KITE REALTY GROUP TRUST [KRG] Filings

10-Q 1 krg-20240630.htm 10-Q krg-20240630

UNITED STATES

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, 2024


☐						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:	001-32268	Kite Realty Group Trust
Commission File Number:	333-202666-01	Kite Realty Group, L.P.

KITE REALTY GROUP TRUST
KITE REALTY GROUP, L.P.
(Exact name of registrant as specified in its charter)

Maryland

Kite Realty Group Trust

11-3715772

Delaware

Kite Realty Group, L.P.

20-1453863

(State or other jurisdiction of incorporation or organization)

(I.R.S. Employer Identification No.)

30 S. Meridian Street, Suite 1100, Indianapolis, Indiana 46204

(Address of principal executive offices) (Zip Code)

(317) 577-5600

(Registrant’s telephone number, including area code)

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

Title of each class

Trading Symbol(s)

Name of each exchange on which registered

Common Shares, $0.01 par value per share

KRG

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.

Kite Realty Group Trust

Yes

☒

Kite Realty Group, L.P.

Yes

☒

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).

Kite Realty Group Trust

Yes

☒

Kite Realty Group, L.P.

Yes

☒

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.

Kite Realty Group Trust:

Large accelerated filer

Accelerated filer

Non-accelerated filer

Smaller reporting company

☐

Emerging growth company

☐

Kite Realty Group, L.P.:

Large accelerated filer

Accelerated filer

Non-accelerated filer

Smaller reporting company

☐

Emerging growth company

☐

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

Kite Realty Group Trust

Kite Realty Group, L.P.

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

Kite Realty Group Trust

Yes

☐

Kite Realty Group, L.P.

Yes

☐

The number of Common Shares outstanding as of July 26, 2024 was 219,665,639 ($0.01 par value).

EXPLANATORY NOTE

This report combines the quarterly reports on Form 10-Q for the period ended June 30, 2024 of Kite Realty Group Trust, Kite Realty Group, L.P. and its subsidiaries. Unless stated otherwise or the context otherwise requires, references to “Kite Realty Group Trust” or the “Parent Company” mean Kite Realty Group Trust, and references to the “Operating Partnership” mean Kite Realty Group, L.P. and its consolidated subsidiaries. The terms “Company,” “we,” “us,” and “our” refer to the Parent Company and the Operating Partnership, collectively, and those entities owned or controlled by the Parent Company and/or the Operating Partnership.

The Operating Partnership is engaged in the ownership, operation, acquisition, development and redevelopment of high-quality, open-air shopping centers and mixed-use assets that are primarily grocery-anchored and located in high-growth Sun Belt markets and select strategic gateway markets in the United States, and the Parent Company conducts substantially all of its activities through the Operating Partnership and its wholly owned subsidiaries. The Parent Company is the sole general partner of the Operating Partnership and, as of June 30, 2024, owned approximately 98.3% of the common partnership interests in the Operating Partnership (“General Partner Units”). The remaining 1.7% of the common partnership interests (“Limited Partner Units” and, together with the General Partner Units, the “Common Units”) are owned by the limited partners.

We believe combining the quarterly reports on Form 10-Q of the Parent Company and the Operating Partnership into this single report benefits investors by:

•enhancing investors’ understanding of the Parent Company and the Operating Partnership by enabling investors to view the business as a whole in the same manner as management views and operates the business;

•eliminating duplicative disclosure and providing a more streamlined and readable presentation of information as a substantial portion of the Company’s disclosure applies to both the Parent Company and the Operating Partnership; and

•creating time and cost efficiencies through the preparation of one combined report instead of two separate reports.

We believe it is important to understand the few differences between the Parent Company and the Operating Partnership in the context of how we operate as an interrelated consolidated company. The Parent Company has no material assets or liabilities other than its investment in the Operating Partnership. The Parent Company issues public equity from time to time but does not have any indebtedness as all debt is incurred by the Operating Partnership. In addition, the Parent Company currently does not nor does it intend to guarantee any debt of the Operating Partnership. The Operating Partnership has numerous wholly owned subsidiaries, and it also owns interests in certain joint ventures. These subsidiaries and joint ventures own and operate retail shopping centers and other real estate assets. The Operating Partnership is structured as a partnership with no publicly traded equity. Except for net proceeds from equity issuances by the Parent Company, which are contributed to the Operating Partnership in exchange for General Partner Units, the Operating Partnership generates the capital required by the business through its operations, its incurrence of indebtedness, and the issuance of Limited Partner Units to third parties.

Shareholders’ equity and partners’ capital are the main areas of difference between the consolidated financial statements of the Parent Company and those of the Operating Partnership. In order to highlight this and other differences between the Parent Company and the Operating Partnership, there are separate sections in this report, as applicable, that separately discuss the Parent Company and the Operating Partnership, including separate financial statements and separate Exhibit 31 and 32 certifications. In the sections that combine disclosure of the Parent Company and the Operating Partnership, this report refers to actions or holdings as being actions or holdings of the collective Company.

KITE REALTY GROUP TRUST AND KITE REALTY GROUP, L.P. AND SUBSIDIARIES

QUARTERLY REPORT ON FORM 10-Q

FOR THE QUARTERLY PERIOD ENDED JUNE 30, 2024

TABLE OF CONTENTS


PART I — FINANCIAL INFORMATION

Item 1.	Financial Statements (Unaudited)

	Kite Realty Group Trust
	Consolidated Balance Sheets as of June 30, 2024 and December 31, 2023	4

	Consolidated Statements of Operations and Comprehensive Income for the Three and Six Months Ended June 30, 2024 and 2023	5

	Consolidated Statements of Shareholders’ Equity for the Three and Six Months Ended June 30, 2024 and 2023	6

	Consolidated Statements of Cash Flows for the Six Months Ended June 30, 2024 and 2023	7

	Kite Realty Group, L.P. and subsidiaries
	Consolidated Balance Sheets as of June 30, 2024 and December 31, 2023	8

	Consolidated Statements of Operations and Comprehensive Income for the Three and Six Months Ended June 30, 2024 and 2023	9

	Consolidated Statements of Partners’ Equity for the Three and Six Months Ended June 30, 2024 and 2023	10

	Consolidated Statements of Cash Flows for the Six Months Ended June 30, 2024 and 2023	11

	Kite Realty Group Trust and Kite Realty Group, L.P. and subsidiaries
	Notes to Consolidated Financial Statements	12

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	27

Item 3.	Quantitative and Qualitative Disclosure about Market Risk	42

Item 4.	Controls and Procedures	42

PART II — OTHER INFORMATION

Item 1.	Legal Proceedings	44

Item 1A.	Risk Factors	44

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	44

Item 3.	Defaults Upon Senior Securities	44

Item 4.	Mine Safety Disclosures	44

Item 5.	Other Information	44

Item 6.	Exhibits	45

SIGNATURES		46

PART I — FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

KITE REALTY GROUP TRUST

Consolidated Balance Sheets

(Unaudited)

($ in thousands, except share and per share data)


	June 30, 2024		December 31, 2023
Assets:
Investment properties, at cost	$	7,546,116	$	7,740,061
Less: accumulated depreciation	(1,447,549)		(1,381,770)
Net investment properties	6,098,567		6,358,291

Cash and cash equivalents	153,835		36,413
Tenant and other receivables, including accrued straight-line rent of $62,035 and $55,482, respectively	120,012		113,290
Restricted cash and escrow deposits	4,935		5,017
Deferred costs, net	263,884		304,171
Short-term deposits	120,000		—
Prepaid and other assets	114,159		117,834
Investments in unconsolidated subsidiaries	9,970		9,062
Assets associated with investment property held for sale	73,558		—
Total assets	$	6,958,920	$	6,944,078

Liabilities and Equity:
Liabilities:
Mortgage and other indebtedness, net	$	3,015,626	$	2,829,202
Accounts payable and accrued expenses	189,688		198,079
Deferred revenue and other liabilities	250,103		272,942
Liabilities associated with investment property held for sale	3,930		—
Total liabilities	3,459,347		3,300,223

Commitments and contingencies
Limited Partners’ interests in the Operating Partnership	76,093		73,287

Equity:
Common shares, $0.01 par value, 490,000,000 shares authorized, 219,654,953 and 219,448,429 shares issued and outstanding at June 30, 2024 and December 31, 2023, respectively	2,197		2,194
Additional paid-in capital	4,886,532		4,886,592
Accumulated other comprehensive income	50,255		52,435
Accumulated deficit	(1,517,383)		(1,373,083)
Total shareholders’ equity	3,421,601		3,568,138
Noncontrolling interests	1,879		2,430
Total equity	3,423,480		3,570,568
Total liabilities and equity	$	6,958,920	$	6,944,078

The accompanying notes are an integral part of these consolidated financial statements.

KITE REALTY GROUP TRUST

Consolidated Statements of Operations and Comprehensive Income

(Unaudited)

($ in thousands, except share and per share data)


	Three Months Ended June 30,				Six Months Ended June 30,
	2024		2023		2024		2023
Revenue:
Rental income	$	205,836	$	205,836	$	411,649	$	408,899
Other property-related revenue	3,146		1,883		4,457		3,799
Fee income	3,452		1,040		3,767		2,811
Total revenue	212,434		208,759		419,873		415,509

Expenses:
Property operating	28,564		27,232		56,645		54,546
Real estate taxes	26,493		26,697		53,027		53,880
General, administrative and other	12,966		14,499		25,750		27,883

Depreciation and amortization	99,291		109,462		199,670		217,533
Impairment charges	66,201		—		66,201		—
Total expenses	233,515		177,890		401,293		353,842

(Loss) gain on sales of operating properties, net	(1,230)		28,440		(1,466)		28,440

Operating (loss) income	(22,311)		59,309		17,114		90,107
Other (expense) income:
Interest expense	(30,981)		(27,205)		(61,345)		(52,630)
Income tax expense of taxable REIT subsidiaries	(132)		(45)		(290)		(16)

Equity in (loss) earnings of unconsolidated subsidiaries	(174)		118		(594)		(126)
Gain on sale of unconsolidated property, net	—		—		2,325		—
Other income, net	4,295		304		7,923		707
Net (loss) income	(49,303)		32,481		(34,867)		38,042
Net loss (income) attributable to noncontrolling interests	665		(423)		385		(593)
Net (loss) income attributable to common shareholders	$	(48,638)	$	32,058	$	(34,482)	$	37,449

Net (loss) income per common share – basic and diluted	$	(0.22)	$	0.15	$	(0.16)	$	0.17


Weighted average common shares outstanding – basic	219,622,059		219,354,275		219,561,586		219,294,255
Weighted average common shares outstanding – diluted	219,622,059		220,032,366		219,561,586		219,999,440



Net (loss) income	$	(49,303)	$	32,481	$	(34,867)	$	38,042
Change in fair value of derivatives	(4,708)		8,642		(2,166)		(3,003)
Total comprehensive (loss) income	(54,011)		41,123		(37,033)		35,039
Comprehensive loss (income) attributable to noncontrolling interests	737		(529)		372		(611)
Comprehensive (loss) income attributable to the Company	$	(53,274)	$	40,594	$	(36,661)	$	34,428

The accompanying notes are an integral part of these consolidated financial statements.

KITE REALTY GROUP TRUST

Consolidated Statements of Shareholders’ Equity

(Unaudited)

(in thousands, except share data)


	Common Shares			Additional Paid-in Capital		Accumulated Other Comprehensive Income (Loss)		Accumulated Deficit		Total
	Shares	Amount
Balance at December 31, 2023	219,448,429	$	2,194	$	4,886,592	$	52,435	$	(1,373,083)	$	3,568,138
Stock compensation activity	155,433	2		1,991		—		—		1,993
Other comprehensive income	—	—		—		2,456		—		2,456
Distributions to common shareholders	—	—		—		—		(54,901)		(54,901)
Net income attributable to common shareholders	—	—		—		—		14,156		14,156

Adjustment to redeemable noncontrolling interests	—	—		(1,010)		—		—		(1,010)
Balance at March 31, 2024	219,603,862	$	2,196	$	4,887,573	$	54,891	$	(1,413,828)	$	3,530,832
Stock compensation activity	51,091	1		3,077		—		—		3,078
Other comprehensive loss	—	—		—		(4,636)		—		(4,636)
Distributions to common shareholders	—	—		—		—		(54,917)		(54,917)
Net loss attributable to common shareholders	—	—		—		—		(48,638)		(48,638)

Adjustment to redeemable noncontrolling interests	—	—		(4,118)		—		—		(4,118)
Balance at June 30, 2024	219,654,953	$	2,197	$	4,886,532	$	50,255	$	(1,517,383)	$	3,421,601


Balance at December 31, 2022	219,185,658	$	2,192	$	4,897,736	$	74,344	$	(1,207,757)	$	3,766,515
Stock compensation activity	140,240	1		2,134		—		—		2,135
Other comprehensive loss	—	—		—		(11,557)		—		(11,557)
Distributions to common shareholders	—	—		—		—		(52,659)		(52,659)
Net income attributable to common shareholders	—	—		—		—		5,391		5,391

Adjustment to redeemable noncontrolling interests	—	—		(3,821)		—		—		(3,821)
Balance at March 31, 2023	219,325,898	$	2,193	$	4,896,049	$	62,787	$	(1,255,025)	$	3,706,004
Stock compensation activity	48,377	1		2,959		—		—		2,960
Other comprehensive income	—	—		—		8,536		—		8,536
Distributions to common shareholders	—	—		—		—		(52,650)		(52,650)
Net income attributable to common shareholders	—	—		—		—		32,058		32,058

Adjustment to redeemable noncontrolling interests	—	—		(4,101)		—		—		(4,101)
Balance at June 30, 2023	219,374,275	$	2,194	$	4,894,907	$	71,323	$	(1,275,617)	$	3,692,807

The accompanying notes are an integral part of these consolidated financial statements.

KITE REALTY GROUP TRUST

Consolidated Statements of Cash Flows

(Unaudited)

(in thousands)


	Six Months Ended June 30,
	2024		2023
Cash flows from operating activities:
Net (loss) income	$	(34,867)	$	38,042
Adjustments to reconcile net (loss) income to net cash provided by operating activities:
Depreciation and amortization	201,586		219,315
Loss (gain) on sales of operating properties, net	1,466		(28,440)
Gain on sale of unconsolidated property, net	(2,325)		—
Impairment charges	66,201		—

Straight-line rent	(6,780)		(6,958)
Compensation expense for equity awards	5,386		5,133
Amortization of debt fair value adjustments	(6,463)		(6,688)
Amortization of in-place lease liabilities	(4,656)		(5,375)
Changes in assets and liabilities:
Tenant receivables	(3,157)		268
Deferred costs and other assets	(9,237)		(14,074)
Accounts payable, accrued expenses, deferred revenue and other liabilities	(11,468)		(20,798)
Net cash provided by operating activities	195,686		180,425

Cash flows from investing activities:

Capital expenditures	(67,131)		(67,767)
Net proceeds from sales of land	4,855		917
Net proceeds from sales of operating properties	29,809		78,556
Investment in short-term deposits	(265,000)		—
Proceeds from short-term deposits	145,000		—
Small business loan repayments	—		287
Change in construction payables	(2,806)		(3,980)
Distribution from unconsolidated joint venture	1,618		—
Capital contribution to unconsolidated joint venture	(946)		—
Net cash (used in) provided by investing activities	(154,601)		8,013

Cash flows from financing activities:
Proceeds from issuance of common shares, net	37		40
Repurchases of common shares upon the vesting of restricted shares	(867)		(731)
Debt and equity issuance costs	(3,640)		(54)
Loan proceeds	385,345		293,095
Loan payments	(192,180)		(361,162)

Distributions paid – common shareholders	(109,763)		(105,243)
Distributions paid – redeemable noncontrolling interests	(1,760)		(1,399)
Distributions to noncontrolling interests	(692)		—
Net cash provided by (used in) financing activities	76,480		(175,454)

Net change in cash, cash equivalents and restricted cash	117,565		12,984
Cash, cash equivalents and restricted cash, beginning of period	41,430		121,970
Cash, cash equivalents and restricted cash, end of period	$	158,995	$	134,954

The accompanying notes are an integral part of these consolidated financial statements.

KITE REALTY GROUP, L.P. AND SUBSIDIARIES

Consolidated Balance Sheets

(Unaudited)

(in thousands, except unit data)


	June 30, 2024		December 31, 2023
Assets:
Investment properties, at cost	$	7,546,116	$	7,740,061
Less: accumulated depreciation	(1,447,549)		(1,381,770)
Net investment properties	6,098,567		6,358,291

Cash and cash equivalents	153,835		36,413
Tenant and other receivables, including accrued straight-line rent of $62,035 and $55,482, respectively	120,012		113,290
Restricted cash and escrow deposits	4,935		5,017
Deferred costs, net	263,884		304,171
Short-term deposits	120,000		—
Prepaid and other assets	114,159		117,834
Investments in unconsolidated subsidiaries	9,970		9,062
Assets associated with investment property held for sale	73,558		—
Total assets	$	6,958,920	$	6,944,078

Liabilities and Equity:
Liabilities:
Mortgage and other indebtedness, net	$	3,015,626	$	2,829,202
Accounts payable and accrued expenses	189,688		198,079
Deferred revenue and other liabilities	250,103		272,942
Liabilities associated with investment property held for sale	3,930		—
Total liabilities	3,459,347		3,300,223

Commitments and contingencies
Limited Partners’ interests in the Operating Partnership	76,093		73,287

Partners’ Equity:
Common equity, 219,654,953 and 219,448,429 units issued and outstanding at June 30, 2024 and December 31, 2023, respectively	3,371,346		3,515,703
Accumulated other comprehensive income	50,255		52,435
Total Partners’ equity	3,421,601		3,568,138
Noncontrolling interests	1,879		2,430
Total equity	3,423,480		3,570,568
Total liabilities and equity	$	6,958,920	$	6,944,078

The accompanying notes are an integral part of these consolidated financial statements.

KITE REALTY GROUP, L.P. AND SUBSIDIARIES

Consolidated Statements of Operations and Comprehensive Income

(Unaudited)

(in thousands, except unit and per unit data)


	Three Months Ended June 30,				Six Months Ended June 30,
	2024		2023		2024		2023
Revenue:
Rental income	$	205,836	$	205,836	$	411,649	$	408,899
Other property-related revenue	3,146		1,883		4,457		3,799
Fee income	3,452		1,040		3,767		2,811
Total revenue	212,434		208,759		419,873		415,509

Expenses:
Property operating	28,564		27,232		56,645		54,546
Real estate taxes	26,493		26,697		53,027		53,880
General, administrative and other	12,966		14,499		25,750		27,883

Depreciation and amortization	99,291		109,462		199,670		217,533
Impairment charges	66,201		—		66,201		—
Total expenses	233,515		177,890		401,293		353,842

(Loss) gain on sales of operating properties, net	(1,230)		28,440		(1,466)		28,440

Operating (loss) income	(22,311)		59,309		17,114		90,107
Other (expense) income:
Interest expense	(30,981)		(27,205)		(61,345)		(52,630)
Income tax expense of taxable REIT subsidiaries	(132)		(45)		(290)		(16)

Equity in (loss) earnings of unconsolidated subsidiaries	(174)		118		(594)		(126)
Gain on sale of unconsolidated property, net	—		—		2,325		—
Other income, net	4,295		304		7,923		707
Net (loss) income	(49,303)		32,481		(34,867)		38,042
Net income attributable to noncontrolling interests	(74)		(30)		(141)		(134)
Net (loss) income attributable to common unitholders	$	(49,377)	$	32,451	$	(35,008)	$	37,908

Allocation of net (loss) income:
Limited Partners	$	(739)	$	393	$	(526)	$	459
Parent Company	(48,638)		32,058		(34,482)		37,449
	$	(49,377)	$	32,451	$	(35,008)	$	37,908

Net (loss) income per common unit – basic and diluted	$	(0.22)	$	0.15	$	(0.16)	$	0.17


Weighted average common units outstanding – basic	223,329,063		222,388,487		223,219,523		222,287,815
Weighted average common units outstanding – diluted	223,329,063		223,066,578		223,219,523		222,993,000



Net (loss) income	$	(49,303)	$	32,481	$	(34,867)	$	38,042
Change in fair value of derivatives	(4,708)		8,642		(2,166)		(3,003)
Total comprehensive (loss) income	(54,011)		41,123		(37,033)		35,039
Comprehensive income attributable to noncontrolling interests	(74)		(30)		(141)		(134)
Comprehensive (loss) income attributable to common unitholders	$	(54,085)	$	41,093	$	(37,174)	$	34,905

The accompanying notes are an integral part of these consolidated financial statements.

KITE REALTY GROUP, L.P. AND SUBSIDIARIES

Consolidated Statements of Partners’ Equity

(Unaudited)

(in thousands)


	General Partner				Total
	Common Equity		Accumulated Other Comprehensive Income (Loss)
Balance at December 31, 2023	$	3,515,703	$	52,435	$	3,568,138
Stock compensation activity	1,993		—		1,993
Other comprehensive income attributable to Parent Company	—		2,456		2,456
Distributions to Parent Company	(54,901)		—		(54,901)
Net income attributable to Parent Company	14,156		—		14,156

Adjustment to redeemable noncontrolling interests	(1,010)		—		(1,010)
Balance at March 31, 2024	$	3,475,941	$	54,891	$	3,530,832
Stock compensation activity	3,078		—		3,078
Other comprehensive loss attributable to Parent Company	—		(4,636)		(4,636)
Distributions to Parent Company	(54,917)		—		(54,917)
Net loss attributable to Parent Company	(48,638)		—		(48,638)

Adjustment to redeemable noncontrolling interests	(4,118)		—		(4,118)
Balance at June 30, 2024	$	3,371,346	$	50,255	$	3,421,601


Balance at December 31, 2022	$	3,692,171	$	74,344	$	3,766,515
Stock compensation activity	2,135		—		2,135
Other comprehensive loss attributable to Parent Company	—		(11,557)		(11,557)
Distributions to Parent Company	(52,659)		—		(52,659)
Net income attributable to Parent Company	5,391		—		5,391

Adjustment to redeemable noncontrolling interests	(3,821)		—		(3,821)
Balance at March 31, 2023	$	3,643,217	$	62,787	$	3,706,004
Stock compensation activity	2,960		—		2,960
Other comprehensive income attributable to Parent Company	—		8,536		8,536
Distributions to Parent Company	(52,650)		—		(52,650)
Net income attributable to Parent Company	32,058		—		32,058

Adjustment to redeemable noncontrolling interests	(4,101)		—		(4,101)
Balance at June 30, 2023	$	3,621,484	$	71,323	$	3,692,807

The accompanying notes are an integral part of these consolidated financial statements.

KITE REALTY GROUP, L.P. AND SUBSIDIARIES

Consolidated Statements of Cash Flows

(Unaudited)

(in thousands)


	Six Months Ended June 30,
	2024		2023
Cash flows from operating activities:
Net (loss) income	$	(34,867)	$	38,042
Adjustments to reconcile net (loss) income to net cash provided by operating activities:
Depreciation and amortization	201,586		219,315
Loss (gain) on sales of operating properties, net	1,466		(28,440)
Gain on sale of unconsolidated property, net	(2,325)		—
Impairment charges	66,201		—

Straight-line rent	(6,780)		(6,958)
Compensation expense for equity awards	5,386		5,133
Amortization of debt fair value adjustments	(6,463)		(6,688)
Amortization of in-place lease liabilities	(4,656)		(5,375)
Changes in assets and liabilities:
Tenant receivables	(3,157)		268
Deferred costs and other assets	(9,237)		(14,074)
Accounts payable, accrued expenses, deferred revenue and other liabilities	(11,468)		(20,798)
Net cash provided by operating activities	195,686		180,425

Cash flows from investing activities:

Capital expenditures	(67,131)		(67,767)
Net proceeds from sales of land	4,855		917
Net proceeds from sales of operating properties	29,809		78,556
Investment in short-term deposits	(265,000)		—
Proceeds from short-term deposits	145,000		—
Small business loan repayments	—		287
Change in construction payables	(2,806)		(3,980)
Distribution from unconsolidated joint venture	1,618		—
Capital contribution to unconsolidated joint venture	(946)		—
Net cash (used in) provided by investing activities	(154,601)		8,013

Cash flows from financing activities:
Contributions from the General Partner	37		40
Repurchases of common shares upon the vesting of restricted shares	(867)		(731)
Debt and equity issuance costs	(3,640)		(54)
Loan proceeds	385,345		293,095
Loan payments	(192,180)		(361,162)

Distributions paid – common unitholders	(109,763)		(105,243)
Distributions paid – redeemable noncontrolling interests	(1,760)		(1,399)
Distributions to noncontrolling interests	(692)		—
Net cash provided by (used in) financing activities	76,480		(175,454)

Net change in cash, cash equivalents and restricted cash	117,565		12,984
Cash, cash equivalents and restricted cash, beginning of period	41,430		121,970
Cash, cash equivalents and restricted cash, end of period	$	158,995	$	134,954

The accompanying notes are an integral part of these consolidated financial statements.

KITE REALTY GROUP TRUST AND KITE REALTY GROUP, L.P. AND SUBSIDIARIES

Notes to Consolidated Financial Statements

June 30, 2024

(Unaudited)

($ in thousands, except share, per share, unit and per unit amounts and where indicated in millions or billions)

NOTE 1. ORGANIZATION AND BASIS OF PRESENTATION

Kite Realty Group Trust (the “Parent Company”), through its majority-owned subsidiary, Kite Realty Group, L.P. (the “Operating Partnership”), owns interests in various operating subsidiaries and joint ventures engaged in the ownership, operation, acquisition, development and redevelopment of high-quality, open-air shopping centers and mixed-use assets that are primarily grocery-anchored and located in high-growth Sun Belt markets and select strategic gateway markets in the United States. The terms “Company,” “we,” “us,” and “our” refer to the Parent Company and the Operating Partnership, collectively, and those entities owned or controlled by the Parent Company and/or the Operating Partnership.

The Operating Partnership was formed on August 16, 2004, when the Parent Company contributed properties and the net proceeds from an initial public offering (“IPO”) of shares of its common stock to the Operating Partnership. The Parent Company was organized in Maryland in 2004 to succeed in the development, acquisition, construction and real estate businesses of its predecessor. We believe the Company qualifies as a real estate investment trust (“REIT”) under sections 856-860 of the Internal Revenue Code of 1986, as amended.

The Parent Company is the sole general partner of the Operating Partnership and, as of June 30, 2024, owned approximately 98.3% of the common partnership interests in the Operating Partnership (“General Partner Units”). The remaining 1.7% of the common partnership interests (“Limited Partner Units” and, together with the General Partner Units, the “Common Units”) were owned by the limited partners. As the sole general partner of the Operating Partnership, the Parent Company has full, exclusive and complete responsibility and discretion in the day-to-day management and control of the Operating Partnership. The Parent Company and the Operating Partnership are operated as one enterprise. The management of the Parent Company consists of the same members as the management of the Operating Partnership. As the sole general partner with control of the Operating Partnership, the Parent Company consolidates the Operating Partnership for financial reporting purposes, and the Parent Company does not have any significant assets other than its investment in the Operating Partnership.

The accompanying unaudited consolidated financial statements have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). Certain information and footnote disclosures normally included in the financial statements prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) may have been condensed or omitted pursuant to such rules and regulations, although management believes that the disclosures are adequate to make the presentation not misleading. The unaudited consolidated financial statements as of June 30, 2024 and for the three and six months ended June 30, 2024 and 2023 include all adjustments, consisting of normal recurring adjustments, necessary in the opinion of management to present fairly the financial information set forth therein. The unaudited consolidated financial statements in this Form 10-Q should be read in conjunction with the audited consolidated financial statements and related notes thereto included in the combined Annual Report on Form 10-K of the Parent Company and the Operating Partnership for the year ended December 31, 2023.

The preparation of financial statements in accordance with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements, and revenues and expenses during the reported period. Actual results could differ from these estimates. The results of operations for the interim periods are not necessarily indicative of the results that may be expected on an annual basis.

As of June 30, 2024, the Company’s portfolio consisted of the following:


	Properties	Square Footage
Operating retail properties(1)	178	27,607,987
Office properties	1	287,291
Development and redevelopment projects:
Carillon medical office building	1	126,000
The Corner – IN(2)	1	24,000
Hamilton Crossing Centre	1	92,283
Edwards Multiplex – Ontario	1	124,614

(1)Included within operating retail properties are 10 properties that contain an office component. Excludes one operating retail property classified as held for sale as of June 30, 2024. Of the 178 operating retail properties, 175 are consolidated within these financial statements and the remaining three are accounted for under the equity method.

(2)This property is held in an unconsolidated joint venture in which the Company has a 50% ownership interest.

NOTE 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Components of Investment Properties

The following table summarizes the composition of the Company’s investment properties as of June 30, 2024 and December 31, 2023 (in thousands):


	Balance as of
	June 30, 2024		December 31, 2023
Land, buildings and improvements	$	7,475,763	$	7,684,066
Construction in progress	70,353		55,995
Investment properties, at cost	$	7,546,116	$	7,740,061

Components of Rental Income including Allowance for Uncollectible Accounts

Rental income related to the Company’s operating leases is comprised of the following for the three and six months ended June 30, 2024 and 2023 (in thousands):


	Three Months Ended June 30,				Six Months Ended June 30,
	2024		2023		2024		2023
Fixed contractual lease payments – operating leases	$	161,673	$	160,134	$	322,213	$	318,724
Variable lease payments – operating leases	39,663		39,876		80,133		79,630
Bad debt reserve	(1,544)		(233)		(2,133)		(1,788)
Straight-line rent adjustments	2,829		2,910		6,192		6,768
Straight-line rent reserve for uncollectibility	825		504		588		190
Amortization of in-place lease liabilities, net	2,390		2,645		4,656		5,375
Rental income	$	205,836	$	205,836	$	411,649	$	408,899

The Company makes estimates as to the collectability of its accounts receivable. In making these estimates, the Company reviews a variety of qualitative and quantitative data and considers such factors as the credit quality of our customer, historical write-off experience and current economic trends, to make a subjective determination. An allowance for uncollectible accounts, including future credit losses of the accrued straight-line rent receivables, is maintained for estimated losses resulting from the inability of certain tenants to meet contractual obligations under their lease agreements.

Short-Term Deposits

In January 2024, the Company invested $265.0 million in short-term deposits at Goldman Sachs Bank USA and KeyBank National Association. As of June 30, 2024, the Company had $120.0 million remaining in short-term deposits. The short-term deposits earned interest at a weighted average interest rate of 5.34% with a final maturity date of July 22, 2024. During the six months ended June 30, 2024, the Company earned $6.2 million of interest income on the deposits, which is recorded within “Other income, net” in the accompanying consolidated statements of operations and comprehensive income.

Consolidation and Investments in Joint Ventures

The accompanying financial statements are presented on a consolidated basis and include all accounts of the Parent Company, the Operating Partnership, the taxable REIT subsidiaries (“TRSs”) of the Operating Partnership, subsidiaries of the Operating Partnership that are controlled and any variable interest entities (“VIEs”) in which the Operating Partnership is the primary beneficiary. As of June 30, 2024, we owned investments in two consolidated joint ventures that were VIEs in which the partners did not have substantive participating rights and we were the primary beneficiary. As of June 30, 2024, these consolidated VIEs had mortgage debt totaling $110.9 million, which was secured by assets of the VIEs totaling $217.3 million. The Operating Partnership guarantees the mortgage debt of these VIEs.

The Operating Partnership is considered a VIE as the limited partners do not hold kick-out rights or substantive participating rights. The Parent Company consolidates the Operating Partnership as it is the primary beneficiary.

As of June 30, 2024, the Company also owned investments in four unconsolidated joint ventures accounted for under the equity method, which are not considered VIEs. On January 31, 2024, the joint venture that owned Glendale Center Apartments, of which we have an 11.5% ownership interest, sold the 267-unit property to a third party, resulting in a gain on sale of $20.2 million. The Company recognized its share of the gain on sale of unconsolidated property of $2.3 million during the six months ended June 30, 2024. In addition, the Company received a $1.6 million distribution upon the disposition of the property. The Company maintains an investment in the joint venture, which is in the process of winding up its activities and distributing remaining net assets. Glendale Center Apartments is adjacent to our Glendale Town Center operating retail property in the Indianapolis MSA.

Income Taxes and REIT Compliance

Parent Company

The Parent Company has been organized and operated, and intends to continue to operate, in a manner that will enable it to maintain its qualification as a REIT for U.S. federal income tax purposes. As a result, it generally will not be subject to U.S. federal income tax on the earnings that it distributes to the extent it distributes its “REIT taxable income” (determined before the deduction for dividends paid and excluding net capital gains) to shareholders of the Parent Company and meets certain other requirements on a recurring basis. To the extent that it satisfies this distribution requirement but distributes less than 100% of its taxable income, it will be subject to U.S. federal income tax on its undistributed REIT taxable income at regular corporate income tax rates. REITs are subject to a number of organizational and operational requirements. If the Parent Company fails to qualify as a REIT in any taxable year, it will be subject to U.S. federal income tax on its taxable income at regular corporate income tax rates for a period of four years following the year in which qualification is lost. Additionally, we may also be subject to certain taxes enacted by the Inflation Reduction Act of 2022 that are applicable to non-REIT corporations, including the nondeductible 1% excise tax on certain stock repurchases. We may also be subject to certain U.S. federal, state and local taxes on our income and property and to U.S. federal income and excise taxes on our undistributed taxable income even if the Parent Company does qualify as a REIT. The Operating Partnership intends to continue to make distributions to the Parent Company in amounts sufficient to assist the Parent Company in adhering to REIT requirements and maintaining its REIT status.

We have elected to treat Kite Realty Holdings, LLC and IWR Protective Corporation as TRSs with respect to the REIT, and we may elect to treat other subsidiaries as TRSs in the future. This election enables us to receive income and provide services that would otherwise be impermissible for a REIT. Deferred tax assets and liabilities are established for temporary differences between the financial reporting bases and the tax bases of assets and liabilities at the tax rates expected to be in effect when the temporary differences reverse. Deferred tax assets are reduced by a valuation allowance if it is more likely than not that some portion or all of the deferred tax asset will not be realized.

Operating Partnership

The allocated share of income and loss, other than the operations of our TRSs, is included in the income tax returns of the Operating Partnership’s partners. Accordingly, the only U.S. federal income taxes included in the accompanying consolidated financial statements are in connection with the TRSs.

Noncontrolling Interests

We report the non-redeemable noncontrolling interests in subsidiaries as equity, and the amount of consolidated net income attributable to these noncontrolling interests is set forth separately in the accompanying consolidated financial statements. The following table summarizes the non-redeemable noncontrolling interests in consolidated properties for the six months ended June 30, 2024 and 2023 (in thousands):


	Six Months Ended June 30,
	2024		2023
Noncontrolling interests balance as of January 1,	$	2,430	$	5,370
Net income allocable to noncontrolling interests, excluding redeemable noncontrolling interests	141		134
Distributions to noncontrolling interests	(692)		—
Noncontrolling interests balance as of June 30,	$	1,879	$	5,504

Noncontrolling Interests – Joint Venture

Prior to the October 2021 merger with Retail Properties of America, Inc. (“RPAI”), RPAI entered into a joint venture related to the development, ownership and operation of the multifamily rental portion of the expansion project at One Loudoun Downtown – Pads G & H. The Company owns 90% of the joint venture.

Under terms defined in the joint venture agreement, after construction completion and stabilization of the development project (as defined in the joint venture agreement), the Company has the ability to call, and the joint venture partner has the ability to put to the Company, subject to certain conditions, the joint venture partner’s interest in the joint venture at fair value. As of June 30, 2024, these conditions for exercising the put and call options have been met but neither the Company nor the joint venture partner has exercised their respective options.

The joint venture is considered a VIE primarily because the Company’s joint venture partner does not have substantive kick-out rights or substantive participating rights. The Company is considered the primary beneficiary as it has a controlling financial interest in the joint venture. As such, the Company has consolidated this joint venture and presented the joint venture partner’s interests as noncontrolling interests.

Redeemable Noncontrolling Interests – Limited Partners

Limited Partner Units are redeemable noncontrolling interests in the Operating Partnership. We classify redeemable noncontrolling interests in the Operating Partnership in the accompanying consolidated balance sheets outside of permanent equity because we may be required to pay cash to holders of Limited Partner Units upon redemption of their interests in the Operating Partnership or deliver registered shares upon their conversion. The carrying amount of the redeemable noncontrolling interests in the Operating Partnership is reflected at the greater of historical book value or redemption value with a corresponding adjustment to additional paid-in capital. As of June 30, 2024 and December 31, 2023, the redemption value of the redeemable noncontrolling interests in the Operating Partnership exceeded the historical book value, and the balances were accordingly adjusted to redemption value.

We allocate net operating results of the Operating Partnership after noncontrolling interests in the consolidated properties based on the partners’ respective weighted average ownership interest. We adjust the redeemable noncontrolling interests in the Operating Partnership at the end of each reporting period to reflect their interests in the Operating Partnership or redemption value. This adjustment is reflected in our shareholders’ and Parent Company’s equity. For the three and six months ended June 30, 2024 and 2023, the weighted average interests of the Parent Company and the limited partners in the Operating Partnership were as follows:


	Three Months Ended June 30,				Six Months Ended June 30,
	2024		2023		2024		2023
Parent Company’s weighted average interest in the Operating Partnership	98.3	%	98.6	%	98.4	%	98.7	%
Limited partners’ weighted average interests in the Operating Partnership	1.7	%	1.4	%	1.6	%	1.3	%

As of June 30, 2024, the Parent Company’s interest and the limited partners’ redeemable noncontrolling ownership interests in the Operating Partnership were 98.3% and 1.7%. As of December 31, 2023, the Parent Company’s interest and the limited partners’ redeemable noncontrolling ownership interests in the Operating Partnership were 98.4% and 1.6%.

Concurrent with the Parent Company’s IPO and related formation transactions, certain individuals received Limited Partner Units of the Operating Partnership in exchange for their interests in certain properties. The limited partners have the right to redeem Limited Partner Units for cash or, at the Parent Company’s election, common shares of the Parent Company in an amount equal to the market value of an equivalent number of common shares of the Parent Company at the time of redemption. Such common shares must be registered, which is not fully in the Parent Company’s control. Therefore, the limited partners’ interest is not reflected within permanent equity. The Parent Company also has the right to redeem the Limited Partner Units directly from the limited partner in exchange for either cash in the amount specified above or a number of its common shares equal to the number of Limited Partner Units being redeemed.

There were 3,707,004 and 3,512,868 Limited Partner Units outstanding as of June 30, 2024 and December 31, 2023, respectively. The increase in Limited Partner Units outstanding from December 31, 2023 is due to non-cash compensation awards granted to our executive officers in the form of Limited Partner Units.

The redeemable noncontrolling interests in the Operating Partnership for the six months ended June 30, 2024 and 2023 were as follows (in thousands):


	Six Months Ended June 30,
	2024		2023
Redeemable noncontrolling interests balance as of January 1,	$	73,287	$	53,967
Net (loss) income allocable to redeemable noncontrolling interests	(526)		459
Distributions declared to redeemable noncontrolling interests	(1,809)		(1,456)
Other, net including adjustments to redemption value	5,141		7,957
Total limited partners’ interests in the Operating Partnership balance as of June 30,	$	76,093	$	60,927

Fair Value Measurements

We follow the framework established under Financial Accounting Standards Board Accounting Standards Codification (“ASC”) 820, Fair Value Measurements and Disclosures, for measuring fair value of non-financial assets and liabilities that are not required or permitted to be measured at fair value on a recurring basis but only in certain circumstances, such as a business combination or upon determination of an impairment.

Assets and liabilities recorded at fair value in the accompanying consolidated balance sheets are categorized based on the inputs to the valuation techniques as follows:

•Level 1 fair value inputs are quoted prices in active markets for identical instruments to which we have access.

•Level 2 fair value inputs are inputs other than quoted prices included in Level 1 that are observable for similar instruments, either directly or indirectly, and appropriately consider counterparty creditworthiness in the valuation.

•Level 3 fair value inputs reflect our best estimate of inputs and assumptions market participants would use in pricing an instrument at the measurement date. The inputs are unobservable in the market and significant to the valuation estimate.

In instances where the determination of the fair value measurement is based upon inputs from different levels of the fair value hierarchy, the level in the fair value hierarchy within which the entire fair value measurement falls is based on the lowest level input that is significant to the fair value measurement in its entirety. Our assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment and considers factors specific to the asset or liability.

Effects of Accounting Pronouncements

In March 2024, the SEC issued a final rule, The Enhancement and Standardization of Climate-Related Disclosures for Investors. This final rule is effective for the Company for the fiscal year beginning in 2025 and requires companies to annually disclose, among other things, (i) climate-related risks that have had or are reasonably likely to have a material impact on the Company, including on its strategy, results of operations, or financial condition, (ii) activities to mitigate or adapt to such risks, including a quantitative and qualitative description of material expenditures incurred and impacts on estimates and assumptions, (iii) information about oversight by a company’s board of directors of climate-related risks and management’s role in managing material climate-related risks; and (iv) information on any climate-related targets or goals that are material to the company’s business, results of operations, or financial condition. In addition, the final rule requires (i) disclosure of Scope 1 and/or Scope 2 greenhouse gas (“GHG”) emissions on a phased-in basis when those emissions are material, (ii) the filing of an attestation

report covering the disclosure of the Scope 1 and/or Scope 2 emissions on a phased-in basis, and (iii) disclosure of the financial statement effects of severe weather events and other natural conditions. In April 2024, the SEC announced a stay of these climate disclosure rules pending judicial review. The Company will continue to evaluate the impact of this final rule until it becomes effective.

NOTE 3. DISPOSITIONS AND IMPAIRMENT CHARGES

The Company closed on the following disposition during the six months ended June 30, 2024 (dollars in thousands):

Date

Property Name

MSA

Property Type

Square
Footage

Sales Price

Gain (Loss)

May 31, 2024

Ashland & Roosevelt

Chicago

Multi-tenant retail

104,176

30,600

(1,230)

The Company closed on the following dispositions during the six months ended June 30, 2023 (dollars in thousands):


Date	Property Name	MSA	Property Type	Square Footage	Sales Price		Gain (Loss)
May 8, 2023	Kingwood Commons	Houston	Multi-tenant retail	158,172	$	27,350	$	4,740
June 8, 2023	Pan Am Plaza & Garage	Indianapolis	Land & garage	—	52,025		23,700

				158,172	$	79,375	$	28,440

As of June 30, 2024, we have classified City Center, a 362,278 square foot multi-tenant retail property in the New York MSA, as held for sale as the Company has committed to a plan to sell this asset and expects that the sale will be completed within one year. This property qualified for held-for-sale accounting treatment upon meeting all applicable GAAP criteria as of June 30, 2024, at which time depreciation and amortization were ceased. In addition, the assets and liabilities associated with this property are separately classified as held for sale in the accompanying consolidated balance sheet as of June 30, 2024. No properties qualified for held-for-sale accounting treatment as of December 31, 2023.

As of June 30, 2024, in connection with the preparation and review of the second quarter 2024 financial statements and in conjunction with classifying City Center as held for sale, we evaluated City Center for impairment and recorded a $66.2 million impairment charge due to changes in the facts and circumstances underlying the Company’s expected future hold period of the property. A shortening of the expected future hold period is considered an impairment indicator; therefore, we assessed the recoverability of City Center by comparing the carrying value of long-lived assets of $135.1 million as of June 30, 2024 to its estimated fair value of $69.6 million, which was determined using the income approach, less estimated selling costs of $0.7 million. The income approach involves discounting the estimated income stream and reversion (presumed sale) value of a property over an estimated hold period to a present value at a risk-adjusted rate. We used capitalization rates as a significant assumption in the valuation model, which are considered to be Level 3 inputs within the fair value hierarchy. We applied capitalization rates ranging from 6.0% to 15.0% to property income streams based upon the risk profile of the respective tenants and market rent of the leasable space. Based on this analysis, we recorded a $66.2 million non-cash impairment charge on City Center during the three months ended June 30, 2024.

The following table presents the assets and liabilities associated with City Center, the investment property classified as held for sale as of June 30, 2024 (in thousands):


	June 30, 2024
Assets


Net investment properties	$	67,984

Tenant and other receivables	2,522
Restricted cash and escrow deposits	225
Deferred costs, net	2,577
Prepaid and other assets	250
Assets associated with investment property held for sale	$	73,558

Liabilities

Accounts payable and accrued expenses	$	637
Deferred revenue and other liabilities	3,293
Liabilities associated with investment property held for sale	$	3,930

There were no discontinued operations for the six months ended June 30, 2024 and 2023 as none of the dispositions or planned dispositions represented a strategic shift that has had, or will have, a material effect on our operations or financial results.

NOTE 4. DEFERRED COSTS AND INTANGIBLES, NET

Deferred costs consist primarily of acquired lease intangible assets, broker fees and capitalized internal commissions incurred in connection with lease originations. Deferred leasing costs, lease intangibles and similar costs are amortized on a straight-line basis over the terms of the related leases. As of June 30, 2024 and December 31, 2023, deferred costs consisted of the following (in thousands):


	June 30, 2024		December 31, 2023
Acquired lease intangible assets	$	389,158	$	433,771
Deferred leasing costs and other	81,943		74,662
	471,101		508,433
Less: accumulated amortization	(204,640)		(204,262)
	$	266,461	$	304,171
Less: deferred costs associated with investment property held for sale	(2,577)		—
Deferred costs, net	$	263,884	$	304,171

The amortization of deferred leasing costs, lease intangibles and other is included within “Depreciation and amortization” in the accompanying consolidated statements of operations and comprehensive income. The amortization of above-market lease intangibles is included as a reduction to “Rental income” in the accompanying consolidated statements of operations and comprehensive income. The amounts of such amortization included in the accompanying consolidated statements of operations and comprehensive income are as follows (in thousands):


	Six Months Ended June 30,
	2024		2023
Amortization of deferred leasing costs, lease intangibles and other	$	40,850	$	57,610
Amortization of above-market lease intangibles	$	5,177	$	6,274

NOTE 5. DEFERRED REVENUE, INTANGIBLES, NET AND OTHER LIABILITIES

Deferred revenue and other liabilities consist of (i) the unamortized fair value of below-market lease liabilities recorded in connection with purchase accounting, (ii) retainage payables for development and redevelopment projects, (iii) tenant rent payments received in advance of the month in which they are due, and (iv) lease liabilities recorded upon adoption of ASU 2016-02, Leases (Topic 842). The amortization of below-market lease liabilities is recognized as revenue over the remaining life of the leases (including option periods for leases with below-market renewal options) through 2085. Tenant rent payments

received in advance are recognized as revenue in the period to which they apply, which is typically the month following their receipt.

As of June 30, 2024 and December 31, 2023, deferred revenue, intangibles, net and other liabilities consisted of the following (in thousands):


	June 30, 2024		December 31, 2023
Unamortized in-place lease liabilities	$	149,279	$	159,449
Retainages payable and other	8,378		9,229
Tenant rents received in advance	27,702		35,339
Lease liabilities	68,037		68,925
	$	253,396	$	272,942
Less: deferred revenue associated with investment property held for sale	(3,293)		—
Deferred revenue and other liabilities	$	250,103	$	272,942

The amortization of below-market lease intangibles is included as a component of “Rental income” in the accompanying consolidated statements of operations and comprehensive income and totaled $9.8 million and $11.6 million for the six months ended June 30, 2024 and 2023, respectively.

NOTE 6. MORTGAGE AND OTHER INDEBTEDNESS

The following table summarizes the Company’s indebtedness as of June 30, 2024 and December 31, 2023 (in thousands):


	June 30, 2024		December 31, 2023
Mortgages payable	$	150,761	$	153,306
Senior unsecured notes	2,030,000		1,829,635
Unsecured term loans	820,000		820,000
Unsecured revolving line of credit	—		—
	3,000,761		2,802,941
Unamortized discounts and premiums, net	26,147		35,765
Unamortized debt issuance costs, net	(11,282)		(9,504)
Total mortgage and other indebtedness, net	$	3,015,626	$	2,829,202

Consolidated indebtedness, including weighted average interest rates and weighted average maturities as of June 30, 2024, considering the impact of interest rate swaps, is summarized below (dollars in thousands):

Amount
Outstanding

Ratio

Weighted Average
Interest Rate

Weighted Average Years
to Maturity

Fixed rate debt(1)

2,829,961