SITE Centers (NYSE: SITC) reports Q2 loss as property sales accelerate
SITE Centers Corp. reported a small net loss as it continues to liquidate its retail portfolio and prepare for an eventual wind‑up. For the six months ended June 30, 2026, total revenues were $23.7 million versus $76.1 million a year earlier, with net (loss) income of $(0.4) million versus $49.6 million, and FFO of $(5.7) million versus $23.0 million. Results reflected $18.5 million of impairment charges and sharply lower rental income from extensive property sales, partly offset by a $20.0 million gain on the sale of joint‑venture interests and higher interest income.
The company sold five wholly‑owned centers and a land parcel through July 31, 2026 for $147.0 million, eliminated all consolidated debt, and ended the quarter with $238.9 million of unrestricted cash and no revolver. A special dividend of $1.00 per share ($52.7 million) was paid July 31. SITE Centers is also pursuing monetization of its 20% DTP joint‑venture stake via a buy‑sell notice that could either yield about $32.4 million in proceeds or require buying its partner’s 80% interest for about $129.6 million by October 15, 2026, while maintaining elevated cash to support these options and future wind‑down costs.
Positive
- No consolidated debt and $238.9 million of unrestricted cash at June 30, 2026 give SITE Centers substantial liquidity to fund operations, asset sales, DTP joint‑venture options and anticipated wind‑down expenses.
Negative
- Revenues fell to $23.7 million from $76.1 million for the first half, and net income moved from a $49.6 million profit to a modest loss, with FFO turning negative as asset sales and impairments reduced earnings capacity.
Key Figures
Key Terms
Funds from Operations financial
Operating FFO financial
Separation and Distribution Agreement regulatory
Shared Services Agreement regulatory
buy-sell notice financial
unconsolidated joint ventures financial
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FAQ
How did SITE Centers (SITC) perform financially in the first half of 2026?
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What is SITE Centers’ (SITC) liquidity and debt position as of June 30, 2026?
What is happening with SITE Centers’ (SITC) DTP joint venture investment?
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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form
For the quarterly period ended
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For the transition period from to
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Securities registered pursuant to Section 12(b) of the Act:
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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.
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).
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.
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Emerging growth company |
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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 check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No
As of July 31, 2026 the registrant had
SITE Centers Corp.
QUARTERLY REPORT ON FORM 10-Q
QUARTER ENDED June 30, 2026
TABLE OF CONTENTS
PART I. FINANCIAL INFORMATION |
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Item 1. |
Financial Statements – Unaudited |
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Consolidated Balance Sheets as of June 30, 2026 and December 31, 2025 |
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Consolidated Statements of Operations and Comprehensive (Loss) Income for the Three Months Ended June 30, 2026 and 2025 |
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Consolidated Statements of Operations and Comprehensive (Loss) Income for the Six Months Ended June 30, 2026 and 2025 |
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Consolidated Statements of Equity for the Three and Six Months Ended June 30, 2026 and 2025 |
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Consolidated Statements of Cash Flows for the Six Months Ended June 30, 2026 and 2025 |
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Notes to Consolidated Financial Statements |
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Item 2. |
Management's Discussion and Analysis of Financial Condition and Results of Operations |
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Item 3. |
Quantitative and Qualitative Disclosures about Market Risk |
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Item 4. |
Controls and Procedures |
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PART II. OTHER INFORMATION |
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Item 1. |
Legal Proceedings |
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Item 1A. |
Risk Factors |
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Item 2. |
Unregistered Sales of Equity Securities and Use of Proceeds |
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Item 3. |
Defaults Upon Senior Securities |
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Item 4. |
Mine Safety Disclosures |
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Item 5. |
Other Information |
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Item 6. |
Exhibits |
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SIGNATURES |
31 |
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2
SITE Centers Corp.
CONSOLIDATED BALANCE SHEETS
(unaudited; in thousands, except share amounts)
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June 30, 2026 |
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December 31, 2025 |
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Assets |
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Land |
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Buildings |
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Fixtures and tenant improvements |
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Less: Accumulated depreciation |
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Construction in progress and land |
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Total real estate assets, net |
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Investments in and advances to joint ventures |
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Cash and cash equivalents |
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Restricted cash |
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Accounts receivable |
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Amounts receivable from Curbline |
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Other assets, net |
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Total assets |
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Liabilities and Equity |
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Amounts payable to Curbline |
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Accounts payable and other liabilities |
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Dividends payable |
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Total liabilities |
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Commitments and contingencies |
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SITE Centers Equity |
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Common shares, with par value, $ |
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Additional paid-in capital |
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Accumulated distributions in excess of net income |
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Less: Common shares in treasury at cost: |
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Total equity |
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$ |
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The accompanying notes are an integral part of these consolidated financial statements.
3
SITE Centers Corp.
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE (LOSS) INCOME
(unaudited; in thousands, except per share amounts)
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Three Months |
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Ended June 30, |
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2026 |
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2025 |
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Revenues from operations: |
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Rental income |
$ |
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$ |
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Fee and other income |
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Rental operation expenses: |
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Operating and maintenance |
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Real estate taxes |
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Impairment charges |
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General and administrative |
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Depreciation and amortization |
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Other income (expense): |
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Interest expense |
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Interest income |
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Debt extinguishment costs |
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Other income (expense), net |
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Loss before earnings from equity method investments and other items |
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Equity in net loss of joint ventures |
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Gain on disposition of real estate, net |
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(Loss) income before tax expense |
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Tax expense of taxable REIT subsidiary and state franchise and income taxes |
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Net (loss) income |
$ |
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$ |
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Per share data: |
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Basic: |
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Diluted: |
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Net (loss) income |
$ |
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$ |
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Amount reclassified to earnings - cash flow hedges |
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Comprehensive (loss) income |
$ |
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$ |
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The accompanying notes are an integral part of these consolidated financial statements.
4
SITE Centers Corp.
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE (LOSS) INCOME
(unaudited; in thousands, except per share amounts)
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Six Months |
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Ended June 30, |
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2026 |
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2025 |
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Revenues from operations: |
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Rental income |
$ |
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$ |
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Fee and other income |
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Rental operation expenses: |
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Operating and maintenance |
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Real estate taxes |
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Impairment charges |
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General and administrative |
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Depreciation and amortization |
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Other income (expense): |
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Interest expense |
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Interest income |
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Debt extinguishment costs |
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Other income (expense), net |
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Loss before earnings from equity method investments and other items |
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Equity in net loss of joint ventures |
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Gain on sale of joint venture interests |
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Gain on disposition of real estate, net |
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(Loss) income before tax benefit (expense) |
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Tax benefit (expense) of taxable REIT subsidiary and state franchise and income taxes |
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Net (loss) income |
$ |
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$ |
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Per share data: |
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Basic: |
$ |
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$ |
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Diluted: |
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$ |
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Net (loss) income |
$ |
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$ |
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Amount reclassified to earnings - cash flow hedges |
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( |
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Comprehensive (loss) income |
$ |
( |
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$ |
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The accompanying notes are an integral part of these consolidated financial statements.
5
SITE Centers Corp.
CONSOLIDATED STATEMENTS OF EQUITY
(unaudited; in thousands)
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Common |
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Additional |
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Accumulated Distributions |
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Deferred Compensation Obligation |
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Accumulated Other Comprehensive Income |
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Treasury |
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Total |
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Balance, December 31, 2025 |
$ |
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$ |
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$ |
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$ |
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$ |
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$ |
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$ |
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Stock-based compensation, net |
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Comprehensive income |
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Balance, March 31, 2026 |
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Stock-based compensation, net |
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Dividend declared |
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Comprehensive loss |
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Balance, June 30, 2026 |
$ |
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$ |
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$ |
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$ |
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$ |
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$ |
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$ |
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Common |
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Additional |
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Accumulated Distributions |
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Deferred Compensation Obligation |
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Accumulated Other Comprehensive Income |
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Treasury |
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Total |
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Balance, December 31, 2024 |
$ |
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$ |
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$ |
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$ |
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$ |
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$ |
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$ |
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Stock-based compensation, net |
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Comprehensive income (loss) |
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Balance, March 31, 2025 |
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Stock-based compensation, net |
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Termination of deferred compensation plan |
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Dividends declared |
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Comprehensive income (loss) |
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Balance, June 30, 2025 |
$ |
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$ |
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$ |
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$ |
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$ |
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$ |
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$ |
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The accompanying notes are an integral part of these consolidated financial statements.
6
SITE Centers Corp.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(unaudited; in thousands)
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Six Months |
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Ended June 30, |
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2026 |
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2025 |
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Cash flow from operating activities: |
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Net (loss) income |
$ |
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$ |
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Adjustments to reconcile net (loss) income to net cash flow (used for) provided by operating activities: |
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Depreciation and amortization |
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Stock-based compensation |
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Amortization and write-off of debt issuance costs, commitment fees and fair market value of debt adjustments |
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Equity in net loss of joint ventures |
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Gain on sale of joint venture interests |
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Gain on disposition of real estate, net |
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Impairment charges |
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Operating cash distributions from joint ventures |
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Loss on abandoned tenant lease costs |
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Net change in accounts receivable |
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Net change in accounts payable and accrued expenses |
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Net change in other operating assets and liabilities |
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Total adjustments |
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Net cash flow (used for) provided by operating activities |
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Cash flow from investing activities: |
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Real estate developed and improvements to operating real estate |
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Proceeds from disposition of real estate |
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Proceeds from disposition of joint venture |
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Distributions from unconsolidated joint venture |
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Equity contributions to joint ventures |
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Net cash flow provided by investing activities |
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Cash flow from financing activities: |
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Repayment of mortgage debt |
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Payment of debt issuance costs |
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Payment of debt extinguishment costs |
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— |
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Repurchase of common shares in conjunction with equity award plans |
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Net cash flow used for financing activities |
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Net increase in cash, cash equivalents and restricted cash |
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Cash, cash equivalents and restricted cash, beginning of period |
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Cash, cash equivalents and restricted cash, end of period |
$ |
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$ |
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The accompanying notes are an integral part of these consolidated financial statements.
7
Notes to Consolidated Financial Statements
Nature of Business
Use of Estimates in Preparation of Financial Statements
The preparation of financial statements in conformity with generally accepted accounting principles (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities and the reported amounts of revenues and expenses during the year. Actual results could differ from those estimates.
Unaudited Interim Financial Statements
These financial statements have been prepared by the Company in accordance with GAAP for interim financial information and the applicable rules and regulations of the Securities and Exchange Commission. Accordingly, they do not include all information and footnotes required by GAAP for complete financial statements. However, in the opinion of management, the interim financial statements include all adjustments, consisting of only normal recurring adjustments, necessary for a fair statement of the results of the periods presented. The results of operations for the three and six months ended June 30, 2026 and 2025 are not necessarily indicative of the results that may be expected for the full year. These consolidated financial statements should be read in conjunction with the Company’s audited financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2025.
Principles of Consolidation
Disposition of Real Estate
For the three and six months ended June 30, 2026, the Company received gross proceeds of $
Reclassifications
Certain prior period amounts reported have been reclassified to conform with current year presentation.
Fair Value Measurement
The carrying amounts reported in the Company’s consolidated balance sheets for Cash and Cash Equivalents, Restricted Cash, Accounts Receivable, Accounts Payable and Other Liabilities approximated fair value because of their short-term maturities.
8
Statements of Cash Flows and Supplemental Disclosure of Non-Cash Investing and Financing Information
Non-cash investing and financing activities are summarized as follows (in millions):
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Six Months |
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Ended June 30, |
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2026 |
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2025 |
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Accounts payable related to construction in progress |
$ |
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$ |
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Dividends declared, but not paid |
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Segments
Recently Issued Accounting Standards
Expense Disaggregation Disclosures. In November 2024, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2024-03, which requires additional disaggregated disclosure about certain income statement expense line items. ASU 2024-03 is effective for annual reporting years beginning after December 15, 2026 and interim periods within the fiscal years beginning after December 15, 2027. Other than additional disclosure, the adoption of this ASU is not expected to have a material impact on the Company’s financial position and/or results of operations.
9
At June 30, 2026 and December 31, 2025, the Company had ownership interests in unconsolidated joint ventures that had investments in
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June 30, 2026 |
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December 31, 2025 |
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||
Condensed Combined Balance Sheets |
|
|
|
|
|
||
Land |
$ |
|
|
$ |
|
||
Buildings |
|
|
|
|
|
||
Fixtures and tenant improvements |
|
|
|
|
|
||
|
|
|
|
|
|
||
Less: Accumulated depreciation |
|
( |
) |
|
|
( |
) |
|
|
|
|
|
|
||
Construction in progress and land |
|
|
|
|
|
||
Real estate, net |
|
|
|
|
|
||
Cash and restricted cash |
|
|
|
|
|
||
Receivables, net |
|
|
|
|
|
||
Other assets, net |
|
|
|
|
|
||
|
$ |
|
|
$ |
|
||
|
|
|
|
|
|
||
Mortgage debt |
$ |
|
|
$ |
|
||
Amounts payable to SITE Centers |
|
|
|
|
|
||
Other liabilities |
|
|
|
|
|
||
|
|
|
|
|
|
||
Accumulated equity |
|
|
|
|
|
||
|
$ |
|
|
$ |
|
||
|
|
|
|
|
|
||
Company's share of accumulated equity |
$ |
|
|
$ |
|
||
Basis differentials |
|
( |
) |
|
|
|
|
Amounts payable to the Company |
|
|
|
|
|
||
Investments in and advances to joint ventures |
$ |
|
|
$ |
|
||
|
Three Months |
|
|
Six Months |
|
||||||||||
|
Ended June 30, |
|
|
Ended June 30, |
|
||||||||||
|
2026 |
|
|
2025 |
|
|
2026 |
|
|
2025 |
|
||||
Condensed Combined Statements of Operations |
|
|
|
|
|
|
|
|
|
|
|
||||
Revenues from operations |
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
Expenses from operations: |
|
|
|
|
|
|
|
|
|
|
|
||||
Operating expenses |
|
|
|
|
|
|
|
|
|
|
|
||||
Depreciation and amortization |
|
|
|
|
|
|
|
|
|
|
|
||||
Interest expense |
|
|
|
|
|
|
|
|
|
|
|
||||
Other expense, net |
|
|
|
|
|
|
|
|
|
|
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
||||
(Loss) income before loss on disposition of real estate |
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|
|
|
|
Gain on disposition of real estate, net |
|
|
|
|
|
|
|
|
|
|
|
||||
(Loss) income attributable to unconsolidated joint ventures |
$ |
( |
) |
|
$ |
( |
) |
|
$ |
( |
) |
|
$ |
|
|
Company's share of equity in net (loss) income of joint ventures |
$ |
( |
) |
|
$ |
( |
) |
|
$ |
( |
) |
|
$ |
|
|
Basis differential adjustments(A) |
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
Equity in net loss of joint ventures |
$ |
( |
) |
|
$ |
( |
) |
|
$ |
( |
) |
|
$ |
( |
) |
Revenues earned by the Company for providing asset management, property management and leasing and development services to the Company’s unconsolidated joint ventures were $
10
Other assets and intangibles consist of the following (in thousands):
|
June 30, 2026 |
|
|||||||||
|
Asset |
|
|
Accumulated Amortization |
|
|
Net |
|
|||
Intangible assets, net: |
|
|
|
|
|
|
|
|
|||
In-place leases |
$ |
|
|
$ |
( |
) |
|
$ |
|
||
Above-market leases |
|
|
|
|
( |
) |
|
|
|
||
Lease origination costs |
|
|
|
|
( |
) |
|
|
|
||
Tenant relationships |
|
|
|
|
( |
) |
|
|
|
||
Total intangible assets, net |
|
|
|
|
( |
) |
|
|
|
||
Operating lease ROU assets |
|
|
|
|
|
|
|
|
|||
Other assets: |
|
|
|
|
|
|
|
|
|||
Prepaid expenses |
|
|
|
|
|
|
|
|
|||
Other assets |
|
|
|
|
|
|
|
|
|||
Deposits |
|
|
|
|
|
|
|
|
|||
Total other assets, net |
|
|
|
|
|
|
$ |
|
|||
|
Liability |
|
|
Accumulated Amortization |
|
|
Net |
|
|||
Below-market leases(A) |
$ |
|
|
$ |
( |
) |
|
$ |
|
||
|
December 31, 2025 |
|
|||||||||
|
Asset |
|
|
Accumulated Amortization |
|
|
Net |
|
|||
Intangible assets, net: |
|
|
|
|
|
|
|
|
|||
In-place leases |
$ |
|
|
$ |
( |
) |
|
$ |
|
||
Above-market leases |
|
|
|
|
( |
) |
|
|
|
||
Lease origination costs |
|
|
|
|
( |
) |
|
|
|
||
Tenant relationships |
|
|
|
|
( |
) |
|
|
|
||
Total intangible assets, net |
|
|
|
|
( |
) |
|
|
|
||
Operating lease ROU assets |
|
|
|
|
|
|
|
|
|||
Other assets: |
|
|
|
|
|
|
|
|
|||
Prepaid expenses |
|
|
|
|
|
|
|
|
|||
Other assets |
|
|
|
|
|
|
|
|
|||
Deposits |
|
|
|
|
|
|
|
|
|||
Total other assets, net |
|
|
|
|
|
|
$ |
|
|||
|
Liability |
|
|
Accumulated Amortization |
|
|
Net |
|
|||
Below-market leases |
$ |
|
|
$ |
( |
) |
|
$ |
|
||
Amortization for the three and six months ended June 30, 2026 and 2025 related to the Company’s intangibles was as follows (in thousands):
Period |
|
Income |
|
|
Expense |
|
||
Three months ended June 30, 2026 |
|
$ |
|
|
$ |
|
||
Three months ended June 30, 2025 |
|
|
|
|
|
|
||
Six months ended June 30, 2026 |
|
|
|
|
|
|
||
Six months ended June 30, 2025 |
|
|
|
|
|
|
||
11
The disaggregation of the Company’s lease income, which is included in Rental income on the Company’s consolidated statements of operations, as either fixed or variable lease income based on the criteria specified in FASB Accounting Standards Codification 842, for the three and six months ended June 30, 2026 and 2025 was as follows (in thousands):
|
|
Three Months |
|
|
Six Months |
|
||||||||||
|
|
Ended June 30, |
|
|
Ended June 30, |
|
||||||||||
|
|
2026 |
|
|
2025 |
|
|
2026 |
|
|
2025 |
|
||||
Rental income: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Fixed lease income(A) |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
Variable lease income(B) |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Above-market and below-market leases amortization, net |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Adjustments for potentially uncollectible revenues and disputed amounts(C) |
|
|
( |
) |
|
|
|
|
|
( |
) |
|
|
|
||
Total rental income |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
On October 1, 2024, the Company completed the spin-off of Curbline Properties Corp. (“Curbline Properties” or “Curbline”). To govern certain ongoing relationships between the Company, Curbline Properties LP (the “Operating Partnership”) and Curbline Properties after the spin-off, and to provide for the allocation among the Company, the Operating Partnership and Curbline Properties of the Company’s assets, liabilities and obligations attributable to periods both prior to and following the separation of Curbline Properties and the Operating Partnership from SITE Centers, the Company, Curbline Properties and the Operating Partnership entered into agreements pursuant to which each provides certain services and has certain rights following the spin-off, and Curbline Properties, the Operating Partnership and SITE Centers indemnify each other against certain liabilities arising from their respective businesses. The Separation and Distribution Agreement, the Tax Matters Agreement, the Employee Matters Agreement, the Shared Services Agreement and other agreements which were entered into in connection with the spin-off and which govern certain ongoing relationships between the Company, Curbline, and the Operating Partnership, were negotiated between related parties and their terms, including fees and other amounts payable, may not be the same as if they had been negotiated at arm’s length with an unaffiliated third party.
Separation and Distribution Agreement
The Separation and Distribution Agreement contains obligations for the Company to complete certain redevelopment projects at properties that are owned by Curbline Properties. As of June 30, 2026, such redevelopment projects were estimated to cost $
Shared Services Agreement
The fair value of the services provided by the Company to Curbline Properties in excess of the fees and the fair value of the services received by the Company from Curbline Properties is reflected as $
The Shared Services Agreement provides Curbline Properties the right to use the Company’s office space in New York, New York. This arrangement is considered an embedded lease based on the criteria specified in Topic 842. The sublease income received under the Shared Services Agreement of $
Summary
The Company recorded in Fee and other income on the Company’s consolidated statements of operations a cash fee of $
12
$
For the three and six months ended June 30, 2026, the Company recorded impairment charges aggregating $
The Company is required to assess the fair value of certain impaired consolidated investments. The valuation of impaired real estate assets is determined using widely accepted valuation techniques including discounted cash flow analysis on the expected cash flows of each asset, as well as the income capitalization approach considering prevailing market capitalization rates, analysis of recent comparable sales transactions, actual sales negotiations and bona fide purchase offers received from third parties and/or consideration of the amount that currently would be required to replace the asset, as adjusted for obsolescence. In general, the Company considers multiple valuation techniques when measuring fair value of an investment. However, in certain circumstances, a single valuation technique may be appropriate.
These valuations are calculated based on market conditions and assumptions made by management at the time the valuation adjustments and impairments were recorded, which may differ materially from actual results if market conditions or the underlying assumptions change.
The following table presents information about the fair value of real estate that was impaired, and therefore, measured on a fair value basis, along with the related impairment charge for the six months ended June 30, 2026. The table also indicates the fair value hierarchy of the valuation techniques used by the Company to determine such fair value (in millions):
|
|
Fair Value Measurements |
|
|||||||||||||||||
|
|
Level 1 |
|
|
Level 2 |
|
|
Level 3 |
|
|
Total |
|
|
Total |
|
|||||
June 30, 2026 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Long-lived assets held and used |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|||||
|
|
Quantitative Information About Level 3 Fair Value Measurements |
||||||||
|
|
Fair Value at |
|
|
Valuation |
|
|
|
|
|
Description |
|
June 30, 2026 |
|
|
Technique |
|
Unobservable Inputs |
|
Range |
|
Impairment of consolidated assets |
|
$ |
|
|
Indicative Bid |
|
Indicative Bid(A) |
|
N/A |
|
13
The following table provides a reconciliation of net income and the number of common shares used in the computations of “basic” earnings per share (“EPS”), which utilizes the weighted-average number of common shares outstanding without regard to dilutive potential common shares, and “diluted” EPS, which includes all such shares (in thousands, except per share amounts).
|
Three Months |
|
|
Six Months |
|
||||||||||
|
Ended June 30, |
|
|
Ended June 30, |
|
||||||||||
|
2026 |
|
|
2025 |
|
|
2026 |
|
|
2025 |
|
||||
Numerators – Basic and Diluted |
|
|
|
|
|
|
|
|
|
|
|
||||
Net (loss) income |
$ |
( |
) |
|
$ |
|
|
$ |
( |
) |
|
$ |
|
||
Earnings attributable to unvested shares |
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
Net (loss) income after allocation to participating securities |
$ |
( |
) |
|
$ |
|
|
$ |
( |
) |
|
$ |
|
||
Denominators – Number of Shares |
|
|
|
|
|
|
|
|
|
|
|
||||
Basic and Diluted—Average shares outstanding |
|
|
|
|
|
|
|
|
|
|
|
||||
Earnings Per Share: |
|
|
|
|
|
|
|
|
|
|
|
||||
Basic |
$ |
( |
) |
|
$ |
|
|
$ |
( |
) |
|
$ |
|
||
Diluted |
$ |
( |
) |
|
$ |
|
|
$ |
( |
) |
|
$ |
|
||
Basic average shares outstanding do not include Restricted Stock units (“RSUs”) representing
Common Share Dividends
The Company declared a special cash dividend of $
14
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OPERATIONS
Management’s Discussion and Analysis of Financial Condition and Results of Operations (“MD&A”) provides readers with a perspective from management on the financial condition, results of operations and liquidity of SITE Centers Corp. and its consolidated subsidiaries (collectively, the “Company” or “SITE Centers”) and other factors that may affect the Company’s future results. The Company believes it is important to read the MD&A in conjunction with its Annual Report on Form 10-K for the year ended December 31, 2025, as well as other publicly available information.
EXECUTIVE SUMMARY
The Company is a self-administered and self-managed Real Estate Investment Trust (“REIT”) in the business of owning, leasing, redeveloping, and managing shopping centers. As of June 30, 2026, the Company’s portfolio consisted of 14 shopping centers (including 10 shopping centers owned through the Dividend Trust Portfolio (“DTP”), an unconsolidated joint venture). At June 30, 2026, the Company owned approximately 3.9 million square feet of gross leasable area (“GLA”) through all its shopping center properties (wholly-owned and joint venture). In addition, the Company owns two adjacent office buildings located in Beachwood, Ohio, totaling approximately 339,000 square feet of GLA, a portion of which currently serves as the Company’s headquarters.
The following provides an overview of the Company’s key financial metrics (see Non-GAAP Financial Measures described later in this section) (in thousands, except per share amounts):
|
Three Months |
|
|
Six Months |
|
||||||||||
|
Ended June 30, |
|
|
Ended June 30, |
|
||||||||||
|
2026 |
|
|
2025 |
|
|
2026 |
|
|
2025 |
|
||||
Net (loss) income |
$ |
(1,304 |
) |
|
$ |
46,504 |
|
|
$ |
(366 |
) |
|
$ |
49,589 |
|
FFO |
$ |
(4,551 |
) |
|
$ |
6,935 |
|
|
$ |
(5,727 |
) |
|
$ |
22,959 |
|
Operating FFO |
$ |
(4,569 |
) |
|
$ |
8,347 |
|
|
$ |
(6,453 |
) |
|
$ |
16,629 |
|
Earnings per share – Diluted |
$ |
(0.03 |
) |
|
$ |
0.88 |
|
|
$ |
(0.01 |
) |
|
$ |
0.94 |
|
For the six months ended June 30, 2026, the decrease in Net (loss) income, as compared to the prior-year period, primarily was the result of impairment charges, a decrease in rental income as a result of property dispositions, a decrease in gains on the disposition of real estate and a decrease in condemnation revenue, partially offset by the gain on the sale of joint venture interests, an increase in interest income and decreases in interest expense and depreciation and amortization expense.
SITE Centers Strategy
The Company continues to pursue the monetization of its investment in the DTP joint venture and the sale of its remaining wholly-owned properties, though no assurances can be given that such efforts will result in additional asset sales. The Company has entered into agreements to sell Shoppes at Paradise Pointe (Fort Walton Beach, Florida) and The Maxwell (Chicago, Illinois) for approximately $8.4 million and $15.3 million in cash, respectively, subject to adjustment for certain closing pro-rations, allocations and credits. The general due diligence period has expired under both of these sale agreements and the closings are expected to occur by the end of the third quarter of 2026. These closings remain subject to customary conditions, including, but not limited to, delivery of estoppel letters from tenants, the accuracy of the Company’s representations in all material respects and the absence of material casualty or condemnation events.
The timing of remaining asset sales may be impacted by general economic conditions, local conditions in the markets in which the Company’s remaining properties are situated and other property-specific considerations. Prospects for selling the retail condominium units that comprise The Blocks (Portland, Oregon) may be impacted by challenging local conditions and vacancy, and timing and the amount of proceeds from the sale of the Company’s corporate headquarters (Beachwood, Ohio) may be impacted by Curbline Properties Corp.’s (“Curbline Properties” or “Curbline”) contractual option to lease space in the buildings.
The Company’s ability and timing to monetize the value of its investment in the DTP joint venture may be impacted by the degree of cooperation of the joint venture partner and the limited rights afforded the Company under the joint venture agreement (including the requirement that the Company obtain the joint venture partner’s consent to the sale of individual joint venture properties or to the Company’s sale of its interests in the joint venture). The Company is in discussions with its joint venture partner and continues to maintain an elevated cash balance in order to maximize the Company’s alternatives for monetizing its joint venture investment. On June 29, 2026, the Company delivered a buy-sell notice to its partner under the joint venture agreement. Pursuant to the terms of the joint venture agreement, unless an alternative consensual resolution is agreed between the Company and its partner, the partner is required to inform the Company by August 31, 2026 of its decision to either purchase the Company’s 20% interest in the
15
joint venture for a price of approximately $32.4 million or sell its 80% interest in the joint venture to the Company for a price of approximately $129.6 million. Pursuant to the terms of the joint venture agreement, closing of the transaction should occur no later than October 15, 2026. No assurances can be given that the partner will comply with the terms of the joint venture agreement or perform its obligations under the joint venture agreement with respect to the buy-sell notice. With its partner’s consent, the Company may continue to explore the sale of its interests in the joint venture to third parties as an alternative to completing the buy-sell transaction.
The Company expects to use proceeds from additional asset sales to pay operating expenses, manage overall liquidity levels, make distributions to shareholders and establish a reserve fund to satisfy projected expenses and known and unknown claims that might arise during the anticipated wind-up of its business. The Company expects to incur significant expenses in connection with the eventual wind-up of its business, including but not limited to employee severance costs, discretionary bonuses upon completion of the sales process, costs to terminate office leases, licenses and other operating contracts, professional fees (including fees of accountants and law firms), costs to comply with ongoing reporting requirements of the Securities Exchange Act of 1934 (the “Exchange Act”) (until such time as the Company qualifies for relief therefrom), insurance premiums and potential deductibles (including with respect to a “tail” insurance policy for directors and officers), vendor expenses, costs to resolve and streamline the Company’s subsidiaries and corporate structure and any claims arising under sale agreements for completed dispositions.
For risks related to the Company’s strategy, see Item 1A. Risk Factors in the Company’s Annual Report on Form 10-K for the year ended December 31, 2025.
The Company expects that rental income and net income will decrease in future periods as compared to corresponding prior year periods as a result of the significant disposition activity and declining property revenues. However, the Company’s general and administrative expenses will remain elevated prior to the expected termination of the Shared Services Agreement on October 1, 2027 as a result of the contractual obligations and services owing to Curbline thereunder.
Transaction and Capital Market Highlights
Transaction and capital market highlights through July 31, 2026 include the following:
Operations
Operational data for the Company’s retail portfolio at June 30, 2026, include the following:
The comparability of year-over-year operating metrics has been increasingly impacted by the level and composition of the Company’s disposition activities and the reduced size of the Company’s portfolio.
16
RESULTS OF OPERATIONS
Consolidated shopping center properties owned as of January 1, 2025, are referred to herein as the “Comparable Portfolio Properties.”
Revenues from Operations (in thousands)
|
Three Months |
|
|
|
|
||||||
|
Ended June 30, |
|
|
|
|
||||||
|
2026 |
|
|
2025 |
|
|
$ Change |
|
|||
Rental income(A) |
$ |
6,847 |
|
|
$ |
30,662 |
|
|
$ |
(23,815 |
) |
Fee and other income |
|
3,846 |
|
|
|
2,808 |
|
|
|
1,038 |
|
Total revenues |
$ |
10,693 |
|
|
$ |
33,470 |
|
|
$ |
(22,777 |
) |
|
Six Months |
|
|
|
|
||||||
|
Ended June 30, |
|
|
|
|
||||||
|
2026 |
|
|
2025 |
|
|
$ Change |
|
|||
Rental income(A) |
$ |
16,088 |
|
|
$ |
62,112 |
|
|
$ |
(46,024 |
) |
Fee and other income(B) |
|
7,621 |
|
|
|
13,981 |
|
|
|
(6,360 |
) |
Total revenues |
$ |
23,709 |
|
|
$ |
76,093 |
|
|
$ |
(52,384 |
) |
|
|
Three Months |
|
|
|
|
||||||
|
|
Ended June 30, |
|
|
|
|
||||||
Contractual Lease Payments |
|
2026 |
|
|
2025 |
|
|
$ Change |
|
|||
Base and percentage rental income |
|
$ |
5,089 |
|
|
$ |
22,145 |
|
|
$ |
(17,056 |
) |
Recoveries from tenants |
|
|
1,708 |
|
|
|
7,900 |
|
|
|
(6,192 |
) |
Uncollectible revenue |
|
|
(121 |
) |
|
|
228 |
|
|
|
(349 |
) |
Lease termination fees, ancillary and other rental income |
|
|
171 |
|
|
|
389 |
|
|
|
(218 |
) |
Total contractual lease payments |
|
$ |
6,847 |
|
|
$ |
30,662 |
|
|
$ |
(23,815 |
) |
|
|
Six Months |
|
|
|
|
||||||
|
|
Ended June 30, |
|
|
|
|
||||||
Contractual Lease Payments |
|
2026 |
|
|
2025 |
|
|
$ Change |
|
|||
Base and percentage rental income(1) |
|
$ |
11,891 |
|
|
$ |
44,900 |
|
|
$ |
(33,009 |
) |
Recoveries from tenants(2) |
|
|
3,838 |
|
|
|
16,302 |
|
|
|
(12,464 |
) |
Uncollectible revenue(3) |
|
|
(85 |
) |
|
|
120 |
|
|
|
(205 |
) |
Lease termination fees, ancillary and other rental income |
|
|
444 |
|
|
|
790 |
|
|
|
(346 |
) |
Total contractual lease payments |
|
$ |
16,088 |
|
|
$ |
62,112 |
|
|
$ |
(46,024 |
) |
|
|
Increase (Decrease) |
|
|
Comparable Portfolio Properties |
|
$ |
— |
|
Disposition of shopping centers |
|
|
(33.0 |
) |
Straight-line rents |
|
|
— |
|
Total |
|
$ |
(33.0 |
) |
At June 30, 2026 and 2025, the Company owned four and 20 wholly-owned retail properties as of each balance sheet date that had an aggregate occupancy rate of 66.9% and 87.2% and an average annualized base rent per occupied square foot of $24.12 and $20.01, respectively. The decrease in occupancy rate and increase in average annualized base rent per occupied square foot was due to a combination of transactional activity, the mix of properties sold and overall decreases in occupancy.
17
Expenses from Operations (in thousands)
|
Three Months |
|
|
|
|
||||||
|
Ended June 30, |
|
|
|
|
||||||
|
2026 |
|
|
2025 |
|
|
$ Change |
|
|||
Operating and maintenance |
$ |
3,776 |
|
|
$ |
6,457 |
|
|
$ |
(2,681 |
) |
Real estate taxes |
|
1,173 |
|
|
|
4,690 |
|
|
|
(3,517 |
) |
Impairment charges |
|
1,000 |
|
|
|
— |
|
|
|
1,000 |
|
General and administrative |
|
9,229 |
|
|
|
9,418 |
|
|
|
(189 |
) |
Depreciation and amortization |
|
3,894 |
|
|
|
12,921 |
|
|
|
(9,027 |
) |
|
$ |
19,072 |
|
|
$ |
33,486 |
|
|
$ |
(14,414 |
) |
|
Six Months |
|
|
|
|
||||||
|
Ended June 30, |
|
|
|
|
||||||
|
2026 |
|
|
2025 |
|
|
$ Change |
|
|||
Operating and maintenance(A) |
$ |
7,069 |
|
|
$ |
13,589 |
|
|
$ |
(6,520 |
) |
Real estate taxes(A) |
|
2,815 |
|
|
|
9,411 |
|
|
|
(6,596 |
) |
Impairment charges(B) |
|
18,450 |
|
|
|
— |
|
|
|
18,450 |
|
General and administrative |
|
18,128 |
|
|
|
18,813 |
|
|
|
(685 |
) |
Depreciation and amortization(A) |
|
8,911 |
|
|
|
26,173 |
|
|
|
(17,262 |
) |
|
$ |
55,373 |
|
|
$ |
67,986 |
|
|
$ |
(12,613 |
) |
|
|
Operating |
|
|
Real Estate |
|
|
Depreciation |
|
|||
Comparable Portfolio Properties |
|
$ |
1.2 |
|
|
$ |
0.1 |
|
|
$ |
(0.8 |
) |
Disposition of shopping centers |
|
|
(7.7 |
) |
|
|
(6.7 |
) |
|
|
(16.5 |
) |
|
|
$ |
(6.5 |
) |
|
$ |
(6.6 |
) |
|
$ |
(17.3 |
) |
18
Other Income and Expenses (in thousands)
|
Three Months |
|
|
|
|
||||||
|
Ended June 30, |
|
|
|
|
||||||
|
2026 |
|
|
2025 |
|
|
$ Change |
|
|||
Interest expense |
$ |
— |
|
|
$ |
(5,304 |
) |
|
$ |
5,304 |
|
Interest income |
|
1,615 |
|
|
|
722 |
|
|
|
893 |
|
Debt extinguishment costs |
|
— |
|
|
|
(504 |
) |
|
|
504 |
|
Other income (expense), net |
|
(1,777 |
) |
|
|
(1,383 |
) |
|
|
(394 |
) |
|
$ |
(162 |
) |
|
$ |
(6,469 |
) |
|
$ |
6,307 |
|
|
Six Months |
|
|
|
|
||||||
|
Ended June 30, |
|
|
|
|
||||||
|
2026 |
|
|
2025 |
|
|
$ Change |
|
|||
Interest expense(A) |
$ |
— |
|
|
$ |
(10,766 |
) |
|
$ |
10,766 |
|
Interest income(B) |
|
2,806 |
|
|
|
1,083 |
|
|
|
1,723 |
|
Debt extinguishment costs |
|
— |
|
|
|
(504 |
) |
|
|
504 |
|
Other income (expense), net(C) |
|
(2,771 |
) |
|
|
(2,239 |
) |
|
|
(532 |
) |
|
$ |
35 |
|
|
$ |
(12,426 |
) |
|
$ |
12,461 |
|
Other Items (in thousands)
|
Three Months |
|
|
|
|
||||||
|
Ended June 30, |
|
|
|
|
||||||
|
2026 |
|
|
2025 |
|
|
$ Change |
|
|||
Equity in net loss of joint ventures |
$ |
(449 |
) |
|
$ |
(68 |
) |
|
$ |
(381 |
) |
Gain on disposition of real estate, net |
|
7,804 |
|
|
|
53,236 |
|
|
|
(45,432 |
) |
Tax expense of taxable REIT subsidiary and state franchise and |
|
(118 |
) |
|
|
(179 |
) |
|
|
61 |
|
|
Six Months |
|
|
|
|
||||||
|
Ended June 30, |
|
|
|
|
||||||
|
2026 |
|
|
2025 |
|
|
$ Change |
|
|||
Equity in net loss of joint ventures(A) |
$ |
(601 |
) |
|
$ |
(29 |
) |
|
$ |
(572 |
) |
Gain on sale of joint venture interests(B) |
|
19,989 |
|
|
|
— |
|
|
|
19,989 |
|
Gain on disposition of real estate, net(C) |
|
11,811 |
|
|
|
54,265 |
|
|
|
(42,454 |
) |
Tax benefit (expense) of taxable REIT subsidiary and state franchise and |
|
64 |
|
|
|
(328 |
) |
|
|
392 |
|
19
Net Income (in thousands)
|
Three Months |
|
|
|
|
||||||
|
Ended June 30, |
|
|
|
|
||||||
|
2026 |
|
|
2025 |
|
|
$ Change |
|
|||
Net (loss) income |
$ |
(1,304 |
) |
|
$ |
46,504 |
|
|
$ |
(47,808 |
) |
|
Six Months |
|
|
|
|
||||||
|
Ended June 30, |
|
|
|
|
||||||
|
2026 |
|
|
2025 |
|
|
$ Change |
|
|||
Net (loss) income |
$ |
(366 |
) |
|
$ |
49,589 |
|
|
$ |
(49,955 |
) |
The decrease in net income in the period ended June 30, 2026, as compared to the prior-year period, primarily was the result of impairment charges, a decrease in rental income as a result of property dispositions, a decrease in gains on the disposition of real estate and a decrease in condemnation revenue, partially offset by the gain on the sale of joint venture interests, an increase in interest income and decreases in interest expense and depreciation and amortization expense.
NON-GAAP FINANCIAL MEASURES
Funds from Operations and Operating Funds from Operations
Definition and Basis of Presentation
The Company believes that Funds from Operations (“FFO”) and Operating FFO, both non-GAAP financial measures, provide additional and useful means to assess the financial performance of REITs. FFO and Operating FFO are frequently used by the real estate industry, as well as securities analysts, investors and other interested parties, to evaluate the performance of REITs. The Company also believes that FFO and Operating FFO more appropriately measure the core operations of the Company.
FFO excludes GAAP historical cost depreciation and amortization of real estate and real estate investments, which assume that the value of real estate assets diminishes ratably over time. Historically, however, real estate values have risen or fallen with market conditions, and many companies use different depreciable lives and methods. Because FFO excludes depreciation and amortization unique to real estate and gains and losses from property dispositions, it can provide a performance measure that, when compared year over year, reflects the impact on operations from trends in occupancy rates, rental rates, operating costs, interest costs and acquisition, disposition and development activities. This provides a perspective of the Company’s financial performance not immediately apparent from net income determined in accordance with GAAP.
FFO is generally defined and calculated by the Company as net income (loss) (computed in accordance with GAAP), adjusted to exclude (i) gains and losses from disposition of real estate property and related investments, which are presented net of taxes, (ii) impairment charges on real estate property and related investments and (iii) certain non-cash items. These non-cash items principally include real property depreciation and amortization of intangibles and equity income (loss) from joint ventures and adding the Company’s proportionate share of FFO from its unconsolidated joint ventures, determined on a consistent basis. The Company’s calculation of FFO is consistent with the definition of FFO provided by the National Association of Real Estate Investment Trusts (“NAREIT”).
The Company believes that certain charges, income and gains recorded in its operating results are not comparable or reflective of its core operating performance. Operating FFO is useful to investors as the Company removes non-comparable charges, income and gains to analyze the results of its operations and assess performance of the core operating real estate portfolio. As a result, the Company also computes Operating FFO and discusses it with the users of its financial statements, in addition to other measures such as net income (loss) determined in accordance with GAAP and FFO. Operating FFO is generally defined and calculated by the Company as FFO excluding certain charges, income and gains/losses that management believes are not comparable and indicative of the results of the Company’s operating real estate portfolio. Such adjustments include condemnation revenue, gains/losses on the early extinguishment of debt, certain transaction fee income, transaction costs and other restructuring type costs, including employee separation costs. The disclosure of these adjustments is regularly requested by users of the Company’s financial statements.
The adjustment for these charges, income and gains may not be comparable to how other REITs or real estate companies calculate their results of operations, and the Company’s calculation of Operating FFO differs from NAREIT’s definition of FFO. Additionally, the Company provides no assurances that these charges, income and gains are non-recurring. These charges, income and gains could be reasonably expected to recur in future results of operations.
20
These measures of performance are used by the Company for several business purposes and by other REITs. The Company uses FFO and/or Operating FFO in part as a disclosure to improve the understanding of the Company’s operating results among the investing public and as a measure of a real estate asset company’s performance.
For the reasons described above, management believes that FFO and Operating FFO provide the Company and investors with an important indicator of the Company’s operating performance. They provide recognized measures of performance other than GAAP net income, which may include non-cash items (often significant). Other real estate companies may calculate FFO and Operating FFO in a different manner.
Management recognizes the limitations of FFO and Operating FFO when compared to GAAP’s net income. FFO and Operating FFO do not represent amounts available for dividends, capital replacement or expansion or other commitments and uncertainties. Management does not use FFO or Operating FFO as an indicator of the Company’s cash obligations and funding requirements for future commitments or development activities. Neither FFO nor Operating FFO represents cash generated from operating activities in accordance with GAAP, and neither is necessarily indicative of cash available to fund cash needs. Neither FFO nor Operating FFO should be considered an alternative to net income (computed in accordance with GAAP) or as an alternative to cash flow as a measure of liquidity. FFO and Operating FFO are simply used as additional indicators of the Company’s operating performance. The Company believes that to further understand its performance, FFO and Operating FFO should be compared with the Company’s reported net income and considered in addition to cash flows determined in accordance with GAAP, as presented in its consolidated financial statements. Reconciliations of these measures to their most directly comparable GAAP measure of net income have been provided below.
Reconciliation Presentation
FFO and Operating FFO were as follows (in thousands):
|
Three Months |
|
|
|
|
||||||
|
Ended June 30, |
|
|
|
|
||||||
|
2026 |
|
|
2025 |
|
|
$ Change |
|
|||
FFO |
$ |
(4,551 |
) |
|
$ |
6,935 |
|
|
$ |
(11,486 |
) |
Operating FFO |
|
(4,569 |
) |
|
|
8,347 |
|
|
|
(12,916 |
) |
|
Six Months |
|
|
|
|
||||||
|
Ended June 30, |
|
|
|
|
||||||
|
2026 |
|
|
2025 |
|
|
$ Change |
|
|||
FFO |
$ |
(5,727 |
) |
|
$ |
22,959 |
|
|
$ |
(28,686 |
) |
Operating FFO |
|
(6,453 |
) |
|
|
16,629 |
|
|
|
(23,082 |
) |
The decrease in FFO for the period ended June 30, 2026, as compared to the prior-year period, was primarily attributable to the net impact of property dispositions and condemnation revenue recorded in the prior-year period, partially offset by an increase in interest income and a decrease in interest expense. The decrease in Operating FFO generally was due to the net impact of property dispositions partially offset by decreased interest expense and an increase in interest income.
21
The Company’s reconciliation of net income computed in accordance with GAAP to FFO and Operating FFO is as follows (in thousands). The Company provides no assurances that these charges and gains are non-recurring. These charges and gains could reasonably be expected to recur in future results of operations.
|
|
Three Months |
|
|
Six Months |
|
||||||||||
|
|
Ended June 30, |
|
|
Ended June 30, |
|
||||||||||
|
|
2026 |
|
|
2025 |
|
|
2026 |
|
|
2025 |
|
||||
Net (loss) income |
|
$ |
(1,304 |
) |
|
$ |
46,504 |
|
|
$ |
(366 |
) |
|
$ |
49,589 |
|
Depreciation and amortization of real estate investments |
|
|
2,387 |
|
|
|
12,054 |
|
|
|
5,720 |
|
|
|
24,468 |
|
Equity in net loss of joint ventures |
|
|
449 |
|
|
|
68 |
|
|
|
601 |
|
|
|
29 |
|
Joint ventures’ FFO(A) |
|
|
721 |
|
|
|
1,545 |
|
|
|
1,668 |
|
|
|
3,138 |
|
Impairment of real estate |
|
|
1,000 |
|
|
|
— |
|
|
|
18,450 |
|
|
|
— |
|
Gain on sale of joint venture interests |
|
|
— |
|
|
|
— |
|
|
|
(19,989 |
) |
|
|
— |
|
Gain on disposition of real estate, net |
|
|
(7,804 |
) |
|
|
(53,236 |
) |
|
|
(11,811 |
) |
|
|
(54,265 |
) |
FFO attributable to common shareholders |
|
|
(4,551 |
) |
|
|
6,935 |
|
|
|
(5,727 |
) |
|
|
22,959 |
|
Transaction and other |
|
|
(18 |
) |
|
|
1,252 |
|
|
|
(821 |
) |
|
|
1,374 |
|
Condemnation revenue |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(8,379 |
) |
Separation and other charges |
|
|
— |
|
|
|
160 |
|
|
|
95 |
|
|
|
675 |
|
Non-operating items, net |
|
|
(18 |
) |
|
|
1,412 |
|
|
|
(726 |
) |
|
|
(6,330 |
) |
Operating FFO |
|
$ |
(4,569 |
) |
|
$ |
8,347 |
|
|
$ |
(6,453 |
) |
|
$ |
16,629 |
|
Joint ventures’ FFO and Operating FFO are summarized as follows (in thousands):
|
Three Months |
|
|
Six Months |
|
||||||||||
|
Ended June 30, |
|
|
Ended June 30, |
|
||||||||||
|
2026 |
|
|
2025 |
|
|
2026 |
|
|
2025 |
|
||||
Net (loss) income attributable to unconsolidated joint ventures |
$ |
(2,165 |
) |
|
$ |
(84 |
) |
|
$ |
(2,806 |
) |
|
$ |
215 |
|
Depreciation and amortization of real estate investments |
|
5,769 |
|
|
|
6,340 |
|
|
|
10,914 |
|
|
|
12,384 |
|
Gain on disposition of real estate, net |
|
— |
|
|
|
(5 |
) |
|
|
— |
|
|
|
(1 |
) |
FFO |
$ |
3,604 |
|
|
$ |
6,251 |
|
|
$ |
8,108 |
|
|
$ |
12,598 |
|
FFO at SITE Centers’ ownership interests |
$ |
721 |
|
|
$ |
1,545 |
|
|
$ |
1,668 |
|
|
$ |
3,138 |
|
Operating FFO at SITE Centers’ ownership interests |
$ |
721 |
|
|
$ |
1,545 |
|
|
$ |
1,668 |
|
|
$ |
3,138 |
|
LIQUIDITY, CAPITAL RESOURCES AND FINANCING ACTIVITIES
The Company requires capital to fund its operating expenses, redevelopment activities and capital expenditures. The Company’s primary capital sources include cash on hand, cash flow from operations and proceeds from ongoing asset sales. The Company does not maintain a revolving credit facility and therefore plans to closely monitor and conservatively manage its liquidity and cash position as it pursues the sale of its remaining properties and monetization of its investment in the DTP joint venture and returns capital to shareholders. The Company expects to maintain sufficient cash reserves with proceeds from asset sales in order to satisfy any discharge expenses projected to be incurred, and to pay any unknown or contingency claims or obligations which might arise, during the subsequent wind-up of its operations. The Company also expects to maintain an elevated cash balance pending resolution of the DTP joint venture in order to maximize the Company’s alternatives for monetizing its joint venture investment, including through the possible purchase of its partner’s interest through the joint venture’s buy-sell provision.
At June 30, 2026, the Company had an unrestricted cash balance of $238.9 million. As of June 30, 2026, the Company anticipates that it has approximately $8.5 million to be incurred to complete redevelopment projects at properties owned by Curbline pursuant to the terms of the Separation and Distribution Agreement. The Company also paid a special cash dividend of $1.00 per share ($52.7 million in the aggregate) to common shareholders on July 31, 2026.
The Company had no consolidated indebtedness outstanding at June 30, 2026. As of June 30, 2026, the Company’s unconsolidated joint venture had $380.6 million of indebtedness ($76.1 million at SITE Centers’ share).
The Company believes it has sufficient liquidity to operate its business at this time.
22
Unconsolidated Joint Venture’s Mortgage Indebtedness – As of June 30, 2026
No assurance can be provided that outstanding indebtedness of the Company’s remaining joint venture will be refinanced or repaid as currently anticipated. Any future deterioration in property-level revenues may cause the joint venture to be unable to refinance maturing obligations or satisfy applicable covenants, financial tests or debt service requirements or loan maturity extension conditions in the future, thereby allowing the mortgage lender to assume control of property cash flows, limit distributions of cash to joint venture members, declare a default, increase the interest rate or accelerate the loan’s maturity. In addition, rising interest rates or challenged transaction markets may adversely impact the ability of the Company’s remaining joint venture to sell assets at attractive prices in order to repay indebtedness.
Cash Flow Activity
The Company’s cash flow activities are summarized as follows (in thousands):
|
Six Months |
|
|||||
|
Ended June 30, |
|
|||||
|
2026 |
|
|
2025 |
|
||
Cash flow (used for) provided by operating activities |
$ |
(14,455 |
) |
|
$ |
22,933 |
|
Cash flow provided by investing activities |
|
133,016 |
|
|
|
86,838 |
|
Cash flow used for financing activities |
|
(35 |
) |
|
|
(14,915 |
) |
Changes in cash flow for the period ended June 30, 2026, compared to the prior comparable period are as follows:
Operating Activities: Cash provided by operating activities decreased by $37.4 million primarily due to lower net operating income as a result of disposition activity partially offset by an increase in interest income and a decrease in interest expense.
Investing Activities: Cash from investing activities increased by $46.2 million primarily due to increased proceeds from disposition of real estate of $24.9 million and increased proceeds from the disposition of unconsolidated joint venture interests of $20.7 million.
Financing Activities: Cash used for financing activities decreased by $14.9 million primarily due to scheduled principal payments made on the Company’s mortgage debt and required payments due to sales on the Company’s mortgage facility during the period ended June 30, 2025.
Dividend Distribution
The Company declared a special cash dividend of $52.7 million on the Company’s common shares during the six months ended June 30, 2026. The Company declared special cash dividends of $79.1 million on the Company’s common shares during the six months ended June 30, 2025.
The decision to declare and pay future dividends on the Company’s common shares, as well as the timing, amount and composition of any such future dividends, will be at the discretion of the Company’s Board of Directors. The Company does not currently expect to make regular quarterly dividend payments in the future. The Company expects that the frequency and timing of future dividends will be influenced by operations, sales of its remaining assets and the resolution of the DTP joint venture, though the Company plans to closely monitor and conservatively manage its cash position in order to maintain sufficient cash reserves to satisfy and discharge expenses projected to be incurred, and any unknown or contingency claims or obligations which might arise, during the subsequent wind-up of its operations. The Company also expects to maintain an elevated cash balance pending resolution of the DTP joint venture in order to maximize the Company’s alternatives for monetizing its joint venture investment, including through the possible purchase of its partner’s interests through the joint venture’s buy-sell provision.
The Company currently operates in a manner that allows it to qualify as a REIT and generally not be subject to U.S. federal income tax. U.S. federal income tax law generally requires that a REIT distribute annually to holders of its capital stock at least 90% of its REIT taxable income, without regard to the deduction for dividends paid and excluding net capital gains, and that it pay tax at regular corporate rates to the extent that it annually distributes less than 100% of its REIT taxable income. The Company may elect to surrender its REIT status in connection with the sale of its remaining assets and the anticipated wind-up of its operations in the event the Company determines that the anticipated benefits to the Company and its shareholders of maintaining REIT qualification do not exceed the related compliance costs or if the nature of the Company’s remaining operations makes compliance with REIT requirements impracticable.
23
SITE Centers’ Equity
In 2022, the Company’s Board of Directors authorized a common share repurchase program. Under the terms of the program, the Company is authorized to repurchase up to a maximum value of $100 million of its common shares. As of June 30, 2026, the Company had repurchased an aggregate of 0.5 million of its common shares under this program at an aggregate cost of $26.6 million.
SOURCES AND USES OF CAPITAL
The Company remains committed to maintaining sufficient liquidity in order to fund its operating expenses, capital expenditures and expenses and liabilities to be incurred during the wind-up of its operations. The Company’s primary capital sources include cash on hand, cash flow from operations and proceeds from sales of its remaining wholly-owned properties and monetization of its investment in the DTP joint venture. The Company does not maintain a revolving credit facility and therefore plans to closely monitor and conservatively manage its cash position and expects to maintain an elevated cash balance pending resolution of the DTP joint venture in order to maximize the Company’s alternatives for monetizing its joint venture investment, including through the possible purchase of its partner’s interests through the joint venture’s buy-sell provision.
Future Sales of Wholly-Owned Properties
The Company continues to pursue the sale of its remaining wholly-owned properties, though no assurances can be given that such efforts will result in additional asset sales. The timing of asset sales may be impacted by general economic conditions, local conditions in the markets in which the Company’s remaining properties are situated and other property-specific considerations.
DTP Joint Venture
The Company owns a 20% interest in, and acts as the general partner of, the DTP joint venture, a joint venture with certain Chinese institutional investors which owns ten shopping centers located in the United States aggregating approximately 3.4 million square feet of GLA. As of June 30, 2026, the joint venture’s properties were encumbered by a mortgage loan in the aggregate principal amount of approximately $380.6 million which matures on January 11, 2029. The terms of the joint venture agreement contain restrictions on when and how the Company can monetize the value of its interests in the joint venture and generally requires the partner’s consent in order for the Company to sell its interest in the joint venture or the underlying properties owned by the joint venture. The Company is in discussions with its joint venture partner and continues to maintain an elevated cash balance in order to maximize the Company’s alternatives for monetizing its joint venture investment. On June 29, 2026, the Company delivered a buy-sell notice to its partner under the joint venture agreement. Pursuant to the terms of the joint venture agreement, unless an alternative consensual resolution is agreed between the Company and its partner, the partner is required to inform the Company by August 31, 2026 of its decision to either purchase the Company’s 20% interest in the joint venture for a price of approximately $32.4 million or sell its 80% interest in the joint venture to the Company for a price of approximately $129.6 million. Pursuant to the terms of the joint venture agreement, closing of the transaction should occur no later than October 15, 2026. No assurances can be given that the partner will comply with the terms of the joint venture agreement or perform its obligations under the joint venture agreement with respect to the buy-sell notice. With its partner’s consent, the Company may continue to explore the sale of its interests in the joint venture to third parties as an alternative to completing the buy-sell transaction.
2026 Transactions Activity
Dispositions
From January 1, 2026 through July 31, 2026, the Company sold the following wholly-owned shopping centers and a land parcel (in thousands):
Date Sold |
|
Property Name |
|
City, State |
|
Total Owned GLA |
|
|
Gross |
|
||
February 2026 |
|
FlatAcres MarketCenter |
|
Parker, Colorado |
|
|
136 |
|
|
$ |
24,400 |
|
March 2026 |
|
3030 North Broadway |
|
Chicago, Illinois |
|
|
132 |
|
|
|
50,100 |
|
May 2026 |
|
Meadowmont Crossing |
|
Chapel Hill, North Carolina |
|
|
92 |
|
|
|
11,050 |
|
June 2026 |
|
The Pike Outlets |
|
Long Beach, California |
|
|
389 |
|
|
|
50,000 |
|
July 2026 |
|
Undeveloped land parcel |
|
Freehold, New Jersey |
|
|
— |
|
|
|
450 |
|
July 2026 |
|
Meadowmont Market |
|
Chapel Hill, North Carolina |
|
|
49 |
|
|
|
11,000 |
|
|
|
|
|
|
|
|
798 |
|
|
$ |
147,000 |
|
24
Redevelopment Projects
At June 30, 2026, the estimated cost to complete redevelopment projects at properties owned by Curbline pursuant to the terms of the Separation and Distribution Agreement was approximately $8.5 million.
CAPITALIZATION
At June 30, 2026, the Company’s capitalization consisted of $208.3 million of market equity (calculated as the number of common shares outstanding multiplied by $3.97, the closing price of the Company’s common shares on the New York Stock Exchange (the “NYSE”) at June 30, 2026).
The Company expects that the NYSE will commence the de-listing of the Company’s common shares from the exchange if (i) the average closing price of the Company’s common shares were to fall below $1.00 per share over a 30-consecutive-day trading period, (ii) the Company’s average market capitalization were to fall below $15 million over a 30‑consecutive-day trading period or (iii) the Company were to lose or terminate its REIT qualification (unless the Company then qualifies for an original listing as a corporation). The NYSE also has certain discretionary authority to de-list the Company’s common shares on an involuntary basis. The Company expects to voluntarily de-list its common shares from the NYSE as future distributions cause its stock price to approach levels that would trigger involuntary de-listing. If the Company’s common shares are de-listed, shareholders may have difficulty trading their common shares on the secondary market. De-listing would also eliminate the requirement that the Company’s Board of Directors be composed of a majority of independent directors.
The Company no longer maintains a revolving line of credit or an investment grade rating. The Company may not be able to obtain financing on favorable terms, or at all, and therefore conservatively manages its cash balances and proceeds from asset sales in order to maintain the capital needed to fund its operations.
CONTRACTUAL OBLIGATIONS AND OTHER COMMITMENTS
The Separation and Distribution Agreement contains obligations to complete certain redevelopment projects at properties that are owned by Curbline. As of June 30, 2026, such redevelopment projects were estimated to cost $8.5 million to complete.
ECONOMIC CONDITIONS
The Company continues to pursue the sale of its remaining wholly-owned properties and the monetization of its investment in the DTP joint venture. Accordingly, the economic conditions most relevant to the Company are those affecting the commercial real estate transaction market, including purchaser demand, the availability and cost of acquisition financing, capitalization rates and other valuation metrics and local property-level conditions at the Company’s remaining assets.
Changes in interest rates, broader economic conditions, capital markets volatility and other factors may affect the timing of asset sales, the prices realized and the Company’s ability to complete its wind-up strategy. Tenant demand, tenant credit conditions and leasing activity remain relevant principally to the extent they affect property-level cash flows and the valuation of the Company’s remaining properties pending disposition.
FORWARD-LOOKING STATEMENTS
MD&A should be read in conjunction with the Company’s consolidated financial statements and the notes thereto appearing elsewhere in this report. Historical results and percentage relationships set forth in the Company’s consolidated financial statements, including trends that might appear, should not be taken as indicative of future operations. The Company considers portions of this information to be “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Exchange Act, both as amended, with respect to the Company’s expectations for future periods. Forward-looking statements include, without limitation, statements relating to future capital expenditures, financing sources, dispositions, the resolution of joint ventures, distributions to shareholders, and the Company’s wind-up strategy and costs and expenses relating thereto. Although the Company believes that the expectations reflected in these forward-looking statements are based upon reasonable assumptions, it can give no assurance that its expectations will be achieved. For this purpose, any statements contained herein that are not statements of historical fact should be deemed to be forward-looking statements. Without limiting the foregoing, the words “will,” “believes,” “anticipates,” “plans,” “expects,” “seeks,” “estimates” and similar expressions are intended to identify forward-looking statements. Readers should exercise caution in interpreting and relying on forward-looking statements because such statements involve known and unknown risks, uncertainties and other factors that are, in some cases, beyond the Company’s control and that could cause actual results to differ materially from those expressed or implied in the forward-looking statements and that could materially affect the Company’s actual results, performance or achievements. For additional factors that could cause the results of the Company to differ materially from those indicated in the forward-looking statements, see Item 1A. Risk Factors in the Company’s Annual Report on Form 10-K for the year ended December 31, 2025.
25
Factors that could cause actual results, performance or achievements to differ materially from those expressed or implied by forward-looking statements include, but are not limited to, the following:
26
Item 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
The Company’s primary market risk exposure is interest rate risk through its unconsolidated joint ventures. At June 30, 2026 and December 31, 2025, the Company had no outstanding consolidated debt. The Company’s unconsolidated joint ventures’ indebtedness at its carrying value is summarized as follows:
|
June 30, 2026 |
|
|
December 31, 2025 |
|
||||||||||||||||||||||||||
|
Joint |
|
|
Company's |
|
|
Weighted- |
|
|
Weighted- |
|
|
Joint |
|
|
Company's |
|
|
Weighted- |
|
|
Weighted- |
|
||||||||
Fixed-Rate Debt |
$ |
371.1 |
|
|
$ |
74.2 |
|
|
|
2.5 |
|
|
|
6.4 |
% |
|
$ |
369.3 |
|
|
$ |
73.9 |
|
|
|
3.0 |
|
|
|
6.4 |
% |
Variable-Rate Debt |
$ |
— |
|
|
$ |
— |
|
|
|
— |
|
|
|
— |
|
|
$ |
59.9 |
|
|
$ |
29.8 |
|
|
|
0.9 |
|
|
|
5.0 |
% |
An estimate of the effect of a 100 basis-point increase at June 30, 2026 and December 31, 2025, is summarized as follows (in millions):
|
June 30, 2026 |
|
|
|
December 31, 2025 |
|
|
||||||||||||||||||
|
Carrying |
|
|
Fair |
|
|
100 Basis-Point |
|
|
|
Carrying |
|
|
Fair |
|
|
100 Basis-Point |
|
|
||||||
Company’s proportionate share |
$ |
74.2 |
|
|
$ |
74.7 |
|
|
$ |
73.0 |
|
|
|
$ |
73.9 |
|
|
$ |
75.7 |
|
|
$ |
73.7 |
|
|
The Company has not entered, and does not plan to enter, into any derivative financial instruments for trading or speculative purposes. As of June 30, 2026, the Company had no other material exposure to market risk.
27
Item 4. CONTROLS AND PROCEDURES
The Company’s management, with the participation of the Chief Executive Officer (“CEO”) and Chief Financial Officer (“CFO”), conducted an evaluation, pursuant to Exchange Act Rules 13a-15(b) and 15d-15(b), of the effectiveness of our disclosure controls and procedures. Based on their evaluation as required, the CEO and CFO have concluded that the Company’s disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) were effective as of the end of the period covered by this Quarterly Report on Form 10-Q to ensure that information required to be disclosed by the Company in reports that it files or submits under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in Securities and Exchange Commission rules and forms and were effective as of the end of such period to ensure that information required to be disclosed by the Company in reports that it files or submits under the Exchange Act is accumulated and communicated to the Company’s management, including its CEO and CFO, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure.
During the three months ended June 30, 2026, there were no changes in the Company’s internal control over financial reporting that materially affected or are reasonably likely to materially affect the Company’s internal control over financial reporting.
28
PART II
OTHER INFORMATION
Item 1. LEGAL PROCEEDINGS
The Company and its subsidiaries are subject to various legal proceedings, which, taken together, are not expected to have a material adverse effect on the Company. The Company is also subject to a variety of legal actions for personal injury or property damage arising in the ordinary course of its business, most of which are covered by insurance. While the resolution of all matters cannot be predicted with certainty, management believes that the final outcome of such legal proceedings and claims will not have a material adverse effect on the Company’s liquidity, financial position or results of operations.
Item 1A. RISK FACTORS
None.
Item 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS
ISSUER PURCHASES OF EQUITY SECURITIES
|
(a) |
|
|
(b) |
|
|
(c) |
|
|
(d) |
|
||||
|
Total |
|
|
Average |
|
|
Total Number |
|
|
Maximum Number |
|
||||
April 1–30, 2026 |
|
— |
|
|
$ |
— |
|
|
|
— |
|
|
$ |
— |
|
May 1–31, 2026 |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
June 1–30, 2026 |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
Total |
|
— |
|
|
$ |
— |
|
|
|
— |
|
|
$ |
73.4 |
|
On December 20, 2022, the Company announced that its Board of Directors authorized a common share repurchase program. Under the terms of the program, the Company is authorized to repurchase up to a maximum value of $100 million of its common shares. As of June 30, 2026, the Company had repurchased 0.5 million of its common shares under this program in open market purchases in the aggregate at a cost of $26.6 million.
Item 3. DEFAULTS UPON SENIOR SECURITIES
None.
Item 4. MINE SAFETY DISCLOSURES
Not applicable.
Item 5. OTHER INFORMATION
29
Item 6. EXHIBITS
3.1 |
|
Amended and Restated Code of Regulations of the Company1 |
|
|
|
10.1 |
|
Purchase Agreement, dated as of May 1, 2026, by and among DDR Urban LP, as Seller, and Pike Long Beach Owner, LLC, as Buyer1 |
|
|
|
10.2 |
|
First Amendment to Purchase Agreement, dated May 11, 2026, by and between DDR Urban LP, as Seller, and Pike Long Beach Owner LLC, as Buyer1 |
|
|
|
10.3 |
|
Second Amendment to Purchase Agreement, dated May 14, 2026, by and between DDR Urban LP, as Seller, and Pike Long Beach Owner LLC, as Buyer1 |
|
|
|
31.1 |
|
Certification of principal executive officer pursuant to Rule 13a-14(a) of the Securities Exchange Act of 19341 |
|
|
|
31.2 |
|
Certification of principal financial officer pursuant to Rule 13a-14(a) of the Securities Exchange Act of 19341 |
|
|
|
32.1 |
|
Certification of chief executive officer pursuant to Rule 13a-14(b) of the Securities Exchange Act of 1934 and 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of this report pursuant to the Sarbanes-Oxley Act of 20021,2 |
|
|
|
32.2 |
|
Certification of chief financial officer pursuant to Rule 13a-14(b) of the Securities Exchange Act of 1934 and 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of this report pursuant to the Sarbanes-Oxley Act of 20021,2 |
|
|
|
101.INS |
|
Inline XBRL Instance Document – the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document1 |
|
|
|
101.SCH |
|
Inline XBRL Taxonomy Extension Schema with Embedded Linkbase Document1 |
|
|
|
104 |
|
The cover page from the Company’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2026 has been formatted in Inline XBRL and included in Exhibit 101. |
Attached as Exhibit 101 to this report are the following formatted in iXBRL (Inline Extensible Business Reporting Language): (i) Consolidated Balance Sheets as of June 30, 2026 and December 31, 2025, (ii) Consolidated Statements of Operations and Comprehensive (Loss) Income for the Three and Six Months Ended June 30, 2026 and 2025, (iii) Consolidated Statements of Equity for the Three and Six Months Ended June 30, 2026 and 2025, (iv) Consolidated Statements of Cash Flows for the Six Months Ended June 30, 2026 and 2025 and (v) Notes to Consolidated Financial Statements.
30
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.
|
|
SITE CENTERS CORP. |
||||
|
|
|
|
|||
|
|
By: |
|
/s/ Jeffrey A. Scott |
||
|
|
|
|
Name: |
|
Jeffrey A. Scott |
|
|
|
|
Title: |
|
Senior Vice President and Chief Accounting Officer (Principal Accounting Officer) |
Date: August 3, 2026 |
|
|
|
|
|
|
31