 30, 2025, the Company held ownership interests in
The Company also held ownership interests in
As part of the Investment Management platform, the Company also holds equity method investments in three unconsolidated co-investment vehicles, through partnerships with large institutional investors. The Company holds significant equity ownership, ranging from
The
The Operating Partnership serves as the sole general partner or managing member of the Funds and earns fees or priority distributions for asset management, property management, construction, development, leasing, and legal services. Cash flows from the Funds are distributed pro-rata to partners and members (including the Operating Partnership) until each receives a cumulative preferred return (“Preferred Return”) and full return of capital. Thereafter, remaining cash flows are distributed
11
ACADIA REALTY TRUST AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
The following table summarizes the general terms and Operating Partnership’s equity interests in the Funds (dollars in millions):
Entity |
|
Formation |
|
Operating |
|
|
Capital Called |
|
|
Unfunded |
|
|
Equity Interest |
|
|
Preferred |
|
|
Total |
|
||||||
Fund II |
|
6/2004 |
|
|
% |
|
$ |
|
|
$ |
|
|
|
% |
|
|
% |
|
$ |
|
||||||
Fund III |
|
5/2007 |
|
|
% |
|
|
|
|
|
|
|
|
% |
|
|
% |
|
|
|
||||||
Fund IV |
|
5/2012 |
|
|
% |
|
|
|
|
|
|
|
|
% |
|
|
% |
|
|
|
||||||
Fund V |
|
8/2016 |
|
|
% |
|
|
|
|
|
|
|
|
% |
|
|
% |
|
|
|
||||||
Basis of Presentation
The interim Condensed Consolidated Financial Statements have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) for interim financial information and the rules and regulations of the U.S. Securities and Exchange Commission (“SEC”). Accordingly, they do not include all of the information and footnotes required for complete annual financial statements. Operating results for interim periods are not necessarily indicative of results for the full fiscal year. In the opinion of management, all adjustments necessary for a fair presentation of interim Condensed Consolidated Financial Statements have been included. These adjustments are of normal recurring nature.
The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts in the interim Condensed Consolidated Financial Statements and accompanying notes. The most significant assumptions and estimates include those related to the valuation of real estate, depreciable lives, revenue recognition and the collectability of notes receivable and rents receivable. Actual results could differ from those estimates.
These interim Condensed Consolidated Financial Statements should be read in conjunction with the Company’s 2024 audited consolidated financial statements and notes thereto included in the Annual Report on Form 10-K for the year ended December 31, 2024.
Segments
We define our reportable segments based on the manner in which our chief operating decision maker makes key operating decisions, evaluates financial performance, allocates resources and manages our business. This approach aligns with our internal reporting structure and reflects the economic characteristics and nature of our operations. Accordingly, we have identified three reportable operating segments: Core Portfolio, Investment Management and Structured Financing. Refer to Note 12 for additional segment information.
Recent Accounting Pronouncements
In August 2023, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) ASU 2023-05, “Business Combinations - Joint Venture Formations (Subtopic 805-60): Recognition and Initial Measurement” (“ASU 2023-05”). ASU 2023-05 addresses the accounting for contributions made to a joint venture, upon formation, in a joint venture’s separate financial statements. Prior to the amendment, the FASB did not provide specific authoritative guidance on the initial measurement of assets and liabilities assumed by a joint venture upon its formation. ASU 2023-05 requires a joint venture to recognize and initially measure its assets and liabilities at fair value (with exceptions to fair value measurement that are consistent with the business combinations guidance). ASU 2023-05 is effective for all joint venture formations with a formation date on or after January 1, 2025, with early adoption permitted. The adoption of this standard did not have a significant impact on the Company’s consolidated financial statements.
In December 2023, the FASB issued ASU 2023-09 “Income Taxes (Topic 740): Improvements to Income Tax Disclosures” (“ASU 2023-09”), to expand the disclosure requirements for income taxes, specifically related to the effective tax rate reconciliation and income taxes paid. ASU 2023-09 is effective for annual periods beginning after December 15, 2024, with early adoption permitted. The Company is currently evaluating the expected impact of the adoption of this ASU on disclosures within the consolidated financial statements.
On November 4, 2024, the FASB issued ASU 2024-03, “Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses” (“ASU 2024-03”) which requires disaggregated disclosure of income statement expenses for public business entities (PBEs). Additionally, in January 2025, the FASB issued ASU 2025-01 to clarify the
12
ACADIA REALTY TRUST AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
effective date of ASU 2024-03. The ASU does not change the expense captions an entity presents on the face of the income statement; rather, it requires disaggregation of certain expense captions into specified categories in disclosures within the footnotes to the financial statements. This guidance applies to all PBEs and is effective for annual reporting periods beginning after December 15, 2026 and interim reporting periods beginning after December 15, 2027, with early adoption permitted. The Company has elected not to early adopt and the requirements will be applied prospectively with the option for retrospective application. The Company is currently evaluating the expected impact of the adoption of this ASU on disclosures within the consolidated financial statements.
On May 12, 2025, the FASB issued ASU 2025-03, “Business Combinations (Topic 805) and Consolidation (Topic 810): Determining the Accounting Acquirer in the Acquisition of a Variable Interest Entity” (“ASU 2025-03”), which clarifies that when a business that is a variable interest entity (VIE) is acquired primarily with equity interests, the determination of the accounting acquirer should follow ASC 805 rather than defaulting to the primary beneficiary under ASC 810. The ASU is effective for fiscal years beginning after December 15, 2026, including interim periods within those fiscal years. The Company has elected not to early adopt and the requirements will be applied prospectively with the option for retrospective application. The Company is currently evaluating the expected impact of the adoption of this ASU on the consolidated financial statements.
Any other recently issued accounting standards or pronouncements not disclosed above have been excluded as they are not relevant to the Company, or they are not expected to have a material impact on the Condensed Consolidated Financial Statements.
13
ACADIA REALTY TRUST AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
2. Real Estate
The Company’s consolidated real estate is comprised of the following for the periods presented (in thousands):
|
|
June 30, |
|
|
December 31, |
|
||
|
|
2025 |
|
|
2024 |
|
||
Buildings and improvements |
|
$ |
|
|
$ |
|
||
Tenant improvements |
|
|
|
|
|
|
||
Land |
|
|
|
|
|
|
||
Construction in progress |
|
|
|
|
|
|
||
Right-of-use assets - finance leases (Note 11) |
|
|
|
|
|
|
||
Total |
|
|
|
|
|
|
||
Less: Accumulated depreciation and amortization |
|
|
( |
) |
|
|
( |
) |
Operating real estate, net |
|
|
|
|
|
|
||
Real estate under development |
|
|
|
|
|
|
||
Net investments in real estate |
|
$ |
|
|
$ |
|
||
Acquisitions
During the six months ended June 30, 2025, the Company acquired the following retail properties and other retail investments (dollars in thousands):
Property and Location |
|
Percent |
|
Date of |
|
Purchase |
|
|
2025 Acquisitions |
|
|
|
|
|
|
|
|
Core |
|
|
|
|
|
|
|
|
106 Spring Street - New York, NY |
|
|
January 9, 2025 |
|
$ |
|
||
73 Wooster Street - New York, NY |
|
|
January 9, 2025 |
|
|
|
||
Renaissance Portfolio - Washington, D.C. (b) |
|
|
January 23, 2025 |
|
|
|
||
95, 97, and 107 North 6th Street - Brooklyn, NY |
|
|
April 9, 2025 |
|
|
|
||
85 5th Avenue - New York, NY |
|
|
April 11, 2025 |
|
|
|
||
70 and 93 North 6th Street - Brooklyn, NY |
|
|
June 4, 2025 |
|
|
|
||
Subtotal Core |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Investment Management |
|
|
|
|
|
|
|
|
Pinewood Square - Lake Worth, FL |
|
|
March 19, 2025 |
|
|
|
||
Total 2025 Acquisitions |
|
|
|
|
|
$ |
|
|
14
ACADIA REALTY TRUST AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
Purchase Price Allocations
The purchase prices for the acquisitions (excluding any properties that were acquired in development) were allocated to the acquired assets and assumed liabilities based on their estimated relative fair values at the dates of acquisition.
|
|
Land |
|
|
Buildings and improvements |
|
|
Intangible assets |
|
|
Intangible liabilities |
|
|
Debt fair value adjustment |
|
|
Total |
|
||||||
106 Spring Street - New York, NY |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
( |
) |
|
$ |
|
|
$ |
|
|||||
73 Wooster St - New York, NY |
|
|
|
|
|
|
|
|
|
|
|
( |
) |
|
|
|
|
|
|
|||||
Renaissance Portfolio - Washington, D.C. |
|
|
|
|
|
|
|
|
|
|
|
( |
) |
|
|
( |
) |
|
|
|
||||
Pinewood Square - Lake Worth, FL |
|
|
|
|
|
|
|
|
|
|
|
( |
) |
|
|
|
|
|
|
|||||
95, 97, and 107 North 6th Street - Brooklyn, NY |
|
|
|
|
|
|
|
|
|
|
|
( |
) |
|
|
|
|
|
|
|||||
85 5th Avenue - New York, NY |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
70 and 93 North 6th Street - Brooklyn, NY |
|
|
|
|
|
|
|
|
|
|
|
( |
) |
|
|
|
|
|
|
|||||
2025 Total |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
( |
) |
|
$ |
( |
) |
|
$ |
|
||||
The Company determines the fair value of the individual components of real estate asset acquisitions primarily through calculating the “as-if vacant” value of a building, using an income approach, which relies significantly upon internally determined assumptions. Assumed debt is recorded at its fair value based on estimated market interest rates at the date of acquisition. The Company has determined that these estimates primarily rely on Level 3 inputs, which are unobservable inputs based on our own assumptions.
|
|
2025 |
|
||||
|
|
Low |
|
High |
|
||
Exit Capitalization Rate |
|
|
% |
|
% |
||
Discount Rate |
|
|
% |
|
% |
||
Annual net rental rate per square foot on acquired buildings |
|
$ |
|
$ |
|
||
Interest rate on assumed debt |
|
|
% |
|
% |
||
The estimate of the portion of the “as-if vacant” value that is allocated to the land underlying the acquired real estate relies on Level 3 inputs and is primarily determined by reference to recent comparable transactions.
Properties Held for Sale
As of June 30, 2025, the Company classified
|
|
June 30, |
|
|
|
|
2025 |
|
|
Assets |
|
|
|
|
Building and improvements |
|
$ |
|
|
Tenant improvements |
|
|
|
|
Land |
|
|
|
|
Real estate, intangible assets |
|
|
|
|
Less: Accumulated depreciation and amortization |
|
|
( |
) |
Other |
|
|
|
|
|
|
$ |
|
|
Liabilities |
|
|
|
|
Real estate, intangible liabilities |
|
$ |
|
|
The Company did
15
ACADIA REALTY TRUST AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
Real Estate Under Development
Real estate under development represents the Company’s consolidated properties that have not yet been placed into service and are undergoing substantial development or construction.
Development activity for these properties during the periods presented is summarized below (dollars in thousands):
|
|
January 1, 2025 |
|
|
Six Months Ended June 30, 2025 |
|
|
June 30, 2025 |
|
|||||||||||||||||||
|
|
Number of |
|
|
Carrying |
|
|
Transfers In |
|
|
Capitalized |
|
|
Transfers Out |
|
|
Number of |
|
|
Carrying |
|
|||||||
Core (a) |
|
|
|
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|
|
|
|
|
|
|||||||
Fund III |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Total |
|
|
|
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|
|
|
|
$ |
|
|||||||
The number of properties in the table above refers to full-property development projects; however, certain projects represent only a portion of a property. As of June 30, 2025, consolidated development projects included portions of the Henderson Avenue Portfolio (Core Portfolio) and Broad Hollow Commons (Investment Management Fund III).
Construction in progress refers to construction activity at operating properties that remain in service during the construction period.
3. Notes Receivable, Net
Interest income from notes and mortgages receivable is reported within the Company’s Structured Financing segment (Note 12). Interest receivable is included in Other assets, net (Note 5).
|
|
June 30, |
|
|
December 31, |
|
|
June 30, 2025 |
||||||||
Description |
|
2025 |
|
|
2024 |
|
|
Number |
|
|
Maturity Date |
|
Interest Rate |
|||
Notes receivable |
|
$ |
|
|
$ |
|
|
|
|
|
|
|||||
Allowance for credit losses |
|
|
( |
) |
|
|
( |
) |
|
|
|
|
|
|
|
|
Notes receivable, net |
|
$ |
|
|
$ |
|
|
|
|
|
|
|
|
|||
In April 2025, the Company modified a redeemable preferred equity investment in a property that is accounted for as a note receivable, with a principal balance of $
The following table presents the activity in the allowance for credit losses for the six months ended June 30, 2025 and year ended December 31, 2024 (in thousands):
|
|
June 30, |
|
|
December 31, |
|
||
|
|
2025 |
|
|
2024 |
|
||
Allowance for credit losses as of beginning of periods |
|
$ |
|
|
$ |
|
||
Provision of loan losses |
|
|
( |
) |
|
|
|
|
Total credit allowance |
|
$ |
|
|
$ |
|
||
As of June 30, 2025, the Company had six performing notes with a total amortized cost of $
16
ACADIA REALTY TRUST AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
One note receivable, totaling $
17
ACADIA REALTY TRUST AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
4. Investments in and Advances to Unconsolidated Affiliates
The Company accounts for its investments in and advances to unconsolidated affiliates primarily under the equity method of accounting.
|
|
|
|
Ownership Interest |
|
June 30, |
|
|
December 31, |
|
||
Portfolio |
|
Property |
|
June 30, 2025 |
|
2025 |
|
|
2024 |
|
||
|
|
|
|
|
|
|
|
|
|
|
||
Core: |
|
Renaissance Portfolio (a) |
|
|
$ |
|
|
$ |
|
|||
|
|
Gotham Plaza |
|
|
|
|
|
|
|
|||
|
|
Georgetown Portfolio (b) |
|
|
|
|
|
|
|
|||
|
|
1238 Wisconsin Avenue (b, c) |
|
|
|
|
|
|
|
|||
|
|
840 N. Michigan Avenue (d, e) |
|
|
|
|
|
|
|
|||
|
|
|
|
|
|
|
|
|
|
|
||
Investment Management: |
|
|
|
|
|
|
|
|
|
|
||
Fund IV: (i) |
|
Fund IV Other Portfolio (j) |
|
|
|
|
|
|
|
|||
|
|
650 Bald Hill Road |
|
|
|
|
|
|
|
|||
|
|
|
|
|
|
|
|
|
|
|
||
|
|
|
|
|
|
|
|
|
|
|
||
Fund V: (i) |
|
Family Center at Riverdale (d) |
|
|
|
|
|
|
|
|||
|
|
Tri-City Plaza |
|
|
|
|
|
|
|
|||
|
|
Frederick County Acquisitions (f) |
|
|
|
|
|
|
|
|||
|
|
Wood Ridge Plaza |
|
|
|
|
|
|
|
|||
|
|
La Frontera Village |
|
|
|
|
|
|
|
|||
|
|
Shoppes at South Hills |
|
|
|
|
|
|
|
|||
|
|
Mohawk Commons |
|
|
|
|
|
|
|
|||
|
|
|
|
|
|
|
|
|
|
|
||
|
|
|
|
|
|
|
|
|
|
|
||
Other: |
|
Shops at Grand |
|
|
|
|
|
|
|
|||
|
|
Walk at Highwoods Preserve |
|
|
|
|
|
|
|
|||
|
|
LINQ Promenade |
|
|
|
|
|
|
|
|||
|
|
|
|
|
|
|
|
|
|
|
||
|
|
|
|
|
|
|
|
|
|
|
||
Various: |
|
Due from Related Parties |
|
|
|
|
|
|
|
|
||
|
|
Other (g) |
|
|
|
|
|
|
|
|
||
|
|
Investments in and advances to |
|
|
|
$ |
|
|
$ |
|
||
|
|
|
|
|
|
|
|
|
|
|
||
Core: |
|
Crossroads (h) |
|
|
$ |
|
|
$ |
|
|||
|
|
Distributions in excess of income from, |
|
|
|
$ |
|
|
$ |
|
||
18
ACADIA REALTY TRUST AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
During the three months ended June 30, 2025, the Company, through Fund IV, sold its investment in Eden Square for $
Fees earned from and paid to Unconsolidated Affiliates
The Company earned fees for property management, construction, development, legal and leasing fees from its investments in unconsolidated affiliates totaling $
In addition, the Company’s unconsolidated joint ventures paid fees to the Company’s unaffiliated joint venture partners of $
Summarized Financial Information of Unconsolidated Affiliates
The following Combined and Condensed Balance Sheets and Statements of Operations, in each period, summarized the financial information of the Company’s investments in unconsolidated affiliates that were held as of June 30, 2025 (in thousands):
|
|
June 30, |
|
|
December 31, |
|
||
|
|
2025 |
|
|
2024 |
|
||
Combined and Condensed Balance Sheets |
|
|
|
|
|
|
||
Assets: |
|
|
|
|
|
|
||
Rental property, net |
|
$ |
|
|
$ |
|
||
Other assets |
|
|
|
|
|
|
||
Total assets |
|
$ |
|
|
$ |
|
||
Liabilities and partners’ equity: |
|
|
|
|
|
|
||
Mortgage notes payable |
|
$ |
|
|
$ |
|
||
Other liabilities |
|
|
|
|
|
|
||
Partners’ equity |
|
|
|
|
|
|
||
Total liabilities and partners’ equity |
|
$ |
|
|
$ |
|
||
|
|
|
|
|
|
|
||
Company's share of accumulated equity |
|
$ |
|
|
$ |
|
||
Basis differential |
|
|
|
|
|
|
||
Deferred fees, net of portion related to the Company's interest |
|
|
|
|
|
|
||
Amounts receivable/payable by the Company |
|
|
|
|
|
|
||
Investments in and advances to unconsolidated affiliates, net of Company's |
|
|
|
|
|
|
||
Investments carried at cost |
|
|
|
|
|
|
||
Company's share of distributions in excess of income from and |
|
|
|
|
|
|
||
Investments in and advances to unconsolidated affiliates |
|
$ |
|
|
$ |
|
||
19
ACADIA REALTY TRUST AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
|
|
Three Months Ended June 30, |
|
|
Six Months Ended June 30, |
|
||||||||||
|
|
2025 |
|
|
2024 |
|
|
2025 |
|
|
2024 |
|
||||
Combined and Condensed Statements of Operations |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Total revenues |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
Operating and other expenses |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
Interest expense |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
Depreciation and amortization |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
Gain on extinguishment of debt (a) |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Impairment of Investment |
|
|
|
|
|
( |
) |
|
|
|
|
|
( |
) |
||
(Loss) gain on disposition of properties (b) |
|
|
( |
) |
|
|
|
|
|
( |
) |
|
|
|
||
Net (loss) income attributable to unconsolidated affiliates |
|
$ |
( |
) |
|
$ |
|
|
$ |
( |
) |
|
$ |
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Company’s share of equity in net (losses) earnings of unconsolidated affiliates |
|
$ |
( |
) |
|
$ |
|
|
$ |
( |
) |
|
$ |
|
||
Basis differential amortization |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
Company’s equity in (losses) earnings of unconsolidated affiliates |
|
$ |
( |
) |
|
$ |
|
|
$ |
( |
) |
|
$ |
|
||
20
ACADIA REALTY TRUST AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
5. Other Assets, Net and Accounts Payable and Other Liabilities
Other assets, net and accounts payable and other liabilities are comprised of the following for the periods presented:
|
|
June 30, |
|
|
December 31, |
|
||
(in thousands) |
|
2025 |
|
|
2024 |
|
||
Other Assets, Net: |
|
|
|
|
|
|
||
Lease intangibles, net (Note 6) |
|
$ |
|
|
$ |
|
||
Derivative financial instruments (Note 8) |
|
|
|
|
|
|
||
Deferred charges, net (A) |
|
|
|
|
|
|
||
Accrued interest receivable (Note 3) |
|
|
|
|
|
|
||
Prepaid expenses |
|
|
|
|
|
|
||
Due from seller |
|
|
|
|
|
|
||
Income taxes receivable |
|
|
|
|
|
|
||
Deposits |
|
|
|
|
|
|
||
Corporate assets, net |
|
|
|
|
|
|
||
Other receivables |
|
|
|
|
|
|
||
|
|
$ |
|
|
$ |
|
||
|
|
|
|
|
|
|
||
(A) Deferred Charges, Net: |
|
|
|
|
|
|
||
Deferred leasing and other costs (a) |
|
$ |
|
|
$ |
|
||
Deferred financing costs related to line of credit |
|
|
|
|
|
|
||
|
|
|
|
|
|
|
||
Accumulated amortization |
|
|
( |
) |
|
|
( |
) |
Deferred charges, net |
|
$ |
|
|
$ |
|
||
|
|
|
|
|
|
|
||
Accounts Payable and Other Liabilities: |
|
|
|
|
|
|
||
Lease intangibles, net (Note 6) |
|
$ |
|
|
$ |
|
||
Accounts payable and accrued expenses |
|
|
|
|
|
|
||
Deferred income |
|
|
|
|
|
|
||
Tenant security deposits, escrow and other |
|
|
|
|
|
|
||
Lease liability - finance leases, net (Note 11) |
|
|
|
|
|
|
||
Derivative financial instruments (Note 8) |
|
|
|
|
|
|
||
|
|
$ |
|
|
$ |
|
||
6. Lease Intangibles
Upon acquisitions of real estate (Note 2), the Company assesses the relative fair value of acquired assets (including land, buildings and improvements, and identified intangibles such as above- and below-market leases, including below-market options and acquired in-place leases) and assumed liabilities. The lease intangibles are amortized over the remaining terms of the respective leases, including option periods where applicable.
21
ACADIA REALTY TRUST AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
Intangible assets and liabilities are included in Other assets, net and Accounts payable and other liabilities (Note 5) on the Condensed Consolidated Balance Sheets and summarized as follows (in thousands):
|
|
June 30, 2025 |
|
|
December 31, 2024 |
|
||||||||||||||||||
|
|
Gross Carrying |
|
|
Accumulated |
|
|
Net Carrying |
|
|
Gross Carrying |
|
|
Accumulated |
|
|
Net Carrying |
|
||||||
Amortizable Intangible Assets |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
In-place lease intangible assets |
|
$ |
|
|
$ |
( |
) |
|
|
|
|
$ |
|
|
$ |
( |
) |
|
$ |
|
||||
Above-market rent |
|
|
|
|
|
( |
) |
|
|
|
|
|
|
|
|
( |
) |
|
|
|
||||
|
|
$ |
|
|
$ |
( |
) |
|
$ |
|
|
$ |
|
|
$ |
( |
) |
|
$ |
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Amortizable Intangible Liabilities |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Below-market rent |
|
$ |
( |
) |
|
$ |
|
|
$ |
( |
) |
|
$ |
( |
) |
|
$ |
|
|
$ |
( |
) |
||
Above-market ground lease |
|
|
( |
) |
|
|
|
|
|
( |
) |
|
|
( |
) |
|
|
|
|
|
( |
) |
||
|
|
$ |
( |
) |
|
$ |
|
|
$ |
( |
) |
|
$ |
( |
) |
|
$ |
|
|
$ |
( |
) |
||
During the six months ended June 30, 2025, the Company:
Amortization of in-place lease intangible assets is recorded in depreciation and amortization expense in the Condensed Consolidated Statements of Operations. Amortization of above-market rent and below-market rent is recorded as a reduction to and increase to rental income, respectively, in the Condensed Consolidated Statements of Operations. Amortization of above-market ground leases is recorded as a reduction to rent expense on the Consolidated Statements of Operations.
The following table summarizes the scheduled amortization of acquired lease intangible assets and assumed liabilities as of June 30, 2025 (in thousands):
Years Ending December 31, |
|
Net Increase in |
|
|
Increase to |
|
|
Reduction of |
|
|||
2025 (Remainder) |
|
$ |
|
|
$ |
( |
) |
|
$ |
|
||
2026 |
|
|
|
|
|
( |
) |
|
|
|
||
2027 |
|
|
|
|
|
( |
) |
|
|
|
||
2028 |
|
|
|
|
|
( |
) |
|
|
|
||
2029 |
|
|
|
|
|
( |
) |
|
|
|
||
Thereafter |
|
|
|
|
|
( |
) |
|
|
|
||
Total |
|
$ |
|
|
$ |
( |
) |
|
$ |
|
||
22
ACADIA REALTY TRUST AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
7. Debt
A summary of the Company’s consolidated indebtedness is as follows (dollars in thousands):
|
|
|
|
|
Carrying Value as of |
|||
|
|
Interest Rate as of |
Maturity Date as of |
|
June 30, |
|
December 31, |
|
|
|
June 30, 2025 |
|
June 30, 2025 |
|
2025 |
|
2024 |
Mortgages Payable |
|
|
|
|
|
|
|
|
Core |
|
|
|
$ |
|
$ |
||
Fund II (a) |
|
SOFR+ |
|
|
|
|||
Fund III |
|
SOFR+ |
|
|
|
|||
Fund IV (b) |
|
SOFR+ |
|
|
|
|||
Fund V |
|
SOFR+ |
|
|
|
|||
Net unamortized debt issuance costs |
|
|
|
|
|
( |
|
( |
Unamortized premium |
|
|
|
|
|
|
||
Total Mortgages Payable |
|
|
|
|
|
$ |
|
$ |
|
|
|
|
|
|
|
|
|
Unsecured Notes Payable |
|
|
|
|
|
|
|
|
Core Term Loans (c) |
|
SOFR+ |
|
|
$ |
|
$ |
|
Core Senior Notes |
|
|
|
|
||||
Net unamortized debt issuance costs |
|
|
|
|
|
( |
|
( |
Total Unsecured Notes Payable |
|
|
|
|
|
$ |
|
$ |
|
|
|
|
|
|
|
|
|
Unsecured Line of Credit |
|
|
|
|
|
|
|
|
Revolving Credit (c) |
|
SOFR+ |
|
|
$ |
|
$ |
|
|
|
|
|
|
|
|
|
|
Total Debt (d)(e) |
|
|
|
|
|
$ |
|
$ |
Net unamortized debt issuance costs |
|
|
|
|
|
( |
|
( |
Unamortized premium |
|
|
|
|
|
|
||
Total Indebtedness |
|
|
|
|
|
$ |
|
$ |
Mortgages Payable
A portion of the Company’s variable-rate property mortgage debt has been effectively fixed through certain cash flow hedge transactions (Note 8).
At June 30, 2025 and December 31, 2024, the Company’s property mortgage loans were collateralized by
Core Portfolio
On January 23, 2025, the Company acquired an additional
During the six months ended June 30, 2025, the Company repaid a $
23
ACADIA REALTY TRUST AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
Investment Management
During the six months ended June 30, 2025, the Company, through Investment Management extended the Fund IV secured bridge facility to mature in March 2026 and made scheduled principal payments totaling $
Unsecured Notes Payable and Unsecured Line of Credit
Credit Facility
In the second quarter of 2025, the Operating Partnership and the Company entered into the Third Amendment to the Third Amended and Restated Credit Agreement (the “Amendment”) to amend the existing senior unsecured credit facility (the “Credit Facility”), which includes a $
At June 30, 2025, the Term Loan had an outstanding balance of $
Other Unsecured Term Loans
Excluding the Term Loan and the $
Senior Notes
On August 21, 2024, the Operating Partnership issued $
The Senior Notes were issued at par in accordance with the Senior Note Purchase Agreement and pay interest semiannually on February 21st and August 21st until their respective maturities.
Revolver
At June 30, 2025, the Revolver, which is part of the Credit Facility discussed above, bears interest at SOFR +
24
ACADIA REALTY TRUST AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
Scheduled Debt Principal Payments
The following table summarizes the scheduled principal repayments, without regard to available extension options (described further below), of the Company’s consolidated indebtedness, as of June 30, 2025 (in thousands):
Year Ending December 31, |
|
Principal Repayments |
|
|
2025 (Remainder) |
|
$ |
|
|
2026 |
|
|
|
|
2027 |
|
|
|
|
2028 |
|
|
|
|
2029 |
|
|
|
|
Thereafter |
|
|
|
|
|
|
|
|
|
Unamortized premium |
|
|
|
|
Net unamortized debt issuance costs |
|
|
( |
) |
Total indebtedness |
|
$ |
|
|
The table above does not reflect available extension options (subject to customary conditions) on consolidated debt with balances as of June 30, 2025. The Company has the option to extend the following debt maturities by up to twelve months, and for some an additional
8. Financial Instruments and Fair Value Measurements
The Company measures certain financial assets and liabilities at fair value on a recurring and nonrecurring basis in accordance with ASC Topic: 820, Fair Value Measurement. The following disclosure summarizes the valuation methodologies and classification within the fair value hierarchy for these instruments.
Items Measured at Fair Value on a Recurring Basis
The Company’s recurring fair value measurements include marketable equity securities and derivative financial instruments. The valuation techniques and classifications are as follows:
Marketable Equity Securities — The Company holds an investment in Albertsons common stock, which is traded on an active exchange and is classified as a Level 1 asset. This investment is included in Marketable securities on the Condensed Consolidated Balance Sheets at June 30, 2025 and December 31, 2024, respectively.
Derivative Financial Instruments — The Company utilizes interest rate swaps and caps to manage interest rate risk on variable-rate debt. These derivatives are over-the-counter instruments valued using observable market inputs, such as interest rate curves, and are classified as Level 2. Derivative assets are included in Other assets, net, and derivative liabilities are included in Accounts payable and other liabilities on the Condensed Consolidated Balance Sheets. See “Derivative Financial Instruments,” below.
The following table presents the Company’s fair value hierarchy for those assets and liabilities measured at fair value on a recurring basis (in thousands):
|
|
June 30, 2025 |
|
|
December 31, 2024 |
|
||||||||||||||||||
|
|
Level 1 |
|
|
Level 2 |
|
|
Level 3 |
|
|
Level 1 |
|
|
Level 2 |
|
|
Level 3 |
|
||||||
Assets |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Marketable equity securities |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||||
Derivative financial instruments |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Liabilities |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Derivative financial instruments |
|
|
|
|
|
( |
) |
|
|
|
|
|
|
|
|
( |
) |
|
|
|
||||
25
ACADIA REALTY TRUST AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
In instances where the determination of the fair value measurement is based on inputs from different levels of the fair value hierarchy, the fair value hierarchy classification is based on the lowest level input that is significant to the valuation. Assessing the significance of a particular input requires judgment and takes into account factors specific to the asset or liability being measured.
The Company did not have any transfers into or out of Level 1, Level 2, and Level 3 measurements during the six months ended June 30, 2025, and 2024.
Marketable Equity Securities
During the six months ended June 30, 2025, the Company sold
Dividend income from marketable securities totaled $
The following table represents the realized and unrealized gains (losses) on marketable securities included in Realized and unrealized holding gains (losses) on investments and other on the Company’s Condensed Consolidated Statements of Operations (in thousands):
|
Three Months Ended June 30, |
|
|
Six Months Ended June 30, |
|
||||||||||
|
2025 |
|
|
2024 |
|
|
2025 |
|
|
2024 |
|
||||
Realized gain on marketable securities, net |
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
Less: previously recognized unrealized gains on marketable securities sold during the period |
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
Unrealized (losses) gains on marketable securities still held as of the end of the period and through the disposition date on marketable securities sold during the period |
|
( |
) |
|
|
( |
) |
|
|
|
|
|
( |
) |
|
Realized and unrealized (losses) gains on marketable securities, net |
$ |
( |
) |
|
$ |
( |
) |
|
$ |
|
|
$ |
( |
) |
|
Items Measured at Fair Value on a Nonrecurring Basis
Refer to Note 2 for fair value adjustments related to the acquisition of an additional
Impairment Charges
Impairment charges for the six months ended June 30, 2025 are as follows (in thousands):
|
|
|
|
|
|
|
|
Impairment Charge (a) |
|
|||||
Property Location |
|
Owner |
|
Triggering Event |
|
Effective Date |
|
Total |
|
|
Acadia's Share |
|
||
New York, NY |
|
Fund III |
|
|
June 30, 2025 |
|
$ |
|
|
$ |
|
|||
New York, NY |
|
Fund IV |
|
|
June 30, 2025 |
|
|
|
|
|
|
|||
Total 2025 Impairment Charges (b) |
|
|
|
|
|
|
|
$ |
|
|
$ |
|
||
Redeemable Noncontrolling Interests
The Company has redeemable noncontrolling interests related to certain properties. The Company periodically evaluates redeemable noncontrolling interests to determine whether the maximum redemption value exceeds the carrying value. As of June 30, 2025, no adjustment was required. Refer to Note 10 for further discussion regarding these interests.
26
ACADIA REALTY TRUST AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
Derivative Financial Instruments
The Company had the following interest rate swaps and caps for the periods presented (information is as of June 30, 2025, unless otherwise noted, and dollars in thousands):
|
|
|
|
|
|
|
|
|
Strike Rate |
|
|
|
Fair Value |
|
||||||||||
Derivative |
|
Aggregate Notional Amount |
|
|
Effective Date |
|
Maturity Date |
|
Low |
|
|
High |
|
Balance Sheet |
|
June 30, |
|
|
December 31, |
|
||||
Core |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Interest Rate Swaps |
|
$ |
|
|
|
|
— |
|
|
Other Assets |
|
$ |
|
|
$ |
|
||||||||
Interest Rate Swaps |
|
|
|
|
|
|
|
— |
|
|
Accounts payable and other liabilities |
|
|
( |
) |
|
|
( |
) |
|||||
|
|
$ |
|
|
|
|
|
|
|
|
|
|
|
|
|
$ |
|
|
$ |
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Fund II |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Interest Rate Swap |
|
$ |
|
|
|
|
— |
|
|
Other Assets |
|
$ |
|
|
$ |
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Fund III |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Interest Rate Cap |
|
$ |
|
|
|
|
|
— |
|
|
Other Assets |
|
$ |
|
|
$ |
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Fund IV |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Interest Rate Cap |
|
$ |
|
|
|
|
|
— |
|
|
Other Assets |
|
$ |
|
|
$ |
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Fund V |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Interest Rate Swaps |
|
$ |
|
|
|
|
— |
|
|
Other Assets |
|
$ |
|
|
$ |
|
||||||||
Interest Rate Swaps |
|
|
|
|
|
|
— |
|
|
Accounts payable and other liabilities |
|
|
( |
) |
|
|
( |
) |
||||||
Interest Rate Cap |
|
|
|
|
|
|
— |
|
|
Other Assets |
|
|
|
|
|
|
||||||||
|
|
$ |
|
|
|
|
|
|
|
|
|
|
|
|
|
$ |
( |
) |
|
$ |
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Total asset derivatives |
|
|
|
|
|
|
|
|
|
|
|
|
|
$ |
|
|
$ |
|
||||||
Total liability derivatives |
|
|
|
|
|
|
|
|
|
|
|
|
|
$ |
( |
) |
|
$ |
( |
) |
||||
All of the Company’s derivative instruments are designated as cash flow hedges and hedge the future cash outflows on variable-rate debt (Note 7). As of June 30, 2025, it is estimated that approximately $
During the six months ended June 30, 2025, the Company terminated
Risk Management Objective of Using Derivatives
The Company is exposed to certain risks arising from both its business operations and economic conditions. The Company manages economic risks, including interest rate, liquidity and credit risk, primarily by managing the amount, sources and duration of its debt funding and, from time to time, through the use of derivative financial instruments. The Company enters into derivative financial instruments to manage exposures that result in the receipt or payment of future known and uncertain cash amounts, the values of which are determined by interest rates. The Company’s derivative financial instruments are used to manage differences in the amount, timing and duration of the Company’s known or expected cash receipts and its known or expected cash payments principally related to the Company’s investments and borrowings.
The Company is exposed to credit risk in the event of non-performance by the counterparties to the swaps if the derivative position has a positive balance. The Company believes it mitigates its credit risk by entering into swaps with major financial institutions. The Company continually monitors and actively manages interest costs on its variable-rate debt portfolio and may enter into additional interest rate swap positions or other derivative interest rate instruments based on market conditions.
27
ACADIA REALTY TRUST AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
Credit Risk-Related Contingent Features
The Company’s agreements with its swap counterparties include provisions that could require immediate settlement of outstanding swap obligations in the event of a default. Specifically, if the Company defaults on certain unsecured debt obligations, such default may trigger a cross-default under the swap agreements, allowing the counterparties to declare an event of default and accelerate payment obligations under the swaps.
Other Financial Instruments
The Company’s other financial instruments had the following carrying values and fair values as of the dates shown (dollars in thousands, inclusive of amounts attributable to noncontrolling interests where applicable):
|
|
|
|
|
June 30, 2025 |
|
|
December 31, 2024 |
|
|||||||||||
|
|
Level |
|
|
Carrying |
|
|
Estimated |
|
|
Carrying |
|
|
Estimated |
|
|||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Notes Receivable (a) |
|
|
3 |
|
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
City Point Loan (a) |
|
|
3 |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Mortgage and Other Notes Payable (a) |
|
|
3 |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Investment in non-traded equity securities (b) |
|
|
3 |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Unsecured notes payable and Unsecured line of credit (c) |
|
|
2 |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
As of June 30, 2025 and December 31, 2024, the carrying amounts of the Company’s cash and cash equivalents, restricted cash, rents receivable, accounts payable, and certain financial instruments classified as Level 1 within other assets and other liabilities approximated their fair values. This approximation is due to the short-term nature and high liquidity of these instruments.
9. Commitments and Contingencies
The Company is involved in various matters of litigation arising out of, or incidental to, its business. While the Company is unable to predict with certainty the outcome of any particular matter, management does not expect, when such litigation is resolved, that the Company’s resulting exposure to loss contingencies, if any, will have a material adverse effect on its consolidated financial position or results of operations.
Commitments and Guaranties
From time to time, the Company (or ventures in which the Company has an ownership interest) has agreed, and may in the future agree, to guarantee portions of the principal, interest and other amounts in connection with their borrowings, provide customary environmental indemnifications and nonrecourse carve-outs (e.g., guarantees against fraud, misrepresentation and bankruptcy) in connection with their borrowings and provide guarantees to lenders, tenants and other third parties for the completion of development projects.
With respect to borrowings of our consolidated entities, the Company and certain subsidiaries of the Company have guaranteed $
Additionally, in connection with the refinancing of the La Frontera Village (Note 4) property mortgage loan of $
28
ACADIA REALTY TRUST AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
Construction and Tenant Improvement Commitments
In conjunction with the development and expansion of various properties, the Company has entered into agreements with general contractors for the construction or development of properties aggregating approximately $
Additionally, the Company has committed to fund tenant improvements under executed leases totaling approximately $
Forfeiture of Deposits
The Company entered into a purchase and sale agreement (together with subsequent amendments thereto) to sell its West Shore Expressway property in the Core Portfolio. At the request of the former potential buyer, the Company extended the closing date numerous times in exchange for additional non-refundable deposits and contributions towards the carrying costs of the property. The agreement terminated and expired by its terms in August 2023, and the deposit was forfeited to an affiliate of the Company, when, among other things, the former potential buyer failed to close on the property pursuant to the terms of the agreement. During the third quarter of 2023, the former potential buyer filed for Chapter 11 bankruptcy, which bankruptcy was dismissed during the fourth quarter of 2023, and as of March 31, 2024 is no longer subject to appeal. The Company recorded income of $
Insurance Coverage
The Company maintains insurance coverage on its properties in different types and amounts, with deductibles, that management believes are consistent with coverage typically carried by owners of similar properties.
10. Shareholders’ Equity, Noncontrolling Interests and Other Comprehensive Loss
ATM Program
The Company has an at-the-market equity issuance program (“ATM Program”) that provides the Company with an efficient vehicle for raising public equity capital to fund its needs. In February 2025, the Company entered into its current $
As of June 30, 2025, the Company had
In March 2025, the Company physically settled
The Company did not receive any proceeds from the sale of shares at the time it entered into each of the respective forward sale agreements. The Company determined that the ATM forward sales agreements meet the criteria for equity classification and, therefore, are exempt from derivative
29
ACADIA REALTY TRUST AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
accounting. The Company recorded the ATM forward sales agreements at fair value at inception, which was determined to be zero, and no subsequent fair value adjustments are required under equity classification.
Common Shares and Units
During the six months ended June 30, 2025, the Company withheld
Share Repurchase Program
In 2018, the Company’s board of trustees (the “Board”) approved a new share repurchase program, which authorizes management, at its discretion, to repurchase up to $
Dividends and Distributions
During the three months ended June 30, 2025 and 2024, the Company declared distributions of $
30
ACADIA REALTY TRUST AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
Noncontrolling Interests
The following tables summarize the change in the noncontrolling interests for the three and six months ended June 30, 2025 and 2024 (dollars in thousands, except per unit data):
|
|
Noncontrolling |
|
|
Noncontrolling |
|
|
Total |
|
|
Redeemable Noncontrolling Interests (c) |
|
||||
Balance as of April 1, 2025 |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
Distributions declared of $ |
|
|
( |
) |
|
|
|
|
|
( |
) |
|
|
|
||
Net income (loss) for the three months ended June 30, 2025 |
|
|
|
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|
Conversion of |
|
|
( |
) |
|
|
|
|
|
( |
) |
|
|
|
||
Other comprehensive income - unrealized loss on valuation of swap agreements |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|
|
|
|
Reclassification of realized interest expense on swap agreements |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|
|
|
|
City Point Loan accrued interest |
|
|
|
|
|
|
|
|
|
|
|
( |
) |
|||
Noncontrolling interest contributions |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Noncontrolling interest distributions |
|
|
|
|
|
( |
) |
|
|
( |
) |
|
|
|
||
Employee Long-term Incentive Plan Unit Awards |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Reallocation of noncontrolling interests (d) |
|
|
( |
) |
|
|
|
|
|
( |
) |
|
|
|
||
Balance as of June 30, 2025 |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Balance as of April 1, 2024 |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
Distributions declared of $ |
|
|
( |
) |
|
|
|
|
|
( |
) |
|
|
|
||
Net income (loss) for the three months ended June 30, 2024 |
|
|
|
|
|
|
|
|
|
|
|
( |
) |
|||
Conversion of |
|
|
( |
) |
|
|
|
|
|
( |
) |
|
|
|
||
Other comprehensive income - unrealized gain on valuation of swap agreements |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Reclassification of realized interest expense on swap agreements |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|
|
|
|
City Point Loan accrued interest |
|
|
|
|
|
|
|
|
|
|
|
( |
) |
|||
Capital call receivable |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Noncontrolling interest contributions |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Noncontrolling interest distributions |
|
|
|
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|
Employee Long-term Incentive Plan Unit Awards |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Reallocation of noncontrolling interests (d) |
|
|
( |
) |
|
|
|
|
|
( |
) |
|
|
|
||
Balance as of June 30, 2024 |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
31
ACADIA REALTY TRUST AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
|
|
Noncontrolling |
|
|
Noncontrolling |
|
|
Total |
|
|
Redeemable Noncontrolling Interests (c) |
|
||||
Balance at January 1, 2025 |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
Distributions declared of $ |
|
|
( |
) |
|
|
|
|
|
( |
) |
|
|
— |
|
|
Net income (loss) for the six months ended June 30, 2025 |
|
|
|
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|
Conversion of |
|
|
( |
) |
|
|
|
|
|
( |
) |
|
|
|
||
Other comprehensive income - unrealized loss on valuation of swap agreements |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|
|
|
|
Consolidation of previously unconsolidated investment |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Reclassification of realized interest expense on swap agreements |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|
|
|
|
City Point Loan accrued interest |
|
|
|
|
|
|
|
|
|
|
|
( |
) |
|||
Noncontrolling interest contributions |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Noncontrolling interest distributions |
|
|
|
|
|
( |
) |
|
|
( |
) |
|
|
|
||
Employee Long-term Incentive Plan Unit Awards |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Reallocation of noncontrolling interests (d) |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Balance at June 30, 2025 |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Balance at January 1, 2024 |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
Distributions declared of $ |
|
|
( |
) |
|
|
|
|
|
( |
) |
|
|
|
||
Net income (loss) for the six months ended June 30, 2024 |
|
|
|
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|
Conversion of |
|
|
( |
) |
|
|
|
|
|
( |
) |
|
|
|
||
Other comprehensive income - unrealized gain on valuation of swap agreements |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Reclassification of realized interest expense on swap agreements |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|
|
|
|
City Point Loan accrued interest |
|
|
|
|
|
|
|
|
|
|
|
( |
) |
|||
Capital call receivable |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Noncontrolling interest contributions |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Noncontrolling interest distributions |
|
|
|
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|
Employee Long-term Incentive Plan Unit Awards |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Reallocation of noncontrolling interests (d) |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Balance at June 30, 2024 |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Redeemable Noncontrolling Interests
Williamsburg Portfolio
In connection with the Williamsburg Portfolio acquisition in February 2022, the venture partner has a one-time right to put its
32
ACADIA REALTY TRUST AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
acquisition date that the venture partner would receive any consideration on redemption due to the Company’s preferential returns, the initial fair value of the Williamsburg NCI was determined to be
City Point Loan
In August 2022, the Company provided a loan, through a separate lending subsidiary, to other Fund II investors in City Point, through a separate borrower subsidiary, to fund the investors’ pro-rata contribution necessary to complete the refinancing of the City Point debt, of which $
8833 Beverly Boulevard
In July 2023, the Company entered into a limited partnership agreement to own and operate the 8833 Beverly Boulevard property. Following the formation of the partnership, the Company retained a
Preferred OP Units
During 2016, the Operating Partnership issued
In 1999, the Operating Partnership issued
11. Leases
As Lessor
The Company’s primary source of revenue is derived from lease agreements related to its portfolio of shopping centers and other retail properties. As of June 30, 2025, the Company was party to approximately
33
ACADIA REALTY TRUST AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
under long-term ground leases. These lease agreements have contractual terms that extend through February 2, 2084, and many include tenant renewal options. Certain leases also provide tenants with early termination rights.
Lease terms generally range from
The following table presents the components of rental revenue, disaggregated into fixed and variable lease income (in thousands):
|
Three Months Ended June 30, |
|
|
Six Months Ended June 30, |
|
||||||||||
|
2025 |
|
|
2024 |
|
|
2025 |
|
|
2024 |
|
||||
Fixed lease revenue |
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
Variable lease revenue |
|
|
|
|
|
|
|
|
|
|
|
||||
Total rental revenue |
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
The following table summarizes the Company’s scheduled future minimum rental revenues under non-cancelable tenant leases with remaining terms greater than one year, as of June 30, 2025. These amounts assume no new or renegotiated leases or exercise of renewal options not deemed reasonably certain (in thousands):
|
|
|
|
|
Year Ending December 31, |
|
Minimum Rental |
|
|
2025 (Remainder) |
|
$ |
|
|
2026 |
|
|
|
|
2027 |
|
|
|
|
2028 |
|
|
|
|
2029 |
|
|
|
|
Thereafter |
|
|
|
|
Total |
|
$ |
|
|
During the first quarter of 2025, the Company recognized $
During the three and six months ended June 30, 2025 and 2024, no single tenant or property collectively comprised more than
34
ACADIA REALTY TRUST AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
As Lessee
The Company leases certain properties that are owned by third parties, including ground leases for retail properties and leases for office space and equipment. These leases grant the Company the right to operate the underlying assets during the lease term. Lease terms generally range from
|
|
Minimum Rental Payments |
|
|||||
Year Ending December 31, |
|
Operating Leases (a) |
|
|
Finance |
|
||
2025 (Remainder) |
|
$ |
|
|
$ |
|
||
2026 |
|
|
|
|
|
|
||
2027 |
|
|
|
|
|
|
||
2028 |
|
|
|
|
|
|
||
2029 |
|
|
|
|
|
|
||
Thereafter |
|
|
|
|
|
|
||
|
|
|
|
|
|
|
||
Interest |
|
|
( |
) |
|
|
( |
) |
Total |
|
$ |
|
|
$ |
|
||
The following table summarizes additional lease cost information for the Company’s lessee arrangements (dollars in thousands):
|
Three Months Ended June 30, |
|
|
Six Months Ended June 30, |
||||||||||||
|
2025 |
|
|
2024 |
|
|
2025 |
|
|
2024 |
|
|
||||
Lease Cost |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Finance lease cost: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Amortization of right-of-use assets |
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|
||||
Interest on lease liabilities |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Subtotal |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Operating lease cost |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Variable lease cost |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Total lease cost |
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Cash Paid |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Payments of operating lease obligations - operating activities |
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|
||||
Payments of interest on finance lease obligations - operating activities |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Payments of finance lease obligations - financing activities |
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
|
As of June 30, |
|
|||||
|
|
2025 |
|
|
2024 |
|
||
Other Information |
|
|
|
|
|
|
||
Weighted-average remaining lease term - finance leases (years) |
|
|
|
|
|
|
||
Weighted-average remaining lease term - operating leases (years) |
|
|
|
|
|
|
||
Weighted-average discount rate - finance leases |
|
|
% |
|
|
% |
||
Weighted-average discount rate - operating leases |
|
|
% |
|
|
% |
||
During the first quarter of 2025, the Company entered into a new corporate office lease. The Company recognized a $
35
ACADIA REALTY TRUST AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
12. Segment Reporting
The Company has identified
The Company’s Core Portfolio segment consists primarily of high-quality retail properties located primarily in high-barrier-to-entry, densely-populated metropolitan areas with a long-term investment horizon. The Company’s Investment Management segment holds primarily retail real estate in which the Company co-invests with high-quality institutional investors. The Company’s Structured Financing segment consists of earnings and expenses related to notes and mortgages receivable (Note 3).
Fees earned by the Company as the general partner or managing member through consolidated Investment Management entities are eliminated in the Company’s Condensed Consolidated Financial Statements and are not presented in the Company’s segments.
The following tables present selected financial information for each reportable segment (in thousands):
|
|
For the Three Months Ended June 30, 2025 |
|
|||||||||||||||||
|
|
Core |
|
|
Investment |
|
|
Structured |
|
|
Unallocated |
|
|
Total |
|
|||||
Rental revenue |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|||||
Other revenue |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Depreciation and amortization expenses |
|
|
( |
) |
|
|
( |
) |
|
|
|
|
|
|
|
|
( |
) |
||
Property operating expenses |
|
|
( |
) |
|
|
( |
) |
|
|
|
|
|
|
|
|
( |
) |
||
Real estate taxes |
|
|
( |
) |
|
|
( |
) |
|
|
|
|
|
|
|
|
( |
) |
||
General and administrative expenses |
|
|
|
|
|
|
|
|
|
|
|
( |
) |
|
|
( |
) |
|||
Impairment charges |
|
|
|
|
|
( |
) |
|
|
|
|
|
|
|
|
( |
) |
|||
Operating income (loss) |
|
|
|
|
|
( |
) |
|
|
|
|
|
( |
) |
|
|
|
|||
Interest income |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Equity in earnings of unconsolidated affiliates |
|
|
( |
) |
|
|
( |
) |
|
|
|
|
|
|
|
|
( |
) |
||
Interest expense |
|
|
( |
) |
|
|
( |
) |
|
|
|
|
|
|
|
|
( |
) |
||
Realized and unrealized holding (losses) gains on investments and other |
|
|
( |
) |
|
|
|
|
|
|
|
|
|
|
|
( |
) |
|||
Income tax provision |
|
|
|
|
|
|
|
|
|
|
|
( |
) |
|
|
( |
) |
|||
Net income (loss) |
|
|
|
|
|
( |
) |
|
|
|
|
|
( |
) |
|
|
( |
) |
||
Net loss attributable to redeemable noncontrolling interests |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Net loss attributable to noncontrolling interests |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Net income (loss) attributable to Acadia shareholders |
|
$ |
|
|
$ |
( |
) |
|
$ |
|
|
$ |
( |
) |
|
$ |
|
|||
36
ACADIA REALTY TRUST AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
|
|
For the Three Months Ended June 30, 2024 |
|
|||||||||||||||||
|
|
Core |
|
|
Investment |
|
|
Structured |
|
|
Unallocated |
|
|
Total |
|
|||||
Rental revenue |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|||||
Other revenue |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Depreciation and amortization expenses |
|
|
( |
) |
|
|
( |
) |
|
|
|
|
|
|
|
|
( |
) |
||
Property operating expenses |
|
|
( |
) |
|
|
( |
) |
|
|
|
|
|
|
|
|
( |
) |
||
Real estate taxes |
|
|
( |
) |
|
|
( |
) |
|
|
|
|
|
|
|
|
( |
) |
||
General and administrative expenses |
|
|
|
|
|
|
|
|
|
|
|
( |
) |
|
|
( |
) |
|||
(Loss) gain related to a previously disposed property |
|
|
( |
) |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Operating income |
|
|
|
|
|
|
|
|
|
|
|
( |
) |
|
|
|
||||
Interest income |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Equity in earnings of unconsolidated affiliates |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Interest expense |
|
|
( |
) |
|
|
( |
) |
|
|
|
|
|
|
|
|
( |
) |
||
Realized and unrealized holding (losses) gains on investments and other |
|
|
( |
) |
|
|
|
|
|
( |
) |
|
|
|
|
|
( |
) |
||
Income tax provision |
|
|
|
|
|
|
|
|
|
|
|
( |
) |
|
|
( |
) |
|||
Net income |
|
|
|
|
|
|
|
|
|
|
|
( |
) |
|
|
|
||||
Net loss attributable to redeemable noncontrolling interests |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Net income attributable to noncontrolling interests |
|
|
( |
) |
|
|
( |
) |
|
|
|
|
|
|
|
|
( |
) |
||
Net income attributable to Acadia shareholders |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
( |
) |
|
$ |
|
||||
|
|
As of or for the Six Months Ended June 30, 2025 |
|
|||||||||||||||||
|
|
Core |
|
|
Investment |
|
|
Structured |
|
|
Unallocated |
|
|
Total |
|
|||||
Rental revenue |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|||||
Other revenue |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Depreciation and amortization expenses |
|
|
( |
) |
|
|
( |
) |
|
|
|
|
|
|
|
|
( |
) |
||
Property operating expenses |
|
|
( |
) |
|
|
( |
) |
|
|
|
|
|
|
|
|
( |
) |
||
Real estate taxes |
|
|
( |
) |
|
|
( |
) |
|
|
|
|
|
|
|
|
( |
) |
||
General and administrative expenses |
|
|
|
|
|
|
|
|
|
|
|
( |
) |
|
|
( |
) |
|||
Impairment charges |
|
|
|
|
|
( |
) |
|
|
|
|
|
|
|
|
( |
) |
|||
Operating income |
|
|
|
|
|
( |
) |
|
|
|
|
|
( |
) |
|
|
|
|||
Interest income |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Equity in earnings (losses) of unconsolidated affiliates |
|
|
( |
) |
|
|
( |
) |
|
|
|
|
|
|
|
|
( |
) |
||
Interest expense |
|
|
( |
) |
|
|
( |
) |
|
|
|
|
|
|
|
|
( |
) |
||
Loss on change in control |
|
|
( |
) |
|
|
|
|
|
|
|
|
|
|
|
( |
) |
|||
Realized and unrealized holding gains (losses) on investments and other |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Income tax provision |
|
|
|
|
|
|
|
|
|
|
|
( |
) |
|
|
( |
) |
|||
Net income (loss) |
|
|
|
|
|
( |
) |
|
|
|
|
|
( |
) |
|
|
( |
) |
||
Net loss attributable to redeemable noncontrolling interests |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Net loss attributable to noncontrolling interests |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Net income attributable to Acadia shareholders |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
( |
) |
|
$ |
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Real estate at cost (a) |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|||||
Total assets (a) |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|||||
Cash paid for acquisition of real estate |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|||||
Cash paid for development and property improvement costs |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|||||
37
ACADIA REALTY TRUST AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
|
|
As of or for the Six Months Ended June 30, 2024 |
|
|||||||||||||||||
|
|
Core |
|
|
Investment |
|
|
Structured |
|
|
Unallocated |
|
|
Total |
|
|||||
Rental revenue |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|||||
Other revenue |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Depreciation and amortization expenses |
|
|
( |
) |
|
|
( |
) |
|
|
|
|
|
|
|
|
( |
) |
||
Property operating expenses |
|
|
( |
) |
|
|
( |
) |
|
|
|
|
|
|
|
|
( |
) |
||
Real estate taxes |
|
|
( |
) |
|
|
( |
) |
|
|
|
|
|
|
|
|
( |
) |
||
General and administrative expenses |
|
|
|
|
|
|
|
|
|
|
|
( |
) |
|
|
( |
) |
|||
Loss related to a previously disposed property |
|
|
( |
) |
|
|
|
|
|
|
|
|
|
|
|
( |
) |
|||
Operating income |
|
|
|
|
|
|
|
|
|
|
|
( |
) |
|
|
|
||||
Interest income |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Equity in earnings (losses) of unconsolidated affiliates |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Interest expense |
|
|
( |
) |
|
|
( |
) |
|
|
|
|
|
|
|
|
( |
) |
||
Realized and unrealized holding losses on investments and other |
|
|
( |
) |
|
|
|
|
|
( |
) |
|
|
|
|
|
( |
) |
||
Income tax provision |
|
|
|
|
|
|
|
|
|
|
|
( |
) |
|
|
( |
) |
|||
Net income (loss) |
|
|
|
|
|
( |
) |
|
|
|
|
|
( |
) |
|
|
( |
) |
||
Net loss attributable to redeemable noncontrolling interests |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Net (income) loss attributable to noncontrolling interests |
|
|
( |
) |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Net loss attributable to Acadia shareholders |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
( |
) |
|
$ |
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Real estate at cost (a) |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|||||
Total assets (a) |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|||||
Cash paid for development and property improvement costs |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|||||
13. Share Incentive and Other Compensation
Share Incentive Plan
The Amended and Restated 2020 Share Incentive Plan, as approved by the Board and the Company’s shareholders, increased the number of Common Shares authorized for issuance to
A summary of the status of the Company’s unvested Restricted Shares and LTIP Units is presented below:
Unvested Restricted Shares and LTIP Units |
|
Common |
|
|
Weighted |
|
|
LTIP Units |
|
|
Weighted |
|
||||
Unvested as of December 31, 2023 |
|
|
|
|
$ |
|
|
|
|
|
$ |
|
||||
Granted |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Vested |
|
|
( |
) |
|
|
|
|
|
( |
) |
|
|
|
||
Forfeited |
|
|
( |
) |
|
|
|
|
|
( |
) |
|
|
|
||
Unvested as of December 31, 2024 |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Granted |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Vested |
|
|
( |
) |
|
|
|
|
|
( |
) |
|
|
|
||
Forfeited |
|
|
|
|
|
|
|
|
( |
) |
|
|
|
|||
Unvested as of June 30, 2025 |
|
|
|
|
$ |
|
|
|
|
|
$ |
|
||||
38
ACADIA REALTY TRUST AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
The weighted-average grant date fair value for Restricted Shares and LTIP Units granted for the six months ended June 30, 2025 and the year ended December 31, 2024 were $
Restricted Shares and LTIP Units - Employees
During the six months ended June 30, 2025, the Company issued
For valuation of the 2025 and 2024 Performance Shares, a Monte Carlo simulation was used to estimate the fair values of the relative TSR portion based on probability of satisfying the market conditions and the projected share prices at the time of payments, discounted to the valuation dates over the
The total fair value of the above Restricted Share Units and LTIP Units as of the grant date was $
39
ACADIA REALTY TRUST AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
Restricted Shares and LTIP Units - Board of Trustees
In addition, members of the Board have been issued shares and units under the Amended and Restated 2020 Plan. During the six months ended June 30, 2025, the Company issued
Long-Term Investment Alignment Program
In 2009, the Company adopted the Long-Term Investment Alignment Program (the “Program”) pursuant to which the Company may grant awards to employees, entitling them to receive up to
As payments to other employees are not subject to further Board approval, compensation relating to these awards will be recorded based on the estimated fair value as of each reporting period in accordance with ASC Topic 718, Compensation– Stock Compensation. The awards in connection with Fund IV were determined to have
For the six months ended June 30, 2025 and 2024, the Company did
Other Plans
On a combined basis, the Company incurred a total of $
Employee Share Purchase Plan
The Acadia Realty Trust Employee Share Purchase Plan (the “Purchase Plan”) allows eligible employees of the Company to purchase Common Shares through payroll deductions for a maximum aggregate issuance of
Deferred Share Plan
The Company maintains a Trustee Deferral and Distribution Election program, under which the participating Trustees earn deferred compensation.
Employee 401(k) Plan
The Company maintains a 401(k) plan for employees under which the Company currently matches
40
ACADIA REALTY TRUST AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
14. Earnings Per Common Share
Basic earnings per Common Share is computed by dividing net income attributable to Common Shareholders by the weighted-average Common Shares outstanding during the period (Note 10).
During the periods presented, the Company had unvested LTIP Units that entitle holders to non-forfeitable dividend equivalent rights. As such, these unvested LTIP Units are considered participating securities and are included in the computation of basic earnings per Common Share using the two-class method.
Diluted earnings per Common Share reflects the potential dilution from the assumed conversion or exercise of securities including the effects of Restricted Share Units issued under the Company’s Amended and Restated 2020 Plan (Note 13), and the shares issuable upon settlement of any outstanding forward sale agreements (Note 10). The shares related to forward sale agreements are included in the diluted earnings per share calculation using the treasury stock method for the period they are outstanding prior to settlement. Under this method, the number of incremental shares included in the diluted share count is equal to the excess, if any, of: (i) the number of Common Shares that would be issued upon full physical settlement of the forward sale agreements, over (ii) the number of Common Shares that could be repurchased using the proceeds receivable upon settlement, based on the average market price during the period and the adjusted forward sales price immediately prior to settlement. The impact of these shares is excluded from the diluted earnings per share calculation when the effect would be anti-dilutive.
|
|
Three Months Ended June 30, |
|
|
Six Months Ended June 30, |
|
||||||||||
(dollars in thousands, except per share data) |
|
2025 |
|
|
2024 |
|
|
2025 |
|
|
2024 |
|
||||
Numerator: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Net income attributable to Acadia shareholders |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
Less: net income attributable to participating securities |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
Income from continuing operations net of income attributable to participating securities for basic earnings per share |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Denominator: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Weighted average shares for basic earnings per share |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Effect of dilutive securities: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Series A Preferred OP Units |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Employee unvested restricted shares |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Assumed settlement of forward sales agreements (Note 10) |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Denominator for diluted earnings per share |
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Basic earnings per Common Share from continuing operations attributable to Acadia shareholders |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
Diluted earnings per Common Share from continuing operations attributable to Acadia shareholders |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Anti-Dilutive Shares Excluded from Denominator: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Series A Preferred OP Units |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Series A Preferred OP Units - Common share equivalent |
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Series C Preferred OP Units |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Series C Preferred OP Units - Common share equivalent |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Restricted shares |
|
|
|
|
|
|
|
|
|
|
|
|
||||
41
ACADIA REALTY TRUST AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
15. Variable Interest Entities
The Company consolidates certain VIEs in which it has determined it is the primary beneficiary. As of June 30, 2025, the Company had identified nine consolidated VIEs, including the Operating Partnership and the Funds.
Excluding the Operating Partnership and the Funds, the Company’s consolidated VIEs include four in-service Core Portfolio properties: the Williamsburg Portfolio, 239 Greenwich Avenue, 8833 Beverly Boulevard, and the Renaissance Portfolio.
The Operating Partnership is considered a VIE because the limited partners lack substantive kick-out or participating rights. The Company is deemed the primary beneficiary of each consolidated VIE because it: (i) has the power to direct the activities that most significantly impact the VIE’s economic performance, and (ii) has the obligation to absorb the losses or right to receive benefits that could potentially be significant to the VIE. The interest of third parties in these consolidated VIEs are presented as noncontrolling interests or redeemable noncontrolling interests in the accompanying Condensed Consolidated Financial Statements and in Note 10.
The operations of these VIEs are primarily funded through fees earned from investment activities or cash flows generated from the underlying properties. The Company has not provided financial support to any of these VIEs beyond its existing contractual obligations, which primarily include funding capital commitments, capital expenditures necessary to maintain operations, and covering any operating cash shortfalls.
Since the Company conducts its business through the Operating Partnership and substantially all of its assets and liabilities are held by the Operating Partnership, the Condensed Consolidated Balance Sheets as of June 30, 2025 and December 31, 2024, primarily reflect the assets and liabilities of the Operating Partnership, including those of its consolidated VIEs. The following table presents the assets and liabilities of the consolidated VIEs included in the Condensed Consolidated Balance sheets (in thousands):
(in thousands) |
|
June 30, 2025 |
|
|
December 31, 2024 |
|
||
VIE ASSETS |
|
|
|
|
|
|
||
Operating real estate, net |
|
$ |
|
|
$ |
|
||
Real estate under development |
|
|
|
|
|
|
||
Investments in and advances to unconsolidated affiliates |
|
|
|
|
|
|
||
Other assets, net |
|
|
|
|
|
|
||
Right-of-use assets - operating leases, net |
|
|
|
|
|
|
||
Cash and cash equivalents |
|
|
|
|
|
|
||
Restricted cash |
|
|
|
|
|
|
||
Rents receivable, net |
|
|
|
|
|
|
||
Total VIE assets (a) |
|
$ |
|
|
$ |
|
||
|
|
|
|
|
|
|
||
VIE LIABILITIES |
|
|
|
|
|
|
||
Mortgage and other notes payable, net |
|
$ |
|
|
$ |
|
||
Accounts payable and other liabilities |
|
|
|
|
|
|
||
Lease liability - operating leases, net |
|
|
|
|
|
|
||
Total VIE liabilities (a) |
|
$ |
|
|
$ |
|
||
42
ACADIA REALTY TRUST AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
Unconsolidated VIEs
The Company holds variable interests in certain entities that are considered VIEs but are not consolidated because the Company is not the primary beneficiary. Although the Company may be responsible for managing the day-to-day operations of these entities, it does not have unilateral power over the activities that, when taken together, most significantly impact the respective VIE’s economic performance. As such, the Company does not meet the criteria for consolidation.
As of June 30, 2025, the Company had interests in two unconsolidated VIEs: 1238 Wisconsin Avenue and the Georgetown Portfolio. The Company’s involvement in these entities consists of direct and indirect equity interests and contractual fee arrangements. These investments are accounted for under the equity method of accounting (Note 4). The Company’s maximum exposure to loss in these unconsolidated VIEs is limited to: (i) the carrying amount of its equity investment, and (ii) any debt guarantees provided (Note 9). As of June 30, 2025 and December 31, 2024, the Company’s investment in the assets of these unconsolidated VIEs was $
The Company also holds a preferred equity investment in a VIE that is structured with characteristics that are substantially similar to a debt instrument and is accounted for as a note receivable. The Company is not the primary beneficiary as it does not have the power to direct the activities that most significantly impact the VIE’s economic performance, and therefore does not consolidate the VIE. As of June 30, 2025, the carrying value of the investment was $
16. Subsequent Events
On July 25, 2025, the Operating Partnership and the Company entered into an amendment related to the $
Subsequent to June 30, 2025, a partner with an interest of approximately
43
ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.
OVERVIEW
Acadia Realty Trust (the “Trust”, collectively with its consolidated subsidiaries, the “Company”, “we”, “us” or “our”), a Maryland real estate investment trust (“REIT”), is a fully-integrated equity REIT focused on the ownership, acquisition, development, and management of retail properties located primarily in high-barrier-to-entry, supply-constrained, densely populated metropolitan areas in the United States. All of the Company’s assets are held by, and all of its operations are conducted through, Acadia Realty Limited Partnership (the “Operating Partnership”) and entities in which the Operating Partnership owns an interest. As of June 30, 2025 and December 31, 2024, the Trust controlled approximately 96% of the Operating Partnership as the sole general partner and is entitled to share, in proportion to its percentage interest, in the cash distributions and profits and losses of the Operating Partnership.
We own and operate a high-quality core real estate portfolio (“Core” or our “Core Portfolio”) located in the nation’s most dynamic retail corridors, complemented by an investment management platform (“Investment Management”). Through the Investment Management platform, we have active investments through the following opportunity funds, including: Acadia Strategic Opportunity Fund II, LLC (“Fund II”), Acadia Strategic Opportunity Fund III LLC (“Fund III”), Acadia Strategic Opportunity Fund IV LLC (“Fund IV”), and Acadia Strategic Opportunity Fund V LLC (“Fund V” and, collectively with Fund II, Fund III and Fund IV, “the Funds”). In addition, we hold equity method investments in three unconsolidated co-investment vehicles, through strategic partnerships with large institutional investors. We hold significant equity ownership, typically ranging from 5% to 20%, in each venture.
We continue to execute on a focused strategy designed to drive long-term, profitable growth by leveraging the strength of our Core Portfolio and Investment Management platform. Our strategic priorities include:
As of June 30, 2025, we own or have an ownership interest in 218 properties held through our Core Portfolio and Investment Management platform (Note 1). Our Core Portfolio consists of those properties either wholly owned, or partially owned through joint venture interests, by the Operating Partnership, or subsidiaries thereof, not including those properties owned through the Investment Management platform. These properties primarily consist of street and urban retail, and suburban shopping centers. The Investment Management platform consists of investment vehicles through which our Operating Partnership and outside institutional investors invest in primarily opportunistic and value-add retail real estate. The majority of our operating income is derived from rental revenues from operating properties, including expense recoveries from tenants, offset by operating and overhead expenses.
44
A summary of our wholly-owned and partially-owned retail properties and their physical occupancies as of June 30, 2025 is as follows:
|
|
Number of Properties |
|
|
Operating Properties |
|
||||||||||
|
|
Development or |
|
|
Operating |
|
|
GLA |
|
|
Occupancy |
|
||||
Core Portfolio: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Chicago Metro |
|
|
3 |
|
|
|
36 |
|
|
|
577,005 |
|
|
|
83.5 |
% |
New York Metro |
|
|
3 |
|
|
|
41 |
|
|
|
375,450 |
|
|
|
94.3 |
% |
Los Angeles Metro |
|
|
— |
|
|
|
2 |
|
|
|
23,757 |
|
|
|
100.0 |
% |
San Francisco Metro |
|
|
2 |
|
|
|
— |
|
|
|
— |
|
|
|
0.0 |
% |
Dallas Metro |
|
|
5 |
|
|
|
14 |
|
|
|
84,734 |
|
|
|
89.7 |
% |
Washington D.C. Metro |
|
|
— |
|
|
|
32 |
|
|
|
359,825 |
|
|
|
80.9 |
% |
Boston Metro |
|
|
— |
|
|
|
1 |
|
|
|
1,050 |
|
|
|
100.0 |
% |
Suburban |
|
|
5 |
|
|
|
23 |
|
|
|
3,708,864 |
|
|
|
94.2 |
% |
Total Core Portfolio |
|
|
18 |
|
|
|
149 |
|
|
|
5,130,685 |
|
|
|
92.0 |
% |
Acadia Share of Total Core Portfolio |
|
|
18 |
|
|
|
149 |
|
|
|
4,870,100 |
|
|
|
92.2 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Investment Management: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Fund II |
|
|
— |
|
|
|
1 |
|
|
|
536,414 |
|
|
|
78.7 |
% |
Fund III |
|
|
1 |
|
|
|
1 |
|
|
|
4,547 |
|
|
|
93.4 |
% |
Fund IV |
|
|
1 |
|
|
|
21 |
|
|
|
297,199 |
|
|
|
82.9 |
% |
Fund V |
|
|
— |
|
|
|
22 |
|
|
|
7,467,978 |
|
|
|
93.7 |
% |
Other |
|
|
— |
|
|
|
4 |
|
|
|
624,521 |
|
|
|
96.0 |
% |
Total Investment Management |
|
|
2 |
|
|
|
49 |
|
|
|
8,930,659 |
|
|
|
92.6 |
% |
Acadia Share of Total Investment Management |
|
|
2 |
|
|
|
49 |
|
|
|
2,090,698 |
|
|
|
91.8 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Total Core and Investment Management |
|
|
20 |
|
|
|
198 |
|
|
|
14,061,344 |
|
|
|
92.4 |
% |
Acadia Share of Total Core and Investment Management |
|
|
20 |
|
|
|
198 |
|
|
|
6,960,798 |
|
|
|
92.1 |
% |
SIGNIFICANT ACTIVITIES DURING 2025
Investments
Acquisitions
The following properties were acquired during the six months ended June 30, 2025 (Note 2) (dollars in thousands):
Property Name |
|
Portfolio |
|
Ownership |
|
Acquisition Date |
|
Location |
|
GLA |
|
|
Purchase Price |
|
||
106 Spring Street |
|
Core |
|
100% |
|
January 9, 2025 |
|
New York Metro |
|
|
5,936 |
|
|
$ |
55,137 |
|
73 Wooster Street |
|
Core |
|
100% |
|
January 9, 2025 |
|
New York Metro |
|
|
8,896 |
|
|
|
25,459 |
|
Renaissance Portfolio |
|
Core |
|
48% |
|
January 23, 2025 |
|
Washington DC Metro |
|
|
225,865 |
|
|
|
245,700 |
|
Pinewood Square |
|
IM |
|
100% |
|
March 19, 2025 |
|
Southeast |
|
|
204,002 |
|
|
|
68,207 |
|
95, 97, and 107 North 6th Street |
|
Core |
|
100% |
|
April 9, 2025 |
|
New York Metro |
|
|
21,100 |
|
|
|
59,668 |
|
85 5th Avenue |
|
Core |
|
100% |
|
April 11, 2025 |
|
New York Metro |
|
|
13,092 |
|
|
|
47,014 |
|
70 and 93 North 6th Street |
|
Core |
|
100% |
|
June 4, 2025 |
|
New York Metro |
|
|
21,713 |
|
|
|
50,323 |
|
On January 23, 2025, we acquired an additional 48% economic ownership interest, increasing our existing 20% interest to 68%, in the Renaissance Portfolio, which is primarily located in Washington D.C. The 48% interest was acquired for a purchase price of $117.9 million, based upon a gross portfolio fair value of $245.7 million, which included existing aggregate mortgage loan indebtedness of $156.1 million (Note 7). Prior to the acquisition, we accounted for our 20% interest under the equity method of accounting. We gained a controlling financial interest as a result
45
of this acquisition, and determined we should consolidate our investment within our Core Portfolio effective January 23, 2025. As such, we measured and recognized 100% of the identifiable assets acquired, the liabilities assumed and any noncontrolling interests of the Renaissance Portfolio, at fair value and recognized a $9.6 million loss on change in control representing the difference between the carrying value and fair value of its existing equity method interest immediately before consolidation of the portfolio (Note 2).
Dispositions
In June 2025, the joint venture that owned the Eden Square property, of which Fund IV has a 90% ownership interest, sold the property to a third-party for $28.0 million and repaid the related $23.3 million property mortgage loan.
In addition to the above disposition, a 4,547 square foot Investment Management retail property located in New York, NY, was classified as held for sale as of June 30, 2025.
Impairment
We recognized the following impairment charges during the six months ended June 30, 2025 (Note 8) (dollars in thousands):
|
|
|
|
|
|
|
|
Impairment Charge |
|
|
|
|
||
Property Location |
|
Owner |
|
Triggering Event |
|
Effective Date |
|
Total |
|
|
Acadia's Share |
|
||
New York, NY |
|
Fund III |
|
Reduced holding period |
|
June 30, 2025 |
|
$ |
7,240 |
|
|
$ |
1,777 |
|
New York, NY |
|
Fund IV |
|
Reduced holding period |
|
June 30, 2025 |
|
|
17,400 |
|
|
|
3,991 |
|
Financing Activity
In the second quarter of 2025, the Operating Partnership and the Company entered into the Third Amendment to the Third Amended and Restated Credit Agreement (the “Amendment”) to the existing senior unsecured credit facility (the “Credit Facility”). The Amendment established a new five-year $250.0 million incremental delayed draw term loan (the “$250.0 Million Term Loan”), of which $175.0 million was drawn at closing. The Amendment also increased the accordion feature limit to $1.5 billion and reduced the borrowing rate on the entire $925.0 million Credit Facility by 10 basis points. The $250.0 Million Term Loan bears interest at the Secured Overnight Financing Rate (“SOFR”) + 1.20% and matures on May 29, 2030.
On January 23, 2025, we acquired an additional 48% economic ownership interest in the Renaissance Portfolio (Note 2). At acquisition, the properties were subject to existing mortgage indebtedness with an aggregate outstanding principal balance of $156.1 million, bore interest at SOFR + 2.65% and was scheduled to mature on November 6, 2026. The property mortgage loans were recorded at a fair value of approximately $156.1 million. On January 24, 2025, the venture modified the property mortgage loans to reduce the interest rate to SOFR + 1.55%. This reduction was achieved through a $50.0 million principal paydown, which was funded by the Company as a note receivable from the venture. The note bears interest at 9.11%, matures in November 2026 and has been eliminated in consolidation (Note 7).
Structured Financing Investments
In April 2025, the Company modified a redeemable preferred equity investment in a property that is accounted for as a note receivable, which had a principal balance of $54.0 million as of March 31, 2025, to extend the maturity date from February 25, 2025 to February 9, 2027, with an option for a one-year extension. As part of this modification, the borrower repaid the accrued interest balance of $25.3 million. Additionally, the Company provided a mezzanine loan and additional advances under the preferred equity related to the same asset in the aggregate amount of $28.5 million, which also matures on February 9, 2027 and bears interest at a fixed rate of 9.00% (Note 3).
Issuance of Common Shares
In February 2025, we entered into our current $500.0 million ATM Program (the “2025 ATM Program”), which includes an optional “forward sale” component, and concurrently terminated our prior $400.0 million ATM Program.
We did not issue any shares during the three months ended June 30, 2024. During the six months ended June 30, 2025, we issued the following forward shares under the 2025 ATM Program (in thousands except share and per share data):
46
|
|
Number of Shares |
|
|
Average Share Price |
|
|
Aggregate Value |
|
|
Average Net Share Price |
|
|
Aggregate Net Value |
|
|||||
ATM Forward Sale Agreements |
|
|
2,445,106 |
|
|
$ |
22.60 |
|
|
$ |
56,333 |
|
|
$ |
22.71 |
|
|
$ |
55,536 |
|
In March 2025, we settled 11,172,699 outstanding forward shares under the 2025 ATM Program and received proceeds of $277.9 million. As of June 30, 2025, $443.7 million remains available for future share issuance under the 2025 ATM Program.
Economic and Other Considerations
Macroeconomic conditions, including elevated levels of inflation, higher interest rates, and recent tariff policies, present risks for our business and the business of our tenants. The elevated levels of inflation in recent years have led to increased costs for certain goods and services and cost of borrowing. However, most of our leases include contractual rent escalations and require tenants to pay their share of operating expenses, including common area maintenance, real estate taxes, and insurance, which help mitigate inflationary impacts on costs and operating expenses. We believe we manage our properties in a cost-conscious manner to minimize recurring operational expenses and utilize multi-year contracts to alleviate the impact of inflation on our business and our tenants.
We also continue to see rising consumer confidence and expect to drive value to our portfolio through leasing momentum, active development and redevelopment projects, and our leasing pipeline. We manage our exposure to fluctuations in interest rates primarily through the use of fixed-rate debt and interest rate swap and cap agreements, which qualify for, and are designated as, hedging instruments. Except for increased interest costs, we have not experienced any material negative impacts at this time.
Recent U.S. tariffs, sanctions, and related geopolitical developments could affect our tenants’ operations or tourism in key markets such as New York, Chicago, Washington, D.C., Los Angeles and San Francisco. While the ultimate impact remains uncertain, we continue to monitor these developments closely.
47
RESULTS OF OPERATIONS
See Note 12 in the Notes to Condensed Consolidated Financial Statements for an overview of our three reportable segments: Core Portfolio, Investment Management and Structured Financing. For purposes of the tables included below, these segments are abbreviated as “Core”, “IM” and “SF”, respectively.
Comparison of Results for the Three Months Ended June 30, 2025 to the Three Months Ended June 30, 2024
The results of operations by reportable segment for the three months ended June 30, 2025 compared to the three months ended June 30, 2024 are summarized in the table below (in millions, totals may not add due to rounding):
|
|
Three Months Ended |
|
|
Three Months Ended |
|
|
|
|
|||||||||||||||||||||||||||||||||||||||
|
|
June 30, 2025 |
|
|
June 30, 2024 |
|
|
Increase (Decrease) |
|
|||||||||||||||||||||||||||||||||||||||
|
|
Core |
|
|
IM |
|
|
SF |
|
|
Total |
|
|
Core |
|
|
IM |
|
|
SF |
|
|
Total |
|
|
Core |
|
|
IM |
|
|
SF |
|
|
Total |
|
||||||||||||
Rental revenue |
|
$ |
57.7 |
|
|
$ |
40.6 |
|
|
$ |
— |
|
|
$ |
98.3 |
|
|
$ |
47.8 |
|
|
$ |
37.8 |
|
|
$ |
— |
|
|
$ |
85.6 |
|
|
$ |
9.9 |
|
|
$ |
2.8 |
|
|
$ |
— |
|
|
$ |
12.7 |
|
Other revenue |
|
|
0.6 |
|
|
|
1.7 |
|
|
|
— |
|
|
|
2.3 |
|
|
|
1.1 |
|
|
|
0.5 |
|
|
|
— |
|
|
|
1.6 |
|
|
|
(0.5 |
) |
|
|
1.2 |
|
|
|
— |
|
|
|
0.7 |
|
Depreciation and amortization |
|
|
(22.4 |
) |
|
|
(16.8 |
) |
|
|
— |
|
|
|
(39.3 |
) |
|
|
(18.0 |
) |
|
|
(16.3 |
) |
|
|
— |
|
|
|
(34.3 |
) |
|
|
(4.4 |
) |
|
|
(0.5 |
) |
|
|
— |
|
|
|
(5.0 |
) |
Property operating expenses |
|
|
(8.6 |
) |
|
|
(8.9 |
) |
|
|
— |
|
|
|
(17.5 |
) |
|
|
(7.7 |
) |
|
|
(8.1 |
) |
|
|
— |
|
|
|
(15.8 |
) |
|
|
(0.9 |
) |
|
|
(0.8 |
) |
|
|
— |
|
|
|
(1.7 |
) |
Real estate taxes |
|
|
(8.8 |
) |
|
|
(4.5 |
) |
|
|
— |
|
|
|
(13.3 |
) |
|
|
(6.7 |
) |
|
|
(3.3 |
) |
|
|
— |
|
|
|
(10.0 |
) |
|
|
(2.1 |
) |
|
|
(1.2 |
) |
|
|
— |
|
|
|
(3.3 |
) |
General and administrative expenses |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(11.5 |
) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(10.2 |
) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(1.3 |
) |
Impairment charges |
|
|
— |
|
|
|
(18.2 |
) |
|
|
— |
|
|
|
(18.2 |
) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(18.2 |
) |
|
|
— |
|
|
|
(18.2 |
) |
(Loss) gain on disposition of property |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(2.2 |
) |
|
|
3.0 |
|
|
|
— |
|
|
|
0.8 |
|
|
|
2.2 |
|
|
|
(3.0 |
) |
|
|
— |
|
|
|
(0.8 |
) |
Operating income |
|
|
18.4 |
|
|
|
(6.1 |
) |
|
|
— |
|
|
|
0.8 |
|
|
|
14.3 |
|
|
|
13.6 |
|
|
|
— |
|
|
|
17.8 |
|
|
|
4.1 |
|
|
|
(19.7 |
) |
|
|
— |
|
|
|
(17.0 |
) |
Interest income |
|
|
— |
|
|
|
— |
|
|
|
6.4 |
|
|
|
6.4 |
|
|
|
— |
|
|
|
— |
|
|
|
5.4 |
|
|
|
5.4 |
|
|
|
— |
|
|
|
— |
|
|
|
1.0 |
|
|
|
1.0 |
|
Equity in earnings (losses) of unconsolidated affiliates |
|
|
(0.5 |
) |
|
|
(3.7 |
) |
|
|
— |
|
|
|
(4.2 |
) |
|
|
0.6 |
|
|
|
3.8 |
|
|
|
— |
|
|
|
4.5 |
|
|
|
(1.1 |
) |
|
|
(7.5 |
) |
|
|
— |
|
|
|
(8.7 |
) |
Interest expense |
|
|
(9.6 |
) |
|
|
(14.0 |
) |
|
|
— |
|
|
|
(23.6 |
) |
|
|
(9.9 |
) |
|
|
(13.6 |
) |
|
|
— |
|
|
|
(23.6 |
) |
|
|
0.3 |
|
|
|
(0.4 |
) |
|
|
— |
|
|
|
— |
|
Realized and unrealized holding (losses) gains on investments and other |
|
|
(0.4 |
) |
|
|
— |
|
|
|
0.4 |
|
|
|
(0.1 |
) |
|
|
(2.2 |
) |
|
|
— |
|
|
|
(0.2 |
) |
|
|
(2.4 |
) |
|
|
1.8 |
|
|
|
— |
|
|
|
0.6 |
|
|
|
2.3 |
|
Income tax provision |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(0.2 |
) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(0.2 |
) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
Net income (loss) |
|
|
8.0 |
|
|
|
(23.9 |
) |
|
|
6.7 |
|
|
|
(20.9 |
) |
|
|
2.9 |
|
|
|
3.8 |
|
|
|
5.2 |
|
|
|
1.6 |
|
|
|
5.1 |
|
|
|
(27.7 |
) |
|
|
1.5 |
|
|
|
(22.5 |
) |
Net loss (income) attributable to redeemable noncontrolling interests |
|
|
— |
|
|
|
1.7 |
|
|
|
— |
|
|
|
1.7 |
|
|
|
— |
|
|
|
2.3 |
|
|
|
— |
|
|
|
2.3 |
|
|
|
— |
|
|
|
(0.6 |
) |
|
|
— |
|
|
|
(0.6 |
) |
Net loss (income) attributable to noncontrolling interests |
|
|
0.1 |
|
|
|
21.0 |
|
|
|
— |
|
|
|
21.2 |
|
|
|
(0.2 |
) |
|
|
(2.2 |
) |
|
|
— |
|
|
|
(2.4 |
) |
|
|
0.3 |
|
|
|
23.2 |
|
|
|
— |
|
|
|
23.6 |
|
Net income (loss) attributable to Acadia shareholders |
|
$ |
8.1 |
|
|
$ |
(1.1 |
) |
|
$ |
6.7 |
|
|
$ |
2.0 |
|
|
$ |
2.7 |
|
|
$ |
3.9 |
|
|
$ |
5.2 |
|
|
$ |
1.4 |
|
|
$ |
5.4 |
|
|
$ |
(5.0 |
) |
|
$ |
1.5 |
|
|
$ |
0.6 |
|
Core Portfolio
Segment net income attributable to Acadia shareholders for our Core Portfolio increased $5.4 million for the three months ended June 30, 2025 compared to the prior year period as a result of the changes further described below.
Rental revenue for our Core Portfolio increased $9.9 million for the three months ended June 30, 2025 compared to the prior year period primarily due to (i) $4.6 million from new property acquisitions, (ii) $3.7 million from the acquisition of an additional interest and consolidation of the Renaissance Portfolio in 2025 and (iii) $1.0 million from new tenant lease up (Note 2).
Depreciation and amortization for our Core Portfolio increased $4.4 million for the three months ended June 30, 2025 compared to the prior year period primarily due to (i) $2.8 million from new property acquisitions and (ii) $2.1 million from the acquisition of an additional interest and consolidation of the Renaissance Portfolio. (Note 2, Note 6).
Real estate taxes for our Core Portfolio increased $2.1 million for the three months ended June 30, 2025 compared to the prior year period primarily due to (i) $1.2 million from the acquisition of an additional interest and consolidation of the Renaissance Portfolio in 2025 and (ii) $0.6 million from new property acquisitions (Note 2).
Equity in earnings of unconsolidated affiliates for our Core Portfolio decreased $1.1 million for the three months ended June 30, 2025 compared to the prior year period primarily due to tenants vacating subsequent to June 30, 2024.
Realized and unrealized holding losses on investments and other for our Core Portfolio decreased $1.8 million for the three months ended June 30, 2025 compared to the prior year period primarily due to a change in the mark-to-market adjustment on the investment in Albertsons (Note 8).
48
Investment Management (all amounts below are consolidated amounts and are not representative of our proportionate share)
Segment net income attributable to Acadia shareholders for Investment Management decreased $5.0 million for the three months ended June 30, 2025 compared to the prior year period as a result of the changes described below.
Rental revenue for Investment Management increased $2.8 million for the three months ended June 30, 2025 compared to the prior year period primarily due to a new property acquisition in 2025.
An impairment charge of $18.2 million for Investment Management is due to the shortened hold periods at one Fund III property and one Fund IV property (Note 8).
Gain on disposition of properties of $3.0 million for Investment Management in 2024 was due to the sale of two Fund IV properties and a Fund V outparcel. The Company did not dispose of any consolidated properties for the three months ended June 30, 2025.
Equity in earnings of unconsolidated affiliates for Investment Management decreased $7.5 million for the three months ended June 30, 2025 compared to the prior year period primarily due to the loss on sale on Eden Square in 2025 compared to the gain on sale of Paramus in 2024 (Note 4).
Net income attributable to noncontrolling interests for Investment Management increased $23.2 million for the three months ended June 30, 2025 compared to the prior year period based on the noncontrolling interests’ share of the variances discussed above. Net income attributable to noncontrolling interests in Investment Management includes asset management fees earned by the Company of $2.4 million for each of the three months ended June 30, 2025 and 2024.
Unallocated
The Company does not allocate general and administrative expenses and income taxes to its reportable segments. These unallocated amounts are depicted in the table above under the headings labeled “Total.” General and administrative expenses increased $1.3 million for the three months ended June 30, 2025 compared to the prior year period primarily due to higher compensation expenses in 2025.
Comparison of Results for the Six Months Ended June 30, 2025 to the Six Months Ended June 30, 2024
The results of operations by reportable segment for the six months ended June 30, 2025 compared to the six months ended June 30, 2024 are summarized in the table below (in millions, totals may not add due to rounding):
|
|
Six Months Ended |
|
|
Six Months Ended |
|
|
|
|
|||||||||||||||||||||||||||||||||||||||
|
|
June 30, 2025 |
|
|
June 30, 2024 |
|
|
Increase (Decrease) |
|
|||||||||||||||||||||||||||||||||||||||
|
|
Core |
|
|
IM |
|
|
SF |
|
|
Total |
|
|
Core |
|
|
IM |
|
|
SF |
|
|
Total |
|
|
Core |
|
|
IM |
|
|
SF |
|
|
Total |
|
||||||||||||
Rental revenue |
|
$ |
121.5 |
|
|
$ |
79.5 |
|
|
$ |
— |
|
|
$ |
200.9 |
|
|
$ |
96.6 |
|
|
$ |
75.1 |
|
|
$ |
— |
|
|
$ |
171.7 |
|
|
$ |
24.9 |
|
|
$ |
4.4 |
|
|
$ |
— |
|
|
$ |
29.2 |
|
Other revenue |
|
|
1.3 |
|
|
|
2.8 |
|
|
|
— |
|
|
|
4.0 |
|
|
|
5.9 |
|
|
|
1.1 |
|
|
|
— |
|
|
|
6.9 |
|
|
|
(4.6 |
) |
|
|
1.7 |
|
|
|
— |
|
|
|
(2.9 |
) |
Depreciation and amortization |
|
|
(46.1 |
) |
|
|
(32.6 |
) |
|
|
— |
|
|
|
(78.7 |
) |
|
|
(36.2 |
) |
|
|
(33.0 |
) |
|
|
— |
|
|
|
(69.2 |
) |
|
|
(9.9 |
) |
|
|
0.4 |
|
|
|
— |
|
|
|
(9.5 |
) |
Property operating expenses |
|
|
(18.2 |
) |
|
|
(17.6 |
) |
|
|
— |
|
|
|
(35.8 |
) |
|
|
(17.4 |
) |
|
|
(17.4 |
) |
|
|
— |
|
|
|
(34.9 |
) |
|
|
(0.8 |
) |
|
|
(0.2 |
) |
|
|
— |
|
|
|
(0.9 |
) |
Real estate taxes |
|
|
(17.7 |
) |
|
|
(8.9 |
) |
|
|
— |
|
|
|
(26.6 |
) |
|
|
(14.9 |
) |
|
|
(7.5 |
) |
|
|
— |
|
|
|
(22.3 |
) |
|
|
(2.8 |
) |
|
|
(1.4 |
) |
|
|
— |
|
|
|
(4.3 |
) |
General and administrative expenses |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(23.1 |
) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(19.9 |
) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(3.2 |
) |
Impairment charges |
|
|
— |
|
|
|
(24.6 |
) |
|
|
— |
|
|
|
(24.6 |
) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(24.6 |
) |
|
|
— |
|
|
|
(24.6 |
) |
Loss on disposition of property |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(2.2 |
) |
|
|
1.8 |
|
|
|
— |
|
|
|
(0.4 |
) |
|
|
2.2 |
|
|
|
(1.8 |
) |
|
|
— |
|
|
|
0.4 |
|
Operating income (loss) |
|
|
40.7 |
|
|
|
(1.5 |
) |
|
|
— |
|
|
|
16.1 |
|
|
|
31.7 |
|
|
|
20.1 |
|
|
|
— |
|
|
|
31.8 |
|
|
|
9.0 |
|
|
|
(21.6 |
) |
|
|
— |
|
|
|
(15.7 |
) |
Interest income |
|
|
— |
|
|
|
— |
|
|
|
12.5 |
|
|
|
12.5 |
|
|
|
— |
|
|
|
— |
|
|
|
10.7 |
|
|
|
10.7 |
|
|
|
— |
|
|
|
— |
|
|
|
1.8 |
|
|
|
1.8 |
|
Equity in earnings (losses) of unconsolidated affiliates |
|
|
(0.2 |
) |
|
|
(5.7 |
) |
|
|
— |
|
|
|
(5.9 |
) |
|
|
2.7 |
|
|
|
1.4 |
|
|
|
— |
|
|
|
4.2 |
|
|
|
(2.9 |
) |
|
|
(7.1 |
) |
|
|
— |
|
|
|
(10.1 |
) |
Interest expense |
|
|
(18.9 |
) |
|
|
(27.9 |
) |
|
|
— |
|
|
|
(46.9 |
) |
|
|
(20.0 |
) |
|
|
(27.3 |
) |
|
|
— |
|
|
|
(47.3 |
) |
|
|
1.1 |
|
|
|
(0.6 |
) |
|
|
— |
|
|
|
0.4 |
|
Loss on change in control |
|
|
(9.6 |
) |
|
|
— |
|
|
|
— |
|
|
|
(9.6 |
) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(9.6 |
) |
|
|
— |
|
|
|
— |
|
|
|
(9.6 |
) |
Realized and unrealized holding gains (losses) on investments and other |
|
|
1.4 |
|
|
|
— |
|
|
|
0.2 |
|
|
|
1.6 |
|
|
|
(4.0 |
) |
|
|
— |
|
|
|
(0.4 |
) |
|
|
(4.4 |
) |
|
|
5.4 |
|
|
|
— |
|
|
|
(0.6 |
) |
|
|
6.0 |
|
Income tax provision |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(0.3 |
) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(0.2 |
) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(0.1 |
) |
Net income (loss) |
|
|
13.3 |
|
|
|
(35.1 |
) |
|
|
12.6 |
|
|
|
(32.6 |
) |
|
|
10.4 |
|
|
|
(5.8 |
) |
|
|
10.3 |
|
|
|
(5.3 |
) |
|
|
2.9 |
|
|
|
(29.3 |
) |
|
|
2.3 |
|
|
|
(27.3 |
) |
Net loss (income) attributable to redeemable noncontrolling interests |
|
|
— |
|
|
|
3.4 |
|
|
|
— |
|
|
|
3.4 |
|
|
|
— |
|
|
|
4.8 |
|
|
|
— |
|
|
|
4.8 |
|
|
|
— |
|
|
|
(1.4 |
) |
|
|
— |
|
|
|
(1.4 |
) |
Net loss (income) attributable to noncontrolling interests |
|
|
0.3 |
|
|
|
32.4 |
|
|
|
— |
|
|
|
32.8 |
|
|
|
(0.6 |
) |
|
|
5.7 |
|
|
|
— |
|
|
|
5.1 |
|
|
|
0.9 |
|
|
|
26.7 |
|
|
|
— |
|
|
|
27.7 |
|
Net income (loss) attributable to Acadia shareholders |
|
$ |
13.7 |
|
|
$ |
0.7 |
|
|
$ |
12.6 |
|
|
$ |
3.6 |
|
|
$ |
9.9 |
|
|
$ |
4.7 |
|
|
$ |
10.3 |
|
|
$ |
4.7 |
|
|
$ |
3.8 |
|
|
$ |
(4.0 |
) |
|
$ |
2.3 |
|
|
$ |
(1.1 |
) |
49
Core Portfolio
Segment net income attributable to Acadia shareholders for our Core Portfolio increased $3.8 million for the six months ended June 30, 2025 compared to the prior year period as a result of the changes further described below.
Rental revenue for our Core Portfolio increased $24.9 million for the six months ended June 30, 2025 compared to the prior year period primarily due to (i) $8.6 million from new property acquisitions, (ii) $8.4 million received from Whole Foods that we recognized as rental and termination income at City Center in San Francisco, CA in 2025, (iii) $6.5 million from the acquisition of an additional interest and consolidation of the Renaissance Portfolio in 2025 and (iv) $1.0 million from new tenant lease up (Note 2).
Other revenue for our Core Portfolio decreased $4.6 million for the six months ended June 30, 2025 compared to the prior year period primarily due to the recognition of a forfeited deposit in 2024.
Depreciation and amortization for our Core Portfolio increased $9.9 million for the six months ended June 30, 2025 compared to the prior year period primarily due to (i) $4.2 million from the acquisition of an additional interest and consolidation of the Renaissance Portfolio, (ii) $3.6 million from new property acquisitions and (iii) $1.5 million from the acceleration of in-place lease intangible assets for bankrupt tenants in 2025 (Note 2, Note 6).
Real estate taxes for our Core Portfolio increased $2.8 million for the six months ended June 30, 2025 compared to the prior year period primarily due to (i) $2.0 million from the acquisition of an additional interest and consolidation of the Renaissance Portfolio in 2025, and (ii) $1.1 million from new property acquisitions (Note 2).
Loss on disposition of property of $2.2 million for our Core Portfolio relates to the deconsolidation of the Shops at Grand property in 2024.
Equity in earnings of unconsolidated affiliates for our Core Portfolio decreased $2.9 million for the six months ended June 30, 2025 due to tenants vacating subsequent to June 30, 2024.
Interest expense for our Core Portfolio decreased $1.1 million for the six months ended June 30, 2025 compared to the prior year period primarily due to higher loan balances in 2025 compared to 2024.
Loss on change in control of $9.6 million for our Core Portfolio for the six months ended June 30, 2025 is due to the Company gaining a controlling financial interest as a result of the acquisition of the incremental 48% interest in the Renaissance Portfolio in 2025 (Note 2).
Realized and unrealized holding gains on investments and other for our Core Portfolio increased $5.4 million for the six months ended June 30, 2025 compared to the prior year period primarily due to a change in the mark-to-market adjustment on the investment in Albertsons (Note 8).
Investment Management (all amounts below are consolidated amounts and are not representative of our proportionate share)
Segment net income attributable to Acadia shareholders for Investment Management decreased $4.0 million for the six months ended June 30, 2025 compared to the prior year period as a result of the changes described below.
Rental revenue for Investment Management increased $4.4 million for the six months ended June 30, 2025 compared to the prior year period primarily due to new property acquisitions in 2025 and tenant lease up subsequent to June 30, 2024.
Other revenue for Investment Management increased $1.7 million for the six months ended June 30, 2025 compared to the prior year period primarily due to higher fees earn from related to the newly acquired Investment Management properties.
Real estate taxes for Investment Management increased $1.4 million for the six months ended June 30, 2025 compared to the prior year period primarily due to refunds received in the prior year.
Impairment charges for Investment Management of $24.6 million for the six months ended June 30, 2025 are due to the shortened hold periods at one Fund III property and one Fund IV property (Note 8).
Loss on disposition of property for Investment Management decreased $1.8 million for the six months ended June 30, 2025 compared to the prior year period due to (i) $3.0 million gain on disposition of two Fund IV properties and a Fund V outparcel, (ii) offset by a $1.2 million loss related to a previously disposed property (Note 2).
50
Equity in earnings of unconsolidated affiliates for Investment Management decreased $7.1 million for the six months ended June 30, 2025 compared to the prior year period primarily due to the loss on sale on Eden Square in 2025 compared to the gain on sale of Paramus in 2024 (Note 4).
Net income attributable to noncontrolling interests for Investment Management increased $26.7 million for the six months ended June 30, 2025 compared to the prior year period based on the noncontrolling interests’ share of the variances discussed above. Net income attributable to noncontrolling interests in Investment Management includes asset management fees earned by the Company of $4.6 million and $4.7 million for the six months ended June 30, 2025 and 2024, respectively.
Structured Financing
Interest income for Structured Finance increased $1.8 million for the six months ended June 30, 2025 compared to the prior year period due to the effect of compounding interest on notes.
Unallocated
The Company does not allocate general and administrative expenses and income taxes to its reportable segments. These unallocated amounts are depicted in the table above under the headings labeled “Total.” General and administrative expenses increased $3.2 million for the six months ended June 30, 2025 compared to the prior year period primarily due to higher compensation expenses in 2025.
NON-GAAP FINANCIAL MEASURES
Net Property Operating Income
The following discussion of net property operating income (“NOI”) and rent spreads on new and renewal leases includes the activity from both our consolidated and our pro-rata share of unconsolidated properties within our Core Portfolio. We believe NOI and rent spreads are not meaningful measures for our Investment Management investments as Investment Management invests primarily in properties that typically require significant leasing and development, and is primarily comprised of finite-life investment vehicles.
NOI represents property revenues less property expenses. We consider NOI and rent spreads on new and renewal leases for our Core Portfolio to be appropriate supplemental disclosures of portfolio operating performance due to their widespread acceptance and use within the REIT investor and analyst communities. NOI and rent spreads on new and renewal leases are presented to assist investors in analyzing our property performance, however, our method of calculating these may be different from methods used by other REITs and, accordingly, may not be comparable to such other REITs.
51
A reconciliation of consolidated operating income to net operating income - Core Portfolio follows (in thousands):
|
|
Three Months Ended June 30, |
|
|
Six Months Ended June 30, |
|
||||||||||
|
|
2025 |
|
|
2024 |
|
|
2025 |
|
|
2024 |
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Consolidated operating income |
|
$ |
760 |
|
|
$ |
17,789 |
|
|
$ |
16,084 |
|
|
$ |
31,797 |
|
Add back: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
General and administrative |
|
|
11,532 |
|
|
|
10,179 |
|
|
|
23,129 |
|
|
|
19,947 |
|
Depreciation and amortization |
|
|
39,269 |
|
|
|
34,281 |
|
|
|
78,709 |
|
|
|
69,221 |
|
Impairment charges |
|
|
18,190 |
|
|
|
— |
|
|
|
24,640 |
|
|
|
— |
|
(Gain) Loss related to a previously disposed property |
|
|
— |
|
|
|
(757 |
) |
|
|
— |
|
|
|
441 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Less: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Above/below-market rent, straight-line rent and other accounts (a) |
|
|
(3,194 |
) |
|
|
(2,869 |
) |
|
|
(5,906 |
) |
|
|
(7,477 |
) |
Termination income (b) |
|
|
— |
|
|
|
— |
|
|
|
(8,366 |
) |
|
|
— |
|
Consolidated NOI |
|
|
66,557 |
|
|
|
58,623 |
|
|
|
128,290 |
|
|
|
113,929 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Redeemable noncontrolling interest in consolidated NOI |
|
|
(1,376 |
) |
|
|
(1,381 |
) |
|
|
(3,264 |
) |
|
|
(2,422 |
) |
Noncontrolling interest in consolidated NOI |
|
|
(19,489 |
) |
|
|
(18,322 |
) |
|
|
(37,144 |
) |
|
|
(35,253 |
) |
Less: Operating Partnership's interest in Investment Management NOI included above |
|
|
(7,936 |
) |
|
|
(6,132 |
) |
|
|
(14,683 |
) |
|
|
(11,473 |
) |
Add: Operating Partnership's share of unconsolidated joint ventures NOI (c) |
|
|
873 |
|
|
|
2,251 |
|
|
|
2,160 |
|
|
|
6,212 |
|
Core Portfolio NOI |
|
$ |
38,629 |
|
|
$ |
35,039 |
|
|
$ |
75,359 |
|
|
$ |
70,993 |
|
Same-Property NOI includes Core Portfolio properties that we owned for both the current and prior periods presented, but excludes those properties which we acquired, sold or expected to sell, redeveloped and developed during these periods. The following table summarizes Same-Property NOI for our Core Portfolio (dollars in thousands):
|
|
Three Months Ended June 30, |
|
|
Six Months Ended June 30, |
|
||||||||||
|
|
2025 |
|
|
2024 |
|
|
2025 |
|
|
2024 |
|
||||
Core Portfolio NOI |
|
$ |
38,629 |
|
|
$ |
35,039 |
|
|
$ |
75,359 |
|
|
$ |
70,993 |
|
Less properties excluded from Same-Property NOI |
|
|
(4,152 |
) |
|
|
(1,941 |
) |
|
|
(7,041 |
) |
|
|
(5,392 |
) |
Same-Property NOI |
|
$ |
34,477 |
|
|
$ |
33,098 |
|
|
$ |
68,318 |
|
|
$ |
65,601 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Percent change from prior year period |
|
|
4.2 |
% |
|
|
|
|
|
4.1 |
% |
|
|
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Components of Same-Property NOI: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Same-Property Revenues |
|
$ |
48,109 |
|
|
$ |
46,626 |
|
|
$ |
95,745 |
|
|
$ |
93,071 |
|
Same-Property Operating Expenses |
|
|
(13,632 |
) |
|
|
(13,528 |
) |
|
|
(27,427 |
) |
|
|
(27,470 |
) |
Same-Property NOI |
|
$ |
34,477 |
|
|
$ |
33,098 |
|
|
$ |
68,318 |
|
|
$ |
65,601 |
|
52
Rent Spreads on Core Portfolio New and Renewal Leases
The following table summarizes rent spreads on both a cash basis and straight-line basis for new and renewal leases based on leases executed within our Core Portfolio for the periods presented. Cash basis represents a comparison of rent most recently paid on the previous lease as compared to the initial rent paid on the new lease. Straight-line basis represents a comparison of rents as adjusted for contractual escalations, abated rent, and lease incentives for the same comparable leases. The table below includes embedded option renewals for which the renewed rent was equal to or approximated existing base rent.
|
|
Three Months Ended June 30, 2025 |
|
|
Six Months Ended June 30, 2025 |
|
||||||||||
Core Portfolio New and Renewal Leases |
|
Cash Basis |
|
|
Straight- |
|
|
Cash Basis |
|
|
Straight- |
|
||||
Number of new and renewal leases executed |
|
|
25 |
|
|
|
25 |
|
|
|
41 |
|
|
|
41 |
|
GLA commencing |
|
|
168,265 |
|
|
|
168,265 |
|
|
|
283,266 |
|
|
|
283,266 |
|
New base rent |
|
$ |
64.68 |
|
|
$ |
67.27 |
|
|
$ |
53.45 |
|
|
$ |
55.67 |
|
Expiring base rent |
|
$ |
68.51 |
|
|
$ |
65.39 |
|
|
$ |
53.21 |
|
|
$ |
50.29 |
|
Percent growth in base rent |
|
|
(5.6 |
)% |
|
|
2.9 |
% |
|
|
0.4 |
% |
|
|
10.7 |
% |
Average cost per square foot (a) |
|
$ |
15.20 |
|
|
$ |
15.20 |
|
|
$ |
10.28 |
|
|
$ |
10.28 |
|
Weighted average lease term (years) |
|
|
10.7 |
|
|
|
10.7 |
|
|
|
8.9 |
|
|
|
8.9 |
|
(a) The average cost per square foot includes tenant improvement costs, leasing commissions and tenant allowances.
Funds from Operations
We consider funds from operations (“FFO”) as defined by the National Association of Real Estate Investment Trusts (“NAREIT”) to be an appropriate supplemental disclosure of operating performance due to its widespread acceptance and use within the REIT investor and analyst communities. FFO is presented to assist investors in analyzing our performance. It is helpful as it excludes various items included in net income that are not indicative of the operating performance, such as gains (losses) from sales of depreciated property, depreciation and amortization, and impairment of real estate. Our method of calculating FFO may be different from methods used by other REITs and, accordingly, may not be comparable to such other REITs. FFO does not represent cash generated from operations as defined by accounting principles generally accepted in the United States (“GAAP”) and is not indicative of cash available to fund all cash needs, including distributions. It should not be considered as an alternative to net income for the purpose of evaluating our performance or to cash flows as a measure of liquidity. Consistent with the NAREIT definition, we define FFO as net income (computed in accordance with GAAP), excluding gains (losses) from sales of depreciated property and impairment of depreciable real estate, plus depreciation and amortization, and after adjustments for unconsolidated partnerships and joint ventures. Also consistent with NAREIT’s definition of FFO, the Company has elected to include gains and losses incidental to its main business (including those related to its investments in Albertsons) in FFO. A reconciliation of net income (loss) attributable to Acadia shareholders to FFO follows (dollars in thousands, except per share data):
|
|
Three Months Ended June 30, |
|
|
Six Months Ended June 30, |
|
||||||||||
|
|
2025 |
|
|
2024 |
|
|
2025 |
|
|
2024 |
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Net income attributable to Acadia shareholders |
|
$ |
1,963 |
|
|
$ |
1,443 |
|
|
$ |
3,571 |
|
|
$ |
4,712 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Depreciation of real estate and amortization of leasing costs (net of |
|
|
31,665 |
|
|
|
26,291 |
|
|
|
63,272 |
|
|
|
53,378 |
|
Impairment charges (net of noncontrolling interests' share) |
|
|
4,185 |
|
|
|
— |
|
|
|
5,768 |
|
|
|
— |
|
Net loss on disposition of properties (net of noncontrolling interests' share) |
|
|
86 |
|
|
|
568 |
|
|
|
86 |
|
|
|
843 |
|
Loss on change in control |
|
|
— |
|
|
|
— |
|
|
|
9,622 |
|
|
|
— |
|
Income attributable to Common OP Unit holders |
|
|
108 |
|
|
|
103 |
|
|
|
204 |
|
|
|
306 |
|
Distributions - Preferred OP Units |
|
|
67 |
|
|
|
84 |
|
|
|
134 |
|
|
|
207 |
|
Funds from operations attributable to Common Shareholders and |
|
$ |
38,074 |
|
|
$ |
28,489 |
|
|
$ |
82,657 |
|
|
$ |
59,446 |
|
53
LIQUIDITY AND CAPITAL RESOURCES
Uses of Liquidity and Cash Requirements
Generally, our principal uses of liquidity are (i) distributions to our shareholders and holders of our units of limited partnership interest (“OP units”), (ii) investments, which include the funding of our capital committed to our Investment Management platform and property acquisitions and development/re-tenanting activities within our Core Portfolio, (iii) distributions to our Investment Management investors, (iv) debt service and loan repayments and (v) share repurchases.
Distributions
In order to qualify as a REIT for federal income tax purposes, we must distribute at least 90% of our taxable income to our shareholders. During the six months ended June 30, 2025, we paid dividends and distributions on our Common Shares and preferred units of limited partnership interest (“Preferred OP Units”) totaling $52.1 million.
Investments
On January 23, 2025, we acquired an additional 48% economic ownership interest, increasing our existing 20% interest to 68%, in the Renaissance Portfolio, which is primarily located in Washington D.C. The 48% interest was acquired for a purchase price of $117.9 million, based upon a gross portfolio fair value of $245.7 million, which included existing aggregate mortgage loan indebtedness of $156.1 million (Note 7). Prior to the acquisition, we accounted for our 20% interest under the equity method of accounting. We gained a controlling financial interest as a result of this acquisition, and determined we should consolidate our investment within our Core Portfolio effective January 23, 2025. As such, we measured and recognized 100% of the identifiable assets acquired, the liabilities assumed and any noncontrolling interests of the Renaissance Portfolio, at fair value and recognized a $9.6 million loss on change in control representing the difference between the carrying value and fair value of its existing equity method interest immediately before consolidation of the portfolio (Note 2).
In addition, during the six months ended June 30, 2025, we acquired nine properties totaling $305.8 million (Note 2).
Structured Financing Investments
During the six months ended June 30, 2025, we provided a mezzanine loan and additional advances under a preferred equity investment in the aggregate amount of $28.5 million (Note 3).
Capital Commitments
During the six months ended June 30, 2025, we made capital contributions aggregating $2.1 million to the Funds.
As of June 30, 2025, our share of the remaining capital commitments to the Funds aggregated $14.1 million as follows:
We do not have any additional capital commitments to Investment Management.
Additionally, the Company has committed to fund tenant improvements under executed leases totaling approximately $45.7 million and $41.4 million, as of June 30, 2025 and December 31, 2024, respectively. The Company’s share of these obligations is approximately $38.9 million and $32.3 million, respectively (Note 9).
Development Activities
During the six months ended June 30, 2025, capitalized costs associated with development activities totaled $22.5 million (Note 2). As of June 30, 2025, we had a total of 20 consolidated projects under development or redevelopment, for which the estimated total cost to complete these projects through 2028 was $25.6 million to $137.6 million. Substantially all remaining development and redevelopment costs are discretionary, and could be affected by various risks and uncertainties, including, but not limited to, the effects of the current inflationary environment, rising
54
interest rates, the imposition of tariffs and other risks detailed in Part I, Item 1A. Risk Factors of our Annual Report on Form 10-K for the year ended December 31, 2024.
Debt
A summary of our consolidated debt, which includes the full amount of Investment Management related obligations and excludes our pro rata share of debt at our unconsolidated subsidiaries, is as follows (in thousands):
|
|
June 30, |
|
|
December 31, |
|
||
|
|
2025 |
|
|
2024 |
|
||
|
|
|
|
|
|
|
||
Total Debt - Fixed and Effectively Fixed Rate |
|
$ |
1,362,547 |
|
|
$ |
1,142,592 |
|
Total Debt - Variable Rate |
|
|
451,925 |
|
|
|
405,355 |
|
|
|
|
1,814,472 |
|
|
|
1,547,947 |
|
Net unamortized debt issuance costs |
|
|
(11,713 |
) |
|
|
(10,893 |
) |
Unamortized premium |
|
|
1,378 |
|
|
|
212 |
|
Total Indebtedness |
|
$ |
1,804,137 |
|
|
$ |
1,537,266 |
|
As of June 30, 2025, our consolidated indebtedness aggregated $1,814.5 million, excluding unamortized premium of $1.4 million and net unamortized loan costs of $11.7 million, and was collateralized by 50 properties and related tenant leases. As of June 30, 2025, stated interest rates on our outstanding indebtedness ranged from 3.99% to SOFR + 3.75% with maturities that ranged from August 1, 2025 to April 15, 2035, excluding available extension options. With respect to the debt maturing in 2025, we are actively pursuing refinancing the remaining obligations, though there can be no assurance that we can refinance such obligations on favorable terms or at all. Taking into consideration $1,072.8 million of notional principal under variable to fixed-rate swap agreements currently in effect, $1,362.5 million of the portfolio debt, or 75.1%, was fixed at a 4.92% weighted average interest rate and $451.9 million, or 24.9%, was floating at a 6.99% weighted average interest rate as of June 30, 2025. Our variable-rate debt includes $111.2 million of debt subject to interest rate caps.
Without regard to available extension options, as of June 30, 2025, we had (i) $285.1 million of debt maturing in 2025 at a weighted-average interest rate of 6.99%, (ii) $3.4 million of scheduled principal amortization due in the remainder of 2025 and (iii) $9.6 million of remaining scheduled 2025 principal payments and maturities, representing our pro rata share of our unconsolidated debt. In addition, $473.6 million of our total consolidated debt and $13.9 million of our pro-rata share of unconsolidated debt will come due by June 30, 2026. With respect to the debt maturing in 2025 and 2026, we have options to extend consolidated debt aggregating $238.0 million and $205.3 million as of June 30, 2025; however, there can be no assurance that the Company will be able to successfully execute any or all of its available extension options. For the remaining indebtedness, we may not have sufficient cash on hand to repay such indebtedness, and, therefore, we expect to refinance at least a portion of this indebtedness or select other alternatives based on market conditions as these loans mature; however, there can be no assurance that we will be able to obtain financing on acceptable terms or at all. Our ability to obtain financing could be affected by various risks and uncertainties, including, but not limited to, the effects of the current inflationary environment, rising interest rates, the imposition of tariffs and other risks, including, but not limited to those detailed in Part I, Item 1A. Risk Factors of our Annual Report on Form 10-K for the year ended December 31, 2024.
Share Repurchase Program
We maintain a share repurchase program under which $122.5 million remains available as of June 30, 2025 (Note 10). We did not repurchase any shares under this program during the six months ended June 30, 2025.
Sources of Liquidity
Our primary sources of capital for funding our short-term (less than 12 months) and long-term (12 months and longer) liquidity needs include (i) the issuance of both public equity and OP Units, (ii) the issuance of both secured and unsecured debt, (iii) unfunded capital commitments from noncontrolling interests within Investment Management, (iv) future sales of existing properties, (v) repayments of structured financing investments, (vi) liquidation of marketable securities, and (vii) cash on hand and future cash flow from operating activities. Our cash on hand in our consolidated subsidiaries as of June 30, 2025 totaled $42.8 million. Our remaining sources of liquidity are described further below. Depending upon the availability and cost of external capital, we believe our sources of capital are sufficient to meet our liquidity needs. Our historical cash flows uses are reflected in our Condensed Consolidated Statements of Cash Flows and are discussed in further detail below.
55
Issuances of Common Shares
The 2025 ATM Program (Note 10) provides us with an efficient and low-cost vehicle for raising capital through public equity issuances on an “as-we-go” basis to fund our capital needs. Through this program, we have been able to effectively “match-fund” the required capital for our Core Portfolio and Investment Management acquisitions through the issuance of Common Shares over extended periods, employing a price averaging strategy. In addition, from time to time, we have issued and intend to continue to issue, equity in follow-on offerings separate from the 2025 ATM Program. Net proceeds raised through the 2025 ATM Program and follow-on offerings are primarily used for acquisitions, both for our Core Portfolio and our pro-rata share of Investment Management acquisitions, and for general corporate purposes.
As of June 30, 2025, we had 2,445,106 forward shares outstanding under the 2025 ATM Program. The net forward sales price per share of the forward shares under the 2025 ATM program was $22.71 and would result in $55.5 million in net cash proceeds if we were to physically settle the shares. In March 2025, we settled 11,172,699 shares outstanding under the 2025 ATM forward and received proceeds of $277.9 million.
Investment Management Capital
During the six months ended June 30, 2025, Funds III and V called for capital contributions of $10.5 million, of which our aggregate share was $2.1 million. As of June 30, 2025, unfunded capital commitments from noncontrolling interests within Funds II, III, IV and V were $0, $1.1 million, $18.5 million and $32.9 million, respectively.
Other Transactions
During the first quarter of 2025, we recognized payments of $8.4 million as rental and termination income related to a lease at City Center in San Francisco (Note 11).
As of June 30, 2025, we held 0.5 million shares of Albertsons which had a fair value of $10.9 million (Note 8). In addition, during the six months ended June 30, 2025, we sold 0.2 million shares generating $5.4 million in net proceeds and recognized dividend income of $0.2 million (Note 8).
Financing and Debt
During the second quarter of 2025, we drew $175.0 million on our new $250.0 Million Term Loan, and have $75.0 million available. As of June 30, 2025, we had $471.5 million of capacity under existing Core Portfolio debt facilities. In addition, as of that date within our Core Portfolio and Investment Management portfolio, we had 136 unleveraged consolidated properties with an aggregate carrying value of approximately $2.2 billion, although there can be no assurance that we would be able to obtain financing for these properties at favorable terms, if at all (Note 7).
HISTORICAL CASH FLOW
The following table compares the historical cash flow for the six months ended June 30, 2025 with the cash flow for the six months ended June 30, 2024 (in millions, totals may not add due to rounding):
|
|
Six Months Ended June 30, |
|
|||||||||
|
|
2025 |
|
|
2024 |
|
|
Variance |
|
|||
|
|
|
|
|
|
|
|
|
|
|||
Net cash provided by operating activities |
|
$ |
90.7 |
|
|
$ |
58.0 |
|
|
$ |
32.7 |
|
Net cash (used in) provided by investing activities |
|
|
(394.7 |
) |
|
|
20.0 |
|
|
|
(414.7 |
) |
Net cash provided by (used in) financing activities |
|
|
332.1 |
|
|
|
(48.2 |
) |
|
|
380.3 |
|
Increase in cash and cash equivalents and restricted cash |
|
$ |
28.1 |
|
|
$ |
29.8 |
|
|
$ |
(1.7 |
) |
Operating Activities
Net cash provided by operating activities primarily consists of cash inflows from rental revenue, and cash outflows for property operating expenses, general and administrative expenses and interest and debt expense.
Our operating activities provided $32.7 million more cash for the six months ended June 30, 2025 as compared to the six months ended June 30, 2024 primarily due to the repayment of accrued interest on a note receivable.
Investing Activities
Net cash used in investing activities is impacted by our investments in and advances to unconsolidated affiliates, the timing and extent of our real estate development, capital improvements, and acquisition and disposition activities during the period.
56
Our investing activities used $414.7 million more cash during the six months ended June 30, 2025 as compared to the six months ended June 30, 2024, primarily due to (i) $333.5 million more cash used for the acquisition of real estate, (ii) $58.7 million less cash received from the disposition of properties, (iii) $12.2 million more cash used for the issuance of notes receivable, (iv) $10.1 million more cash used for development, construction and property improvement costs, and (v) $5.2 million less cash received from the repayment of notes receivable.
Financing Activities
Net cash used in financing activities is impacted by the timing and extent of issuances of debt and equity securities, distributions paid to common shareholders and unitholders of the Operating Partnership, as well as principal and other payments associated with our outstanding indebtedness.
Our financing activities provided $380.3 million more cash during the six months ended June 30, 2025 as compared to the six months ended June 30, 2024, primarily from (i) $283.8 million more cash from proceeds on debt, (ii) $135.4 million more cash provided by the sale of Common Shares, (iii) $5.8 million more cash used for financing costs and (iv) $3.4 million less capital distributed to noncontrolling interests. These increases were offset by (i) $35.3 million less cash provided by contributions from noncontrolling interests and (ii) $13.2 million more used to pay dividends.
See Note 4 for a discussion of our unconsolidated investments. The Operating Partnership’s pro-rata share of unconsolidated non-recourse debt related to those investments is as follows (dollars in millions):
|
|
Operating Partnership |
|
|
June 30, 2025 |
|||||||||
Investment |
|
Ownership |
|
|
Pro-rata Share of |
|
|
Effective Interest Rate (a) |
|
|
Maturity Date |
|||
Tri-City Plaza |
|
|
18.1 |
% |
|
$ |
6.4 |
|
|
|
6.16 |
% |
|
Oct 2025 |
Frederick County Square |
|
|
90.0 |
% |
|
|
4.5 |
|
|
|
6.84 |
% |
|
Jan 2026 |
650 Bald Hill Rd |
|
|
20.8 |
% |
|
|
3.1 |
|
|
|
3.75 |
% |
|
Jun 2026 |
840 N. Michigan |
|
|
94.4 |
% |
|
|
36.8 |
|
|
|
6.50 |
% |
|
Dec 2026 |
Wood Ridge Plaza |
|
|
18.1 |
% |
|
|
6.5 |
|
|
|
7.20 |
% |
|
Mar 2027 |
La Frontera |
|
|
18.1 |
% |
|
|
10.0 |
|
|
|
6.11 |
% |
|
Jun 2027 |
Riverdale FC |
|
|
89.4 |
% |
|
|
6.8 |
|
|
|
6.87 |
% |
|
Nov 2027 |
Georgetown Portfolio |
|
|
50.0 |
% |
|
|
6.8 |
|
|
|
4.72 |
% |
|
Dec 2027 |
LINQ Promenade(e) |
|
|
15.0 |
% |
|
|
26.3 |
|
|
|
6.06 |
% |
|
Dec 2027 |
Shoppes at South Hills(b) |
|
|
18.1 |
% |
|
|
5.9 |
|
|
|
5.95 |
% |
|
Mar 2028 |
Mohawk Commons |
|
|
18.1 |
% |
|
|
7.1 |
|
|
|
5.80 |
% |
|
Mar 2028 |
The Walk at Highwoods Preserve(b) |
|
|
20.0 |
% |
|
|
4.1 |
|
|
|
6.25 |
% |
|
Oct 2028 |
Crossroads Shopping Center(c) |
|
|
49.0 |
% |
|
|
36.8 |
|
|
|
5.78 |
% |
|
Nov 2029 |
Gotham Plaza |
|
|
49.0 |
% |
|
|
13.7 |
|
|
|
5.90 |
% |
|
Oct 2034 |
Total |
|
|
|
|
$ |
174.8 |
|
|
|
|
|
|
||
CRITICAL ACCOUNTING POLICIES
Management’s Discussion and Analysis of Financial Condition and Results of Operations in this Report is based upon the Condensed Consolidated Financial Statements, which have been prepared in accordance with GAAP. The preparation of Condensed Consolidated Financial Statements requires management to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses. We base our estimates on historical experience and assumptions that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about carrying value of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions. We believe there have been no material changes to the items that we disclosed as our critical accounting policies under Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” in our 2024 Annual Report on Form 10-K.
Recently Issued and Adopted Accounting Pronouncements
57
Reference is made to Note 1 in the Notes to Condensed Consolidated Financial Statements for information about recently issued accounting pronouncements.
SUPPLEMENTAL U.S. FEDERAL INCOME TAX CONSIDERATIONS
The following supplements the discussion contained under the heading “Certain U.S. Federal Income Tax Considerations” in our prospectus dated November 6, 2023.
The One Big Beautiful Bill Act
On July 4, 2025, President Trump signed into law the One Big Beautiful Bill Act, or the OBBBA. The OBBBA made significant changes to the U.S. federal income tax laws in various areas. Among the relevant changes:
The OBBBA contain complex revisions to the U.S. federal income tax laws. Holders of our Common Shares are urged to consult with their tax advisors with respect to the OBBBA and its potential effect on the acquisition, ownership and disposition of our Common Shares.
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.
Information as of June 30, 2025
Our primary market risk exposure is to changes in interest rates related to our property mortgage loans and other debt. See Note 7 in the Notes to Condensed Consolidated Financial Statements, for certain quantitative details related to our property mortgage loans and other debt.
Currently, we manage our exposure to fluctuations in interest rates primarily through the use of fixed-rate debt and interest rate swap and cap agreements. As of June 30, 2025, we had total property mortgage loans and other notes payable of $1,814.5 million, excluding the unamortized premium of $1.4 million and net unamortized debt issuance costs of $11.7 million, of which $1,362.5 million, or 75.1% was fixed-rate, inclusive of debt with rates fixed through the use of derivative financial instruments, and $451.9 million, or 24.9%, was variable-rate based upon SOFR or Prime rates plus certain spreads. As of June 30, 2025, we were party to 31 interest rate swaps and three interest rate cap agreements to hedge our exposure to changes in interest rates with respect to $1,072.8 million and $111.2 million of variable-rate debt, respectively. If we decided to employ higher leverage levels, we would be subject to increased debt service requirements and a higher risk of default on our debt obligations, which could adversely affect our financial conditions, cash flows and ability to make distributions to our shareholders. In addition, increases or changes in interest rates could cause our borrowing costs to rise and may limit our ability to refinance debt.
58
The following table sets forth information as of June 30, 2025 concerning our long-term debt obligations, including principal cash flows by scheduled maturity (without regard to available extension options) and weighted average effective interest rates of maturing amounts (dollars in millions):
Core Consolidated Mortgage and Other Debt
Year |
|
Scheduled |
|
|
Maturities |
|
|
Total |
|
|
Weighted Average |
|
||||
2025 (Remainder) |
|
$ |
1.1 |
|
|
$ |
— |
|
|
$ |
1.1 |
|
|
|
— |
% |
2026 |
|
|
4.9 |
|
|
|
102.0 |
|
|
|
106.9 |
|
|
|
6.1 |
% |
2027 |
|
|
4.8 |
|
|
|
45.1 |
|
|
|
49.9 |
|
|
|
4.8 |
% |
2028 |
|
|
1.8 |
|
|
|
523.9 |
|
|
|
525.7 |
|
|
|
4.1 |
% |
2029 |
|
|
1.2 |
|
|
|
172.1 |
|
|
|
173.3 |
|
|
|
5.3 |
% |
Thereafter |
|
|
1.3 |
|
|
|
176.6 |
|
|
|
177.9 |
|
|
|
4.4 |
% |
|
|
$ |
15.1 |
|
|
$ |
1,019.7 |
|
|
$ |
1,034.8 |
|
|
|
|
|
Investment Management Consolidated Mortgage and Other Debt
Year |
|
Scheduled |
|
|
Maturities |
|
|
Total |
|
|
Weighted Average |
|
||||
2025 (Remainder) |
|
$ |
2.3 |
|
|
$ |
285.1 |
|
|
$ |
287.4 |
|
|
|
7.0 |
% |
2026 |
|
|
2.9 |
|
|
|
237.2 |
|
|
|
240.1 |
|
|
|
6.4 |
% |
2027 |
|
|
1.7 |
|
|
|
165.7 |
|
|
|
167.4 |
|
|
|
6.6 |
% |
2028 |
|
|
0.3 |
|
|
|
84.5 |
|
|
|
84.8 |
|
|
|
5.9 |
% |
2029 |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
% |
Thereafter |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
% |
|
|
$ |
7.2 |
|
|
$ |
772.5 |
|
|
$ |
779.7 |
|
|
|
|
|
Mortgage Debt in Unconsolidated Partnerships (at our Pro-Rata Share)
Year |
|
Scheduled |
|
|
Maturities |
|
|
Total |
|
|
Weighted Average |
|
||||
2025 (Remainder) |
|
$ |
3.2 |
|
|
$ |
6.4 |
|
|
$ |
9.6 |
|
|
|
6.2 |
% |
2026 |
|
|
6.2 |
|
|
|
35.8 |
|
|
|
42.0 |
|
|
|
6.3 |
% |
2027 |
|
|
1.1 |
|
|
|
55.0 |
|
|
|
56.1 |
|
|
|
6.1 |
% |
2028 |
|
|
0.1 |
|
|
|
16.6 |
|
|
|
16.7 |
|
|
|
6.0 |
% |
2029 |
|
|
0.3 |
|
|
|
36.4 |
|
|
|
36.7 |
|
|
|
5.8 |
% |
Thereafter |
|
|
— |
|
|
|
13.7 |
|
|
|
13.7 |
|
|
|
5.9 |
% |
|
|
$ |
10.9 |
|
|
$ |
163.9 |
|
|
$ |
174.8 |
|
|
|
|
|
Without regard to available extension options, in the remainder of 2025, $288.5 million of our total consolidated debt and $9.6 million of our pro-rata share of unconsolidated outstanding debt will become due. In addition, $346.9 million of our total consolidated debt and $42.0 million of our pro-rata share of unconsolidated debt will become due in 2026. As it relates to the aforementioned maturing debt in 2025 and 2026, we have options to extend consolidated debt aggregating $238.0 million and $205.3 million at June 30, 2025, respectively; however, there can be no assurance that the Company will be able successfully execute any or all of its available extension options. As we intend on refinancing some or all of such debt at the then-existing market interest rates, which may be greater than the current interest rates, our interest expense would increase by approximately $6.8 million annually if the interest rate on the refinanced debt increased by 100 basis points. After giving effect to noncontrolling interests, our share of this increase would be $2.8 million. Interest expense on our variable-rate debt of $451.9 million, net of variable to fixed-rate swap agreements currently in effect, as of June 30, 2025, would increase $4.5 million if corresponding rate indices increased by 100 basis points. After giving effect to noncontrolling interests, our share of this increase would be $1.3 million. We may seek additional variable-rate financing if and when pricing and other commercial and financial terms warrant. As such, we would consider hedging against the interest rate risk related to such additional variable-rate debt through interest rate swaps and protection agreements, or other means.
59
Based on our outstanding debt balances as of June 30, 2025, the fair value of our total consolidated outstanding debt would decrease by approximately $11.5 million if interest rates increased by 1%. Conversely, if interest rates decreased by 1%, the fair value of our total outstanding debt would increase by approximately $6.4 million.
As of June 30, 2025, and December 31, 2024, we had consolidated notes receivable of $154.7 million and $126.6 million, respectively. We determined the estimated fair value of our notes receivable by discounting future cash receipts utilizing a discount rate equivalent to the rate at which similar notes receivable would be originated under conditions then existing.
Based on our outstanding notes receivable balances as of June 30, 2025, the fair value of our total outstanding notes receivable would decrease by approximately $1.5 million if interest rates increased by 1%. Conversely, if interest rates decreased by 1%, the fair value of our total outstanding notes receivable would increase by approximately $1.5 million.
Summarized Information as of December 31, 2024
As of December 31, 2024, we had total property mortgage loans and other notes payable of $1,547.9 million, excluding the unamortized premium of $0.2 million and unamortized debt issuance costs of $10.9 million, of which $1,142.6 million, or 73.8%, was fixed-rate, inclusive of debt with rates fixed through the use of derivative financial instruments, and $405.4 million, or 26.2%, was variable-rate based upon SOFR rates plus certain spreads. As of December 31, 2024, we were party to 30 interest rate swap and four interest rate cap agreements to hedge our exposure to changes in interest rates with respect to $852.0 million and $111.2 million of SOFR-based variable-rate debt, respectively.
Interest expense on our variable-rate debt of $405.4 million, net of variable to fixed-rate swap agreements currently in effect, as of December 31, 2024, would have increased $4.1 million if corresponding rate indices increased by 100 basis points. Based on our outstanding debt balances as of December 31, 2024, the fair value of our total outstanding debt would have decreased by approximately $9.8 million if interest rates increased by 1%. Conversely, if interest rates decreased by 1%, the fair value of our total outstanding debt would have increased by approximately $9.8 million.
Changes in Market Risk Exposures from December 31, 2024 to June 30, 2025
Our interest rate risk exposure from December 31, 2024, to June 30, 2025, has increased on an absolute basis, as the $405.4 million of variable-rate debt as of December 31, 2024 has increased to $451.9 million as of June 30, 2025. Our interest rate exposure as a percentage of total debt has decreased, as our variable-rate debt accounted for 26.2% of our consolidated debt as of December 31, 2024 compared to 24.9% as of June 30, 2025.
ITEM 4. CONTROLS AND PROCEDURES.
Disclosure Controls and Procedures
Our disclosure controls and procedures include internal controls and other procedures designed to provide reasonable assurance that information required to be disclosed in this and other reports filed under the Exchange Act, is recorded, processed, summarized, and reported within the required time periods specified in the SEC’s rules and forms; and that such information is accumulated and communicated to management, including our Chief Executive Officer and Chief Financial Officer, to allow timely decisions regarding required disclosures. It should be noted that no system of controls can provide complete assurance of achieving a company’s objectives and that future events may impact the effectiveness of a system of controls. Our Chief Executive Officer and Chief Financial Officer, after conducting an evaluation, together with members of our management, of the effectiveness of the design and operation of our disclosure controls and procedures as of June 30, 2025, have concluded that our disclosure controls and procedures (as defined in Rule 13a-15(e) under the Exchange Act) were effective as of June 30, 2025, at a reasonable level of assurance.
Changes in Internal Control Over Financial Reporting
There have been no changes in our internal control over financial reporting during our most recently completed fiscal quarter that have materially affected, or are reasonably likely to materially affect, our internal controls over financial reporting.
60
PART II – OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS.
From time to time, we are a party to various legal proceedings, claims or regulatory inquiries and investigations arising out of, or incident to, our ordinary course of business. While we are unable to predict with certainty the outcome of any particular matter, management does not expect, when such matters are resolved, that our resulting exposure to loss contingencies, if any, will have a material adverse effect on our consolidated financial position.
ITEM 1A. RISK FACTORS.
Except to the extent additional factual information disclosed elsewhere in this Report relates to such risk factors (including, without limitation, the matters discussed in Part I, “Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations”), there were no material changes to the risk factors disclosed in Part I, “Item 1A. Risk Factors” of our Annual Report on Form 10-K for the year ended December 31, 2024.
ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS.
None.
ITEM 3. DEFAULTS UPON SENIOR SECURITIES.
None.
ITEM 4. MINE SAFETY DISCLOSURES.
Not applicable.
ITEM 5. OTHER INFORMATION.
Trading Arrangements
During the three months ended June 30, 2025, none of our officers or trustees (as defined in Rule 16a-1(f) of the Exchange Act)
61
ITEM 6. EXHIBITS.
The following is an index to all exhibits including (i) those filed with this Quarterly Report on Form 10-Q and (ii) those incorporated by reference herein:
Exhibit No. |
|
Description |
|
Method of Filing |
||
|
|
|
|
|
||
10.1 |
|
Third Amendment to Third Amended and Restated Credit Agreement, dated as of May 29, 2025, by and among Acadia Realty Limited Partnership, Acadia Realty Trust, Bank of America, N.A., as administrative agent, Wells Fargo Bank, National Association, Truist Bank, and PNC Bank, National Association, as syndication agents, BofA Securities, Inc. and Wells Fargo Securities, LLC, as joint bookrunners, and BofA Securities, Inc., Wells Fargo Securities, LLC, Truist Securities, Inc. and PNC Capital Markets LLC, as joint lead arrangers, and the lenders and letter of credit issuers party thereto |
|
Filed herewith |
||
|
|
|
|
|
||
31.1 |
|
Certification of Chief Executive Officer pursuant to rule 13a-14(a)/15d-14(a) of the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 |
|
Filed herewith
|
||
|
|
|
|
|
||
31.2 |
|
Certification of Chief Financial Officer pursuant to rule 13a-14(a)/15d-14(a) of the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 |
|
Filed herewith |
||
|
|
|
|
|
||
32.1 |
|
Certification of Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 |
|
Furnished herewith |
||
|
|
|
|
|
||
32.2 |
|
Certification of Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 |
|
Furnished herewith |
||
|
|
|
|
|
||
101.INS |
|
Inline XBRL Instance Document–the instance document does not appear in the Interactive Data File as its XBRL tags are embedded within the Inline XBRL document |
|
Filed herewith |
||
|
|
|
|
|
||
101.SCH |
|
Inline XBRL Taxonomy Extension Schema with Embedded Linkbase Documents |
|
Filed herewith |
||
|
|
|
|
|
||
104 |
|
Cover page formatted as Inline XBRL and contained in Exhibit 101 |
|
Filed herewith |
||
62
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
|
|
ACADIA REALTY TRUST |
|
|
(Registrant) |
|
|
|
By: |
|
/s/ Kenneth F. Bernstein |
|
|
Kenneth F. Bernstein |
|
|
Chief Executive Officer, |
|
|
President and Trustee |
|
|
|
By: |
|
/s/ John Gottfried |
|
|
John Gottfried |
|
|
Executive Vice President and |
|
|
Chief Financial Officer |
|
|
(Principal Financial Officer) |
|
|
|
By: |
|
/s/ Richard Hartmann |
|
|
Richard Hartmann |
|
|
Senior Vice President and |
|
|
Chief Accounting Officer |
|
|
(Principal Accounting Officer) |
Dated: July 30, 2025
63
FAQ
How much revenue did Antero Resources (AR) report for Q2 2025?
What was Antero Resources’ Q2 2025 diluted EPS?
How much debt did AR carry at 30 June 2025?
What were Antero’s operating cash flows for the first half of 2025?
Did Antero Resources repurchase shares in 2025?
