SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
☒
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended June 30, 2026
or
☐
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from to
Commission File Number 001-12002
ACADIA REALTY TRUST
(Exact name of registrant as specified in its charter)
Maryland
(State or other jurisdiction of
incorporation or organization)
23-2715194
(I.R.S. Employer
Identification No.)
411 THEODORE FREMD AVENUE, SUITE 300, RYE, NY
(Address of principal executive offices)
10580
(Zip Code)
(914) 288-8100
(Registrant’s telephone number, including area code)
Securities registered pursuant to Section 12(b) of the Act:
Title of class of registered securities
Trading symbol
Name of exchange on which registered
Common shares of beneficial interest, par value $0.001 per share
AKR
The New York Stock Exchange
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.
Yes ☒
No ☐
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).
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.
Large Accelerated Filer
Accelerated Filer
Emerging Growth Company
Non-accelerated Filer
Smaller Reporting Company
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate by checkmark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act) Yes ☐ No ☒
As of July 24, 2026, there were 137,332,722 common shares of beneficial interest, par value $0.001 per share (“Common Shares”), outstanding.
ACADIA REALTY TRUST AND SUBSIDIARIES
INDEX
Item No.
Description
Page
PART I - FINANCIAL INFORMATION
1.
Financial Statements
4
Condensed Consolidated Balance Sheets (Unaudited) as of June 30, 2026 and December 31, 2025
Condensed Consolidated Statements of Operations (Unaudited) for the Three and Six Months Ended June 30, 2026 and 2025
5
Condensed Consolidated Statements of Comprehensive Income (Loss) (Unaudited) for the Three and Six Months Ended June 30, 2026 and 2025
6
Condensed Consolidated Statements of Changes in Equity (Unaudited) for the Three and Six Months Ended June 30, 2026 and 2025
7
Condensed Consolidated Statements of Cash Flows (Unaudited) for the Six Months Ended June 30, 2026 and 2025
9
Notes to Condensed Consolidated Financial Statements (Unaudited)
11
2.
Management’s Discussion and Analysis of Financial Condition and Results of Operations
38
3.
Quantitative and Qualitative Disclosures about Market Risk
50
4.
Controls and Procedures
52
PART II - OTHER INFORMATION
Legal Proceedings
53
1A.
Risk Factors
Unregistered Sales of Equity Securities and Use of Proceeds
Defaults Upon Senior Securities
Mine Safety Disclosures
5.
Other Information
6.
Exhibits
54
Signatures
55
SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS
Certain statements contained in this Quarterly Report on Form 10-Q (this “Report”) of Acadia Realty Trust, a Maryland real estate investment trust (the “Company”), may contain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). We intend these forward-looking statements to be covered by the safe harbor provisions for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995, and we are including this statement for the purposes of complying with those safe harbor provisions, in each case, to the extent applicable. Forward-looking statements, which are based on certain assumptions and describe our future plans, strategies and expectations, are generally identifiable by the use of words such as “may,” “will,” “should,” “expect,” “anticipate,” “estimate,” “believe,” “intend” or “project,” or the negative thereof, or other variations thereon or comparable terminology. Forward-looking statements involve known and unknown risks, uncertainties and other factors that could cause our actual results and financial performance to be materially different from future results and financial performance expressed or implied by such forward-looking statements, including, but not limited to: (i) macroeconomic conditions, including due to geopolitical instability, contemplated tariff increases and other trade restrictions, which may lead to a disruption of or lack of access to the capital markets, disruptions and instability in the banking and financial services industries and elevated inflation; (ii) our success in implementing our business strategy and our ability to identify, underwrite, finance, consummate and integrate diversifying acquisitions and investments; (iii) changes in general economic conditions or economic conditions in the markets in which we may, from time to time, compete, and their effect on our revenues, earnings and funding sources and those of our tenants; (iv) increases in our borrowing costs as a result of elevated inflation, changes in interest rates and other factors; (v) our ability to pay down, refinance, restructure or extend our indebtedness as it becomes due; (vi) our investments in joint ventures and unconsolidated entities, including our lack of sole decision-making authority and our reliance on our joint venture partners’ financial condition; (vii) our ability to obtain the financial results expected from our development and redevelopment projects; (viii) our tenants’ ability and willingness to renew their leases with us upon expiration, our ability to re-lease our properties on the same or better terms in the event of nonrenewal or in the event we exercise our right to replace an existing tenant, and obligations we may incur in connection with the replacement of an existing tenant; (ix) our potential liability for environmental matters; (x) damage to our properties from catastrophic weather and other natural events, and the physical effects of climate change; (xi) the economic, political and social impact of, and uncertainty surrounding, any future public health crisis, which may adversely affect us and our tenants’ business, financial condition, results of operations and liquidity; (xii) uninsured losses; (xiii) our ability and willingness to maintain our qualification as a real estate investment trust (“REIT”) in light of economic, market, legal, tax and other considerations; (xiv) information technology (“IT”) security breaches, including increased cybersecurity risks relating to the use of remote technology and artificial intelligence (“AI”); (xv) risks associated with our use of AI tools, which could result in reputational harm, and legal or regulatory liability; (xvi) the loss of key executives; and (xvii) the accuracy of our methodologies and estimates regarding corporate responsibility metrics, goals and targets, tenant willingness and ability to collaborate towards reporting such metrics and meeting such goals and targets, and the impact of governmental regulation on our corporate responsibility efforts.
The factors described above are not exhaustive and additional factors could adversely affect the Company’s future results and financial performance, including the risk factors discussed under the section captioned “Risk Factors” in the Company’s Annual Report on Form 10-K for the year ended December 31, 2025 and other periodic or current reports the Company files with the Securities and Exchange Commission (the “SEC”), including those set forth under the headings “Item 1A. Risk Factors” and “Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations” in this Report. These risks and uncertainties should be considered in evaluating any forward-looking statements contained or incorporated by reference herein. Any forward-looking statements speak only as of the date hereof. The Company expressly disclaims any obligation or undertaking to release publicly any updates or revisions to any forward-looking statements to reflect any changes in the Company’s expectations with regard thereto or changes in the events, conditions or circumstances on which such forward-looking statements are based.
SPECIAL NOTE REGARDING CERTAIN REFERENCES
All references to “Notes” throughout the document refer to the Notes to the Condensed Consolidated Financial Statements of the registrant referenced in Part I, Item 1. Financial Statements.
3
PART I – FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS.
CONDENSED CONSOLIDATED BALANCE SHEETS
June 30,
December 31,
(in thousands, except share and per share data)
2026
2025
ASSETS
(Unaudited)
Investments in real estate
Operating real estate, net
$
3,677,439
3,983,754
Real estate under development
194,222
167,051
Net investments in real estate
3,871,661
4,150,805
Notes receivable, net ($2,180 and $1,638 of allowance for credit losses as of June 30, 2026 and December 31, 2025, respectively)(a)
154,501
154,892
Investments in and advances to unconsolidated affiliates
263,598
161,955
Other assets, net
194,661
223,980
Right-of-use assets - operating leases, net
21,589
23,594
Cash and cash equivalents
32,960
38,818
Restricted cash
16,272
18,081
Rents receivable, net
55,430
65,027
Assets of property held for sale
6,835
—
Total assets (b)
4,617,507
4,837,152
LIABILITIES, REDEEMABLE NONCONTROLLING INTERESTS AND EQUITY
Liabilities:
Mortgage and other notes payable, net
480,045
893,944
Unsecured notes payable, net
1,113,650
879,462
Unsecured line of credit
43,323
89,500
Accounts payable and other liabilities
229,641
273,479
Lease liabilities - operating leases
23,852
25,972
Dividends and distributions payable
29,185
28,526
Distributions in excess of income from, and investments in, unconsolidated affiliates
16,914
16,838
Total liabilities (b)
1,936,610
2,207,721
Commitments and contingencies (Note 9)
Redeemable noncontrolling interests (Note 10)
4,499
9,113
Equity:
Acadia Shareholders' Equity
Common shares, $0.001 par value per share, authorized 200,000,000 shares, issued and outstanding 137,329,896 and 131,036,560 shares as of June 30, 2026 and December 31, 2025, respectively
137
131
Additional paid-in capital
2,829,749
2,710,651
Accumulated other comprehensive income
25,838
15,585
Distributions in excess of accumulated earnings
(519,027
)
(500,720
Total Acadia shareholders’ equity
2,336,697
2,225,647
Noncontrolling interests
339,701
394,671
Total equity
2,676,398
2,620,318
Total liabilities, redeemable noncontrolling interests, and equity
The accompanying notes are an integral part of these Condensed Consolidated Financial Statements (unaudited).
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
Three Months Ended June 30,
Six Months Ended June 30,
(in thousands, except per share amounts)
Revenues
Rental
91,188
98,297
189,756
200,937
Other
4,235
2,295
8,659
4,049
Total revenues
95,423
100,592
198,415
204,986
Expenses
Depreciation and amortization
35,162
39,269
75,317
78,709
General and administrative
11,782
11,532
27,085
23,129
Real estate taxes
12,735
13,317
25,657
26,620
Property operating
17,039
17,524
35,288
35,804
Impairment charges
18,190
24,640
Total expenses
76,718
99,832
163,347
188,902
Gain on disposition of properties
3,969
146,117
Operating income
22,674
760
181,185
16,084
Equity in earnings (losses) of unconsolidated affiliates
13,929
(4,191
12,421
(5,904
Interest income (a)
6,557
6,358
11,345
12,454
Realized and unrealized holding (losses) gains on investments and other
(33
(54
(649
1,567
Interest expense
(20,143
(23,604
(42,195
(46,851
Loss on change in control
(9,622
Income (loss) from continuing operations before income taxes
22,984
(20,731
162,107
(32,272
Income tax provision
(154
(211
(166
(327
Net income (loss)
22,830
(20,942
161,941
(32,599
Net loss attributable to redeemable noncontrolling interests
981
1,724
1,679
3,393
Net (income) loss attributable to noncontrolling interests
(12,773
21,181
(122,105
32,777
Net income attributable to Acadia shareholders
11,038
1,963
41,515
3,571
Basic income per share
0.05
0.01
0.27
0.02
Diluted income per share
Weighted average shares for basic income per share
133,627
130,981
132,444
126,182
Weighted average shares for diluted income per share
133,825
132,642
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) (UNAUDITED)
(in thousands)
Other comprehensive income (loss):
Unrealized gain (loss) on valuation of swap agreements
8,331
(4,715
16,216
(15,000
Reclassification of realized interest on swap agreements
(1,772
(3,542
(3,565
(7,463
Other comprehensive income (loss)
6,559
(8,257
12,651
(22,463
Comprehensive income (loss)
29,389
(29,199
174,592
(55,062
Comprehensive loss attributable to redeemable noncontrolling interests
Comprehensive (income) loss attributable to noncontrolling interests
(13,551
22,356
(124,503
36,572
Comprehensive income (loss) attributable to Acadia shareholders
16,819
(5,119
51,768
(15,097
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY (UNAUDITED)
Three Months Ended June 30, 2026 and 2025
Acadia Shareholders
CommonShares
ShareAmount
AdditionalPaid-inCapital
AccumulatedOtherComprehensiveIncome (Loss)
Distributionsin Excess ofAccumulatedEarnings
TotalCommonShareholders’Equity
NoncontrollingInterests
TotalEquity
Redeemable NoncontrollingInterests
Balance as of April 1, 2026
133,514
134
2,755,574
20,057
(498,735
2,277,030
358,497
2,635,527
8,457
Issuance of Common Shares, net
3,764
71,472
71,475
Conversion of OP Units to Common Shares by limited partners of the Operating Partnership
26
451
(451
Dividends/distributions declared ($0.20 per Common Share/OP Unit)
(27,462
(1,621
(29,083
Adjustment of redeemable non-controlling interest to estimated redemption value (Note 10)
(3,868
3,868
Acquisition of noncontrolling interest (Note 10)
(8,627
City Point Loan accrued interest (Note 10)
(2,373
Employee and trustee stock compensation, net
289
3,064
3,353
Noncontrolling interest distributions
(33,108
Noncontrolling interest contributions
1,732
4,155
5,781
13,551
30,370
(981
Reallocation of noncontrolling interests
(1,963
Balance as of June 30, 2026
137,330
Balance as of April 1, 2025
130,956
2,704,731
27,064
(433,966
2,297,960
464,786
2,762,746
25,897
23
395
(395
(26,202
(1,447
(27,649
City Point Loan accrued interest
(3,009
32
66
2,969
3,035
(4,875
377
10
Comprehensive (loss) income
(7,082
(22,356
(27,475
(1,724
2,026
(2,026
Balance as of June 30, 2025
131,011
2,707,218
19,982
(458,205
2,269,126
437,033
2,706,159
21,174
Six Months Ended June 30, 2026 and 2025
Redeemable Noncontrolling Interest
Balance at January 1, 2026
131,037
6,210
127,308
127,314
44
751
(751
Dividends/distributions declared ($0.40 per Common Share/OP Unit)
(54,161
(3,242
(57,403
(5,661
5,661
(4,119
39
405
9,359
9,764
(195,943
(5
1,738
10,253
124,503
176,271
(1,679
(9,366
9,366
Balance at June 30, 2026
Balance at January 1, 2025
119,658
120
2,436,285
38,650
(409,383
2,065,672
436,017
2,501,689
30,583
11,173
277,495
277,506
136
2,113
(2,113
(52,393
(2,891
(55,284
Consolidation of previously unconsolidated investment
29,573
(6,026
204
5,446
5,650
(9,674
8,368
(18,668
(36,572
(51,669
(3,393
(8,879
8,879
Balance at June 30, 2025
8
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
CASH FLOWS FROM OPERATING ACTIVITIES
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Gain on disposition of properties and other investments
(146,117
Stock compensation expense
9,712
Straight-line rents
(2,552
(951
Equity in (gains) losses of unconsolidated affiliates
(12,421
5,904
Distributions of operating income from unconsolidated affiliates
14,772
1,472
Amortization of financing costs
4,262
4,137
Non-cash lease expense
2,005
2,007
Net unrealized holding losses (gains) on investments
(1,543
9,622
Other, net
(5,490
(5,250
Changes in assets and liabilities:
Accounts receivable
6,131
(3,969
Accounts payable and accrued expenses
(4,920
(2,938
Prepaid expenses and other assets
2,804
15,084
Other liabilities
(13,714
(7,252
(2,120
(2,023
Net cash provided by operating activities
89,610
90,700
CASH FLOWS FROM INVESTING ACTIVITIES
Acquisitions of properties
(196,302
(344,647
Proceeds from the disposition of properties and other investments, net
572,015
Development, construction and property improvement costs
(57,289
(47,528
Payment of deferred leasing costs
(5,536
(5,908
Investments and advances in unconsolidated affiliates
(68,334
(5,229
Return of capital from unconsolidated affiliates
19,763
4,639
Issuance of note receivable
(150
(20,141
Proceeds from repayment of note receivable
807
Refund of deposits for properties under purchase contract
4,000
11,125
Proceeds from sale of marketable securities
5,406
Increase in cash upon change of control
6,777
Net cash provided by (used in) investing activities
268,167
(394,699
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from issuances of Common Shares and settlement of forward equity contracts
277,519
Proceeds from unsecured notes payable and line of credit
590,300
837,700
Proceeds received from mortgages payable
41,557
3,321
Principal payments on unsecured debt and line of credit
(395,477
(623,200
Principal payments on mortgages payable
(457,423
(107,399
Prepayment penalty on early debt extinguishment
(2,150
Payment of deferred financing and other costs
(13,465
(2,863
Contributions from noncontrolling interests
5,893
8,378
Distributions to noncontrolling interests
(199,791
(12,803
Dividends paid to Common Shareholders
(52,910
(48,926
Acquisition of noncontrolling interest
Payments of finance lease obligations
(665
378
Net cash (used in) provided by financing activities
(365,444
332,105
(Decrease) increase in cash and cash equivalents and restricted cash
(7,667
28,106
Cash and cash equivalents of $38,818 and $16,806 and restricted cash of $18,081 and $22,897, respectively, beginning of period
56,899
39,703
Cash and cash equivalents of $32,960 and $42,780 and restricted cash of $16,272 and $25,029, respectively, end of period
49,232
67,809
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) (Continued)
Supplemental disclosure of cash flow information
Cash paid during the period for interest, net of capitalized interest of $4,830 and $5,412 respectively (a)
48,079
53,716
Cash paid for income taxes, net of refunds
163
330
Supplemental disclosure of non-cash investing and financing activities
Dividends/Distributions declared and payable
29,084
27,649
Assumption of accounts payable and accrued expenses through acquisition of real estate
2,138
Conversion of Common and Preferred OP Units to Common Shares
Accrued interest on note receivable recorded to redeemable noncontrolling interest
4,131
6,020
Adjustment of redeemable non-controlling interest to estimated redemption value
Changes in accrued development, construction and property improvement costs included in Accounts payable and other liabilities
12,730
Note receivable and accrued interest exchanged for redeemable noncontrolling interest
58,471
Properties contributed to unconsolidated affiliates
55,438
Increase (decrease) in assets and liabilities resulting from the consolidation of previously unconsolidated investment:
Operating real estate
201,700
Mortgage and other notes payable
156,117
(28,516
Rents receivable and other assets
654
4,548
29,572
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
1. Organization, Basis of Presentation and Summary of Significant Accounting Policies
Organization
Acadia Realty Trust, (the “Trust”, collectively with its consolidated subsidiaries, the “Company”), a Maryland real estate investment trust (“REIT”), is a fully-integrated equity real estate investment trust focused on the ownership, acquisition, development, and management of retail properties located primarily in high-barrier-to-entry, supply-constrained, densely populated metropolitan areas in the United States.
The Company owns and operates a high-quality real estate portfolio, primarily comprised of street and open-air retail assets in the nation’s most dynamic retail corridors (the “REIT Portfolio”). This portfolio is complemented by an investment management platform that leverages institutional capital relationships to pursue opportunistic, high-yield, and/or value-add investments (“Investment Management”). As of June 30, 2026, the Company held ownership interests in 183 REIT Portfolio properties (including properties in various stages of development and redevelopment) and 48 Investment Management properties across the United States.
All of the Company’s assets are held by, and its operations are conducted through, Acadia Realty Limited Partnership (the “Operating Partnership”) and entities in which the Operating Partnership owns an interest. At June 30, 2026 and December 31, 2025, the Trust controlled approximately 96% of the Operating Partnership as the sole general partner and is entitled to share in the cash distributions and profits and losses of the Operating Partnership in proportion to its percentage interest.
The remaining interests are held by limited partners, consisting primarily of entities or individuals that contributed interests in certain properties or entities to the Operating Partnership in exchange for common or preferred units of limited partnership interest (“Common OP Units” or “Preferred OP Units”), as well as employees who have been granted restricted Common OP Units (“LTIP Units”) as long-term incentive compensation (Note 13). Limited partners holding Common OP and LTIP Units generally have the right to exchange their units on a one-for-one basis for common shares of beneficial interest, par value $0.001 per share, of the Company (“Common Shares”). This structure is referred to as an umbrella partnership REIT or “UPREIT.”
The Investment Management platform operates through the Company’s consolidated opportunity funds, including: Acadia Strategic Opportunity Fund II, LLC (“Fund II”), Acadia Strategic Opportunity Fund III LLC (“Fund III”), Acadia Strategic Opportunity Fund IV LLC (“Fund IV”), and Acadia Strategic Opportunity Fund V LLC (“Fund V” and, collectively with Fund II, Fund III and Fund IV, the “Funds”), as well as 7 unconsolidated co-investment vehicles with institutional partners in which the Company holds equity ownership interests ranging from 5% to 20% (Note 4). The Company consolidates the Funds as variable interest entities, as it is the primary beneficiary through its role as sole general partner or managing member.
The Operating Partnership earns fees or priority distributions for asset management, property management, construction, development, leasing, and legal services provided to the Funds. Cash flows from the Funds are distributed pro-rata to partners and members (including the Operating Partnership) until each receives a cumulative preferred return (“Preferred Return”) and full return of capital. Thereafter, remaining cash flows are distributed 20% to the Operating Partnership (“Promote”) and 80% to the partners or members (including the Operating Partnership). All intercompany transactions between the Funds and the Operating Partnership are eliminated in consolidation.
In June 2026, the Company’s ownership interest in Fund II increased from 80% to 100% (Note 10). The following table summarizes the general terms and Operating Partnership’s equity interests in the Funds (dollars in millions):
Entity
FormationDate
OperatingPartnershipShare ofCapital
Capital Called as of June 30, 2026 (a)
UnfundedCommitment (a)
Equity InterestHeld ByOperatingPartnership (b)
PreferredReturn
Total Distributions as of June 30, 2026 (a)
Fund III
5/2007
24.54
%
449.2
0.8
39.63
616.3
Fund IV
5/2012
23.12
508.3
21.7
221.4
Fund V
8/2016
20.10
491.3
28.7
432.1
Basis of Presentation
The interim Condensed Consolidated Financial Statements have been prepared in accordance with accounting principles generally accepted in the United States GAAP for interim financial information and the rules and regulations of the U.S. Securities and Exchange Commission (“SEC”). Accordingly, they do not include all of the information and footnotes required for complete annual financial statements. Operating results for interim periods are not necessarily indicative of results for the full fiscal year. In the opinion of management, all adjustments necessary for a fair presentation of interim Condensed Consolidated Financial Statements have been included. These adjustments are of normal recurring nature.
The preparation of financial statements in conformity with generally accepted accounting principles (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts in the interim Condensed Consolidated Financial Statements and accompanying notes. The most significant assumptions and estimates include those related to the valuation of real estate, depreciable lives, revenue recognition and the collectability of notes receivable and rents receivable. Application of these estimates and assumptions requires the exercise of judgment as to future uncertainties and, as a result, actual results could differ from these estimates.
These interim Condensed Consolidated Financial Statements should be read in conjunction with the Company’s 2025 audited consolidated financial statements and notes thereto included in the Annual Report on Form 10-K for the year ended December 31, 2025.
Segments
We define our reportable segments based on the manner in which our chief operating decision maker makes key operating decisions, evaluates financial performance, allocates resources and manages our business. This approach aligns with our internal reporting structure and reflects the economic characteristics and nature of our operations. Accordingly, we have identified three reportable operating segments: REIT Portfolio, Investment Management and Structured Financing. Refer to Note 12.
Recent Accounting Pronouncements
In November 2024, the FASB issued ASU 2024-03, “Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses” (“ASU 2024-03”) which requires disaggregated disclosure of income statement expenses for public business entities (PBEs). Additionally, in January 2025, the FASB issued ASU 2025-01 to clarify the effective date of ASU 2024-03. The ASU does not change the expense captions an entity presents on the face of the income statement; rather, it requires disaggregation of certain expense captions into specified categories in disclosures within the footnotes to the financial statements. This guidance applies to all PBEs and is effective for annual reporting periods beginning after December 15, 2026 and interim reporting periods beginning after December 15, 2027, with early adoption permitted. The Company has elected not to early adopt and the requirements will be applied prospectively with the option for retrospective application. The Company is currently evaluating the expected impact of the adoption of ASU 2024-03 on disclosures within the Company’s Condensed Consolidated Financial Statements.
In November 2025, the FASB issued ASU 2025-09, “Derivatives and Hedging (Topic 815): Hedge Accounting Improvements” (“ASU 2025-09”) that more closely aligns hedge accounting with the economics of an entity’s risk management activities. ASU 2025-09 is effective for fiscal years beginning after December 15, 2026, including interim periods within those fiscal years, with early adoption permitted. The Company expects to early adopt the requirements in the third quarter of 2026. The adoption of ASU 2025-09 is not expected to have a significant impact on the Company’s Condensed Consolidated Financial Statements.
Any other recently issued accounting standards or pronouncements not disclosed above have been excluded as they are not relevant to the Company, or they are not expected to have a material impact on the Condensed Consolidated Financial Statements.
12
2. Real Estate
The Company’s consolidated real estate is comprised of the following for the periods presented (in thousands):
June 30,2026
December 31,2025
Buildings and improvements
3,089,483
3,421,366
Tenant improvements
324,002
339,414
Land
1,176,836
1,147,236
Construction in progress
30,564
32,969
Right-of-use assets - finance leases (Note 11)
61,366
Total
4,682,251
5,002,351
Less: Accumulated depreciation and amortization
(1,004,812
(1,018,597
Acquisitions
During the six months ended June 30, 2026, the Company acquired the following consolidated REIT Portfolio retail properties (dollars in thousands):
Property and Location
PercentAcquired
Date ofAcquisition
PurchasePrice (a)
2026 REIT Portfolio Acquisitions
1045 and 1165 Madison Avenue - New York, NY
100%
January 29, 2026
21,313
Rhode Island Place - Washington, D.C.
March 4, 2026
9,464
846 W. Armitage Avenue - Chicago, IL
March 5, 2026
4,440
225 Worth Avenue - Palm Beach, FL
March 27, 2026
43,469
4-6 Newbury Street and 28 Newbury Street - Boston, MA
April 10, 2026
110,154
129 5th Avenue - New York, NY
June 15, 2026
9,599
Total 2026 REIT Portfolio Acquisitions
198,439
For acquisitions completed during the period, the Company recorded identifiable intangible assets and intangible liabilities in the aggregate of approximately $20.5 million and $13.9 million, respectively. These intangibles are amortized over the remaining lease terms of the related leases, which ranged from approximately 1 to 50 years as of the respective acquisition dates. Refer to Note 6 for additional detail on the Company’s amortization of intangible assets and liabilities.
The Company determines the fair value of the individual components of real estate asset acquisitions primarily through calculating the “as-if vacant” value of a building, using an income approach, which relies significantly upon internally determined assumptions. The Company has determined that these estimates primarily rely on Level 3 inputs, which are unobservable inputs based on our own assumptions. The most significant assumptions used in calculating the “as-if vacant” value for acquisition activity during 2026 are as follows:
Low
High
Exit Capitalization Rate
5.00
6.75
Discount Rate
6.25
8.50
Annual net rental rate per square foot on acquired buildings
10.50
500.00
Annual net rental rate per square foot on acquired master lease
4.71
23.83
13
Dispositions
During the second quarter of 2026, the Company recognized a gain on disposition of properties of $4.0 million primarily related to the disposition of New Towne Center, a consolidated Fund V Investment Management property located in Canton, Michigan. During the first quarter of 2026, the Company recognized a gain on disposition of properties of $142.1 million primarily related to:
Properties Held for Sale
As of June 30, 2026, the Company classified the parking garage at 1035 Third Avenue in New York, New York, a consolidated Fund IV Investment Management property, as held for sale. The disposition was completed in July 2026 (Note 16). No properties were classified as held for sale as of December 31, 2025.
The assets of the property held for sale are presented separately in the accompanying condensed consolidated balance sheets and are summarized as follows:
Assets
Building and improvements
5,365
2,521
(1,844
793
Real Estate Under Development
Real estate under development represents the Company’s consolidated properties that have not yet been placed into service and are undergoing substantial development or construction.
Development activity for these properties during the periods presented is summarized below (dollars in thousands):
January 1, 2026
Six Months Ended June 30, 2026
June 30, 2026
Number ofProperties
CarryingValue
Transfers In
CapitalizedCosts (a)
Transfers Out
REIT Portfolio
27,171
The number of properties in the table above refers to full-property development projects; however, certain projects represent only a portion of a property, and the capitalized costs and carrying value of these projects are included in the table above. As of June 30, 2026, consolidated REIT Portfolio development projects included 13 properties in the Henderson Avenue Portfolio.
14
3. Notes Receivable, Net
Interest income from notes and mortgages receivable is reported within the Company’s Structured Financing segment (Note 12). Interest receivable is included in Other assets, net (Note 5). The Company’s notes receivable, net, are generally collateralized by either the underlying real estate or the borrowers’ equity interests in the entities that own the properties. The balances were as follows (dollars in thousands):
Number
Maturity Date
Interest Rate
Notes receivable
156,681
156,530
Apr 2020 - Dec 2027
6.00% - 13.75%
Allowance for credit losses
(2,180
(1,638
Notes receivable, net
The following table presents the activity in the allowance for credit losses for the six months ended June 30, 2026 and year ended December 31, 2025 (dollars in thousands):
December 31, 2025
Allowance for credit losses as of beginning of periods
1,638
2,004
Provision (recovery) of loan losses
542
(366
Total credit allowance
2,180
As of June 30, 2026, the Company had five performing notes with a total amortized cost of $136.1 million, including accrued interest of $2.3 million. Each note was evaluated individually due to the lack of comparability across the Structured Financing Portfolio.
One note receivable with an outstanding principal balance of $5.0 million was on nonaccrual status as of June 30, 2026 as collection of contractual principal and interest was no longer considered probable. The note is secured by pledges of ownership interests in the Georgetown Portfolio (Note 4), which owns a portfolio of retail properties in Washington, D.C. Accordingly, interest income on this note is recognized only to the extent cash payments are received. No interest income was recognized on the note during the three and six months ended June 30, 2026. Contractual interest income not recognized as a result of the note’s nonaccrual status was approximately $1.5 million as of June 30, 2026. Based on the estimated fair value of the collateral at the expected realization date, no allowance for credit losses was recorded as of June 30, 2026.
One note receivable with a principal balance of $17.8 million matured and remained in default as of June 30, 2026 and December 31, 2025. The Company applied the collateral-dependent practical expedient in accordance with ASC Topic 326: Financial Instruments - Credit Losses (“ASC 326”) as the note is expected to be settled through foreclosure or possession of the underlying collateral. Based on the estimated fair value of the collateral at the expected realization date, no allowance for credit losses was recorded as of June 30, 2026.
The Company holds a preferred equity investment, which is accounted for as a note receivable, and a mezzanine loan with an aggregate carrying value of approximately $82.5 million as of June 30, 2026. As of June 30, 2026, the borrowers were current on contractual interest payments through the use of interest reserves established in connection with a prior restructuring. The remaining interest reserves were insufficient to fund the full interest payment due in July 2026, causing a default, and the Company is currently evaluating a restructuring of the investment with the borrowers. The Company continues to evaluate the investment under ASC 326, including the collectability of contractual interest and the value of the underlying collateral.
15
4. Investments in and Advances to Unconsolidated Affiliates
The Company accounts for its investments in and advances to unconsolidated affiliates primarily under the equity method of accounting. The Company’s investments in and advances to unconsolidated affiliates consist of the following (dollars in thousands):
Ownership Interest
Portfolio
Property
REIT:
Gotham Plaza
49%
27,885
28,161
Georgetown Portfolio (a)
50%
3,766
3,744
1238 Wisconsin Avenue (a, b)
80%
17,258
18,025
840 N. Michigan Avenue (c, d)
94.35%
37,033
34,631
85,942
84,561
Investment Management:
Fund IV: (e)
Fund IV Other Portfolio (f)
90%
41
375
650 Bald Hill Road (g)
369
5,789
410
6,164
Fund V: (e)
Family Center at Riverdale (c)
89.42%
271
521
Tri-City Plaza (m)
310
6,120
Frederick County Acquisitions (h)
3,575
3,872
Wood Ridge Plaza
7,944
7,962
La Frontera Village
8,424
9,746
Shoppes at South Hills
8,335
9,151
Mohawk Commons
7,648
9,023
36,507
46,395
Other:
Shops at Grand
5%
2,293
2,363
Walk at Highwoods Preserve
20%
1,716
1,805
LINQ Promenade
15%
15,979
15,918
Shops at Skyview (i)
63,760
Atlantic Portfolio (j)
42,976
Avenue West Cobb
4,275
Pinewood Square
4,876
135,875
20,086
Various:
Due from Related Parties
2,151
1,366
Other (k)
2,713
3,383
Investments in and advances tounconsolidated affiliates
Crossroads (l)
Distributions in excess of income from,and investments in, unconsolidated affiliates
16
In January 2026, the Company acquired a 20% non-controlling equity interest in a joint venture that acquired the Shops at Skyview, a retail shopping center located in Queens, NY, for $424.1 million. At closing, the joint venture secured a mortgage loan with a total commitment of $290.0 million, of which $277.0 million was funded at closing. Additionally, the Company provided a preferred equity investment of approximately $41.7 million. The preferred equity is accounted for as a held-to-maturity debt instrument given its stated maturity date in January 2029, and bears interest at 7.5%.
In February 2026, the Company acquired a 20% non-controlling equity interest in two newly formed joint ventures, Atlantic Portfolio and Avenue at West Cobb, that, as part of a recapitalization, acquired a seven-property open-air retail portfolio. Six of the properties were previously held in Fund V, while one property (Avenue at West Cobb) was previously held in the Company’s wholly owned portfolio. The Company’s retained interest in the joint ventures was fair-valued at $87.1 million. At closing, the joint venture obtained a mortgage loan with a total commitment of $317 million, of which $298 million was funded at closing. Additionally, the Company provided seller financing to the Atlantic Portfolio joint venture in the form of a $27.5 million preferred equity investment. The preferred equity is accounted for as a held-to-maturity debt instrument given its stated maturity date in February 2029, is secured by the equity interests in the entity that owns the Atlantic Portfolio properties, and bears interest at a stated rate of 6.0%. The preferred equity investment was determined to be issued at below-market terms, as the prevailing market rate for a comparable instrument at the time of origination exceeded the stated rate. Accordingly, the Company recorded the instrument at fair value at origination, resulting in a $2.4 million discount, which is presented as a reduction to the preferred equity investment balance within Investments in and advances to unconsolidated affiliates on the Condensed Consolidated Balance Sheets, with a corresponding reduction to the gain on disposition recognized in connection with the recapitalization (Note 2). The discount will be accreted into interest income over the term of the instrument using the effective interest method.
In March 2026, the Company retained a 20% non-controlling equity interest in a newly formed joint venture that acquired Pinewood Square, which was fair-valued at $13.6 million. At closing, the joint venture obtained a mortgage loan of $45.0 million.
During the three months ended June 30, 2026, the Company, through Fund IV, sold its investment in 650 Bald Hill for $20.5 million and repaid the related $14.4 million property mortgage loan. The venture recognized a gain on sale of $0.6 million, of which the Company’s proportionate share was $0.2 million.
During the three months ended June 30, 2026, the Company, through Fund V, sold its investment in Tri-City Plaza for $62.5 million and repaid the related $34.8 million property mortgage loan. The venture recognized a gain of $19.7 million, of which the Company’s proportionate share of the gain was $3.0 million.
840 N. Michigan Avenue
In December 2023, an unconsolidated venture holding an interest in a property on North Michigan Avenue modified its $73.5 million nonrecourse mortgage loan. The modification reduced the principal balance by $18.5 million, required a $17.5 million principal paydown, increased the interest rate from 4.4% to 6.5%, and extended the maturity from February 2025 to December 2026. Under the modification, the venture may be required to make contingent payments of up to $17.5 million upon a sale or secured refinancing prior to maturity (“Contingent Payment”). The Contingent Payment amortizes on a straight‑line basis over the remaining loan term and is reduced over time in accordance with the modification agreement. The modification was accounted for as a troubled debt restructuring under ASC 470, resulting in an initial gain of approximately $0.4 million recognized in equity in earnings of unconsolidated affiliates. Future cash payments under the modified loan, including any Contingent Payment, are treated as reductions of the mortgage carrying amount, and no interest expense is recognized through the revised maturity. As the Contingent Payment amortizes, additional gains are recognized in equity in earnings, of which $1.0 million and $2.0 million were recognized
17
during the three and six months ended June 30, 2026 and 2025, respectively. As part of the modification, the Operating Partnership provided a recourse guarantee equal to 50% of the unpaid principal balance of the mortgage which was $30.0 million as of June 30, 2026.
Fees earned from and paid to Unconsolidated Affiliates
The Company earned fees for asset management, property management, construction, development, legal and leasing fees from its investments in unconsolidated affiliates totaling $2.8 million and $1.3 million for the three months ended June 30, 2026 and 2025, respectively, and $6.2 million and $2.0 million for the six months ended June 30, 2026 and 2025, respectively, which are included in Other revenues in the Condensed Consolidated Statements of Operations.
In addition, the Company’s unconsolidated joint ventures paid fees to the Company’s unaffiliated joint venture partners of $1.1 million and $0.8 million for the three months ended June 30, 2026 and 2025, respectively, and $2.2 million and $1.6 million for the six months ended June 30, 2026 and 2025, respectively, for leasing commissions, development, management, construction and overhead fees.
Summarized Financial Information of Unconsolidated Affiliates
The following Combined and Condensed Balance Sheets and Statements of Operations, in each period, summarized the financial information of the Company’s investments in unconsolidated affiliates that were held as of June 30, 2026 and 2025 (in thousands):
Combined and Condensed Balance Sheets
Assets:
Rental property, net
1,640,086
902,016
Other assets
334,174
119,689
Total assets
1,974,260
1,021,705
Liabilities and partners’ equity:
Mortgage notes payable
1,254,574
630,077
228,878
127,164
Partners’ equity
490,808
264,464
Total liabilities and partners’ equity
Company's share of accumulated equity
230,677
127,079
Basis differential
8,664
8,860
Deferred fees, net of portion related to the Company's interest
2,509
4,452
Amounts receivable/payable by the Company
Investments in and advances to unconsolidated affiliates, net of Company's share of distributions in excess of income from and investments in unconsolidated affiliates
244,001
141,757
Investments carried at cost
2,683
3,360
Company's share of distributions in excess of income from and investments in unconsolidated affiliates
18
Combined and Condensed Statements of Operations
55,962
29,016
99,987
61,142
Operating and other expenses
(19,656
(10,981
(34,968
(23,230
(19,448
(10,713
(35,320
(22,163
(26,833
(13,622
(46,883
(26,474
Gain on extinguishment of debt (a)
971
951
1,942
1,922
Gain (loss) on disposition of properties (b)
20,381
(1,030
Net (loss) income attributable to unconsolidated affiliates
11,377
(6,379
5,139
(9,833
Company’s share of equity in net (losses) earnings of unconsolidated affiliates
14,027
(4,093
12,617
(5,708
Basis differential amortization
(98
(196
Company’s equity in earnings (losses) of unconsolidated affiliates
5. Other Assets, Net and Accounts Payable and Other Liabilities
Other assets, net and accounts payable and other liabilities are comprised of the following for the periods presented:
Other Assets, Net:
Lease intangibles, net (Note 6)
99,946
128,239
Derivative financial instruments (Note 8)
18,407
9,738
Deferred charges, net (A)
45,786
44,133
Accrued interest receivable (Note 3)
9,190
8,916
Prepaid expenses
13,826
17,327
Due from seller
1,367
1,768
Income taxes receivable
503
1,180
Deposits
1,709
5,774
Corporate assets, net
604
430
Other receivables
3,323
6,475
(A) Deferred Charges, Net:
Deferred leasing and other costs
94,411
94,957
Deferred financing costs related to line of credit
18,240
13,939
112,651
108,896
Accumulated amortization
(66,865
(64,763
Deferred charges, net
Accounts Payable and Other Liabilities:
83,189
95,991
72,936
88,139
Deferred income
25,748
34,102
Tenant security deposits, escrow and other
14,951
19,939
Lease liability - finance leases, net (Note 11)
32,494
32,112
323
3,196
19
6. Lease Intangibles
Intangible assets and liabilities are included in Other assets, net and Accounts payable and other liabilities (Note 5) on the Condensed Consolidated Balance Sheets and summarized as follows (in thousands):
Gross CarryingAmount
AccumulatedAmortization
Net CarryingAmount
Amortizable Intangible Assets
In-place lease intangible assets
340,762
(243,888
96,874
408,015
(289,643
118,372
Above-market rent
20,821
(17,749
3,072
32,608
(22,741
9,867
361,583
(261,637
440,623
(312,384
Amortizable Intangible Liabilities
Below-market rent
(205,990
122,942
(83,048
(223,893
128,072
(95,821
Above-market ground lease
(671
530
(141
501
(170
(206,661
123,472
(83,189
(224,564
128,573
(95,991
Amortization of in-place lease intangible assets is recorded in depreciation and amortization expense in the Condensed Consolidated Statements of Operations. Amortization of above-market rent and below-market rent is recorded as a reduction to and increase to rental revenue, respectively, in the Condensed Consolidated Statements of Operations. Amortization of above-market ground leases is recorded as a reduction to rent expense on the Condensed Consolidated Statements of Operations.
The amounts of such amortization included in the accompanying consolidated statements of operations and comprehensive income (loss) are as follows (in thousands):
Three Months EndedJune 30,
Six Months EndedJune 30,
Amortization of in-place lease intangibles
6,796
8,871
16,880
18,392
Amortization of above-market rent and below-market rent
(2,098
(2,276
(5,446
(4,459
Amortization of above-market ground leases
(15
(29
20
7. Debt
A summary of the Company’s consolidated indebtedness is as follows (dollars in thousands):
Carrying Value as of
Interest Rate as of
Maturity Date as of
Mortgages Payable
3.99% - 6.05%
Nov 2026 - Apr 2035
$226,501
$227,684
Fund II (a)
137,500
5.62%
Jun 2028
25,939
27,249
SOFR+1.40% - SOFR+3.10%
Dec 2026 - Apr 2030
229,311
505,184
Net unamortized debt issuance costs
(2,180)
(4,599)
Unamortized premium
474
926
Total Mortgages Payable
$480,045
$893,944
Unsecured Notes Payable
Term Loans (b, c)
SOFR+1.15% - SOFR+1.20%
May 2030 - Apr 2031
$837,500
$725,000
Senior Notes
5.86% - 5.94%
Aug 2027 - Aug 2029
100,000
Term Loan A-3
SOFR+1.15%
Apr 2031
Fund IV Term Loan
SOFR+1.20%
Dec 2028
52,250
61,250
(13,600)
(6,788)
Total Unsecured Notes Payable
$1,113,650
$879,462
Unsecured Line of Credit
Revolving Credit Facility (c, d)
SOFR+1.00%
Apr 2030
$43,323
$89,500
Total Debt (e)(f)
$1,652,324
$1,873,367
(15,780)
(11,387)
Total Indebtedness
$1,637,018
$1,862,906
At June 30, 2026 and December 31, 2025, the Company’s property mortgage loans were collateralized by 35 and 45 properties, respectively, as well as the related tenant leases. The Company was in compliance with its debt covenants as of June 30, 2026.
Investment Management
In connection with the Fourth Amended and Restated Credit Facility, during the quarter ended June 30, 2026, the Operating Partnership used proceeds from Term Loan A-3, discussed below, to refinance a secured mortgage loan related to a Fund II asset which had an outstanding balance of $137.5 million.
During the six months ended June 30, 2026, the Company, through its Investment Management platform:
21
Unsecured Notes Payable and Unsecured Line of Credit
The Company was in compliance with its unsecured notes payable and unsecured line of credit debt covenant requirements as of June 30, 2026.
Revolving Credit Facility
On April 17, 2026, the Operating Partnership entered into a Fourth Amended and Restated Credit Agreement (the "Amendment") to amend and expand its senior unsecured credit facility (the “Credit Facility”). The Amendment (i) extended the maturity of the $525.0 million revolving credit facility (the “Revolving Credit Facility”), the size of which remained unchanged, from April 15, 2028 to April 17, 2030, subject to two six-month extension options; (ii) increased the borrowing capacity of Term Loan A-1 from $400.0 million to $512.5 million and extended its maturity from April 15, 2028 to April 17, 2031; and (iii) established a new $137.5 million unsecured term loan facility (“Term Loan A-3”) maturing April 17, 2031. The Operating Partnership's existing $250.0 million Term Loan A-2, maturing May 29, 2030, was not modified by the Amendment. The Amendment also increased the accordion feature under the Credit Facility to up to $2.0 billion, at the Operating Partnership's option and subject to customary conditions.
The Revolving Credit Facility, Term Loan A-1 and Term Loan A-3 bear interest at floating rates based on SOFR plus an applicable margin determined by reference to the Company’s leverage ratio or credit ratings. As of June 30, 2026, the applicable rates were SOFR plus 1.00% on the Revolving Credit Facility and SOFR plus 1.15% on each of Term Loan A-1 and Term Loan A-3.
Unamortized deferred financing costs of $4.8 million associated with the prior facility were carried forward and are being amortized over the term of the amended facility, and the Company capitalized $11.7 million of new deferred financing costs in connection with the Amendment, which are being amortized over the remaining term of the Credit Facility.
As of June 30, 2026, outstanding borrowings were $512.5 million under Term Loan A-1, $250.0 million under Term Loan A-2, and $137.5 million under Term Loan A-3. The Revolving Credit Facility had an outstanding balance of $43.3 million and remaining borrowing capacity of $481.7 million.
Scheduled Debt Principal Payments
The following table summarizes the scheduled principal repayments, without regard to available extension options (described further below), of the Company’s consolidated indebtedness, as of June 30, 2026 (in thousands):
Year Ending December 31,
Principal Repayments
2026 (Remainder)
161,782
2027
106,029
2028
150,384
2029
182,889
2030
400,173
Thereafter
651,067
1,652,324
(15,780
Total indebtedness (a)
1,637,018
22
8. Financial Instruments and Fair Value Measurements
Items Measured at Fair Value on a Recurring Basis
The following table presents the Company’s fair value hierarchy for those assets and liabilities measured at fair value on a recurring basis (in thousands):
Level 1
Level 2
Level 3
Derivative financial instruments
Liabilities
(323
(3,196
There were no transfers between levels of the fair value hierarchy during the six months ended June 30, 2026, and 2025.
Items Measured at Fair Value on a Nonrecurring Basis
Redeemable Noncontrolling Interests
During the six months ended June 30, 2026, the Company recorded an adjustment of redeemable noncontrolling interest to its estimated redemption value. Refer to Note 10 for further discussion regarding these interests.
Derivative Financial Instruments
The Company had the following interest rate swaps and caps for the periods presented (information is as of June 30, 2026, unless otherwise noted, and dollars in thousands):
Strike Rate
Fair Value
DerivativeInstrument
Aggregate Notional Amount
Effective Date
Balance SheetLocation
Interest Rate Swaps
800,000
May 2022—Aug 2025
Jul 2027—Jul 2030
1.98%
3.61%
Other Assets
17,002
9,531
102,000
Nov 2023
Nov 2026
4.50%
(258
(2,140
902,000
16,744
7,391
Fund II
Interest Rate Swap
50,000
Jan 2023
Dec 2029
3.23%
1,001
199
May 2026—Dec 2027
3.36%
404
32,200
Jun 2026
Jun 2029
3.95%
(65
(1,056
Interest Rate Cap
Sep 2025
Sep 2026
5.00%
114,400
339
(1,048
Total Asset Derivatives
Total Liability Derivatives
As of June 30, 2026, it is estimated that approximately $12.0 million included in Accumulated other comprehensive income related to derivatives will be reclassified as a reduction to interest expense within the next twelve months.
During the six months ended June 30, 2026, the Company terminated five swaps with an aggregate notional value of $162.0 million in conjunction with the repayment of debt that occurred as part of the Fund V recapitalization (Note 2).
Other Financial Instruments
The carrying values and fair values of Company’s other financial assets and liabilities that are not measured at fair value on its Condensed Consolidated Balance Sheets are as follows as of the dates shown (dollars in thousands, inclusive of amounts attributable to noncontrolling interests where applicable):
Level
CarryingAmount
EstimatedFair Value
Notes Receivable (a)
155,433
157,325
City Point Loan (f)
34,821
35,346
Mortgage and Other Notes Payable (a, d)
481,751
474,745
897,616
894,607
Investment in non-traded equity securities (b)
2,528
3,307
Unsecured notes payable and Unsecured line of credit (c, e)
2
1,170,573
1,171,644
975,750
981,271
As of June 30, 2026 and December 31, 2025, the carrying amounts of the Company’s cash and cash equivalents, restricted cash, rents receivable, accounts payable, and certain financial instruments classified as Level 1 within other assets and other liabilities approximated their fair values. This approximation is due to the short-term nature and high liquidity of these instruments.
9. Commitments and Contingencies
The Company is involved in various matters of litigation arising out of, or incidental to, its business. While the Company is unable to predict with certainty the outcome of any particular matter, management does not expect, when such litigation is resolved, that the Company’s resulting exposure to loss contingencies, if any, will have a material adverse effect on its consolidated financial position or results of operations.
Commitments and Guaranties
The Operating Partnership is jointly and severally liable for the obligations under the Fund IV Term Loan, which may result in an obligation for the payment of principal, interest, and any other amounts due. As of June 30, 2026, the Company did not expect the Operating Partnership to make any payments under this arrangement. The outstanding balance of the facility was $52.3 million as of June 30, 2026 (Note 7).
Additionally, in connection with the refinancing of the La Frontera Village (Note 4) property mortgage loan of $57.0 million, which is collateralized by the investment property, Fund V guaranteed the joint venture’s obligation under the loan. Fund V acted as guarantor under the non-recourse carveout guaranty. At June 30, 2026 and December 31, 2025, $0.1 million and $0.1 million related to the guarantee was recorded as a liability in the Company’s Condensed Consolidated Balance Sheets, respectively.
Construction and Tenant Improvement Commitments
In conjunction with the development and expansion of various properties, the Company has entered into agreements with general contractors for the construction or development of properties aggregating approximately $39.1 million and $68.6 million, of which the Company’s share is $34.8 million and $64.8 million as of June 30, 2026 and December 31, 2025, respectively.
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Additionally, the Company has committed to fund tenant improvements under executed leases totaling approximately $63.3 million and $44.1 million, as of June 30, 2026 and December 31, 2025, respectively. The Company’s share of these obligations is approximately $46.6 million and $37.1 million, respectively. The timing and amounts of these payments are uncertain and are subject to the satisfaction of certain performance conditions.
Insurance Coverage
The Company maintains insurance coverage on its properties in different types and amounts, with deductibles, that management believes are consistent with coverage typically carried by owners of similar properties.
10. Shareholders’ Equity, Noncontrolling Interests and Other Comprehensive Loss
Public Offerings
From time to time, the Company may offer its shares of beneficial interest through public offerings registered with the SEC or through private offerings pursuant to one or more exemptions from registration under the Securities Act. In connection with such offerings, the Company may issue and sell the offered shares upon settlement of the offering or, alternatively, enter into forward sale agreements with respect to all or a portion of the sold in such public offerings, pursuant to which the offered shares are borrowed by the forward sale purchasers and the issuance of such shares takes place upon settlement of the applicable forward sale agreement in accordance with its terms.
On June 11, 2026, the Company completed an offering of 9,000,000 Common Shares at an initial forward sale price of $21.80 per share. These shares are subject to forward sale agreements, which require settlement within one-year of the various effective dates. In connection with the offering, in July 2026, the underwriters partially exercised their over-allotment option, resulting in the issuance of an additional 242,996 Common Shares for an aggregate of 9,242,996 Common Shares subject to forward sale agreements. The Company did not initially receive any proceeds from the sale of Common Shares in the offering, which were sold to the underwriters by the forward purchasers or their respective affiliates. Assuming full physical settlement, the Company expects to receive net proceeds of approximately $201.1 million after deduction of estimated expenses.
ATM Program
The Company has an at-the-market equity issuance program (“ATM Program”) that provides the Company with an efficient vehicle for raising public equity capital to fund its needs.
During the six months ended June 30, 2026, the Company physically settled 6,209,562 Common Shares outstanding under the forward contracts pursuant to the ATM Program, and received proceeds of $128.0 million. This included settlements of $55.9 million in March and $72.1 million in June.
As of June 30, 2026, the Company had 8,529,275 Common Shares subject to forward sales agreements outstanding under its ATM Program at a weighted-average net offering price of $19.90 per share. All forward sales agreements require settlement within one-year of the various effective dates and are expected to result in net cash proceeds of approximately $167.9 million if the Company were to physically settle all outstanding Common Shares subject to forward sales agreements. An additional $199.1 million remains available for future share issuance under the ATM Program.
The Company did not receive any proceeds at the time it entered into each of the respective forward sale agreements. The Company determined that the ATM forward sales agreements qualify for equity classification and are therefore exempt from derivative accounting. Accordingly, the ATM forward sales agreements were recorded at fair value at inception, which was determined to be zero, with no subsequent fair value adjustments required.
Common Shares and Units
During the six months ended June 30, 2026, the Company withheld 6,546 shares of its restricted Common Shares (“Restricted Shares”) to pay the employees’ statutory minimum income tax withholding obligations upon vesting. For the three and six months ended June 30, 2026, the
25
Company recognized $2.9 million and $9.3 million, respectively, of compensation expense in connection with Restricted Shares and Common OP Units (Note 13).
Share Repurchase Program
The Company maintains a share repurchase authorization of up to $200.0 million of outstanding Common Shares (the “Share Repurchase Program”), providing flexibility to return capital to shareholders when appropriate. No shares were repurchased during the six months ended June 30, 2026 or 2025. As of June 30, 2026, $122.5 million remains available under the Share Repurchase Program.
Dividends and Distributions
During each of the three months ended June 30, 2026 and 2025, the Company declared distributions of $0.20 per Common Share/OP Unit. During the six months ended June 30, 2026 and 2025, the Company declared aggregate distributions of $0.40 per Common Share/OP Unit in each period.
Noncontrolling Interests
The following tables summarize the change in the noncontrolling interests for the three and six months ended June 30, 2026 and 2025 (dollars in thousands, except per unit data):
NoncontrollingInterests inOperatingPartnership (a)
NoncontrollingInterests inPartially-OwnedAffiliates (b)
Redeemable Noncontrolling Interests (c)
109,838
248,659
Distributions declared of $0.20 per Common OP Unit and distributions on Preferred OP Units
Net income (loss) for the three months ended June 30, 2026
557
12,216
12,773
Conversion of 26,360 Common OP Units to Common Shares by limited partners of the Operating Partnership
Other comprehensive income - unrealized loss on valuation of swap agreements
259
685
944
Reclassification of realized interest expense on swap agreements
(1
(165
Employee Long-term Incentive Plan Unit Awards
Reallocation of noncontrolling interests (d)
109,682
230,019
95,628
369,158
Net income (loss) for the three months ended June 30, 2025
175
(21,356
(21,181
Conversion of 23,118 Common OP Units to Common Shares by limited partners of the Operating Partnership
Other comprehensive income - unrealized gain on valuation of swap agreements
(301
(274
(575
(4
(596
(600
94,599
342,434
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Balance as of January 1, 2026
92,482
302,189
Distributions declared of $0.40 per Common OP Unit and distributions on Preferred OP Units
Net income (loss) for the six months ended June 30, 2026
2,056
120,049
122,105
Conversion of 43,971 Common OP Units to Common Shares by limited partners of the Operating Partnership
412
2,173
2,585
(187
Balance as of January 1, 2025
85,730
350,287
Net income (loss) for the six months ended June 30, 2025
(33,100
(32,777
Conversion of 136,210 Common OP Units to Common Shares by limited partners of the Operating Partnership
(757
(1,776
(2,533
(18
(1,244
(1,262
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Williamsburg Portfolio
In connection with the Williamsburg Portfolio acquisition in February 2022, the venture partner has a one-time right to put its 50.01% interest in the property to the Company for redemption at fair value after five years have passed (“Williamsburg NCI”). As it was unlikely as of the acquisition date that the venture partner would receive any consideration on redemption due to the Company’s preferential returns, the initial fair value of the Williamsburg NCI was determined to be zero. As of June 30, 2026, the fair value of the Williamsburg NCI was zero.
City Point Loan
In August 2022, the Company provided a loan of $65.9 million (“City Point Loan”) to the other Fund II investors in City Point to fund their pro-rata contribution required to complete the refinancing of the City Point debt. The City Point Loan was collateralized by the investors’ equity in City Point (“City Point NCI”) and, because it was granted in return for a capital contribution, it was presented as a reduction of the City Point NCI balance on the Company’s Condensed Consolidated Balance Sheets. In connection with the City Point Loan, each investor received a one-time right, beginning in August 2023, to put its City Point NCI to the Company for redemption in exchange for settlement of its proportionate share of the City Point Loan plus either (i) a fixed cash amount or (ii) a cash amount equal to the value of a fixed number of the Company’s Common Shares on the trading day prior to election (“Redemption Value”). Accordingly, the City Point NCI, net of the City Point Loan, was classified as Redeemable noncontrolling interests on the Company’s Condensed Consolidated Balance Sheets.
During the three months ended June 30, 2026, the Company acquired the remaining interests of the other Fund II investors in City Point for total consideration of $67.1 million, comprised of the assumption of the remaining investors’ portion of the City Point Loan and accrued interest balance of $58.5 million and a cash payment of $8.6 million. Following the transaction, the Company owns 100% of Fund II (Note 1). As the Company retained control of the subsidiary, no gain or loss was recognized in the Condensed Consolidated Statement of Operations.
For the six months ended June 30, 2026, the Company recorded aggregate adjustments of $5.6 million to increase the carrying value of the City Point NCI to its Redemption Value. Because the redemption feature was not based on fair value, these adjustments were recorded as reductions of net income attributable to Acadia shareholders in the calculation of earnings per share (Note 14).
8833 Beverly Boulevard
In July 2023, the Company entered into a limited partnership agreement to own and operate the 8833 Beverly Boulevard property. Following the formation of the partnership, the Company retained a 97.0% controlling interest. At a future point in time, either party may elect a buy-out right, where either the Company may purchase the venture partner’s interest, or the venture partner may sell its 3.0% interest in the partnership (the “8833 Beverly NCI”) to the Company for fair value. As a result of these redemption rights, the 8833 Beverly NCI was initially recorded at fair value.
As of June 30, 2026, the Company recorded an adjustment of $0.2 million to adjust the carrying value of the NCI to its redemption value. As this interest is redeemable at fair value, the adjustment to redemption value was recognized as an adjustment to Additional Paid-in Capital and had no impact on consolidated Net (loss) income, or Net income attributable to Acadia shareholders in the Company’s Condensed Consolidated Statements of Operations.
Henderson
In May 2026, the Company entered into a limited liability company agreement to own and operate the Henderson JV, a mixed-use ground-up development project located on N. Henderson Avenue in Dallas, Texas. The Company retained a 95.0% controlling interest, with the venture partner holding a 5.0% interest (the “Henderson NCI”). The Henderson JV was determined to be a VIE for which the Company is the primary beneficiary, as the Company has both the power to direct the activities that most significantly impact the Henderson JV’s economic performance and the obligation to absorb losses or right to receive benefits that could be significant to the Henderson JV. Accordingly, as the development project was wholly-owned prior to this transaction, the Henderson JV continues to be consolidated in the Company’s Condensed Consolidated Financial Statements (Note 15).
The venture partner holds a one-time right to require the Company to purchase all or a portion of the Henderson NCI for cash at fair value during the 24-month period following stabilization of the project. Following the expiration of that period, the Company may require the venture partner to sell its interest to the Company at fair value. Because redemption is exercisable at the option of the venture partner and is outside the Company’s control, the Henderson NCI is classified as Redeemable noncontrolling interests on the Company’s Condensed Consolidated Balance Sheets.
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The Henderson NCI is measured at the greater of its carrying amount or redemption value. Adjustments to redemption value are recognized through Additional Paid-in Capital when the redemption becomes probable. As of June 30, 2026, no adjustment to redemption value was required.
Preferred OP Units
In 1999, the Operating Partnership issued 1,580 Series A Preferred OP Units in connection with the acquisition of a property, which have a stated value of $1,000 per unit, and are entitled to a preferred quarterly distribution of the greater of (i) $22.50 (9.00% annually) per Series A Preferred OP Unit or (ii) the quarterly distribution attributable to a Series A Preferred OP Unit if such unit was converted into a Common OP Unit. Through June 30, 2026, 1,392 Series A Preferred OP Units were converted into 185,600 Common OP Units and then into Common Shares. The 188 remaining Series A Preferred OP Units are currently convertible into Common OP Units based on the stated value divided by $7.50. Either the Company or the holders can currently call for the conversion of the Series A Preferred OP Units at the lesser of $7.50 or the market price of the Common Shares as of the conversion date.
11. Leases
As Lessor
As of June 30, 2026, the Company was party to approximately 1,000 leases, which include both properties owned directly and those operated under long-term ground leases. These lease agreements have contractual terms that extend through January 31, 2099, and many include tenant renewal options. Certain leases also provide tenants with early termination rights. During the three and six months ended June 30, 2026 and 2025, no single tenant or property collectively comprised more than 10% of the Company’s total revenues.
Lease terms generally range from one month to sixty years. In addition to fixed base rent, many leases include provisions for variable lease payments, such as reimbursements for operating expenses and rent based on a percentage of the tenant’s sales volume.
The following table presents the components of rental revenue, disaggregated into fixed and variable lease income (in thousands):
Fixed lease revenue
73,187
78,871
151,880
163,074
Variable lease revenue
18,001
19,426
37,876
37,863
Total rental revenue
The following table summarizes the Company’s scheduled future minimum rental revenues under non-cancelable tenant leases with remaining terms greater than one year, as of June 30, 2026. These amounts assume no new or renegotiated leases or exercise of renewal options not deemed reasonably certain (in thousands):
Minimum RentalRevenues
131,590
268,438
247,660
219,274
192,923
738,831
1,798,716
During the six months ended June 30, 2025, the Company recognized $8.4 million as rental and termination income related to a lease termination at City Center, a REIT Portfolio property, which is included in Other revenue on the Company’s Condensed Consolidated Statements of Operations.
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As Lessee
The following table summarizes the Company’s scheduled future minimum rental payments under non-cancelable leases as of June 30, 2026 (in thousands):
Minimum Rental Payments
Operating Leases (a)
Finance Leases (a)
2,856
681
4,849
1,350
4,646
1,396
4,121
1,415
4,077
1,495
8,988
153,824
29,537
160,161
Interest
(5,685
(127,667
The following table summarizes additional lease cost information for the Company’s lessee arrangements (dollars in thousands):
Lease Cost
Finance lease cost:
Amortization of right-of-use assets
373
747
Interest on lease liabilities
525
513
1,047
1,025
Subtotal
898
886
1,794
1,772
Operating lease cost
1,318
1,409
2,635
2,715
Variable lease cost
48
105
85
194
Total lease cost
2,264
2,400
4,514
4,681
Cash Paid
Payments of operating lease obligations - operating activities
1,421
2,794
2,731
Payments of interest on finance lease obligations - operating activities
1,046
Payments of finance lease obligations - financing activities
317
132
665
As of June 30,
Weighted-average remaining lease term - finance leases (years)
56.1
56.5
Weighted-average remaining lease term - operating leases (years)
7.9
8.3
Weighted-average discount rate - finance leases
6.5
Weighted-average discount rate - operating leases
5.2
5.1
During the six months ended June 30, 2025, the Company entered into a new corporate office lease and recorded a right-of-use assets - operating lease and corresponding lease liability - operating lease of $2.1 million.
12. Segment Reporting
The Company has identified three reportable segments: REIT Portfolio, Investment Management and Structured Financing. The Company’s Chief Operating Decision Maker (“CODM”), its Chief Executive Officer, evaluates the performance of these segments and allocates resources based on financial information presented at the segment level. The CODM primarily uses net income as the key measure of segment profitability, as it reflects a comprehensive view of the segments’ financial performance, including all revenues and expenses.
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The Company’s REIT Portfolio segment consists primarily of high-quality retail properties located primarily in high-barrier-to-entry, densely-populated metropolitan areas with a long-term investment horizon. The Company’s Investment Management segment holds primarily retail real estate in which the Company co-invests with high-quality institutional investors. The Company’s Structured Financing segment consists of earnings and expenses related to notes and mortgages receivable (Note 3).
Fees earned by the Company as the general partner or managing member through consolidated Investment Management entities are eliminated in the Company’s Condensed Consolidated Financial Statements and are not presented in the Company’s segments.
The following tables present selected financial information for each reportable segment (in thousands):
For the Three Months Ended June 30, 2026
REITPortfolio
StructuredFinancing
Unallocated
Rental revenue
65,944
25,244
Other revenue
1,030
3,205
Depreciation and amortization expenses
(23,973
(11,189
(35,162
Property operating expenses
(9,956
(7,083
(17,039
(10,018
(2,717
(12,735
General and administrative expenses
(11,782
Gain (loss) on disposition of properties
(416
4,385
22,611
11,845
Interest income
Equity in (losses) earnings of unconsolidated affiliates
(80
14,009
(12,090
(8,053
Net income
10,408
17,801
(11,936
Net income attributable to noncontrolling interests
(435
(12,338
9,973
6,444
For the Three Months Ended June 30, 2025
57,699
40,598
1,691
(22,446
(16,823
(39,269
(8,639
(8,885
(17,524
(8,780
(4,537
(13,317
(11,532
(18,190
Operating income (loss)
18,438
(6,146
Equity in losses of unconsolidated affiliates
(522
(3,669
(9,555
(14,049
(411
357
7,950
(23,864
6,715
(11,743
Net loss attributable to noncontrolling interests
21,045
8,086
(1,095
As of or for the Six Months Ended June 30, 2026
128,558
61,198
1,629
7,030
(48,344
(26,973
(75,317
(20,255
(15,033
(35,288
(19,372
(6,285
(25,657
(27,085
146,533
41,800
166,470
(30
12,451
(24,393
(17,802
16,728
161,119
(27,251
(1,671
(120,434
15,057
42,364
Real estate at cost (a)
3,569,687
1,306,786
4,876,473
Total assets (a)
3,355,631
1,107,375
Cash paid for acquisition of real estate
196,302
Cash paid for development and property improvement costs
50,832
6,457
57,289
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As of or for the Six Months Ended June 30, 2025
121,473
79,464
1,287
2,762
(46,129
(32,580
(78,709
(18,192
(17,612
(35,804
(17,738
(8,882
(26,620
(23,129
(24,640
40,701
(1,488
(209
(5,695
(18,934
(27,917
Realized and unrealized holding losses on investments and other
1,374
193
13,310
(35,100
12,647
(23,456
345
32,432
13,655
725
3,281,496
1,815,145
5,096,641
3,112,930
1,607,957
154,682
4,875,569
276,852
67,795
344,647
42,030
5,498
47,528
13. Share Incentive and Other Compensation
The Amended and Restated 2020 Share Incentive Plan (the “Amended and Restated 2020 Plan”), as approved by the Board and the Company’s shareholders, authorizes the issuance of up to 3,883,564 Common Shares. The Amended and Restated 2020 Plan allows for the issuance of options, Restricted Shares, LTIP Units, and other securities (collectively, the “Awards”) to, among others, the Company’s officers, trustees, and employees. As of June 30, 2026 a total of 1,269,950 shares remained available for issuance under the Amended and Restated 2020 Plan.
As of June 30, 2026, there was $27.3 million of total unrecognized compensation cost related to unvested share-based compensation arrangements granted under the Amended and Restated 2020 Plan. That cost is expected to be recognized over a weighted-average period of 1.6 years.
The total fair value of Restricted Shares that vested during the six months ended June 30, 2026 and the year ended December 31, 2025, was $0.7 million and $0.7 million, respectively. The total fair value of LTIP Units that vested (LTIP units vest primarily during the first quarter) during the six months ended June 30, 2026 and the year ended December 31, 2025, was $15.6 million and $9.9 million, respectively.
During the six months ended June 30, 2026, the Company issued 593,577 time-based LTIP Units and 25,350 time-based restricted share units (“Restricted Share Units”), to employees of the Company pursuant to the Amended and Restated 2020 Plan.
Additionally, the Company awarded 360,666 performance-based LTIP Units and 368 performance-based Restricted Share Units. These awards were measured at their fair value on the grant date.
For valuation of the 2026 and 2025 performance-based award grants, a Monte Carlo simulation was used to estimate the fair values of the grants. The assumptions include volatility (24.0% and 29.0%) and risk-free interest rates (3.6% and 4.4%) for 2026 and 2025, respectively. The total fair value of the 2026 and 2025 grants will be expensed on a graded vesting basis over the vesting period of the award.
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The weighted-average grant date fair value for Restricted Shares and LTIP Units granted for the six months ended June 30, 2026 and the year ended December 31, 2025 were $17.33 and $21.29, respectively. The total fair value of the above Restricted Share Units and LTIP Units as of the grant date was $15.2 million for the six months ended June 30, 2026 and $14.7 million for the year ended December 31, 2025. Total long-term incentive compensation expense, including the expense related to the Amended and Restated 2020 Plan, was $3.0 million and $2.9 million for the three months ended June 30, 2026 and 2025, respectively, and was $9.3 million and $5.3 million for the six months ended June 30, 2026 and 2025, respectively, and is recorded in General and administrative expenses in the Condensed Consolidated Statements of Operations.
In addition, members of the Board have been issued shares and units under the Amended and Restated 2020 Plan. During the six months ended June 30, 2026, the Company issued 29,202 LTIP Units and 21,954 Restricted Share Units to Trustees of the Company. Total trustee fee expense, including the expense related to the Amended and Restated 2020 Plan, was $0.4 million and $0.4 million for the three months ended June 30, 2026 and 2025, respectively, and $0.8 million and $0.7 million for the six months ended June 30, 2026 and 2025, respectively, and is recorded in General and administrative expenses in the Condensed Consolidated Statements of Operations.
14. Earnings Per Common Share
The Company’s unvested LTIP Units are entitled to non-forfeitable dividend equivalent rights and are therefore considered participating securities. Accordingly, basic earnings per Common Share is computed using the two-class method. Diluted earnings per Common Share reflects the potential dilutive effect of Restricted Share Units issued under the Company’s Amended and Restated 2020 Plan (Note 13), and the shares issuable upon settlement of any outstanding forward sale agreements (Note 10), calculated using the treasury stock method. The assumed conversion of Common Operating Partnership Units is excluded from both basic and diluted earnings per Common Share, as the related income is reflected as noncontrolling interests and their conversion would have no net impact on diluted earnings per Common Share.
For the three and six months ended June 30, 2026, the Series A Preferred Operating Partnership Units were dilutive and are therefore included in the denominator for diluted earnings per Common Share. For the three and six months ended June 30, 2025, the Series A Preferred Operating Partnership Units were anti-dilutive and are therefore excluded from the computation of diluted earnings per Common Share.
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(dollars in thousands, except per share data)
Numerator:
Less: adjustment of redeemable non-controlling interest to estimated redemption value (Note 10)
Less: net income attributable to participating securities
(332
(338
(677
Income from continuing operations net of income attributable to participating securities for basic earnings per share
6,838
1,625
35,189
2,894
Denominator:
Weighted average shares for basic earnings per share
133,626,890
130,981,401
132,443,666
126,181,730
Effect of dilutive securities:
Series A Preferred OP Units
Employee unvested restricted shares
Assumed settlement of forward sales agreements (Note 10)
198,047
Denominator for diluted earnings per share
133,824,937
132,641,713
Basic earnings per Common Share from continuing operations attributable to Acadia shareholders
Diluted earnings per Common Share from continuing operations attributable to Acadia shareholders
Anti-Dilutive Shares Excluded from Denominator:
188
Series A Preferred OP Units - Common share equivalent
25,067
Series C Preferred OP Units
66,519
Series C Preferred OP Units - Common share equivalent
230,967
Restricted shares
79,358
Shares outstanding under the forward sales agreement (Note 10)
9,000,000
2,445,106
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15. Variable Interest Entities
The Company consolidates certain VIEs in which it has determined it is the primary beneficiary. As of June 30, 2026, the Company had identified nine consolidated VIEs, including the Operating Partnership and the Funds.
Excluding the Operating Partnership and the Funds, the Company’s consolidated VIEs include in-service REIT Portfolio operating properties: the Williamsburg Portfolio, 239 Greenwich Avenue, 8833 Beverly Boulevard, the Renaissance Portfolio, and the Henderson Avenue Development Project. The following table presents the assets and liabilities of the consolidated VIEs included in the Condensed Consolidated Balance sheets (in thousands):
VIE ASSETS
1,001,997
1,768,555
37,093
53,255
41,023
78,266
1,300
1,539
27,241
30,429
6,998
6,517
11,884
29,324
Total VIE assets (a)
1,134,371
1,967,885
VIE LIABILITIES
380,952
793,840
79,720
125,586
Lease liabilities - operating leases, net
1,355
1,604
Total VIE liabilities (a)
514,277
982,280
Unconsolidated VIEs
As of June 30, 2026, the Company had interests in two unconsolidated VIEs: 1238 Wisconsin Avenue and the Georgetown Portfolio. The Company’s investment in the assets of these unconsolidated VIEs was $41.9 million and $42.6 million, respectively. The Company’s share of the liabilities of these unconsolidated VIEs was $38.9 million and $38.9 million as of June 30, 2026 and December 31, 2025, respectively.
The Company holds a preferred equity investment in an unconsolidated VIE with a carrying value of $82.9 million as of June 30, 2026, which represents the Company’s maximum exposure to loss.
16. Subsequent Events
In July 2026, the Company acquired a single-tenant retail building at 8800-8804 Melrose Avenue in West Hollywood, California for $29.0 million, which was added to the REIT Portfolio. During the same period, the Company disposed of the parking garage at 1035 Third Avenue in New York, New York, a consolidated Fund IV Investment Management property, for $8.3 million.
In July 2026, through its Structured Financing segment, the Company originated a note receivable and funded an initial advance of $54.0 million at closing. The note matures in July 2029, subject to extension options.
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ITEM 2.MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.
OVERVIEW
Acadia Realty Trust (the “Trust”, collectively with its consolidated subsidiaries, the “Company”, “Acadia”, “we”, “us” or “our”), a Maryland real estate investment trust (“REIT”), is a fully-integrated equity REIT focused on the ownership, acquisition, development, and management of retail properties located primarily in high-barrier-to-entry, supply-constrained, densely populated metropolitan areas in the United States.
The Company operates through two primary platforms:
REIT Portfolio: The REIT Portfolio consists of open-air and street retail properties located in premier urban retail corridors and select suburban markets characterized by strong demographics and limited new supply. These assets generate recurring rental revenues and benefit from contractual rent escalations and leasing activity.
Investment Management (“IM”): Through its Investment Management platform, the Company manages opportunistic and value-add retail real estate investments through its strategic opportunity funds (Fund II, Fund III, Fund IV, and Fund V) and select co-investment ventures. While Fund III, Fund IV and Fund V currently include institutional partner capital, Fund II is presently wholly owned by the Company and is being managed within the IM platform, with the potential for future third-party capital participation. From time to time, assets previously held in the Company’s strategic opportunity funds may be recapitalized or transitioned into new joint ventures with third-party partners as part of the portfolio lifecycle, while the Company retains an ownership interest and continues its role as operator and manager. The Company earns management fees and, in certain cases, incentive-based performance fees.
All of the Company’s assets are held by, and all of its operations are conducted through, Acadia Realty Limited Partnership (the “Operating Partnership”) and its subsidiaries. As of June 30, 2026, the Trust controlled approximately 96% of the Operating Partnership as its sole general partner.
As of June 30, 2026, the Company owned or had an ownership interest in 231 properties, including development or redevelopment projects (Note 1). The Company’s operating income is primarily derived from rental revenues from operating properties, including tenant expense recoveries, net of property operating and corporate overhead expenses.
In addition, the Company maintains a Structured Financing (“SF”) program through which it selectively invests in first mortgage loans and other real estate-backed notes.
The following table summarizes the Company’s wholly owned and partially owned retail properties and related physical occupancy as of June 30, 2026:
Number of Properties
Operating Properties
Development orRedevelopment (1)
Operating
GLA
Occupancy
REIT Portfolio:
Chicago Metro
595,660
87.3
New York Metro
45
404,403
96.0
Los Angeles Metro
23,757
83.2
San Francisco Metro
Dallas Metro
59,522
85.3
Washington D.C. Metro
407,756
93.7
Boston Metro
30,321
100.0
South Florida Metro
1
10,118
Suburban
3,880,285
95.6
Total REIT Portfolio
154
5,411,822
94.4
Acadia Share of Total REIT Portfolio
5,151,064
529,545
86.7
128,073
76.7
4,698,169
91.1
3,327,308
91.4
Total Investment Management
47
8,683,095
90.8
Acadia Share of Total Investment Management
2,072,316
89.9
Total REIT and Investment Management
201
14,094,917
92.2
Acadia Share of Total REIT and Investment Management
7,223,380
93.1
SIGNIFICANT ACTIVITIES DURING 2026
See Note 12 in the Notes to Condensed Consolidated Financial Statements for an overview of our three reportable segments: REIT Portfolio, Investment Management and Structured Financing. For purposes of the tables included below, these segments are abbreviated as “REIT”, “IM” and “SF”, respectively.
During the six months ended June 30, 2026, the Company completed a number of transactions across its REIT Portfolio and Investment Management segments reflecting continued portfolio growth and deepening of relationships with key institutional partners.
Within the REIT Portfolio, the Company continued to selectively deploy capital into retail assets located in established, high-barrier markets. During six months ended June 30, 2026, the Company completed consolidated acquisitions totaling approximately $198.4 million, including:
These acquisitions were integrated into the Company’s existing REIT Portfolio and are consolidated (Note 2).
In July 2026, the Company acquired a single-tenant retail building at 8800-8804 Melrose Avenue in West Hollywood, California for $29.0 million, which was added to the REIT Portfolio. During the same period, the Company disposed of the parking garage at 1035 Third Avenue in New York, New York, a consolidated Fund IV Investment Management property, for $8.3 million (Note 16).
During the six months ended June 30, 2026, the Company completed several transactions through its Investment Management segment, consisting of equity investments in unconsolidated joint ventures and recapitalizations of existing assets (Note 2, Note 4).
In January 2026, the Company acquired a 20% equity interest in a joint venture that purchased the Shops at Skyview, a retail shopping center located in Queens, New York, for a total purchase price of $424.1 million. At closing, the joint venture secured a mortgage loan with a total commitment of $290.0 million, of which $277.0 million was funded at closing. Additionally, the Company provided a preferred equity investment of approximately $41.7 million. The Company’s equity contribution to the joint venture totaled approximately $22.5 million.
In February 2026, the Company completed a $435.8 million recapitalization of a seven-property, open-air retail portfolio. Six of the properties were previously held in Fund V, while one property (Avenue at West Cobb) was previously held in the Company’s wholly-owned portfolio. In connection with the transaction, the properties were contributed to two newly formed joint ventures and the Company retained a 20% non-controlling equity interest. Additionally, the Company provided seller financing to the Atlantic Portfolio joint venture in the form of a $27.5 million preferred equity investment. The transaction resulted in the deconsolidation of the properties and the recognition of a gain on disposition and deconsolidation of $112.3 million, of which the Company’s proportionate share was $22.1 million.
In March 2026, the Company completed a recapitalization of Pinewood Square, an open-air retail center in Lake Worth, Florida, with a gross transaction value of $68.4 million. The property was contributed to a newly formed joint venture, with the Company retaining a 20% non-controlling equity interest. The transaction resulted in the deconsolidation of the property and the recognition of a gain on deconsolidation of $4.1 million.
During the six months ended June 30, 2026, the Company completed consolidated property dispositions within its Investment Management platform totaling approximately $128.1 million, including the sale of Landstown Commons for $102.0 million, the sale of 1964 Union Street for $2.6 million and the sale of New Towne Center for $23.5 million (Note 2).
During the six months ended June 30, 2026, the Company completed unconsolidated property dispositions within its Investment Management platform totaling approximately $83.0 million, including the sale of 650 Bald Hill Road for $20.5 million, and the sale of Tri-City Plaza for $62.5 million (Note 4).
These transactions reflect the Company’s continued execution of its strategic objectives, including portfolio growth, balance sheet optimization, and the expansion of its Investment Management platform.
Financing and Capital Activity
In connection with the Investment Management disposition and recapitalization activity, the Company retired approximately $334.3 million of property-level mortgage loans associated with assets sold or contributed to joint ventures. The Company also terminated related interest rate hedges in conjunction with these repayments.
On April 17, 2026, we entered into the Fourth Amended and Restated Credit Facility, which extended the maturity of our $525.0 million revolving credit facility (the size of which remained unchanged) from April 15, 2028 to April 17, 2030 (subject to two six-month extension options), increased our existing $400.0 million term loan to $512.5 million and extended its maturity from April 15, 2028 to April 17, 2031, and provided for a new $137.5 million term loan maturing April 17, 2031. The existing $250.0 million term loan maturing May 29, 2030 remained unchanged. The Fourth Amended and Restated Credit Facility also includes an accordion feature permitting the Operating Partnership, at its option and subject to customary conditions, to increase total capacity to up to $2.0 billion. We believe the refinancing extended our weighted average debt maturity and enhanced our liquidity position (Note 7).
Common Share Activity
On June 11, 2026, we completed a forward equity offering of 9,000,000 Common Shares at an initial forward sale price of $21.80 per share. In July 2026, the underwriters partially exercised their over-allotment option for an additional 242,996 Common Shares. We did not receive any proceeds at the time of the offering and related underwriters’ option exercise; upon settlement of the forward sale agreements, which must occur within one-year of the effective date, we expect to receive net proceeds of approximately $201.1 million, which we intend to use to fund acquisition opportunities, repay outstanding indebtedness, and for general corporate purposes. We believe the offering provides additional flexibility to manage the timing of our capital raising activities relative to our capital needs.
During the six months ended June 30, 2026, we settled 6,209,562 outstanding forward shares under the Company’s $500.0 million “at-the-market” program (the “ATM Program”) and received proceeds of $128.0 million. This included settlements of $55.9 million in March and $72.1 million in June. Proceeds were used to reduce outstanding borrowings and fund investment activity (Note 10).
Economic and Other Considerations
Macroeconomic conditions, including inflationary pressures, elevated energy prices, higher interest rates, and broader geopolitical developments, continue to present risks for our business and the businesses of our tenants. While inflation has moderated from prior periods, certain operating and capital costs remain elevated. However, the majority of our leases include contractual rent escalations and expense recovery provisions, which help mitigate the impact of inflation on operating results. We also seek to manage operating expenses through cost-conscious property management practices and the use of multi-year service contracts where appropriate.
We seek to drive value across our portfolio through leasing momentum, active development and redevelopment projects, and strategic deployment of capital into high-quality assets. The Company manages its exposure to interest rate fluctuations primarily through the use of fixed-rate debt and interest rate derivative instruments, including interest rate swaps and caps that are designated as hedging instruments (Note 8). While higher interest rates have increased borrowing costs, we believe our capital structure and hedging strategy provide meaningful protection against interest rate volatility.
In addition, evolving trade policies, tariffs, sanctions and related geopolitical developments could impact certain tenants’ operations or consumer demand in our markets. The ultimate impact of these factors remains uncertain, and the Company continues to monitor these developments closely.
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RESULTS OF OPERATIONS
Comparison of Results for the Three Months Ended June 30, 2026 to the Three Months Ended June 30, 2025
The results of operations by reportable segment for the three months ended June 30, 2026 compared to the three months ended June 30, 2025 are summarized in the table below (in millions, totals may not add due to rounding):
Three Months Ended
June 30, 2025
Change
REIT
IM
SF
65.9
25.2
91.2
57.7
40.6
98.3
8.2
(15.4
(7.1
1.0
3.2
4.2
0.6
1.7
2.3
0.4
1.5
1.9
(24.0
(11.2
(35.2
(22.4
(16.8
(39.3
(1.6
5.6
4.1
(10.0
(17.0
(8.6
(8.9
(17.5
(1.4
1.8
0.5
(2.7
(12.7
(8.8
(4.5
(13.3
(1.2
(11.8
(11.5
(0.3
(18.2
18.2
(0.4
4.4
4.0
22.6
11.8
22.7
18.4
(6.1
17.9
21.9
6.6
6.4
0.2
(0.1
14.0
13.9
(0.5
(3.7
(4.2
17.7
18.1
(12.1
(8.1
(20.1
(9.6
(14.0
(23.6
(2.5
5.9
3.5
(0.2
10.4
17.8
22.8
8.0
(23.9
6.7
(20.9
2.4
41.7
43.7
Net loss (income) attributable to redeemable noncontrolling interests
(0.7
(12.3
(12.8
0.1
21.0
21.2
(33.3
(34.0
10.0
11.0
8.1
(1.1
2.0
7.5
9.0
Net income attributable to Acadia shareholders for the REIT Portfolio increased $1.9 million compared to the prior year period.
Rental revenue increased $8.2 million, primarily reflecting $4.5 million from acquisitions completed during 2025 and 2026 and $3.0 million from tenant lease-up activity.
Depreciation and amortization increased $1.6 million, property operating expenses increased $1.4 million, and real estate taxes increased $1.2 million, primarily due to new property acquisitions in 2026 and 2025.
Interest expense increased $2.5 million, primarily due to higher average outstanding borrowings associated with acquisitions completed during 2025 and 2026.
(all amounts below are consolidated amounts and are not representative of our proportionate share)
Net income attributable to Acadia shareholders for Investment Management increased $7.5 million compared to the prior year period.
Rental revenue decreased $15.4 million primarily due to reduced rental income following property dispositions and recapitalization activity within Fund V completed in 2026.
Other revenue increased $1.5 million primarily due to higher fee income from acquisitions completed during 2025 and 2026.
Depreciation and amortization, property operating expenses and real estate taxes decreased $5.6 million, $1.8 million, and $1.8 million, respectively, primarily due to the Fund V recapitalization and the disposition of Landstown Commons in 2026.
Equity in earnings of unconsolidated affiliates increased $17.7 million primarily due to the gain on sale of Tri-City Plaza, and gain on disposition of properties increased $4.4 million primarily due to the sale of New Towne Center, both completed in 2026.
Results also benefited from the absence of an $18.2 million impairment charge recognized in the prior year period.
Interest expense decreased $5.9 million, primarily due to the Fund V recapitalization and disposition activity completed in 2026.
Net income attributable to noncontrolling interests increased $33.3 million reflecting the noncontrolling interests' share of the variances discussed above. Net income attributable to noncontrolling interests in Investment Management includes asset management fees earned by the Company of $1.7 million for the three months ended June 30, 2026, compared to $2.4 million for the prior year period.
The Company does not allocate general and administrative expenses and income taxes to its reportable segments. These unallocated amounts are depicted in the table above under the headings labeled “Total.”
Comparison of Results for the Six Months Ended June 30, 2026 to the Six Months Ended June 30, 2025
The results of operations by reportable segment for the six months ended June 30, 2026 compared to the six months ended June 30, 2025, are summarized in the table below (in millions, totals may not add due to rounding):
Six Months Ended
128.6
61.2
189.8
121.5
79.5
200.9
7.1
(18.3
(11.1
1.6
7.0
8.7
1.3
2.8
0.3
4.7
(48.3
(27.0
(75.3
(46.1
(32.6
(78.7
(2.2
3.4
(20.3
(15.0
(35.3
(17.6
(35.8
(2.1
2.6
(19.4
(6.3
(25.7
(17.7
(26.6
(1.7
0.9
(27.1
(23.1
(4.0
(24.6
24.6
146.5
146.1
41.8
166.5
181.2
40.7
(1.5
16.1
1.1
168.0
165.1
11.3
12.5
12.4
(5.7
(5.9
18.3
(24.4
(17.8
(42.2
(18.9
(27.9
(46.9
(5.5
10.1
9.6
(0.6
1.4
(2.0
16.7
161.1
161.9
13.3
(35.1
12.6
196.2
(1.3
194.5
(120.4
(122.1
32.4
32.8
(152.8
(154.9
Net income (loss) attributable to Acadia shareholders
15.1
42.4
41.5
13.7
0.7
3.6
37.9
Net income attributable to Acadia shareholders for the REIT Portfolio increased $1.4 million compared to the prior year period.
Rental revenue increased $7.1 million, primarily reflecting $7.6 million from acquisitions completed during 2025 and 2026, $6.0 million from tenant lease-up activity, and $2.1 million from the 2025 consolidation of the Renaissance Portfolio, partially offset by the absence of $8.4 million of non-recurring rental and termination income recognized in the prior year period from Whole Foods at City Center.
Depreciation and amortization, property operating expenses, and real estate taxes increased $2.2 million, $2.1 million, and $1.7 million, respectively, primarily due to acquired properties.
Interest expense increased $5.5 million due to higher average outstanding borrowings associated with acquisitions completed during 2025 and 2026.
Results also benefited from the absence of a $9.6 million loss on change in control recognized in the prior year period upon the consolidation of the Renaissance Portfolio.
42
Realized and unrealized holding gains (losses) decreased $2.0 million due to changes in mark-to-market adjustments on marketable securities that were liquidated in 2025.
Net income attributable to Acadia shareholders for Investment Management increased $41.7 million compared to the prior year period.
Rental revenue decreased $18.3 million primarily due to Fund V property dispositions completed in 2026.
Other revenue increased $4.2 million primarily due to higher fee income from acquisitions completed during 2025 and 2026.
Depreciation and amortization, property operating expenses and real estate taxes decreased $5.6 million, $2.6 million and $2.6 million, respectively, primarily due to Fund V property dispositions completed in 2026.
Gain on disposition of properties increased $146.5 million primarily due to the Fund V recapitalization and the dispositions of Landstown Commons, New Towne Center and Avenue at West Cobb.
Equity in earnings of unconsolidated affiliates increased $18.2 million primarily due to the gain on sale of Tri-City Plaza in 2026.
Results also benefited from the absence of $24.6 million of impairment charges recognized in the prior year period.
Interest expense decreased $10.1 million primarily due to the Fund V recapitalization and disposition activity completed in 2026.
Net income attributable to noncontrolling interests increased $152.8 million reflecting the noncontrolling interests' share of the variances discussed above.
Structured Financing
Interest income from the Structured Financing portfolio decreased $1.2 million to $11.3 million primarily due to a lower average outstanding investment balance following repayments received during 2025, including the partial repayment of the City Point Loan in 2025.
General and administrative expenses increased $4.0 million to $27.1 million primarily due to higher compensation, legal and transaction-related costs. The increase also included accelerated compensation expense resulting from a modification of vesting provisions associated with a change in expected service period
NON-GAAP FINANCIAL MEASURES
Net Property Operating Income
The following discussion of net property operating income (“NOI”) and rent spreads on new and renewal leases includes the activity from both our consolidated and our pro-rata share of unconsolidated properties within our REIT Portfolio. We do not consider NOI and rent spreads to be meaningful measures for our Investment Management investments, as Investment Management invests primarily in properties that typically require significant leasing and development, and is primarily comprised of finite-life investment vehicles.
We use NOI, a non-GAAP financial measure, to evaluate the performance of our properties. We define NOI as income from our REIT portfolio real estate, less our property operating expenses, excluding lease termination income received from tenants and other amounts such as above- or below-market rent, and straight-line rent. We consider NOI and rent spreads on new and renewal leases for our REIT Portfolio to be appropriate supplemental disclosures of portfolio operating performance due to their widespread acceptance and use within the REIT investor and analyst communities. NOI and rent spreads on new and renewal leases are presented to assist investors in analyzing our property performance; however, our method of calculating these may be different from methods used by other REITs and, accordingly, may not be comparable to such other REITs.
43
A reconciliation of consolidated operating income to net operating income - REIT Portfolio follows (in thousands):
Consolidated operating income
Add back:
Less:
Above/below-market rent, straight-line rent and other accounts (a)
(5,556
(3,194
(12,541
(5,906
Termination income (b)
(8,366
Consolidated NOI
60,093
66,557
124,929
128,290
Redeemable noncontrolling interest in consolidated NOI
(1,659
(1,376
(3,499
(3,264
Noncontrolling interest in consolidated NOI
(10,244
(19,489
(25,241
(37,144
Less: Operating Partnership's interest in Investment Management NOI included above
(4,701
(7,936
(12,243
(14,683
Add: Operating Partnership's share of unconsolidated joint ventures NOI (c)
1,641
873
2,999
2,160
REIT Portfolio NOI
45,130
38,629
86,945
75,359
We also use same-property NOI (“Same-Property NOI”), a non-GAAP financial measure, to evaluate the performance of our properties. Same-Property NOI includes REIT Portfolio properties that we owned for both the current and prior periods presented, but excludes those properties which we acquired, sold or expected to sell, redeveloped and developed during these periods. The following table summarizes Same-Property NOI for our REIT Portfolio (dollars in thousands):
Less properties excluded from Same-Property NOI
(5,566
(2,243
(8,538
(2,295
Same-Property NOI
39,564
36,386
78,407
73,064
Percent change from prior year period
7.3
Components of Same-Property NOI:
Same-Property Revenues
54,573
50,560
109,283
102,002
Same-Property Operating Expenses
(15,009
(14,174
(30,876
(28,938
Rent Spreads on REIT Portfolio New and Renewal Leases
The following table summarizes rent spreads on both a cash basis and straight-line basis for new and renewal leases based on leases executed within our REIT Portfolio for the periods presented. Cash basis represents a comparison of rent most recently paid on the previous lease as compared to the initial rent paid on the new lease. Straight-line basis represents a comparison of rents as adjusted for contractual escalations, abated rent, and lease incentives for the same comparable leases. The table below includes embedded option renewals for which the renewed rent was equal to or approximated existing base rent.
Three Months Ended June 30, 2026
REIT Portfolio New and Renewal Leases
Cash Basis
Straight-Line Basis
Number of new and renewal leases executed
GLA commencing
18,758
201,132
New base rent
$194.20
$214.30
$59.70
$63.99
Expiring base rent
$109.26
$108.25
$47.51
$45.89
Percent growth in base rent
77.7%
98.0%
25.7%
39.4%
Average cost per square foot (a)
$134.46
$32.96
Weighted average lease term (years)
6.0
(a) The average cost per square foot includes tenant improvement costs, leasing commissions, and tenant allowances.
Funds from Operations
We consider funds from operations (“FFO”) as defined by the National Association of Real Estate Investment Trusts (“NAREIT”) to be an appropriate supplemental disclosure of operating performance for an equity REIT due to its widespread acceptance and use within the REIT and analyst communities. FFO is presented to assist investors in analyzing our performance. It is helpful as it excludes various items included in net income that are not indicative of the operating performance, such as gains (losses) from sales of depreciated property, depreciation and amortization, and impairment of real estate. Our method of calculating FFO may be different from methods used by other REITs and, accordingly, may not be comparable to such other REITs. FFO does not represent cash generated from operations as defined by accounting principles generally accepted in the United States (“GAAP”) and is not indicative of cash available to fund all cash needs, including distributions. It should not be considered as an alternative to net income for the purpose of evaluating our performance or to cash flows as a measure of liquidity. Consistent with the NAREIT definition, we define FFO as net income (computed in accordance with GAAP), excluding gains (losses) from sales of depreciated property and impairment of depreciable real estate assets related to the Company’s main business and land held for the development of property for its operating portfolio, plus depreciation and amortization, after adjustments for unconsolidated partnerships and joint ventures. Also consistent with NAREIT’s definition of FFO, the Company has elected to include gains and losses incidental to its main business in FFO. A reconciliation of net income attributable to Acadia shareholders to FFO follows (dollars in thousands, except per share amounts):
Depreciation of real estate and amortization of leasing costs (net of noncontrolling interests' share)
35,113
31,665
70,964
63,272
Impairment charges (net of noncontrolling interests' share)
4,185
5,768
Net gain on disposition of properties (net of noncontrolling interests' share)
(3,601
86
(34,555
Income attributable to Common OP Unit holders
580
108
2,076
Distributions - Preferred OP Units
67
Funds from operations attributable to Common Shareholders and Common OP Unit holders - Basic and Diluted
43,135
38,074
80,010
82,657
LIQUIDITY AND CAPITAL RESOURCES
Uses of Liquidity and Cash Requirements
Generally, our principal uses of liquidity are (i) distributions to our shareholders and OP Unit holders, (ii) investments which include the funding of capital committed to our Investment Management platform and property acquisitions and development/re-tenanting activities within our REIT Portfolio, (iii) distributions to our Investment Management investors, (iv) debt service and loan repayments and (v) share repurchases.
Distributions
In order to qualify as a REIT for federal income tax purposes, we must distribute at least 90% of our taxable income to our shareholders. During the six months ended June 30, 2026, we paid dividends and distributions on our Common Shares and preferred units of limited partnership interest (“Preferred OP Units”) totaling $56.8 million.
Investments
As previously discussed, during the six months ended June 30, 2026, we deployed approximately $252.9 million in cash outlays related to acquisitions within our REIT Portfolio and equity investments and recapitalizations completed through our Investment Management platform.
Structured Financing Investments
During the six months ended June 30, 2026, we provided advances under preferred equity investments aggregating to $69.3 million (Note 4).
Capital Commitments
As of June 30, 2026, our share of the remaining capital commitments to the Funds aggregated $11.0 million as follows:
We do not have any additional capital commitments to the Funds other than the remaining amounts described above.
Additionally, the Company has committed to fund tenant improvements under executed leases totaling approximately $63.3 million and $44.1 million, as of June 30, 2026 and December 31, 2025, respectively. The Company’s share of these obligations is approximately $46.6 million and $37.1 million, respectively (Note 9).
Development Activities
During the six months ended June 30, 2026, capitalized costs associated with development activities totaled $27.2 million (Note 2). As of June 30, 2026, we estimated total cost to complete development and redevelopment projects through 2028 was approximately $90.7 million to $128.4 million, respectively. These estimates exclude assets for which redevelopment or development plans are still being evaluated and for which costs are not yet determinable.
Substantially all remaining development and redevelopment costs are discretionary, other than the construction and tenant improvement commitments disclosed in Note 9, and could be affected by various risks and uncertainties, including, but not limited to, the effects of the current inflationary environment, elevated interest rates, global macroeconomic conditions, the imposition of tariffs and other risks detailed in Part I, Item 1A. Risk Factors of our Annual Report on Form 10-K for the year ended December 31, 2025.
46
Debt
A summary of our consolidated debt, which includes the full amount of Investment Management related obligations and excludes our pro rata share of debt at our unconsolidated subsidiaries, is as follows (in thousands):
Total Debt - Fixed and Effectively Fixed Rate
1,284,640
1,502,753
Total Debt - Variable Rate
367,684
370,614
1,873,367
(11,387
1,862,906
As of June 30, 2026, our consolidated indebtedness aggregated $1,652.3 million, excluding $0.5 million of unamortized premium and $15.8 million of net unamortized loan costs, and was secured by 35 properties and related tenant leases. Maturities on our outstanding indebtedness ranged from November 6, 2026 to April 15, 2035, excluding available extension options.
Taking into consideration $1,034.2 million of notional principal under variable-to-fixed interest rate swap agreements currently in effect, $1,284.6 million, or 77.7%, of the Company’s consolidated debt was fixed at a weighted-average interest rate of 4.52%, and $367.7 million, or 22.3%, was floating at a weighted-average interest rate of 5.13% as of June 30, 2026. Variable-rate debt included $32.2 million subject to interest rate cap agreements.
Without regard to available extension options, as of June 30, 2026, we had (i) $159.9 million of consolidated debt maturing in 2026 at a weighted-average interest rate of 5.88%, (ii) $1.9 million of scheduled principal amortization due during the remainder of 2026, and (iii) $31.5 million representing the Company’s pro-rata share of scheduled principal payments and maturities on unconsolidated debt during 2026. In addition, $160.3 million of consolidated debt and $44.8 million representing the Company’s pro-rata share of unconsolidated debt will mature by March 31, 2027.
The Company has extension options on consolidated debt aggregating $160.3 million maturing in 2026 and $48.5 million maturing in 2027; however, there can be no assurance that the Company will be able to successfully execute any or all of its available extension options. With respect to the debt maturing in the remainder of 2026, we are actively pursuing refinancing the remaining obligations, though there can be no assurance that we can refinance such obligations on favorable terms or at all. For the remaining indebtedness, we may not have sufficient cash on hand to repay such obligations, and, therefore, we expect to refinance at least a portion of this indebtedness or select other alternatives based on market conditions as these loans mature; however, there can be no assurance that we will be able to obtain financing on acceptable terms or at all.
Our ability to obtain financing could be affected by various risks and uncertainties, including, but not limited to, the current inflationary environment, elevated interest rates, tariff policies, and other risks, including, but not limited to those detailed in Part I, Item 1A. Risk Factors of our Annual Report on Form 10-K for the year ended December 31, 2025.
We maintain a share repurchase program under which $122.5 million remains available to repurchase as of June 30, 2026 (Note 10). We did not repurchase any Common Shares under this program during the six months ended June 30, 2026.
Sources of Liquidity
Our primary sources of capital for funding our short-term (less than 12 months) and long-term (12 months and longer) liquidity needs include (i) the issuance of both public equity and OP Units, (ii) the issuance of both secured and unsecured debt, (iii) unfunded capital commitments from noncontrolling interests within Investment Management, (iv) future sales of existing properties, (v) repayments of Structured Financing investments, and (vi) cash on hand and future cash flow from operating activities.
Our cash on hand in our consolidated subsidiaries as of June 30, 2026 totaled $33.0 million. Our remaining sources of liquidity are described further below. Depending upon the availability and cost of external capital, we believe our sources of capital are sufficient to meet our liquidity needs. Our historical cash flow uses are reflected in our Condensed Consolidated Statements of Cash Flows and are discussed in further detail below.
Issuances of Common Shares
Our ATM Program (Note 10) provides us with an efficient and low-cost vehicle for raising capital through public equity issuances on an “as-we-go” basis to fund our capital needs.
During the six months ended June 30, 2026, we physically settled 6,209,562 forward shares under the ATM Program in exchange for aggregate net proceeds of $128.0 million, which were used to reduce outstanding borrowings and fund investment activity. As of June 30, 2026, we had unsettled forward equity contracts to sell 17,771,271 shares (including 9,242,996 Common Shares sold in an underwritten public offering in June 2026 and related underwriters’ option exercise) for estimated aggregate net cash proceeds of $368.8 million. We also had $199.1 million of remaining availability for future share issuance under the ATM Program (Note 10).
Investment Management Capital
As of June 30, 2026, unfunded capital commitments from noncontrolling interests within Funds III, IV and V were $0.6 million, $16.7 million and $22.9 million, respectively. We have no remaining commitments from Fund II (Note 1).
Financing and Debt
As of June 30, 2026, we had $490.7 million of capacity under existing REIT Portfolio debt facilities. In addition, our REIT Portfolio and Investment Management platform included 146 unleveraged consolidated properties with an aggregate carrying value of approximately $2.5 billion; however, there can be no assurance that financing would be available for these properties at favorable terms, if at all (Note 7). See also “—Financing and Capital Activity” for details on our Fourth Amended and Restated Credit Facility entered into in April 2026.
HISTORICAL CASH FLOW
The following table compares the historical cash flow for the six months ended June 30, 2026 with the cash flow for the six months ended June 30, 2025 (in millions, totals may not add due to rounding):
Variance
89.6
90.7
268.2
(394.7
662.9
(365.4
332.1
(697.5
(7.7
28.1
Operating Activities
Net cash provided by operating activities primarily reflects the Company’s operating results, adjusted for non-cash items and changes in working capital.
Net cash provided by operating activities was relatively flat, decreasing by $1.1 million for the six months ended June 30, 2026 compared to the prior year period, despite a $194.5 million increase in net income. The increase in net income was largely driven by non-cash and non-operating items, primarily a $146.1 million gain on property dispositions, that do not impact operating cash flow.
Investing Activities
Net cash used in investing activities is impacted by our investments in and advances to unconsolidated affiliates, the timing and extent of our real estate development, capital improvements, and acquisition and disposition activities during the period.
Net cash provided by investing activities increased by $662.9 million for the six months ended June 30, 2026 compared to the prior year period, primarily due to (i) $572.0 million of higher cash inflows from real estate dispositions, (ii) $148.3 million of lower cash outflows for acquisitions, (iii) $20.0 million less cash used for the issuance of a note receivable, and (iv) $15.1 million of higher return of capital from unconsolidated affiliates. These increases were partially offset by (i) $63.1 million of higher cash used for investments in unconsolidated affiliates, (ii) $9.8 million of increased spending on development, construction, and property improvements, (iii) $7.1 million of lower refunds of deposits for properties under contract, (iv) $6.8 million of cash received in the prior year upon the consolidation of a previously unconsolidated investment that did not recur, and (v) $5.4 million of proceeds from the sale of marketable securities in the prior year that did not recur.
Financing Activities
Net cash provided by financing activities is impacted by the timing and extent of issuances of debt and equity securities, distributions paid to common shareholders and unitholders of the Operating Partnership as well as principal and other payments associated with our outstanding indebtedness.
Net cash used in financing activities increased by $697.5 million for the six months ended June 30, 2026 compared to the prior year period, primarily due to (i) $150.2 million of lower proceeds from the issuance of Common Shares, (ii) $331.5 million of increased net repayments of debt, (iii) $187.0 million of higher capital distributions to noncontrolling interests, (iv) $8.6 million more cash used to acquire noncontrolling interests, (v) $2.5 million of lower contributions from noncontrolling interests, and (vi) $4.0 million of higher dividend payments.
Unconsolidated Indebtedness
We have the following investments made through joint ventures (that may include, among others, tenancy-in common and other similar investments) for the purpose of investing in operating properties. We account for these investments using the equity method of accounting. As such, our financial statements reflect our investment and our share of income and loss from, but not the individual assets and liabilities, of these joint ventures.
See Note 4 for a discussion of our unconsolidated investments. The Operating Partnership’s pro-rata share of unconsolidated non-recourse debt related to those investments is as follows (dollars in millions):
Operating Partnership
Investment
OwnershipPercentage
Pro-rata Share ofMortgage Debt
Effective Interest Rate (a)
840 N. Michigan
31.3
6.50
Dec 2026
7.14
Mar 2027
La Frontera
6.14
Jun 2027
Riverdale FC
18.0
6.60
Nov 2027
Frederick County Square
5.52
Georgetown Portfolio
50.0
4.72
Dec 2027
LINQ Promenade(d)
15.0
26.3
5.40
Shoppes at South Hills(b)
5.95
Mar 2028
5.80
The Walk at Highwoods Preserve(b)
20.0
Oct 2028
Shops at Skyview(c)
55.3
5.13
Jan 2029
Atlantic Portfolio(c)
51.1
4.98
Feb 2029
Avenue at West Cobb(c)
8.5
Crossroads Shopping Center(c)
49.0
36.8
5.78
Nov 2029
Pinewood Square(b)
5.51
Mar 2030
5.90
Oct 2034
283.2
CRITICAL ACCOUNTING ESTIMATES
Management’s Discussion and Analysis of Financial Condition and Results of Operations in this Report is based upon the Condensed Consolidated Financial Statements, which have been prepared in accordance with GAAP. The preparation of the Condensed Consolidated Financial Statements requires management to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses. We base our estimates on historical experience and assumptions that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about carrying value of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions. We believe there have been no material changes to the items that we disclosed as our critical accounting policies under Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” in our Annual Report on Form 10-K for the year ended December 31, 2025.
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Recently Issued and Adopted Accounting Pronouncements
Reference is made to Note 1 in the Notes to Condensed Consolidated Financial Statements for information about recently issued accounting pronouncements.
ITEM 3.QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.
Information as of June 30, 2026
Our primary market risk exposure is to changes in interest rates related to our property mortgage loans and other debt. See Note 7 in the Notes to the Condensed Consolidated Financial Statements for certain quantitative details related to our property mortgage loans and other debt.
Currently, we manage our exposure to fluctuations in interest rates primarily through the use of fixed-rate debt and interest rate swap and cap agreements. As of June 30, 2026, total property mortgage loans and other notes payable aggregated $1,652.3 million, excluding $0.5 million of unamortized premium and $15.8 million of net unamortized debt issuance costs. Of this amount, $1,284.6 million, or 77.7%, was fixed-rate, including debt with rates effectively fixed through the use of derivative financial instruments, and $367.7 million, or 22.3%, was variable-rate based upon the Secured Overnight Financing Rate (“SOFR”) or Prime rates plus applicable spreads.
As of June 30, 2026, we were party to 28 interest rate swap agreements and one interest rate cap agreement, which together hedged interest rate exposure on $1,034.2 million and $32.2 million of variable-rate debt, respectively.
If the Company decided to employ higher leverage levels, it would be subject to higher debt service requirements and an increased risk of default, which could adversely affect financial condition, cash flows and ability to make distributions to shareholders. In addition, increases or changes in interest rates could increase borrowing costs and may limit the Company’s ability to refinance its indebtedness.
The following table sets forth information as of June 30, 2026 concerning our long-term debt obligations, including principal cash flows by scheduled maturity (without regard to available extension options) and weighted average effective interest rates of maturing amounts (dollars in millions):
REIT Portfolio Consolidated Mortgage and Other Debt
Year
ScheduledAmortization
Maturities
Weighted AverageInterest Rate
1.2
102.0
103.2
6.1
4.8
45.1
49.9
70.4
72.2
97.1
5.5
369.9
370.2
512.5
513.5
10.3
1,197.0
1,207.3
Investment Management Consolidated Mortgage and Other Debt
57.9
58.6
55.6
6.2
78.2
84.6
5.7
30.0
137.5
4.6
443.8
445.0
Mortgage Debt in Unconsolidated Partnerships (at our Pro-Rata Share)
28.3
31.5
59.3
60.5
5.8
16.6
151.5
151.8
278.4
Without regard to available extension options, during the remainder of 2026, $161.8 million of our total consolidated debt and $31.5 million representing our pro-rata share of unconsolidated debt will mature. In addition, $106 million of consolidated debt and $60.5 million representing our pro-rata share of unconsolidated debt will mature in 2027. With respect to this maturing debt, we have extension options on consolidated debt aggregating $160.3 million maturing in 2026 and $48.5 million maturing in 2027 as of June 30, 2026; however, there can be no assurance that the Company will be able to successfully execute any or all of its available extension options.
The Company expects to refinance some or all of such debt at the then-prevailing market interest rates, which may be greater than the current interest rates. Based on outstanding balances, a 100 basis point increase in interest rates on refinanced debt would increase annual interest expense by approximately $3.6 million, of which the Company’s pro-rata share would be $2.3 million.
As of June 30, 2026, the Company had variable-rate debt of $367.7 million, net of variable-to-fixed interest rate swap agreements currently in effect. A 100 basis point increase in applicable interest rate indices would increase annual interest expense on such debt by approximately $3.7 million, of which the Company’s pro-rata share would be $2.1 million. We may seek additional variable-rate financing if pricing and other commercial and financial terms are favorable and would consider hedging associated interest rate risk through interest rate swaps and protection agreements, or other means.
Based on our outstanding debt balances as of June 30, 2026, the estimated fair value of our total consolidated outstanding debt would decrease by approximately $7.0 million assuming a 100 basis point increase in interest rates. Conversely, a 100 basis point decrease in interest rates would increase the estimated fair value of our total outstanding debt by approximately $4.8 million.
As of June 30, 2026, and December 31, 2025, we had consolidated notes receivable of $154.5 million and $154.9 million, respectively. The estimated fair value of our notes receivable was determined by discounting future cash receipts utilizing a discount rate equivalent to the rate at which similar notes receivable would be originated under conditions then existing. Based on our outstanding notes receivable balances as of June 30, 2026, a 100 basis point increase in interest rates would decrease the estimated fair value of our total outstanding notes receivable by approximately $0.8 million, while a 100 basis point decrease would increase the estimated fair value by approximately $0.8 million.
Summarized Information as of December 31, 2025
As of December 31, 2025, we had total property mortgage loans and other notes payable of $1.9 billion, excluding the unamortized premium of $0.9 million and unamortized debt issuance costs of $11.4 million, of which $1.5 billion, or 80.2%, was fixed-rate, inclusive of debt with rates fixed through the use of derivative financial instruments, and $370.6 million, or 19.8%, was variable-rate based upon SOFR rates plus applicable spreads. As of December 31, 2025, we were party to 35 interest rate swap and one interest rate cap agreement to hedge our exposure to changes in interest rates with respect to $1.2 billion and $32.2 million of SOFR-based variable-rate debt, respectively.
Interest expense on our variable-rate debt of $370.6 million, net of variable to fixed-rate swap agreements currently in effect, as of December 31, 2025, would have increased $3.7 million if corresponding rate indices increased by 100 basis points. Based on our outstanding debt balances as of December 31, 2025, the fair value of our total outstanding debt would have decreased by approximately $9.4 million if interest rates increased by 1%. Conversely, if interest rates decreased by 1%, the fair value of our total outstanding debt would have increased by approximately $6.1 million.
Changes in Market Risk Exposures from December 31, 2025 to June 30, 2026
Our interest rate risk exposure from December 31, 2025, to June 30, 2026 has decreased on an absolute basis, as the $370.6 million of variable-rate debt as of December 31, 2025 has decreased to $367.7 million as of June 30, 2026. Our interest rate exposure as a percentage of total debt has increased, as our variable-rate debt accounted for 19.8% of our consolidated debt as of December 31, 2025 compared to 22.3% as of June 30, 2026.
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ITEM 4.CONTROLS AND PROCEDURES.
Disclosure Controls and Procedures
Our disclosure controls and procedures include internal controls and other procedures designed to provide reasonable assurance that information required to be disclosed in this and other reports filed under the Exchange Act, is recorded, processed, summarized, and reported within the required time periods specified in the SEC’s rules and forms; and that such information is accumulated and communicated to management, including our Chief Executive Officer and Chief Financial Officer, to allow timely decisions regarding required disclosures. It should be noted that no system of controls can provide complete assurance of achieving a company’s objectives and that future events may impact the effectiveness of a system of controls. Our Chief Executive Officer and Chief Financial Officer, after conducting an evaluation, together with members of our management, of the effectiveness of the design and operation of our disclosure controls and procedures as of June 30, 2026, have concluded that our disclosure controls and procedures (as defined in Rule 13a-15(e) under the Exchange Act) were effective as of June 30, 2026, at a reasonable level of assurance.
Changes in Internal Control Over Financial Reporting
There have been no changes in our internal control over financial reporting during our most recently completed fiscal quarter that have materially affected, or are reasonably likely to materially affect, our internal controls over financial reporting.
PART II – OTHER INFORMATION
ITEM 1.LEGAL PROCEEDINGS.
From time to time, we are a party to various legal proceedings, claims or regulatory inquiries and investigations arising out of, or incident to, our ordinary course of business. While we are unable to predict with certainty the outcome of any particular matter, management does not expect, when such matters are resolved, that our resulting exposure to loss contingencies, if any, will have a material adverse effect on our consolidated financial position.
ITEM 1A.RISK FACTORS.
Except to the extent additional factual information disclosed elsewhere in this Report relates to such risk factors (including, without limitation, the matters discussed in Part I, “Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations”), there were no material changes to the risk factors disclosed in Part I, “Item 1A. Risk Factors” of our Annual Report on Form 10-K for the year ended December 31, 2025.
ITEM 2.UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS.
None.
ITEM 3.DEFAULTS UPON SENIOR SECURITIES.
ITEM 4.MINE SAFETY DISCLOSURES.
Not applicable.
ITEM 5.OTHER INFORMATION.
Trading Arrangements
During the three months ended June 30, 2026, none of our officers or trustees (as defined in Rule 16a-1(f) of the Exchange Act) adopted, terminated, or modified any contract, instruction or written plan for the purchase or sale of our securities that was intended to satisfy the affirmative defense conditions of Rule 10b5-1(c) or any non-Rule 10b5-1 trading arrangement (as defined in Item 408 of Regulation S-K).
ITEM 6.EXHIBITS.
The following is an index to all exhibits including (i) those filed with this Quarterly Report on Form 10-Q and (ii) those incorporated by reference herein:
Exhibit No.
Method of Filing
Fourth Amended and Restated Credit Agreement, dated as of April 17, 2026, by and among Acadia Realty Limited Partnership, certain subsidiaries of Acadia Realty Limited Partnership, Acadia Realty Trust, and Bank of America, N.A., as administrative agent, Wells Fargo Bank, National Association, M&T Bank, Truist Bank, and PNC Bank, National Association, as syndication agents, BofA Securities, Inc. and Wells Fargo Securities, LLC, as joint bookrunners, BofA Securities, Inc., Wells Fargo Securities, LLC, M&T Bank, Truist Securities, Inc. and PNC Capital Markets LLC, as joint lead arrangers, Citizens Bank, N.A, JPMorgan Chase Bank, N.A. and TD Bank, as documentation agents, and the lenders and letter of credit issuers party thereto
Incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed on April 20, 2026
31.1
Certification of Chief Executive Officer pursuant to rule 13a-14(a)/15d-14(a) of the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
Filed herewith
31.2
Certification of Chief Financial Officer pursuant to rule 13a-14(a)/15d-14(a) of the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
32.1
Certification of Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
Furnished herewith
32.2
Certification of Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
101.INS
Inline XBRL Instance Document–the instance document does not appear in the Interactive Data File as its XBRL tags are embedded within the Inline XBRL document
101.SCH
Inline XBRL Taxonomy Extension Schema with Embedded Linkbase Documents
104
Cover page formatted as Inline XBRL and contained in Exhibit 101
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.
(Registrant)
By:
/s/ Kenneth F. Bernstein
Kenneth F. Bernstein
Chief Executive Officer,
President and Trustee
/s/ John Gottfried
John Gottfried
Executive Vice President and
Chief Financial Officer
(Principal Financial Officer)
/s/ David Buell
David Buell
Senior Vice President and
Chief Accounting Officer
(Principal Accounting Officer)
Dated: July 29, 2026