Kite Realty Group (NYSE: KRG) raises $345M in 3.25% exchangeable notes to refinance 2026 debt
Rhea-AI Filing Summary
Kite Realty Group completed a private offering of $345 million aggregate principal amount of 3.25% exchangeable senior notes due 2032 through its operating partnership. The notes pay 3.25% interest semi-annually, mature on April 15, 2032, and can be exchanged into cash and potentially common shares at an initial rate of 28.2466 shares per $1,000 of notes.
Net proceeds were approximately $335.7 million, which the partnership used in part to fund capped call transactions with a cap price of $41.91 and intends to use, together with asset sale proceeds, to repurchase about $30 million of common shares and to repay or redeem $300 million of 4.00% senior unsecured notes due 2026. The capped calls are designed to reduce potential dilution or excess cash payments if the notes are exchanged.
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Insights
Refinances 2026 notes with longer-dated, lower-coupon exchangeable debt and caps dilution risk.
Kite Realty Group raised $345 million via 3.25% exchangeable senior notes due 2032, privately placed with qualified institutional buyers. The notes are senior unsecured and can be exchanged into cash and, above par, into common shares at an initial exchange price of about $35.40 per share.
Management earmarks proceeds, alongside asset disposition cash, to repay or redeem $300 million of 4.00% senior notes due 2026 and to repurchase roughly $30 million of shares. This lengthens the debt maturity profile and slightly lowers the coupon while adding potential equity-linked dilution.
The company entered capped call transactions with an initial cap of $41.91 (about a 45% premium to the $28.90 share price on June 29, 2026) to offset dilution or excess cash on exchange. Actual impact will depend on future share price movements and whether noteholders elect to exchange.
8-K Event Classification
Key Figures
Key Terms
exchangeable senior notes financial
Indenture regulatory
registration rights agreement regulatory
capped call transactions financial
qualified institutional buyers regulatory
fundamental change regulatory
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
CURRENT REPORT
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| Item 1.01 | Entry into a Material Definitive Agreement. |
Indenture and Notes
On July 2, 2026, Kite Realty Group, L.P. (the “Issuer”), the operating partnership through which Kite Realty Group Trust (the “Company”) holds substantially all of its assets and conducts substantially all of its activities, issued $345 million aggregate principal amount of 3.25% Exchangeable Senior Notes due 2032 (the “Notes”). Pursuant to the purchase agreement among the Issuer, the Company and the representatives of the initial purchasers of the Notes, the Issuer also granted the initial purchasers of the Notes an option to purchase up to an additional $45 million aggregate principal amount of Notes. The Notes issued on July 2, 2026 include $45 million aggregate principal amount of Notes issued pursuant to the full exercise by the initial purchasers of such option. The Notes were issued pursuant to, and are governed by, an Indenture, dated as of July 2, 2026 (the “Indenture”), among the Issuer, the Company, and U.S. Bank Trust Company, National Association, as trustee (the “Trustee”). The Notes were sold in a private placement to persons reasonably believed to be qualified institutional buyers pursuant to Rule 144A under the Securities Act of 1933, as amended (the “Securities Act”).
The Notes are the Issuer’s senior unsecured obligations and rank equally in right of payment with all of the Issuer’s other senior unsecured indebtedness and are effectively subordinated in right of payment to all of the Issuer’s secured indebtedness (to the extent of the collateral securing such indebtedness) and to all liabilities and preferred equity of the Issuer’s subsidiaries.
The Notes accrue interest payable semi-annually in arrears on April 15 and October 15 of each year, beginning on April 15, 2027, at a rate of 3.25% per year. The Notes will mature on April 15, 2032 (the “Maturity Date”), unless earlier exchanged, repurchased, or redeemed. Prior to the close of business on the business day immediately preceding January 15, 2032, the Notes are exchangeable into cash up to the principal amount of the Notes exchanged and, if applicable, cash or common shares of beneficial interest, par value $0.01 per share, of the Company (the “Common Shares”) or a combination thereof, only upon certain circumstances and during certain periods. On or after January 15, 2032, the Notes will be exchangeable into cash up to the principal amount of the Notes exchanged and, if applicable, cash or Common Shares or a combination thereof at the option of the holders at any time prior to the close of business on the second scheduled trading day preceding the Maturity Date. The exchange rate initially equals 28.2466 Common Shares per $1,000 principal amount of Notes, which is equivalent to an exchange price of approximately $35.40 per Common Share and an exchange premium of approximately 22.5% based on the closing price of $28.90 per Common Share on June 29, 2026. The exchange rate is subject to adjustment upon the occurrence of certain events, but it will not be adjusted for any accrued and unpaid interest.
The Issuer may redeem the Notes, at its option, in whole or in part, on any business day on or after July 20, 2029, if the last reported sale price of the Common Shares has been at least 130% of the exchange price then in effect for at least 20 trading days (whether or not consecutive) during any 30 consecutive trading day period ending on, and including, the trading day immediately preceding the date on which the Issuer provides notice of redemption at a redemption price equal to 100% of the principal amount of the Notes to be redeemed, plus accrued and unpaid interest to, but excluding, the redemption date (the “redemption price”). The Issuer also has the right, at its election, to redeem all or any portion of the Notes at any time and from time to time at the redemption price to the extent necessary to preserve the Company’s status as a real estate investment trust for U.S. federal income tax purposes, as reasonably determined by the Company’s Board of Trustees. The Issuer may also redeem the Notes, in whole but not in part, at any time in cash at the redemption price if the aggregate principal amount of Notes that remains outstanding at such time is less than 10% of the aggregate principal amount of Notes initially issued under the Indenture.
If the Issuer or the Company undergoes a fundamental change (as defined in the Indenture), holders of the Notes may require the Issuer to purchase the Notes in whole or in part for cash at a price equal to 100% of the principal amount of the Notes to be purchased, plus accrued and unpaid interest, if any, to, but excluding, such purchase date.
If an event of default (as defined in the Indenture) occurs and is continuing, the Trustee by notice to the Issuer, or the holders of at least 25% in aggregate principal amount of the Notes then outstanding by notice to the Issuer and the Trustee, may declare 100% of the principal and accrued and unpaid interest on the Notes to be due and payable. In the case of an event of default arising out of certain bankruptcy or insolvency events (as set forth in the Indenture), 100% of the principal and accrued and unpaid interest on the Notes will automatically become due and payable.
The net proceeds from the offering, after deducting the initial purchasers’ discount and estimated offering costs and expenses payable by the Issuer and the Company, were approximately $335.7 million.
The foregoing description is qualified in its entirety by the full text of the Indenture, a copy of which is attached hereto as Exhibit 4.1. The terms of the Indenture, including the form of the Notes attached hereto as Exhibit 4.2, are incorporated herein by reference.
Registration Rights Agreement
In connection with the issuance and sale of the Notes, on July 2, 2026, the Issuer and the Company also entered into a registration rights agreement (the “Registration Rights Agreement”) with the initial purchasers of the Notes.
Pursuant to the Registration Rights Agreement, the Company has agreed that it will, at its cost:
| · | as promptly as practicable following the date on which the Company becomes eligible to file an automatic shelf registration statement (but in no event more than 90 days after the first date of original issuance of the Notes), (i) file with the Securities and Exchange Commission a shelf registration statement (which shall be an automatic shelf registration statement if the Company is eligible to file an automatic shelf registration at the time such filing is made) and/or (ii) file one or more prospectus supplements to an already effective shelf registration statement, covering resales of Common Shares, if any, issuable upon exchange of the Notes; |
| · | if the shelf registration statement filed is not an automatic shelf registration statement, then the Company will use its commercially reasonable efforts to cause the shelf registration statement or resale prospectus supplement to become effective within 180 days after the first date of original issuance of the Notes; and |
| · | use commercially reasonable efforts to keep the shelf registration statement or resale prospectus effective until the earlier of (1) the 30th trading day immediately following the Maturity Date (subject to extension for any suspension of the effectiveness of the registration during such 30-trading day period immediately following the Maturity Date) and (2) the date on which there are no longer outstanding any Notes or Common Shares issued upon exchange of the Notes that would be “restricted” securities (within the meaning of Rule 144). |
If the Issuer does not fulfill certain of its obligations under the Registration Rights Agreement with respect to the Notes, the Issuer will be required to pay additional interest to holders of the Notes. If a holder of the Notes exchanges some or all of its Notes for Common Shares, such holder will not be entitled to additional interest with respect to the Common Shares. However, if a holder of the Notes exchanges its Notes when there exists a registration default with respect to the Common Shares, the Issuer will increase the applicable exchange rate by 3% instead of paying any additional interest on such Common Shares.
The foregoing description is qualified in its entirety by the full text of the Registration Rights Agreement, a copy of which is attached hereto as Exhibit 4.3. The terms of the Registration Rights Agreement are incorporated herein by reference.
Capped Call Transactions
On June 29, 2026 and July 1, 2026, in connection with the pricing of the Notes, the Issuer entered into privately negotiated capped call transactions (the “Capped Call Transactions”) with certain financial institutions, including the initial purchasers of the Notes or their respective affiliates (the “Capped Call Counterparties”). The Capped Call Transactions cover, subject to anti-dilution adjustments substantially similar to those applicable to the Notes, the number of Common Shares underlying the Notes. The Capped Call Transactions are generally expected to reduce the potential dilution to holders of the Common Shares upon exchange of the Notes and/or offset the potential cash payments the Issuer could be required to make in excess of the principal amount of any exchanged Notes upon exchange thereof, with such reduction and/or offset subject to a cap.
The cap price of the Capped Call Transactions is initially $41.91, which represents a premium of approximately 45% over the last reported sale price of the Common Shares on the New York Stock Exchange on June 29, 2026, and is subject to anti-dilution adjustments under the terms of the Capped Call Transactions.
The Capped Call Transactions are separate transactions entered into by the Issuer with the Capped Call Counterparties, are not part of the terms of the Notes, and will not change any holder’s rights under the Notes. Holders of the Notes will not have any rights with respect to the Capped Call Transactions.
The foregoing description is qualified in its entirety by the full text of the form of confirmation for the Capped Call Transactions, a copy of which is attached hereto as Exhibit 10.1. The terms of the form of confirmation for the Capped Call Transactions are incorporated herein by reference.
| Item 2.03. | Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant. |
The information set forth in Item 1.01 above with respect to the Indenture and the issuance of the Notes by the Issuer is incorporated by reference into this Item 2.03.
| Item 3.02. | Unregistered Sales of Equity Securities. |
The disclosure set forth in Item 1.01 above is incorporated by reference into this Item 3.02. The Notes were issued to the initial purchasers in reliance upon Section 4(a)(2) of the Securities Act, in transactions not involving any public offering. The Notes were resold by the initial purchasers to persons whom the initial purchasers reasonably believe are “qualified institutional buyers,” as defined in and in accordance with Rule 144A under the Securities Act. Initially, a maximum of 11,937,690 Common Shares may be issued upon exchange of the Notes, based on the initial maximum exchange rate of 34.6020 Common Shares per $1,000 principal amount of Notes, which is subject to customary adjustments.
| Item 8.01 | Other Events. |
On June 30, 2026, the Company and the Issuer issued a press release pursuant to Rule 135c under the Securities Act in connection with the pricing of the Notes. A copy of the press release is attached hereto as Exhibit 99.1.
On July 2, 2026, the Company and the Issuer issued a press release pursuant to Rule 135c under the Securities Act in connection with the issuance of the Notes. A copy of the press release is attached hereto as Exhibit 99.2.
| Item 9.01 | Financial Statements and Exhibits. |
(d) Exhibits.
| Exhibit Number | Description | |
| 4.1 | Indenture, dated as of July 2, 2026, among Kite Realty Group, L.P., as issuer, Kite Realty Group Trust, as potential future guarantor, and U.S. Bank Trust Company, National Association, as trustee | |
| 4.2 | Form of Global Note representing the Notes (included in Exhibit 4.1) | |
| 4.3 | Registration Rights Agreement, dated as of July 2, 2026, by and among Kite Realty Group Trust, Kite Realty Group, L.P., and the initial purchasers party thereto | |
| 10.1 | Form of Capped Call Transaction Confirmation | |
| 99.1 | Pricing press release, dated June 30, 2026 | |
| 99.2 | Closing press release, dated July 2, 2026 | |
| 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document) |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, each registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| KITE REALTY GROUP TRUST | ||
| By: | /s/ Heath R. Fear | |
| Name: | Heath R. Fear | |
| Title: | President and Chief Financial Officer | |
Date: July 2, 2026
| KITE REALTY GROUP, L.P. | ||
| By: Kite Realty Group Trust, its sole general partner | ||
| By: | /s/ Heath R. Fear | |
| Name: | Heath R. Fear | |
| Title: | President and Chief Financial Officer | |
Date: July 2, 2026
Exhibit 99.1
 |
PRESS RELEASE
Contact Information: Kite Realty Group
Tyler Henshaw
SVP, Capital Markets & Investor Relations
317.713.7780
thenshaw@kiterealty.com
Kite Realty Group Announces Pricing of
$300 Million of Exchangeable Senior Notes Offering
INDIANAPOLIS, June 30, 2026 - Kite Realty Group (NYSE: KRG) (the “Company” or “KRG”) announced today that on June 29, 2026 its operating partnership, Kite Realty Group, L.P. (the “Operating Partnership”), priced an offering (the “Offering”) of $300 million aggregate principal amount of 3.25% exchangeable senior notes due 2032 (the “Notes”) in a private placement to persons reasonably believed to be qualified institutional buyers pursuant to Rule 144A under the Securities Act of 1933, as amended (the “Securities Act”). The Operating Partnership also granted the initial purchasers of the Notes an option to purchase up to an additional $45 million aggregate principal amount of Notes. The sale of the Notes is expected to close on July 2, 2026, subject to customary closing conditions.
The Notes will be the Operating Partnership’s senior unsecured obligations and will accrue interest payable semi-annually in arrears on April 15 and October 15 of each year, beginning on April 15, 2027, at a rate of 3.25% per year. The Notes will mature on April 15, 2032 (the “Maturity Date”), unless earlier exchanged, repurchased, or redeemed. Prior to the close of business on the business day immediately preceding January 15, 2032, the Notes will be exchangeable into cash up to the principal amount of the Notes exchanged and, if applicable, cash or common shares of beneficial interest, par value $0.01 per share, of the Company (the “Common Shares”) or a combination thereof, only upon certain circumstances and during certain periods. On or after January 15, 2032, the Notes will be exchangeable into cash up to the principal amount of the Notes exchanged and, if applicable, cash or Common Shares or a combination thereof at the option of the holders at any time prior to the close of business on the second scheduled trading day preceding the Maturity Date. The exchange rate will initially equal 28.2466 Common Shares per $1,000 principal amount of the Notes, which is equivalent to an exchange price of approximately $35.40 per Common Share and an exchange premium of approximately 22.5% based on the closing price of $28.90 per Common Share on June 29, 2026. The exchange rate will be subject to adjustment upon the occurrence of certain events, but it will not be adjusted for any accrued and unpaid interest.
The Operating Partnership may redeem the Notes, at its option, in whole or in part, on any business day on or after July 20, 2029, if the last reported sale price of the Common Shares has been at least 130% of the exchange price then in effect for at least 20 trading days (whether or not consecutive) during any 30 consecutive trading day period ending on, and including, the trading day immediately preceding the date on which the Operating Partnership provides notice of redemption at a redemption price equal to 100% of the principal amount of the Notes to be redeemed, plus accrued and unpaid interest to, but excluding, the redemption date (the “redemption price”). The Operating Partnership will also have the right, at its election, to redeem all or any portion of the Notes at any time and from time to time at the redemption price to the extent necessary to preserve the Company’s status as a real estate investment trust for U.S. federal income tax purposes, as reasonably determined by the Company’s Board of Trustees. The Operating Partnership may also redeem the Notes, in whole but not in part, at any time in cash at the redemption price if the aggregate principal amount of Notes that remains outstanding at such time is less than 10% of the aggregate principal amount of Notes initially issued under the indenture.
The Operating Partnership estimates that the net proceeds from the Offering will be approximately $291.8 million (or approximately $335.7 million if the initial purchasers exercise their option to purchase additional Notes in full), after deducting the initial purchasers’ discount and estimated offering expenses payable by the Company and the Operating Partnership. The Operating Partnership intends to use the net proceeds from the Offering to enter into the capped call transactions described below and to use the remaining net proceeds from the Offering, together with the proceeds from our recent asset dispositions, to (i) repurchase approximately $30 million of the Company’s Common Shares concurrently with the pricing of the Offering in privately negotiated transactions through one of the initial purchasers of the Offering or its affiliates, as the Operating Partnership’s agent, and (ii) repay or redeem all of the Operating Partnership’s $300 million aggregate principal amount of 4.00% senior unsecured notes due 2026 at or prior to maturity.
In connection with the pricing of the Notes, the Operating Partnership entered into privately negotiated capped call transactions with certain financial institutions, which may include certain of the initial purchasers of the Notes or their respective affiliates (the “Option Counterparties”). The capped call transactions cover, subject to anti-dilution adjustments substantially similar to those applicable to the Notes, the number of Common Shares underlying the Notes. If the initial purchasers exercise their option to purchase additional Notes, the Operating Partnership expects to use a portion of the net proceeds from the sale of such additional Notes to enter into additional capped call transactions with the Option Counterparties. The capped call transactions are generally expected to reduce the potential dilution to the Common Shares upon any exchange of the Notes and/or offset any cash payments the Operating Partnership is required to make in excess of the principal amount of such exchanged Notes, as the case may be, with such reduction and/or offset subject to a cap. The cap price of the capped call transactions will initially be approximately $41.91, which represents a premium of approximately 45% over the last reported sale price of the Common Shares on the New York Stock Exchange on June 29, 2026, and is subject to anti-dilution adjustments under the terms of the capped call transactions.
In connection with establishing their initial hedges of the capped call transactions, the Option Counterparties or their respective affiliates expect to purchase Common Shares and/or enter into various derivative transactions with respect to the Common Shares concurrently with or shortly after the pricing of the Notes. This activity could increase (or reduce the size of any decrease in) the market price of the Common Shares or the Notes at that time.
In addition, the Option Counterparties or their respective affiliates may modify their hedge positions by entering into or unwinding various derivatives with respect to the Common Shares and/or purchasing or selling Common Shares or other securities of the Company or the Operating Partnership in secondary market transactions following the pricing of the Notes and prior to the maturity of the Notes (and are likely to do so (x) during any averaging period related to an exchange of the Notes, following any redemption of the Notes by the Operating Partnership or following any repurchase of the Notes by the Operating Partnership in connection with any fundamental change and (y) following any repurchase of the Notes by the Operating Partnership other than in connection with any such redemption or any such fundamental change if the Operating Partnership elects to unwind a corresponding portion of the capped call transactions in connection with such repurchase). This activity could also cause or avoid an increase or a decrease in the market price of the Common Shares or the Notes, which could affect a noteholder’s ability to exchange the Notes, and, to the extent the activity occurs during any averaging period related to an exchange of the Notes, it could affect the number of Common Shares and value of the consideration that a noteholder will receive upon exchange of the Notes.
Neither the Notes nor the Common Shares issuable upon exchange of the Notes have been registered under the Securities Act or any state securities laws, and unless so registered, may not be offered or sold in the United States absent registration or an applicable exemption from, or in a transaction not subject to, the registration requirements of the Securities Act and other applicable securities laws. Accordingly, the Notes are being offered and sold only to persons reasonably believed to be qualified institutional buyers (as defined in Rule 144A under the Securities Act).
This press release does not constitute an offer to sell or a solicitation of an offer to buy, nor shall there be any offer or sale of the Notes or the Common Shares issuable upon exchange of the Notes in any jurisdiction in which the offer, solicitation or sale of the Notes or the Common Shares issuable upon exchange of the Notes would be unlawful prior to the registration or qualification thereof under the securities laws of any such state or jurisdiction.
About Kite Realty Group
Kite Realty Group is a real estate investment trust that owns and operates a high-quality portfolio of open-air shopping centers and mixed-use destinations. The Company’s portfolio is concentrated in high-growth Sun Belt and select strategic gateway markets. Publicly listed since 2004, KRG brings more than six decades of experience in developing, operating, and investing in real estate, using a disciplined, hands-on approach to enhance portfolio quality and maximize long-term value for all stakeholders. As of March 31, 2026, the Company owned interests in 169 U.S. open-air shopping centers and mixed-use assets, comprising approximately 27.3 million square feet of gross leasable space.
2
Safe Harbor
This release, together with other statements and information publicly disseminated by the Company, contains certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Such statements are based on assumptions and expectations that may not be realized and are inherently subject to risks, uncertainties and other factors, many of which cannot be predicted with accuracy and some of which might not even be anticipated. Future events and actual results, performance, transactions or achievements, financial or otherwise, may differ materially from the results, performance, transactions or achievements, financial or otherwise, expressed or implied by the forward-looking statements.
Risks, uncertainties and other factors that might cause such differences, some of which could be material, include but are not limited to: economic, business, banking, real estate and other market conditions, particularly in connection with low or negative growth in the U.S. economy as well as economic uncertainty (including from an economic slowdown or recession, federal government shutdown, disruptions related to tariffs and other trade or sanction issues, geopolitical instability, rising interest rates, inflation, unemployment, or limited growth in consumer income or spending); financing risks, including the availability of, and costs associated with, sources of liquidity; the Company’s ability to refinance, or extend the maturity dates of, the Company’s indebtedness; the level and volatility of interest rates; the financial stability of the Company’s tenants; the competitive environment in which the Company operates, including potential oversupplies of, or a reduction in demand for, rental space; acquisition, disposition, development and joint venture risks, including the ability to complete them on the terms and timing anticipated; property ownership and management risks, including the relative illiquidity of real estate investments, and expenses, vacancies or the inability to rent space on favorable terms or at all; the Company’s ability to maintain the Company’s status as a real estate investment trust for U.S. federal income tax purposes; potential environmental and other liabilities; impairment in the value of real estate property the Company owns; the attractiveness of the Company’s properties to tenants; the actual and perceived impact of e-commerce on the value of shopping center assets, and changing demographics and customer traffic patterns; business continuity disruptions and a deterioration in the Company’s tenants’ ability to operate in affected areas or delays in the supply of products or services to the Company or its tenants from vendors that are needed to operate efficiently; risks related to the Company’s current geographical concentration of properties in the states of Texas, Florida, and North Carolina and the metropolitan statistical areas of New York, Atlanta, Seattle, Chicago, and Washington, D.C.; civil unrest, acts of violence, terrorism or war, acts of God, climate change, epidemics, pandemics, natural disasters and severe weather conditions, including such events that may result in underinsured or uninsured losses or other increased costs and expenses; changes in laws and government regulations, including governmental orders affecting the use of the Company’s properties or the ability of its tenants to operate, and the costs of complying with such changed laws and government regulations; possible changes in consumer behavior due to public health crises and the fear of future pandemics; the Company’s ability to satisfy environmental, social or governance standards set by various constituencies; insurance costs and coverage, especially in Florida and Texas coastal areas and North Carolina; risks associated with cyberattacks and the loss of confidential information and other business disruptions; risks associated with the use of artificial intelligence and related tools; other factors affecting the real estate industry generally; and other risks identified in reports the Company files with the Securities and Exchange Commission or in other documents that it publicly disseminates, including, in particular, the section titled “Risk Factors” in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2025, and in the Company’s quarterly reports on Form 10-Q. The Company undertakes no obligation to publicly update or revise these forward-looking statements, whether as a result of new information, future events or otherwise.
3
Exhibit 99.2
PRESS RELEASE
Contact Information: Kite Realty Group
Tyler Henshaw
SVP, Capital Markets & Investor Relations
317.713.7780
thenshaw@kiterealty.com
Kite Realty Group Announces Closing of
Offering of 3.25% Exchangeable Senior Notes due 2032
INDIANAPOLIS, July 02, 2026 - Kite Realty Group (NYSE: KRG) (the “Company”) announced today that its operating partnership, Kite Realty Group, L.P. (the “Operating Partnership”), has closed its previously announced offering (the “Offering”) of $345 million aggregate principal amount of 3.25% exchangeable senior notes due 2032 (the “Notes”), which includes $45 million aggregate principal amount of Notes issued pursuant to the full exercise by the initial purchasers of their overallotment option. The Notes were sold in a private placement to persons reasonably believed to be qualified institutional buyers pursuant to Rule 144A under the Securities Act of 1933, as amended (the “Securities Act”).
The Notes are the Operating Partnership’s senior unsecured obligations and accrue interest payable semi-annually in arrears on April 15 and October 15 of each year, beginning on April 15, 2027, at a rate of 3.25% per year. The Notes will mature on April 15, 2032 (the “Maturity Date”), unless earlier exchanged, repurchased, or redeemed. Prior to the close of business on the business day immediately preceding January 15, 2032, the Notes are exchangeable into cash up to the principal amount of the Notes exchanged and, if applicable, cash or common shares of beneficial interest, par value $0.01 per share, of the Company (the “Common Shares”) or a combination thereof, only upon certain circumstances and during certain periods. On or after January 15, 2032, the Notes will be exchangeable into cash up to the principal amount of the Notes exchanged and, if applicable, cash or Common Shares or a combination thereof at the option of the holders at any time prior to the close of business on the second scheduled trading day preceding the Maturity Date. The exchange rate initially equals 28.2466 Common Shares per $1,000 principal amount of Notes, which is equivalent to an exchange price of approximately $35.40 per Common Share and an exchange premium of approximately 22.5% based on the closing price of $28.90 per Common Share on June 29, 2026. The exchange rate is subject to adjustment upon the occurrence of certain events, but it will not be adjusted for any accrued and unpaid interest.
The Operating Partnership may redeem the Notes, at its option, in whole or in part, on any business day on or after July 20, 2029, if the last reported sale price of the Common Shares has been at least 130% of the exchange price then in effect for at least 20 trading days (whether or not consecutive) during any 30 consecutive trading day period ending on, and including, the trading day immediately preceding the date on which the Operating Partnership provides notice of redemption at a redemption price equal to 100% of the principal amount of the Notes to be redeemed, plus accrued and unpaid interest to, but excluding, the redemption date (the “redemption price”). The Operating Partnership also has the right, at its election, to redeem all or any portion of the Notes at any time and from time to time at the redemption price to the extent necessary to preserve the Company’s status as a real estate investment trust for U.S. federal income tax purposes, as reasonably determined by the Company’s Board of Trustees. The Operating Partnership may also redeem the Notes, in whole but not in part, at any time in cash at the redemption price if the aggregate principal amount of Notes that remains outstanding at such time is less than 10% of the aggregate principal amount of Notes initially issued under the Indenture.
The Operating Partnership used a portion of the net proceeds from the Offering of the Notes to pay the cost of the Capped Call Transactions (defined below) described below. The Operating Partnership used or intends to use the remaining net proceeds from the Offering, together with the proceeds from its recent asset dispositions, to (i) repurchase approximately $30 million of the Company’s Common Shares concurrently with the pricing of the Offering in privately negotiated transactions through one of the initial purchasers of the Offering or its affiliates, as the Operating Partnership’s agent, and (ii) repay or redeem all of the Operating Partnership’s $300 million aggregate principal amount of 4.00% senior unsecured notes due 2026 at or prior to maturity.
In connection with the pricing of the Notes, the Operating Partnership entered into privately negotiated capped call transactions (the “Capped Call Transactions”) with certain financial institutions, including the initial purchasers of the Notes or their respective affiliates (the “Capped Call Counterparties”). The Capped Call Transactions cover, subject to anti-dilution adjustments substantially similar to those applicable to the Notes, the number of Common Shares underlying the Notes. The Capped Call Transactions are generally expected to reduce the potential dilution to holders of the Common Shares upon exchange of the Notes and/or offset the potential cash payments the Operating Partnership could be required to make in excess of the principal amount of any exchanged Notes upon exchange thereof, with such reduction and/or offset subject to a cap. The cap price of the Capped Call Transactions is initially $41.91, which represents a premium of approximately 45% over the last reported sale price of the Common Shares on the New York Stock Exchange on June 29, 2026, and is subject to anti-dilution adjustments under the terms of the Capped Call Transactions.
The Capped Call Counterparties or their respective affiliates may modify their hedge positions by entering into or unwinding various derivatives with respect to the Common Shares and/or purchasing or selling Common Shares or other securities of the Company or the Operating Partnership in secondary market transactions following the pricing of the Notes and prior to the maturity of the Notes (and are likely to do so (x) during any averaging period related to an exchange of the Notes, following any redemption of the Notes by the Operating Partnership or following any repurchase of the Notes by the Operating Partnership in connection with any fundamental change and (y) following any repurchase of the Notes by the Operating Partnership other than in connection with any such redemption or any such fundamental change if the Operating Partnership elects to unwind a corresponding portion of the Capped Call Transactions in connection with such repurchase). This activity could also cause or avoid an increase or a decrease in the market price of the Common Shares or the Notes, which could affect a noteholder’s ability to exchange the Notes, and, to the extent the activity occurs during any averaging period related to an exchange of the Notes, it could affect the number of Common Shares and value of the consideration that a noteholder will receive upon exchange of the Notes.
Neither the Notes nor the Common Shares issuable upon exchange of the Notes have been registered under the Securities Act or any state securities laws, and unless so registered, may not be offered or sold in the United States absent registration or an applicable exemption from, or in a transaction not subject to, the registration requirements of the Securities Act and other applicable securities laws. Accordingly, the Notes have been offered and sold only to persons reasonably believed to be qualified institutional buyers (as defined in Rule 144A under the Securities Act).
This press release does not constitute an offer to sell or a solicitation of an offer to buy, nor shall there be any offer or sale of the Notes or the Common Shares issuable upon exchange of the Notes in any jurisdiction in which the offer, solicitation or sale of the Notes or the Common Shares issuable upon exchange of the Notes would be unlawful prior to the registration or qualification thereof under the securities laws of any such state or jurisdiction.
About Kite Realty Group
Kite Realty Group is a real estate investment trust that owns and operates a high-quality portfolio of open-air shopping centers and mixed-use destinations. The Company’s portfolio is concentrated in high-growth Sun Belt and select strategic gateway markets. Publicly listed since 2004, KRG brings more than six decades of experience in developing, operating, and investing in real estate, using a disciplined, hands-on approach to enhance portfolio quality and maximize long-term value for all stakeholders. As of March 31, 2026, the Company owned interests in 169 U.S. open-air shopping centers and mixed-use assets, comprising approximately 27.3 million square feet of gross leasable space.
Safe Harbor
This release, together with other statements and information publicly disseminated by the Company, contains certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Such statements are based on assumptions and expectations that may not be realized and are inherently subject to risks, uncertainties and other factors, many of which cannot be predicted with accuracy and some of which might not even be anticipated. Future events and actual results, performance, transactions or achievements, financial or otherwise, may differ materially from the results, performance, transactions or achievements, financial or otherwise, expressed or implied by the forward-looking statements.
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Risks, uncertainties and other factors that might cause such differences, some of which could be material, include but are not limited to: economic, business, banking, real estate and other market conditions, particularly in connection with low or negative growth in the U.S. economy as well as economic uncertainty (including from an economic slowdown or recession, federal government shutdown, disruptions related to tariffs and other trade or sanction issues, geopolitical instability, rising interest rates, inflation, unemployment, or limited growth in consumer income or spending); financing risks, including the availability of, and costs associated with, sources of liquidity; the Company’s ability to refinance, or extend the maturity dates of, the Company’s indebtedness; the level and volatility of interest rates; the financial stability of the Company’s tenants; the competitive environment in which the Company operates, including potential oversupplies of, or a reduction in demand for, rental space; acquisition, disposition, development and joint venture risks, including the ability to complete them on the terms and timing anticipated; property ownership and management risks, including the relative illiquidity of real estate investments, and expenses, vacancies or the inability to rent space on favorable terms or at all; the Company’s ability to maintain the Company’s status as a real estate investment trust for U.S. federal income tax purposes; potential environmental and other liabilities; impairment in the value of real estate property the Company owns; the attractiveness of the Company’s properties to tenants; the actual and perceived impact of e-commerce on the value of shopping center assets, and changing demographics and customer traffic patterns; business continuity disruptions and a deterioration in the Company’s tenants’ ability to operate in affected areas or delays in the supply of products or services to the Company or its tenants from vendors that are needed to operate efficiently; risks related to the Company’s current geographical concentration of properties in the states of Texas, Florida, and North Carolina and the metropolitan statistical areas of New York, Atlanta, Seattle, Chicago, and Washington, D.C.; civil unrest, acts of violence, terrorism or war, acts of God, climate change, epidemics, pandemics, natural disasters and severe weather conditions, including such events that may result in underinsured or uninsured losses or other increased costs and expenses; changes in laws and government regulations, including governmental orders affecting the use of the Company’s properties or the ability of its tenants to operate, and the costs of complying with such changed laws and government regulations; possible changes in consumer behavior due to public health crises and the fear of future pandemics; the Company’s ability to satisfy environmental, social or governance standards set by various constituencies; insurance costs and coverage, especially in Florida and Texas coastal areas and North Carolina; risks associated with cyberattacks and the loss of confidential information and other business disruptions; risks associated with the use of artificial intelligence and related tools; other factors affecting the real estate industry generally; and other risks identified in reports the Company files with the Securities and Exchange Commission or in other documents that it publicly disseminates, including, in particular, the section titled “Risk Factors” in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2025, and in the Company’s quarterly reports on Form 10-Q. The Company undertakes no obligation to publicly update or revise these forward-looking statements, whether as a result of new information, future events or otherwise.
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