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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

 

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

November 2, 2023

Date of Report (Date of earliest event reported)

 

REGENCY CENTERS CORPORATION

REGENCY CENTERS, L.P.

(Exact name of registrant as specified in its charter)

 

Florida (Regency Centers Corporation) Delaware (Regency Centers, L. P.)		001-12298 (Regency Centers Corporation) 0-24763 (Regency Centers, L.P.)		59-3191743 (Regency Centers Corporation) 59-3429602 (Regency Centers, L.P.)
(State or other jurisdiction of incorporation)		(Commission File Number)		(IRS Employer Identification No.)

 

One Independent Drive, Suite 114

Jacksonville, Florida 32202

(Address of principal executive offices) (Zip Code)

(904) 598-7000

(Registrant's telephone number, including area code)

Not Applicable

(Former name or former address, if changed since last report)

Securities registered pursuant to Section 12(b) of the Act:

Regency Centers Corporation

Title of each class		Trading Symbol		Name of each exchange on which registered
Common Stock, $.01 par value		REG		The Nasdaq Stock Market LLC
6.25% Series A Cumulative Redeemable Preferred Stock, par value $0.01 per share		REGCP		The Nasdaq Stock Market LLC
5.875% Series B Cumulative Redeemable Preferred Stock, par value $0.01 per share		REGCO		The Nasdaq Stock Market LLC

 

Regency Centers, L.P.

 

Title of each class		Trading Symbol		Name of each exchange on which registered
None		N/A		N/A

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

 

☐		Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230 .425)
☐		Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
☐		Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
☐		Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. 

 

 

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Item 2.02	Disclosure of Results of Operations and Financial Condition

 

On November 2, 2023, Regency Centers Corporation ("Regency") issued an earnings release for the three and nine months ended September 30, 2023, which is attached as Exhibit 99.1.

On November 2, 2023, Regency posted on its website, at investors.regencycenters.com, certain supplemental information for the three and nine months ended September 30, 2023, which are attached as Exhibit 99.2 and Exhibit 99.3, respectively.

The information furnished under this Item 2.02, including Exhibit 99.1, Exhibit 99.2, and Exhibit 99.3, shall not be deemed "filed" for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), or otherwise subject to the liabilities of that section and shall not be deemed to be incorporated by reference into any filing under the Securities Act of 1933, as amended (the "Securities Act"), or the Exchange Act.

 

Item 7.01	Regulation FD Disclosures

 

On November 2, 2023, Regency posted on its website, at investors.regencycenters.com, the Regency Centers Q3 2023 Earnings Presentation.

The information furnished under this item 7.01 shall not be deemed "filed" for purposes of Section 18 of the Exchange Act or otherwise subject to the liabilities of that section and shall not be deemed to be incorporated by reference into any filing under the Securities Act, or the Exchange Act.

 

Item 9.01	Financial Statements and Exhibits

 

(d) Exhibits

 

Exhibit 99.1	Earnings release issued by Regency on November 2, 2023, for the three and nine months ended September 30, 2023.
Exhibit 99.2	Supplemental information posted on its website on November 2, 2023, for the three and nine months ended September 30, 2023.
Exhibit 99.3	Fixed income supplemental information posted on its website on November 2, 2023, for the three and nine months ended September 30, 2023.
104	Cover Page Interactive Data File (the cover page XBRL tags are embedded within the inline XBRL documents)

 

 

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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 hereunto duly authorized.

 

		REGENCY CENTERS CORPORATION
November 2, 2023		By:		/s/ Terah L. Devereaux
				Terah L. Devereaux, Senior Vice President, Chief Accounting Officer (Principal Accounting Officer)
		REGENCY CENTERS, L.P.
		By: Regency Centers Corporation, its general partner
November 2, 2023		By:		/s/ Terah L. Devereaux
				Terah L. Devereaux, Senior Vice President, Chief Accounting Officer (Principal Accounting Officer)

 

 

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Exhibit 99.1

 

		NEWS RELEASE For immediate release   Christy McElroy 904 598 7616 ChristyMcElroy@regencycenters.com

 

Regency Centers Reports Third Quarter 2023 Results

JACKSONVILLE, Fla. (November 2, 2023) – Regency Centers Corporation (“Regency” or the “Company”) (Nasdaq: REG) today reported financial and operating results for the period ended September 30, 2023 and provided updated 2023 earnings guidance. For the three months ended September 30, 2023 and 2022, Net Income was $0.50 per diluted share and $0.51 per diluted share, respectively.

Third Quarter 2023 Highlights

Subsequent Highlights

“Our strong results in the third quarter were supported by continued positive momentum in our business, including robust tenant demand and further progress building our value creation pipeline,” said Lisa Palmer, President and Chief Executive Officer. “Our integration with Urstadt Biddle is progressing successfully, we acquired two additional shopping centers, and we raised our dividend once again. With a high-quality portfolio of grocery-anchored centers in top trade areas, a sector-leading balance sheet and an exceptional team, Regency remains well positioned in today’s environment.”

 

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Exhibit 99.1

Financial Results

Net Income

Nareit FFO

Core Operating Earnings

Portfolio Performance

Same Property NOI

Occupancy

Leasing Activity

 

 

 

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Exhibit 99.1

Capital Allocation and Balance Sheet

Developments and Redevelopments

Property Transactions

Urstadt Biddle Merger

Balance Sheet

Common and Preferred Dividends

 

 

 

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Exhibit 99.1

2023 Guidance

Regency Centers has updated its 2023 guidance, as summarized in the table below. Please refer to the Company’s third quarter 2023 ‘Earnings Presentation’ and ‘Quarterly Supplemental’ for additional detail. All materials are posted on the Company’s website at investors.regencycenters.com.

 

Full Year 2023 Guidance (in thousands, except per share data)	3Q YTD	Current Guidance	Previous Guidance
Net Income Attributable to Common Shareholders per diluted share	$1.56	$2.02-$2.04	$2.05-$2.09
Nareit Funds From Operations ("Nareit FFO") per diluted share	$3.13	$4.13-$4.15	$4.11-$4.15
Core Operating Earnings per diluted share (1)	$2.96	$3.93-$3.95	$3.89-$3.93
Same property NOI growth without termination fees	2.0%	+/- 1.5%	+1.0% to +1.5%
Same property NOI growth without termination fees or collection of 2020/2021 reserves	4.3%	+/- 3.5%	+3.0% to +3.5%
Collection of 2020/2021 reserves (2)	$3,736	+/-$4,000	+/-$4,000
Certain non-cash items (3)	$31,226	+/-$39,500	+/-$37,500
G&A expense, net (4)	$69,370	+/-$91,000	$88,000-$91,000
Interest expense, net	$127,636	+/-$178,000	+/-$168,000
Recurring third party fees & commissions	$19,582	+/-$26,000	+/-$25,000
Development and Redevelopment spend	$115,719	+/-$130,000	+/-$130,000
Acquisitions	$5,502	$30,830	$0
Cap rate (weighted average)	7.4%	5.6%	0%
Dispositions	$0	+/-$10,000	+/-$65,000
Cap rate (weighted average)	0.0%	+/- 7.0%	+/- 7.0%
Unit issuance (gross)	$20,000	$20,000	$20,000
Share Repurchase settlement (gross)	$20,000	$20,000	$20,000
Merger transition costs	$1,511	+/-$5,000	$0

Note: With the exception of per share data, figures above represent 100% of Regency's consolidated entities and its pro-rata share of unconsolidated co-investment partnerships.

 

 

 

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Exhibit 99.1

Conference Call Information

To discuss Regency’s third quarter results and provide further business updates, management will host a conference call on Friday, November 3rd, at 11:00 a.m. ET. Dial-in and webcast information is below.

Third Quarter 2023 Earnings Conference Call

 

Date:	Friday, November 3, 2023
Time:	11:00 a.m. ET
Dial#:	877-407-0789 or 201-689-8562
Webcast:	3rd Quarter 2023 Webcast Link

Replay: Webcast Archive: Investor Relations page under Events & Webcasts

About Regency Centers Corporation (Nasdaq: REG)

Regency Centers is a preeminent national owner, operator, and developer of shopping centers located in suburban trade areas with compelling demographics. Our portfolio includes thriving properties merchandised with highly productive grocers, restaurants, service providers, and best-in-class retailers that connect to their neighborhoods, communities, and customers. Operating as a fully integrated real estate company, Regency Centers is a qualified real estate investment trust (REIT) that is self-administered, self-managed, and an S&P 500 Index member. For more information, please visit RegencyCenters.com.

Reconciliation of Net Income Attributable to Common Shareholders to Nareit FFO and Core Operating Earnings – Actual (in thousands, except per share amounts)

 

For the Periods Ended September 30, 2023 and 2022		Three Months Ended								Year to Date
		2023				2022				2023				2022
Reconciliation of Net Income to Nareit FFO:
Net Income Attributable to Common Shareholders		$	89,076				87,578			$	273,139				387,602
Adjustments to reconcile to Nareit Funds From Operations (1):
Depreciation and amortization (excluding FF&E)			94,011				86,405				272,551				256,273
Gain on sale of real estate			(827	)			(202	)			(1,132	)			(119,301	)
Exchangeable operating partnership units			520				379				1,490				1,694
Nareit Funds From Operations		$	182,780				174,160			$	546,048				526,268
Nareit FFO per share (diluted)		$	1.02				1.01			$	3.13				3.05
Weighted average shares (diluted)			179,311				172,267				174,621				172,620
Reconciliation of Nareit FFO to Core Operating Earnings:
Nareit Funds From Operations		$	182,780				174,160			$	546,048				526,268
Adjustments to reconcile to Core Operating Earnings (1):
Not Comparable Items
Merger transition costs			1,511				-				1,511				-
Early extinguishment of debt			-				-				-				176
Certain Non-Cash Items
Straight-line rent			(3,142	)			(3,140	)			(7,315	)			(9,152	)
Uncollectible straight-line rent			92				(4,156	)			(2,298	)			(9,610	)
Above/below market rent amortization, net			(7,919	)			(5,191	)			(22,138	)			(15,906	)
Debt and derivative mark-to-market amortization			667				(28	)			667				(185	)
Core Operating Earnings		$	173,989				161,645				516,475				491,591
Core Operating Earnings per share (diluted)		$	0.97				0.94			$	2.96				2.85
Weighted average shares (diluted)			179,311				172,267				174,621				172,620
Weighted Average Shares For Diluted Earnings per Share			178,231				171,525				173,711				171,870
Weighted Average Shares For Diluted FFO and Core Operating Earnings per Share			179,311				172,267				174,621				172,620

 

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Exhibit 99.1

 

 

 

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Exhibit 99.1

Same Property NOI is a key non-GAAP measure used by management in evaluating the operating performance of Regency’s properties. The Company provides a reconciliation of Net Income Attributable to Common Shareholders to pro-rata Same Property NOI.

 

Reconciliation of Net Income Attributable to Common Shareholders to Pro-Rata Same Property NOI - Actual (in thousands)

 

For the Periods Ended September 30, 2023 and 2022		Three Months Ended								Year to Date
		2023				2022				2023				2022
Net income attributable to common shareholders		$	89,076				87,578			$	273,139				387,602
Less:
Management, transaction, and other fees			(7,079	)			(5,767	)			(20,223	)			(18,950	)
Other(1)			(12,016	)			(13,564	)			(34,317	)			(38,295	)
Plus:
Depreciation and amortization			87,505				80,270				253,373				237,462
General and administrative			20,903				20,273				71,248				56,710
Other operating expense			3,533				949				4,718				3,739
Other expense			39,643				37,356				109,192				12,516
Equity in income of investments in real estate excluded from NOI (2)			11,668				11,754				35,266				23,767
Net income attributable to noncontrolling interests			1,453				1,269				4,050				4,048
Preferred stock dividends			1,644				-				-				-
NOI			236,330				220,118				698,090				668,599
Less non-same property NOI (3)			(11,570	)			(122	)			(15,055	)			(1,711	)
Same Property NOI		$	224,760				219,996			$	683,035				666,888
% change			2.2	%							2.4	%
Same Property NOI without Termination Fees		$	223,723				219,094			$	676,628				663,098
% change			2.1	%							2.0	%
Same Property NOI without Termination Fees or Redevelopments		$	191,110				189,398			$	579,772				572,834
% change			0.9	%							1.2	%
Same Property NOI without Termination Fees or Collection of 2020/2021 Reserves		$	222,674				216,298			$	672,892				645,268
% change			2.9	%							4.3	%

Reported results are preliminary and not final until the filing of the Company’s Form 10-Q with the SEC and, therefore, remain subject to adjustment.

The Company has published forward-looking statements and additional financial information in its third quarter 2023 supplemental package that may help investors estimate earnings. A copy of the Company’s third quarter 2023 supplemental package will be available on the Company's website at investors.regencycenters.com or by written request to: Investor Relations, Regency Centers Corporation, One Independent Drive, Suite 114, Jacksonville, Florida, 32202. The supplemental package contains more detailed financial and property results including financial statements, an outstanding debt summary, acquisition and development activity, investments in partnerships, information pertaining to securities issued other than common stock, property details, a significant tenant rent report and a lease expiration table in addition to earnings and valuation guidance assumptions. The information provided in the supplemental package is unaudited and includes non-GAAP measures, and there can be no assurance that the information will not vary from the final information in the Company’s Form 10-Q for the period ended September 30, 2023. Regency may, but assumes no obligation to, update information in the supplemental package from time to time.

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Exhibit 99.1

Non-GAAP Disclosure

We believe these non-GAAP measures provide useful information to our Board of Directors, management and investors regarding certain trends relating to our financial condition and results of operations. Our management uses these non-GAAP measures to compare our performance to that of prior periods for trend analyses, purposes of determining management incentive compensation and budgeting, forecasting and planning purposes.

We do not consider non-GAAP measures an alternative to financial measures determined in accordance with GAAP, rather they supplement GAAP measures by providing additional information we believe to be useful to our shareholders. The principal limitation of these non-GAAP financial measures is they may exclude significant expense and income items that are required by GAAP to be recognized in our consolidated financial statements. In addition, they reflect the exercise of management’s judgment about which expense and income items are excluded or included in determining these non-GAAP financial measures. In order to compensate for these limitations, reconciliations of the non-GAAP financial measures we use to their most directly comparable GAAP measures are provided. Non-GAAP financial measures should not be relied upon in evaluating the financial condition, results of operations or future prospects of the Company.

Nareit FFO is a commonly used measure of REIT performance, which the National Association of Real Estate Investment Trusts (“Nareit”) defines as net income, computed in accordance with GAAP, excluding gains on sale and impairments of real estate, net of tax, plus depreciation and amortization, and after adjustments for unconsolidated partnerships and joint ventures. Regency computes Nareit FFO for all periods presented in accordance with Nareit's definition. Since Nareit FFO excludes depreciation and amortization and gains on sales and impairments of real estate, it provides a performance measure that, when compared year over year, reflects the impact on operations from trends in percent leased, rental rates, operating costs, acquisition and development activities, and financing costs. This provides a perspective of the Company’s financial performance not immediately apparent from net income determined in accordance with GAAP. Thus, Nareit FFO is a supplemental non-GAAP financial measure of the Company's operating performance, which does not represent cash generated from operating activities in accordance with GAAP; and, therefore, should not be considered a substitute measure of cash flows from operations. The Company provides a reconciliation of Net Income Attributable to Common Shareholders to Nareit FFO.

Core Operating Earnings is an additional performance measure that excludes from Nareit FFO: (i) transaction related income or expenses; (ii) gains or losses from the early extinguishment of debt; (iii) certain non-cash components of earnings derived from above and below market rent amortization, straight-line rents, and amortization of mark-to-market of debt adjustments; and (iv) other amounts as they occur. The Company provides a reconciliation of Net Income to Nareit FFO to Core Operating Earnings.

Forward-Looking Statements

Certain statements in this document regarding anticipated financial, business, legal or other outcomes including business and market conditions, outlook and other similar statements relating to Regency’s future events, developments, or financial or operational performance or results such as our 2023 Guidance, are “forward-looking statements” made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995 and other federal securities laws. These forward-looking statements are identified by the use of words such as “may,” “will,” “could,” “should,” “would,” “expect,” “estimate,” “believe,” “intend,” “forecast,” “project,” “plan,” “anticipate,” “guidance,” and other similar language. However, the absence of these or similar words or expressions does not mean a statement is not forward-looking. While we believe these forward-looking statements are reasonable when made, forward-looking statements are not guarantees of future performance or events and undue reliance should not be placed on these statements. Although we believe the expectations reflected in any forward-looking statements are based on reasonable assumptions, we can give no assurance these expectations will be attained, and it is possible actual results may differ materially from those indicated by these forward-looking statements due to a variety of risks and uncertainties. Our operations are subject to a number of risks and uncertainties including, but not limited to, those risk factors described in our Securities and Exchange Commission (“SEC”) filings, our Annual Report on Form 10-K for the year ended December 31, 2022 (“2022 Form 10-K”) under Item 1A. “Risk Factors”, on Form 10-Q for the three months ended March 31, 2023 under Part II, Item 1A. “Risk Factors” and our Form S-4 Registration Statement, filed with the SEC on July 10, 2023, in connection with our acquisition of Urstadt Biddle, which contains, without limitation, additional risk factors in a section of the prospectus entitled “Risks Relating to Regency After Completion of the Mergers”. When considering an investment in our securities, you should carefully read and consider these risks, together with all other information in our Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q and our other filings and submissions to the SEC. If any of the events described in the risk factors actually occur, our business, financial condition or operating results, as well as the market price of our securities, could be materially adversely affected. Forward-looking statements are only as of the date they are made, and Regency

 

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Exhibit 99.1

undertakes no duty to update its forward-looking statements, whether as a result of new information, future events or developments or otherwise, except as to the extent required by law. These risks and events include, without limitation:

Risk Factors Related to the Company’s Acquisition of Urstadt Biddle

Combining our business with Urstadt Biddle’s may be more difficult, costly or time-consuming than expected and we may fail to realize the anticipated benefits of the acquisition, which may adversely affect our business results and negatively affect the market price of our securities.

Risk Factors Related to the Current Economic Environment

Continued rising interest rates in the current economic environment may adversely impact our cost to borrow, real estate valuation, and stock price. Current economic challenges, including the potential for recession, may adversely impact our tenants and our business. Unfavorable developments affecting the banking and financial services industry could adversely affect our business, liquidity and financial condition, and overall results of operations. Additionally, macroeconomic and geopolitical risks, including the current wars in Ukraine, and involving Israel and Gaza, create challenges that may exacerbate current market and economic conditions in the United States.

Risk Factors Related to Pandemics or other Health Crises

Pandemics or other health crises, such as the COVID-19 pandemic, may adversely affect our tenants’ financial condition, the profitability of our properties, and our access to the capital markets and could have a material adverse effect on our business, results of operations, cash flows and financial condition.

Risk Factors Related to Operating Retail-Based Shopping Centers

Economic and market conditions may adversely affect the retail industry and consequently reduce our revenues and cash flow and increase our operating expenses. Shifts in retail trends, sales, and delivery methods between brick-and-mortar stores, e-commerce, home delivery, and curbside pick-up may adversely impact our revenues, results of operations, and cash flows. Changing economic and retail market conditions in geographic areas where our properties are concentrated may reduce our revenues and cash flow. Our success depends on the continued presence and success of our “anchor” tenants. A percentage of our revenues are derived from “local” tenants and our net income may be adversely impacted if these tenants are not successful, or if the demand for the types or mix of tenants significantly change. We may be unable to collect balances due from tenants in bankruptcy. Many of our costs and expenses associated with operating our properties may remain constant or increase, even if our lease income decreases. Compliance with the Americans with Disabilities Act and other building, fire, and safety and regulations may have a material negative effect on us.

Risk Factors Related to Real Estate Investments

Our real estate assets may decline in value and be subject to impairment losses which may reduce our net income. We face risks associated with development, redevelopment and expansion of properties. We face risks associated with the development of mixed-use commercial properties. We face risks associated with the acquisition of properties. We may be unable to sell properties when desired because of market conditions. Changes in tax laws could impact our acquisition or disposition of real estate.

Risk Factors Related to the Environment Affecting Our Properties

Climate change may adversely impact our properties directly and may lead to additional compliance obligations and costs as well as additional taxes and fees. Geographic concentration of our properties makes our business more vulnerable to natural disasters, severe weather conditions and climate change. Costs of environmental remediation may adversely impact our financial performance and reduce our cash flow.

Risk Factors Related to Corporate Matters

An increased focus on metrics and reporting relating to environmental, social, and governance (“ESG”) factors may impose additional costs and expose us to new risks. An uninsured loss or a loss that exceeds the insurance coverage on our properties may subject us to loss of capital and revenue on those properties. Failure to attract and retain key personnel may adversely affect our business and operations. The unauthorized access, use, theft or destruction of tenant or employee personal, financial or other data or of Regency’s proprietary or confidential information stored in our information systems or by third parties on our behalf could impact our reputation and brand and expose us to potential liability and loss of revenues.

 

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Exhibit 99.1

 

Risk Factors Related to Our Partnerships and Joint Ventures

We do not have voting control over all of the properties owned in our co-investment partnerships and joint ventures, so we are unable to ensure that our objectives will be pursued. The termination of our partnerships may adversely affect our cash flow, operating results, and our ability to make distributions to stock and unit holders.

Risk Factors Related to Funding Strategies and Capital Structure

Our ability to sell properties and fund acquisitions and developments may be adversely impacted by higher market capitalization rates and lower NOI at our properties which may dilute earnings. We depend on external sources of capital, which may not be available in the future on favorable terms or at all. Our debt financing may adversely affect our business and financial condition. Covenants in our debt agreements may restrict our operating activities and adversely affect our financial condition. Increases in interest rates would cause our borrowing costs to rise and negatively impact our results of operations. Hedging activity may expose us to risks, including the risks that a counterparty will not perform and that the hedge will not yield the economic benefits we anticipate, which may adversely affect us.

Risk Factors Related to the Market Price for Our Securities

Changes in economic and market conditions may adversely affect the market price of our securities. There is no assurance that we will continue to pay dividends at current or historical rates.

Risk Factors Related to the Company’s Qualification as a REIT

If the Company fails to qualify as a REIT for federal income tax purposes, it would be subject to federal income tax at regular corporate rates. Dividends paid by REITs generally do not qualify for reduced tax rates. Certain foreign shareholders may be subject to U.S. federal income tax on gain recognized on a disposition of our common stock if we do not qualify as a “domestically controlled” REIT. Legislative or other actions affecting REITs may have a negative effect on us or our investors. Complying with REIT requirements may limit our ability to hedge effectively and may cause us to incur tax liabilities.

Risk Factors Related to the Company’s Common Stock

Restrictions on the ownership of the Company’s capital stock to preserve its REIT status may delay or prevent a change in control. The issuance of the Company's capital stock may delay or prevent a change in control. Ownership in the Company may be diluted in the future.

 

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Exhibit 99.2

 

 

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Table of Contents

September 30, 2023

 

Forward-Looking Statements	i
Earnings Press Release	iii
	t
Summary Information:
Summary Financial Information	1
Summary Real Estate Information	2
Financial Information:
Consolidated Balance Sheets	3
Consolidated Statements of Operations	4
Supplemental Details of Operations (Consolidated Only)	5
Supplemental Details of Assets and Liabilities (Real Estate Partnerships Only)	6
Supplemental Details of Operations (Real Estate Partnerships Only)	7
Supplemental Details of Same Property NOI (Pro-Rata)	8
Reconciliations of Non-GAAP Financial Measures	9
Capital Expenditures and Additional Disclosures	10
Summary of Consolidated Debt	11
Summary of Consolidated Debt Detail	12
Summary of Unsecured Debt Covenants and Leverage Ratios	13
Summary of Unconsolidated Debt	14
Unconsolidated Investments	15
Investment Activity:
Property Transactions	16
Summary of In-Process Developments and Redevelopments	17
Development and Redevelopment Current Year Completions	18
Real Estate Information:
Leasing Statistics	19
New Lease Net Effective Rent and Leases Signed Not Yet Commenced	20
Annual Base Rent by State	21
Annual Base Rent by CBSA	22
Annual Base Rent by Tenant Category	23
Significant Tenant Rents	24
Tenant Lease Expirations	25
Portfolio Summary Report by State	26
Additional Disclosures and Forward-Looking Information:
Components of NAV	42
Earnings Guidance	43
Glossary of Terms	44

 

 

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Safe Harbor Language

September 30, 2023

 

Forward-Looking Statements

Certain statements in this document regarding anticipated financial, business, legal or other outcomes including business and market conditions, outlook and other similar statements relating to Regency’s future events, developments, or financial or operational performance or results such as our 2023 Guidance, are “forward-looking statements” made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995 and other federal securities laws. These forward-looking statements are identified by the use of words such as “may,” “will,” “could,” “should,” “would,” “expect,” “estimate,” “believe,” “intend,” “forecast,” “project,” “plan,” “anticipate,” “guidance,” and other similar language. However, the absence of these or similar words or expressions does not mean a statement is not forward-looking. While we believe these forward-looking statements are reasonable when made, forward-looking statements are not guarantees of future performance or events and undue reliance should not be placed on these statements. Although we believe the expectations reflected in any forward-looking statements are based on reasonable assumptions, we can give no assurance these expectations will be attained, and it is possible actual results may differ materially from those indicated by these forward-looking statements due to a variety of risks and uncertainties. Our operations are subject to a number of risks and uncertainties including, but not limited to, those risk factors described in our Securities and Exchange Commission (“SEC”) filings, our Annual Report on Form 10-K for the year ended December 31, 2022 (“2022 Form 10-K”) under Item 1A. “Risk Factors”, on Form 10-Q for the three months ended March 31, 2023 under Part II, Item 1A. “Risk Factors” and our Form S-4 Registration Statement, filed with the SEC on July 10, 2023, in connection with our acquisition of Urstadt Biddle, which contains, without limitation, additional risk factors in a section of the prospectus entitled “Risks Relating to Regency After Completion of the Mergers”. When considering an investment in our securities, you should carefully read and consider these risks, together with all other information in our Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q and our other filings and submissions to the SEC. If any of the events described in the risk factors actually occur, our business, financial condition or operating results, as well as the market price of our securities, could be materially adversely affected. Forward-looking statements are only as of the date they are made, and Regency undertakes no duty to update its forward-looking statements, whether as a result of new information, future events or developments or otherwise, except as to the extent required by law. These risks and events include, without limitation:

 

Risk Factors Related to the Company’s Acquisition of Urstadt Biddle

Combining our business with Urstadt Biddle’s may be more difficult, costly or time-consuming than expected and we may fail to realize the anticipated benefits of the acquisition, which may adversely affect our business results and negatively affect the market price of our securities.

 

Risk Factors Related to the Current Economic Environment

Continued rising interest rates in the current economic environment may adversely impact our cost to borrow, real estate valuation, and stock price. Current economic challenges, including the potential for recession, may adversely impact our tenants and our business. Unfavorable developments affecting the banking and financial services industry could adversely affect our business, liquidity and financial condition, and overall results of operations. Additionally, macroeconomic and geopolitical risks, including the current wars in Ukraine, and involving Israel and Gaza, create challenges that may exacerbate current market and economic conditions in the United States.

 

Risk Factors Related to Pandemics or other Health Crises

Pandemics or other health crises, such as the COVID-19 pandemic, may adversely affect our tenants’ financial condition, the profitability of our properties, and our access to the capital markets and could have a material adverse effect on our business, results of operations, cash flows and financial condition.

 

Risk Factors Related to Operating Retail-Based Shopping Centers

Economic and market conditions may adversely affect the retail industry and consequently reduce our revenues and cash flow and increase our operating expenses. Shifts in retail trends, sales, and delivery methods between brick-and-mortar stores, e-commerce, home delivery, and curbside pick-up may adversely impact our revenues, results from operations, and cash flows. Changing economic and retail market conditions in geographic areas where our properties are concentrated may reduce our revenues and cash flow. Our success depends on the continued presence and success of our “anchor” tenants. A percentage of our revenues are derived from “local” tenants and our net income may be adversely impacted if these tenants are not successful, or if the demand for the types or mix of tenants significantly change. We may be unable to collect balances due from tenants in bankruptcy. Many of our costs and expenses associated with operating our properties may remain constant or increase, even if our lease income decreases. Compliance with the Americans with Disabilities Act and other building, fire, and safety and regulations may have a material negative effect on us.
 

 

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Risk Factors Related to Real Estate Investments

Our real estate assets may decline in value and be subject to impairment losses which may reduce our net income. We face risks associated with development, redevelopment, and expansion of properties. We face risks associated with the development of mixed-use commercial properties. We face risks associated with the acquisition of properties. We may be unable to sell properties when desired because of market conditions. Changes in tax laws could impact our acquisition or disposition of real estate.
 

 

Risk Factors Related to the Environment Affecting Our Properties

Climate change may adversely impact our properties directly and may lead to additional compliance obligations and costs as well as additional taxes and fees. Geographic concentration of our properties makes our business more vulnerable to natural disasters, severe weather conditions and climate change. Costs of environmental remediation may adversely impact our financial performance and reduce our cash flow.

 

Risk Factors Related to Corporate Matters

An increased focus on metrics and reporting relating to environmental, social, and governance (“ESG”) factors may impose additional costs and expose us to new risks. An uninsured loss or a loss that exceeds the insurance coverage on our properties may subject us to loss of capital and revenue on those properties. Failure to attract and retain key personnel may adversely affect our business and operations. The unauthorized access, use, theft or destruction of tenant or employee personal, financial, or other data or of Regency’s proprietary or confidential information stored in our information systems or by third parties on our behalf could impact our reputation and brand and expose us to potential liability and loss of revenues.

Risk Factors Related to Our Partnerships and Joint Ventures

We do not have voting control over all of the properties owned in our co-investment partnerships and joint ventures, so we are unable to ensure that our objectives will be pursued. The termination of our partnerships may adversely affect our cash flow, operating results, and our ability to make distributions to stock and unit holders.

 

Risk Factors Related to Funding Strategies and Capital Structure

Our ability to sell properties and fund acquisitions and developments may be adversely impacted by higher market capitalization rates and lower NOI at our properties which may dilute earnings. We depend on external sources of capital, which may not be available in the future on favorable terms or at all. Our debt financing may adversely affect our business and financial condition. Covenants in our debt agreements may restrict our operating activities and adversely affect our financial condition. Increases in interest rates would cause our borrowing costs to rise and negatively impact our results of operations. Hedging activity may expose us to risks, including the risks that a counterparty will not perform and that the hedge will not yield the economic benefits we anticipate, which may adversely affect us.

 

Risk Factors Related to the Market Price for Our Securities

Changes in economic and market conditions may adversely affect the market price of our securities. There is no assurance that we will continue to pay dividends at current or historical rates.

 

Risk Factors Related to the Company’s Qualification as a REIT

If the Company fails to qualify as a REIT for federal income tax purposes, it would be subject to federal income tax at regular corporate rates. Dividends paid by REITs generally do not qualify for reduced tax rates. Certain foreign shareholders may be subject to U.S. federal income tax on gain recognized on a disposition of our common stock if we do not qualify as a “domestically controlled” REIT. Legislative or other actions affecting REITs may have a negative effect on us or our investors. Complying with REIT requirements may limit our ability to hedge effectively and may cause us to incur tax liabilities.

 

Risk Factors Related to the Company’s Common Stock

Restrictions on the ownership of the Company’s capital stock to preserve its REIT status may delay or prevent a change in control. The issuance of the Company's capital stock may delay or prevent a change in control. Ownership in the Company may be diluted in the future.

 

 

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		NEWS RELEASE For immediate release   Christy McElroy 904 598 7616 ChristyMcElroy@regencycenters.com

 

Regency Centers Reports Third Quarter 2023 Results

JACKSONVILLE, Fla. (November 2, 2023) – Regency Centers Corporation (“Regency” or the “Company”) (Nasdaq: REG) today reported financial and operating results for the period ended September 30, 2023 and provided updated 2023 earnings guidance. For the three months ended September 30, 2023 and 2022, Net Income was $0.50 per diluted share and $0.51 per diluted share, respectively.

Third Quarter 2023 Highlights

Subsequent Highlights

“Our strong results in the third quarter were supported by continued positive momentum in our business, including robust tenant demand and further progress building our value creation pipeline,” said Lisa Palmer, President and Chief Executive Officer. “Our integration with Urstadt Biddle is progressing successfully, we acquired two additional shopping centers, and we raised our dividend once again. With a high-quality portfolio of grocery-anchored centers in top trade areas, a sector-leading balance sheet and an exceptional team, Regency remains well positioned in today’s environment.”

Supplemental Information iii

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Financial Results

Net Income

Nareit FFO

Core Operating Earnings

Portfolio Performance

Same Property NOI

Occupancy

Leasing Activity

 

Supplemental Information iv

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Capital Allocation and Balance Sheet

Developments and Redevelopments

Property Transactions

Urstadt Biddle Merger

Balance Sheet

Common and Preferred Dividends

 

Supplemental Information v

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2023 Guidance

Regency Centers has updated its 2023 guidance, as summarized in the table below. Please refer to the Company’s third quarter 2023 ‘Earnings Presentation’ and ‘Quarterly Supplemental’ for additional detail. All materials are posted on the Company’s website at investors.regencycenters.com.

 

Full Year 2023 Guidance (in thousands, except per share data)	3Q YTD	Current Guidance	Previous Guidance
Net Income Attributable to Common Shareholders per diluted share	$1.56	$2.02-$2.04	$2.05-$2.09
Nareit Funds From Operations ("Nareit FFO") per diluted share	$3.13	$4.13-$4.15	$4.11-$4.15
Core Operating Earnings per diluted share (1)	$2.96	$3.93-$3.95	$3.89-$3.93
Same property NOI growth without termination fees	2.0%	+/- 1.5%	+1.0% to +1.5%
Same property NOI growth without termination fees or collection of 2020/2021 reserves	4.3%	+/- 3.5%	+3.0% to +3.5%
Collection of 2020/2021 reserves (2)	$3,736	+/-$4,000	+/-$4,000
Certain non-cash items (3)	$31,226	+/-$39,500	+/-$37,500
G&A expense, net (4)	$69,370	+/-$91,000	$88,000-$91,000
Interest expense, net	$127,636	+/-$178,000	+/-$168,000
Recurring third party fees & commissions	$19,582	+/-$26,000	+/-$25,000
Development and Redevelopment spend	$115,719	+/-$130,000	+/-$130,000
Acquisitions	$5,502	$30,830	$0
Cap rate (weighted average)	7.4%	5.6%	0%
Dispositions	$0	+/-$10,000	+/-$65,000
Cap rate (weighted average)	0.0%	+/- 7.0%	+/- 7.0%
Unit issuance (gross)	$20,000	$20,000	$20,000
Share Repurchase settlement (gross)	$20,000	$20,000	$20,000
Merger transition costs	$1,511	+/-$5,000	$0

Note: With the exception of per share data, figures above represent 100% of Regency's consolidated entities and its pro-rata share of unconsolidated co-investment partnerships.

 

Supplemental Information vi

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Conference Call Information

To discuss Regency’s third quarter results and provide further business updates, management will host a conference call on Friday, November 3rd, at 11:00 a.m. ET. Dial-in and webcast information is below.

Third Quarter 2023 Earnings Conference Call

 

Date:	Friday, November 3, 2023
Time:	11:00 a.m. ET
Dial#:	877-407-0789 or 201-689-8562
Webcast:	3rd Quarter 2023 Webcast Link

Replay: Webcast Archive: Investor Relations page under Events & Webcasts

About Regency Centers Corporation (Nasdaq: REG)

Regency Centers is a preeminent national owner, operator, and developer of shopping centers located in suburban trade areas with compelling demographics. Our portfolio includes thriving properties merchandised with highly productive grocers, restaurants, service providers, and best-in-class retailers that connect to their neighborhoods, communities, and customers. Operating as a fully integrated real estate company, Regency Centers is a qualified real estate investment trust (REIT) that is self-administered, self-managed, and an S&P 500 Index member. For more information, please visit RegencyCenters.com.

Reconciliation of Net Income Attributable to Common Shareholders to Nareit FFO and Core Operating Earnings – Actual (in thousands, except per share amounts)

 

For the Periods Ended September 30, 2023 and 2022		Three Months Ended								Year to Date
		2023				2022				2023				2022
Reconciliation of Net Income to Nareit FFO:
Net Income Attributable to Common Shareholders		$	89,076				87,578			$	273,139				387,602
Adjustments to reconcile to Nareit Funds From Operations (1):
Depreciation and amortization (excluding FF&E)			94,011				86,405				272,551				256,273
Gain on sale of real estate			(827	)			(202	)			(1,132	)			(119,301	)
Exchangeable operating partnership units			520				379				1,490				1,694
Nareit Funds From Operations		$	182,780				174,160			$	546,048				526,268
Nareit FFO per share (diluted)		$	1.02				1.01			$	3.13				3.05
Weighted average shares (diluted)			179,311				172,267				174,621				172,620
Reconciliation of Nareit FFO to Core Operating Earnings:
Nareit Funds From Operations		$	182,780				174,160			$	546,048				526,268
Adjustments to reconcile to Core Operating Earnings (1):
Not Comparable Items
Merger transition costs			1,511				-				1,511				-
Early extinguishment of debt			-				-				-				176
Certain Non-Cash Items
Straight-line rent			(3,142	)			(3,140	)			(7,315	)			(9,152	)
Uncollectible straight-line rent			92				(4,156	)			(2,298	)			(9,610	)
Above/below market rent amortization, net			(7,919	)			(5,191	)			(22,138	)			(15,906	)
Debt and derivative mark-to-market amortization			667				(28	)			667				(185	)
Core Operating Earnings		$	173,989				161,645				516,475				491,591
Core Operating Earnings per share (diluted)		$	0.97				0.94			$	2.96				2.85
Weighted average shares (diluted)			179,311				172,267				174,621				172,620
Weighted Average Shares For Diluted Earnings per Share			178,231				171,525				173,711				171,870
Weighted Average Shares For Diluted FFO and Core Operating Earnings per Share			179,311				172,267				174,621				172,620

 

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Same Property NOI is a key non-GAAP measure used by management in evaluating the operating performance of Regency’s properties. The Company provides a reconciliation of Net Income Attributable to Common Shareholders to pro-rata Same Property NOI.

 

Reconciliation of Net Income Attributable to Common Shareholders to Pro-Rata Same Property NOI - Actual (in thousands)

 

For the Periods Ended September 30, 2023 and 2022		Three Months Ended								Year to Date
		2023				2022				2023				2022
Net income attributable to common shareholders		$	89,076				87,578			$	273,139				387,602
Less:
Management, transaction, and other fees			(7,079	)			(5,767	)			(20,223	)			(18,950	)
Other(1)			(12,016	)			(13,564	)			(34,317	)			(38,295	)
Plus:
Depreciation and amortization			87,505				80,270